Hello Mr Brown.
We have been unable to afford a house for a number of years.
The reasons for rising prices are always shrouded in mist in the political/media debate.
In the 1997 budget, you abolished dividend tax credits on pension funds. Companies saw the writing on the wall and immediately ended their final salary pension schemes to new employees shortly after.
They also started to cut down on the number of people with long final salary pension service and worked towards ending a scheme which would no longer be viable.
When you abolished the pensions tax credit, the yield for institutional funds across the entire market fell by 20 per cent. Few people outside the City understood the change and hardly any MPs protested. But Whitehall papers produced under the Freedom of Information act showing that you were warned by your officials and by the Treasury that there would be dire consequences.
3.] The advice you were given, in 1997 was as follows:
'The changes in incentives are likely to lead to substantial changes in portfolios. Pension funds will find equity relatively less attractive, and will prefer other assets ? particularly interest bearing securities and foreign equity ? and may also be prompted to consider more direct property investment.'
Much of those funds were then channelled into fuelling an unsustainable property bubble, BTL portfolios, which developed because of Labours complete lack of regulation of the Banks.
This was followed by ever increasing toxic mortgage debt, and this was followed by the bank bailouts.
The UK debt bubble stopped inflating at the end of 2003.
But then, you removed housing costs from the inflation index (in December 2003, from RPI to CPI), despite Bank of England's opposition, to force the Bank to keep interest rates low. [Too low.]
Is this an example of incompetent decision making which helped to create the cornerstone of the debt bubble?
4.] In the ten years previous to the Raid on pensions, From 1987 to 1997 the Average House Price rose from £40k to £55k.
A 33.3% rise over ten years.
From 1997 to 2007, the Average House Price rose from £55k to £190k [Nationwide Building Society figures]
A staggering 245% increase over the same period. [Ten years.]
The UK should not be facing the debt we are facing.
Why should a younger generation pay for your debt?
Whilst keeping your house prices artificially inflated?
We are in effect paying for your houses, whilst being unable to afford our own.
We have already been forced to waste tens of thousands in rent over the last nine to ten years.
We are being forced into Debt Bondage.
There are tens if not hundreds of thousands of disenchanted people, completely priced out of the housing market for a decade are looking at the Lib Dems.
The Tories, seem only interested in making the 'debt more affordable to pay,' as a pose to 'tackling the debt itself.'
You said in 1997 'I will not let House Prices get out of control.'
Do you think that this debt transfer is UNFAIR?