INCOME SUPPORT MORTGAGE INTEREST, STANDARD RATE

Summary

That this House notes with concern that the current scheme for calculating the standard rate of interest for mortgage payments through income support or job seeker's allowance is inflexible and causes increased indebtedness and the threat of repossession if mortgage shortfalls cannot be made-up by the borrower; notes that it costs on average ú55.80 per week in housing benefit payments to rehouse repossessed families compared to ú38.81 per week to meet full interest costs; therefore calls on the Government to review the way the standard rate is calculated to provide greater flexibility and sensitivity to changes in interest rates; and further calls on the Government to lay the necessary regulations to increase the standard rate given that the 0.25 percentage point change required to trigger a change in the rate occurred in January.

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