Comment: Just pass it on ...

Nov 7 2008 by Val Javin, Huddersfield Daily Examiner

DRAMATIC news yesterday as the Bank of England slashed interest rates to a 50 year low in a bid to rescue the country from economic gloom.

Few expected the interest rate cut to be so swingeing but the move, surprising though it may have been, should surely help to ease the threat of recession which has menaced the country for months.

But will it? Huddersfield MP Barry Sheerman was swift to point out that Britain’s mortgage lenders should quickly pass on the lower rates to its borrowers.

And he was not the only politician to urge there be no shilly-shallying from the banks and building societies when it comes to passing on savings to already hard-pressed home-owners.

There has been little enough good news about the economy of late. When there is, it should be shared and passed on to all and it should be done as quickly as possible.

Clearly politicians fear that the banks may drag their feet on what is seen as unprecedented action by the Bank of England.

Chief Secretary to the Treasury Yvette Cooper said ministers expected banks to pass on the cuts as rapidly as possible after shoring up the finances of several major players with taxpayers’ cash.

“The Government has stepped in to make the banking system safe, to support the banks. It is right now that the banks do their bit to support everybody else,” she said.

Some of our economic ills are down to market confidence. What better way to lift that confidence than to energise the money markets with an historic bank rate cut. So pass it on.