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Duffy on Mortgages

Television coverage of the general election was riveting and my missus was not at all impressed when I crept into bed at 3am after promising at midnight to be there “in 10 minutes, luv”. The dust now settled, I am, however, left with a stark sense of foreboding for our industry.

Whatever your political persuasion on issues such as Iraq, if the electorate had to vote purely on this Government’s record in financial services, it would surely have given Blair more than a bloody nose. More like a bloody good kicking.

For it has been abysmal. It could not even patronise voters over the past eight weeks with promises on how to resolve the pension timebomb or first-time buyer paralysis because, quite plainly, it has neither the inclination nor the innovation to tackle such issues. Waiting for the outcome of the Turner report before outlining a policy on pensions is every bit as lame as commis- sioning allegedly independent reports on matters such as housing supply or long-term fixed-rate mortgages.

Labour’s greatest contradiction is that while it is prepared to grant autonomy to the monetary policy committee and establish a private finance initiative culture in most public service sectors, it still plods on with an untrained supervision of our financial markets.

The next four years will produce no improvements whatsoever, either for financial advisers or homeowners. The latter are presently discovering (if they actually read key facts illustrations) that their enhanced consumer protection is coming at a cost to them. How else could the industry realistically sustain the 300m-plus cost of regulation at a time when many practitioners do not even make profits? The recent furore over deed-release charges and sub-prime pricing is only the thin end of a very fat wedge.

We are now stuck with something close to a lame duck Government which did not pass worthwhile legislation even when it had an obscene majority. The consequences will be an exasperated market as a result of numerous factors ranging from the flawed design of home income plans to the Chancellor’s miscalculations on GDP growth and the Budget deficit which will mean further stealth taxation, stagnating any genuine recovery in consumer confidence.

Had the Tories won, the grand slam of deregulation, lower taxation and stamp duty would have been a fillip for us all. Gordon Brown will doubtless have to start clearing up the mess in 18 months time. And there’s the rub. Being so preoccupied with reuniting his party and moving policy back to the left, there will be no time to throw any bones to our downtrodden industry.

Worse still, with the Tories having only made gains on the back of voter dissent, there is no credible opposition looming in 2009. I long for a Ken Clarke renaissance – a proven Cabinet minister who gave Brown the legacy of a war chest that even my nan could have administered as well as Labour tells us it has done.

If the European constitution gets a non vote next month, the thorny issue of Europe may recede. I concede that as with Howard’s “something of the night about him”, there will forever be “something of the Rose and Crown” about Clarke. But he has an integrity and intelligence lacking in many post-millennium politicians. If nothing else, this election will signal to Brown that the public’s tolerance with spin and condescension is beginning to wane very thin.

Kevin Duffy is managing director at Hamptons International Mortgages

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