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| Version 1 | Version 2 |
|---|---|
| Labour's claims on mortgages and the economy fact-checked | Labour's claims on mortgages and the economy fact-checked |
| (4 months later) | |
| Labour leader Keir Starmer has been appearing on BBC local radio stations while shadow levelling up secretary Lisa Nandy made an appearance on Radio 4. | Labour leader Keir Starmer has been appearing on BBC local radio stations while shadow levelling up secretary Lisa Nandy made an appearance on Radio 4. |
| We've been looking at some of their claims. | We've been looking at some of their claims. |
| 'We estimate based on Bank of England figures that the average mortgage payer who is coming off a fixed-rate mortgage over the next year... will be paying on average £500 more on their mortgage bill as a direct consequence of this government's decision to crash the economy' - Lisa Nandy | 'We estimate based on Bank of England figures that the average mortgage payer who is coming off a fixed-rate mortgage over the next year... will be paying on average £500 more on their mortgage bill as a direct consequence of this government's decision to crash the economy' - Lisa Nandy |
| Ms Nandy used an average mortgage increase figure for the UK - Keir Starmer used a number of different figures for the areas covered by the BBC local radio stations he was speaking to. | Ms Nandy used an average mortgage increase figure for the UK - Keir Starmer used a number of different figures for the areas covered by the BBC local radio stations he was speaking to. |
| This is how they worked it out: | This is how they worked it out: |
| Average UK house price is about £290,000 | Average UK house price is about £290,000 |
| If you have a 25% deposit you need to borrow £217,500 | If you have a 25% deposit you need to borrow £217,500 |
| Two years ago, the average two-year fixed rate with a 25% deposit was 1.6% | Two years ago, the average two-year fixed rate with a 25% deposit was 1.6% |
| At that rate, for a 20-year mortgage the monthly payment would have been £1,060 | At that rate, for a 20-year mortgage the monthly payment would have been £1,060 |
| If you had to take a new fixed rate deal at 6% the payments would be £1,558 | If you had to take a new fixed rate deal at 6% the payments would be £1,558 |
| That's an increase of £498 a month. | That's an increase of £498 a month. |
| The interest rate of a typical two-year fixed rate mortgage breached 6% on Wednesday for the first time since 2008. | The interest rate of a typical two-year fixed rate mortgage breached 6% on Wednesday for the first time since 2008. |
| But Sir Keir and Ms Nandy were clear they were talking about the extra costs from "this government's decision to crash the economy", referring to the "mini-budget" on 23 September. But it has to be pointed out that mortgage rates had already been rising before Liz Truss became prime minister. | But Sir Keir and Ms Nandy were clear they were talking about the extra costs from "this government's decision to crash the economy", referring to the "mini-budget" on 23 September. But it has to be pointed out that mortgage rates had already been rising before Liz Truss became prime minister. |
| The corresponding average two-year fixed rate at the end of August this year, just before she came to office, was 3.64%, which would mean a monthly payment of £1,274. From there, the difference made by a 6% rate would be £284, which is considerably less than the £500 claimed by Labour. | The corresponding average two-year fixed rate at the end of August this year, just before she came to office, was 3.64%, which would mean a monthly payment of £1,274. From there, the difference made by a 6% rate would be £284, which is considerably less than the £500 claimed by Labour. |
| It's also likely that some of that increase in mortgage rates since the end of August has been due to international factors that cannot be blamed on Liz Truss' government. | It's also likely that some of that increase in mortgage rates since the end of August has been due to international factors that cannot be blamed on Liz Truss' government. |
| 'The oil and gas and energy companies have made £170bn of unexpected profit' - Keir Starmer | 'The oil and gas and energy companies have made £170bn of unexpected profit' - Keir Starmer |
| We've looked at this claim from the Labour leader before, which we have been told comes from a Bloomberg article. | We've looked at this claim from the Labour leader before, which we have been told comes from a Bloomberg article. |
| But the article suggested that the excess profits for UK gas producers and electricity generators could come in the next two years. They have not already been made, as Sir Keir told BBC Radio Leicester. | But the article suggested that the excess profits for UK gas producers and electricity generators could come in the next two years. They have not already been made, as Sir Keir told BBC Radio Leicester. |
| There are other questions over the £170bn figure, which the article says came from Treasury analysis, although the Treasury says it does not recognise the figure. | There are other questions over the £170bn figure, which the article says came from Treasury analysis, although the Treasury says it does not recognise the figure. |
| We have not been able to reproduce the figure, especially if you are only looking at profits from the North Sea, which are the ones that would be subject to an additional windfall tax. | We have not been able to reproduce the figure, especially if you are only looking at profits from the North Sea, which are the ones that would be subject to an additional windfall tax. |
| 'We wouldn't cut corporation tax to 19%' - Lisa Nandy | 'We wouldn't cut corporation tax to 19%' - Lisa Nandy |
| The shadow levelling up secretary told BBC Radio 4's Today that one of the ways Labour would do things differently was not cutting corporation tax (which businesses pay on their profits) to 19%. | The shadow levelling up secretary told BBC Radio 4's Today that one of the ways Labour would do things differently was not cutting corporation tax (which businesses pay on their profits) to 19%. |
| Actually, corporation tax is already 19%, and has been since April 2017. | Actually, corporation tax is already 19%, and has been since April 2017. |
| Former chancellor Rishi Sunak announced in March 2021 that it would increase to 25% from April 2023, but the government has now decided to cancel that increase. | Former chancellor Rishi Sunak announced in March 2021 that it would increase to 25% from April 2023, but the government has now decided to cancel that increase. |
| Labour has previously said that it would go ahead with raising that tax. | Labour has previously said that it would go ahead with raising that tax. |
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| Read more from Reality Check | Read more from Reality Check |
| Related Topics | |
| Keir Starmer | |
| Reality Check | |
| Mortgages | |
| Lisa Nandy | |
| Labour Party |