Life is good in Starmerland. It's a shame about Britain
Members on the Labour backbenches fanned themselves with order papers and squirmed. Given that these are people who give the impression that they are kept in tanks needing only a coco fibre brick, a heat lamp and the odd handful of dried locusts to keep them going, then it must have been warm.
A generous explanation of the fever dream which Sir Keir inflicted on the House in his answers at Prime Minister's Questions would be that the heat had gone to his head. Sadly, however, the picture painted by the PM – of an unrecognisable nation – is consistent with the government's constant and singular inability to realise just how much trouble Britain is in, and just how much its people now hate them.
Sometimes I wonder which country the Prime Minister thinks he is leading – Lilliput? Barataria? Oz? Certainly, it isn't Britain, but rather a Utopia that exists exclusively in his head. In Starmerland, working people are finally able to prosper due to the generous rise in National Insurance placed upon them, businesses are confident, public services are thriving and immigration is a side issue that barely needs to be mentioned.
The Leader of the Opposition tried to drag the PM into reality, quoting rises in unemployment and inflation as well as drops in market confidence. How, she asked, were they going to go back to their constituents and explain what a complete hash they'd made of things?
Sir Keir actually took this as a spur for confidence. He was looking forward to placating a country poorer and angrier than it's been in generations with some extra NHS appointment slots, thank you very much. He tried to rouse some cheers from his backbenchers with limited success. Behind him, the bug tank looked glum. Some of them weren't looking forward to a summer with the electorate at all.
From the Tory backbenchers came a cricketing theme: Sir Desmond Swayne's MCC tie shone almost as brightly as his eyes as he directed a furious question about prosecutions of veterans to the PM. Lincoln Jopp asked Sir Keir if he would take some inspiration from the England cricket team and deploy 'more pace, less spin'.
The Prime Minister, who does not strike me as someone you'd want even doing the scoring at a cricket match, did not find it funny. 'He needs a break', oinked the PM.
Then the full horror dawned on me: these people would now be at large. Imagine, feeling into the chest freezer to grab a Cornetto and finding Kim Leadbeater taking her annual cryogenic death rest amongst the Soleros. Or going abroad with the lurking knowledge that your safety there is technically in the hands of David Lammy.
Or, perhaps worst of all, going to the beach and finding the Prime Minister himself, fanning his trotters in the gentle sea breeze. Surely, with this high risk of encountering members of the worst cabinet on record, there can only be one piece of advice for the British public: stay indoors.
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The Independent
2 hours ago
- The Independent
‘Why take the risk?' Readers push back on Rachel Reeves's savings shake-up
Rachel Reeves's plan to encourage savers to move their cash into investments has sparked a lively reader response, especially among older people who say they have neither the time nor appetite for risk. Many commenters questioned the wisdom of urging people into the stock market, arguing that fixed-rate savings accounts and tax-free ISAs already offer attractive returns of 4–5 per cent, with none of the potential losses. 'Why would I want to invest in something that could lose money?' asked one 78-year-old pensioner, summing up a widely shared sentiment. Others pointed to personal experience with underperforming stocks and shares ISAs, and noted that at a later stage in life, there simply isn't time to recover from a market downturn. Still, a few acknowledged that younger savers with time and discipline could benefit from regular investing, provided they get the right guidance. Here's what you had to say: It was not worth the anxiety Investment products are not for everyone, especially people who cannot afford top-end financial advice, which costs too. I once had an investment-only mortgage, which kept me awake for years, every time the markets underperformed. In the end, we cashed it when the markets were doing quite well and paid off the mortgage 8 years earlier. To be honest, it was not worth the anxiety and sleepless nights over 17 years. So, carefully consider what type of risk resilience you have and how you would cope if your investments underperform, or if you lose it all, or a considerable chunk of your money. For me personally, never ever again. I feel safer with my Cash ISAs and, for the moment, sleep a lot better! Cecinha Would you move your savings into investments for the chance of bigger returns, or are you sticking with the safety of cash? Let us know in the comments below. I wouldn't take the risk Each to their own, but if I have a decent amount of cash to invest, then I always fix it with a non-UK high street bank that's based in the UK and protects funds up to £85k, and do my homework on them first, also checking for decent UK-based customer service. High street banks offer poor interest rate returns because they need to allegedly "cover their costs", despite most banks now having closed down. But there are plenty of other banks out there that can give you a decent rate. For me personally, if it's a decent wedge of money, then I wouldn't take the risk in investing in stocks and shares. But that's just me. If you're rich and can afford to take the risk and the loss, then go for it. Amy The risk factor I've a mate who's far more well off than me, but she doesn't have a scooby about all this stuff so she's got £300k just sitting in her bank. It's only in the last couple of years that she bothered getting an ISA and sorting out a higher-rate account, but when I said maybe she should invest or something, she simply wasn't fussed. She said she doesn't like the risk factor and is happy to just get a wee bit of interest and have it all to hand if she needs it. If people really aren't interested in investing, particularly due to risk, I don't really see what you can do to persuade them. I feel like this is another duff idea from the increasingly hapless Reeves. Elsie D Optimistic Assuming a 9 per cent return is pretty optimistic. I was advised years ago never to make long-term plans based on more than a 5% return – that would double your money in just under 15 years and quadruple it in 33 years – and to treat anything higher as an unexpected bonus. That advice has served me well for over 40 years. Yorkshireman Remember the caveat Remember the caveat: 'Your capital is at risk and you may not get back the amount you invested.' Remember the ads asking if you'd lost money in a stocks and shares ISA? I know people who lost or didn't make anything on their portfolio. Don't forget Labour will want to tax any gains. samuel smith People don't understand their own risk tolerance Most people don't understand their own risk tolerance and should not put money into any assets that they are not comfortable with seeing a 30–50 per cent drawdown on. That's why Reeves, who is not a financial adviser, is giving bad advice. PeakyBoo There are far more attractive places to invest The problem for Reeves is that there are far more attractive places to invest. For me, in the last 10 years, NASDAQ has been the only place to be. Some UK stocks have become attractive in recent years because of cheap valuations—cheap valuations because of a lack of confidence and the flight of deep pools of money from the UK, mainly due to Brexit and the mismanagement of baboons running the economy into the dust. I hope Reeves succeeds – there is no alternative politically. NotRedorBlue My stocks and shares ISA has grown After a year, my stocks and shares ISA has grown by the princely sum of 1.28%. Stocks can dive very quickly and take ages to bounce back. samuel smith Relaxing regulations Rachel Reeves is relaxing regulations which were introduced after 2008 to prevent another financial crash. For that reason, I would be very cautious about investing. STIDW Don't buy a car... invest A lot of people, when they retire, use their lump sum to buy a car or a camper van. That is serious money just thrown away on a fast-depreciating asset. Just buy an old banger and invest the money in the stock market. Pomerol95 Why would I want to invest in something that could lose money? I am 78 years old with an adequate pension and no mortgage. My savings are about 50 per cent kept in fixed-term ISAs earning around 4–5 per cent tax-free. I have an emergency fund in instant access. The remaining savings earn 4.55 per cent or more. Why would I want to invest in something that could lose money? Tony Cave No time If you are in your "later years" you don't have time to wait for falling stocks and shares to rise again. I have one stocks and shares ISA and, averaged out over 15 years, it's not done any better than a cash ISA. Heather Risk profiles If you get yourself a reputable financial adviser (check their qualifications), they will do a risk assessment for you and agree on your risk profile before deciding where to invest. We have a relatively modest amount invested with a single 'platform' and used to be medium risk, but as we are getting on now, we've gone medium/low—less time to recover from any nasty, unexpected events that cause sudden drops in value (e.g. Covid, Russia invading Ukraine). WokeUp The key word is 'could' And the key word is could. Investments could increase in value, but they could also decrease – unless the government is underwriting losses. rEUjoin Is the public expected to fill the investment gap? Does this mean that major investment in the British economy is so low that the government is resorting to exhorting the people of this country to fill the void – hmmm. Claudia Making the leap If they haven't put the money into a better savings account, then I'd doubt they'd make the leap. It would be convenient if the interest rate had to be at least adequate—that was the law. TheRedSquirrel Twenty years is a long time in investment Twenty years is a long time in investment. During this period, companies can go bankrupt, geopolitical turmoil and wars can affect investments, and services and products can become obsolete due to disruptive technologies, and so on. Opinator Want to share your views? Simply register your details below. Once registered, you can comment on the day's top stories for a chance to be featured. Alternatively, click 'log in' or 'register' in the top right corner to sign in or sign up.
Daily Mail
3 hours ago
- Daily Mail
Dishing out super-sized mortgages won't solve the problem of high house prices: SIMON LAMBERT
'Up, up, up go the house prices.' That was the TV news reporter's opening line the first time I was invited to go on the television. It was November 2006 and the reason that a much younger version of your correspondent had got ITV's call to comment was that I had reported on a plan by a major lender to offer bumper mortgages. Abbey, at the time the UK's second biggest mortgage lender, had decided first-time buyers and home movers should be allowed to borrow up to five times their joint salary. The early 2000s property market boom was about to hit its peak and an Abbey spokesman said: 'Lending five times salary may sound high but really is something we have to do given what is happening with house prices.' You can read the This is Money article on Abbey's five times salary mortgages here. It noted that while Abbey had made a fanfare about extending its lending, it wasn't alone - some other banks and building societies including RBS and Cheltenham & Gloucester were also offering supersized loans. We had written: 'Some lenders go even higher - Northern Rock said its maximum loan was 5.9 times salary but added that it rarely allows borrowers to stretch that far.' Almost 19 years later, the big financial news this week was that Chancellor Rachel Reeves is planning to allow mortgage borrowers to stretch that far. Rules put in place to protect borrowers in the aftermath of the financial crisis will be swept aside to usher in a new era of bigger mortgages. Banks and building societies will no longer be bound by rules that say only 15 per cent of their mortgage lending can be at more than 4.5 times income. Instead, individuals and couples will be able to borrow up to six times their salary. For a couple on a combined £80,000, this means potential borrowing would rise from £360,000 to £480,000. Understandably, there are some deep concerns about the impact of allowing a pair of near average earners to take on an extra £120,000 of mortgage debt. The ratio of house prices to earnings has fallen from its recent peak, as wages have risen faster than home values - but it remains far higher than the long-term average Stretching your mortgage to the limit in this way dramatically increases the risk of discovering you have overextended your finances, particularly if you come off a fixed rate mortgage term at a time when interest rates have jumped. First-time buyers and those moving up the property ladder also have a habit of discovering that the cost of running their new home comes in at more than they budgeted for. Many of us who are lucky enough to be homeowners will have been there. You take an optimistic view of what your bills and running costs will be to justify thinking: 'Yes, we can afford that home we really want'. Reality bites about six months in. Something that was especially true for those of us who bought in the pandemic and then got whacked by bills soaring in the cost-of-living crisis. When it comes to mortgages, we are in a very different financial world to 2006. It was a lot easier to borrow and overstretch back then and banks were eager to dish out interest-only loans. The eagle-eyed will notice all the banking brands named above didn't make it through the credit crunch-driven financial crisis that arrived in 2008. The banks that are around now are much more robust. Meanwhile, the rules may say six times salary is possible, but that doesn't mean you will get a mortgage that big. Lenders assess now on affordability and if your incomings and outgoings don't tick the boxes, they won't lend you that much. It's also very easy to criticise this from both the comfortable position of being a homeowner and from a top-down zoomed out viewpoint. Whereas, on an individual level, if a prospective borrower is already paying more per month in rent, then who can blame them for being very happy to take on a mortgage instead and at least be working towards owning the property. Nonetheless, I can't help but think this mortgage bonanza is a bad idea, as it will only serve to drive house prices up further. You don't need to be an economic genius to work out that if you lend people more money to buy homes, the price of homes will rise. And this is unfortunate timing, as homes have got more affordable in recent years. The house price to earnings ratio has fallen from its pandemic boom peak, as wages have risen faster than home values. Looked at from a broader perspective, homes are still very expensive though, at about 5.7 times earnings compared to the long-term average of 4.6. Albeit, this long-term average itself has been pulled up by the very high levels over the past 20 years. Ideally, we need a prolonged period of wages rising faster than house prices to correct the market not a short-term fix of bunging people bigger mortgages, Extending borrowing on the demand end also undermines the benefit of building more homes on the supply end. I would argue too high house prices are a root cause of much of Britain's economic ills over the past 20 years. Bumper mortgages only make things worse.
Daily Mirror
6 hours ago
- Daily Mirror
Boost income by £330 annually with little-known government scheme
It currently costs around £43,900 a year for a comfortable retirement. And with the full new state pension covering £11,973, savers will need to make up the difference themselves. Finance expert Antonia Medlicott has revealed a savvy tip for those eyeing a comfortable retirement, with the current annual cost estimated at about £43,900. With the full new state pension providing just £11,973, Brits are left to bridge the gap themselves. Antonia, MD of Investing Insiders, is pointing savers towards a "little-known government scheme" known as Specific Adult Childcare Credits that could bolster your state pension to the maximum if you're short on qualifying years. The investment expert said: "When a parent gets child benefit, they also get national insurance credits, but if they're working and someone else is doing the childcare, like a grandparent, then those credits can be transferred, which increases your retirement income if you don't have enough national insurance contributions. "Each year of credit can be worth up to £330 in extra pension income. Over a 20-year retirement, that equates to £6,600. Even better, you can backdate credits to 2011 in the application." Should have no effect on state pension entitlement And there's no need to worry about the parents' state pension entitlement – it remains unaffected as long as they're clocking up qualifying years through other means, such as employment. Royal London's analysis shows just over half of the 3.4 million people on the new state pension snag the full amount, reports Lancs Live. The remainder receive amounts proportional to the number of qualifying years they possess. To secure the full sum, you need 35 qualifying years where you either contributed National Insurance or obtained credits such as the Specific Adult Childcare entitlement. To qualify for the credits, you must be aged over 16 but below state pension age, the child's parent or primary carer must consent to transferring their credit to you, and they must verify that you have cared for their child. You must also be an 'eligible family member' - this encompasses aunts, uncles, siblings irrespective of blood ties, grandparents, great-grandparents or great-great-grandparents. Check your pension Antonia also encouraged individuals to monitor their pensions even if retirement is years away. She said: "A staggering 55% of workplace pensions underperform against industry standards, which could leave workers with an income shortfall when they retire. "It's vital to take an active interest in a workplace pension to make sure it's on track for a comfortable retirement. Simply checking a pension regularly (at least once a year) will help workers identify any disappointing returns and take action if they need to change their investment strategy." Antonia highlighted that a mere 10% of the UK population have taken advantage of a Self-Invested Personal Pension (SIPP), which offers the same tax benefits as workplace pension schemes but with greater control over investment choices. She recommended considering a SIPP for several reasons beyond merely enhancing retirement income. She said: "There is a lot of flexibility when it comes to this pension; you can contribute as much or as little as you want. It is also very effective when it comes to estate planning. "You can pass on your pension savings to nominated beneficiaries very easily, which gives good peace of mind to know that your money will end up with loved ones." The finance guru also pointed out a common costly mistake regarding pensions: delaying the start of saving. She elaborated: "If you invest £200 a month from the age of 25, by 65 you could have a pot of over £459,000 at an average return rate of 7.5 per cent. "But if you start at 35, that pot will be £223,000, and it will be just £98,600 if you start at 45." It's important to remember that investments carry risk, and it's advised not to invest more than you can afford to lose at any point in life or when planning for retirement.
