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BLOGS by Stephen Kahn

SO MR BROWN, WHAT ABOUT THE SAVERS?

Monday December 8,2008

Have your say(12)

By Stephen Kahn

Gordon Brown seems to have forgotten about the responsible people who saved money in the good times

All week I’ve had a reader’s letter on my desk to remind me that while official policy is to drive down interest rates – with very mixed results on both the cost of mortgages and the availability of loans to businesses - there is one section of the community where there is no ambiguity about the result. Savers are being hammered through no fault of their own.

Here is part of Mr.F of Matlock’s letter. “What about us savers? What will we live on? Many of us have a modest income off our savings and rely on income from savings; what do we do when they have gone? I have always tried to be independent. I am elderly. It is a big shame that this Government has ruined the country.”

I wish I had a satisfactory answer. I do know though that the plight of savers will be in vain if the banks are allowed to slash savings’ rates while at the same time refusing to pass on the benefit of lower interest rates to borrowers.

The Government’s approach to what ails the economy is cock-eyed. The UK is heavily over-borrowed but rather than promote saving, it wants Britain to spend its way out of recession. Hence the ill-judged temporary reduction in VAT.

I agree with Mr.F in the direction which allocates blame for the present plight of savers. I’m certain this lesson will not be forgotten by millions of his ilk come election time.

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