Funding for Lending change is good for the economy, but bad for the Chancellor

Commenting on the announcement today (Thursday) by the Bank of England that the government’s flagship Funding for Lending scheme will no longer apply to households, TUC General Secretary Frances O’Grady said:

“This is good news for the real economy, but bad news for the Chancellor.

“The Bank of England is clearly worried that the economic recovery is based on consumers borrowing on the back of rising house prices rather than business investment and rising exports.

“Ensuring that funding for lending works to boost business investment is a sensible policy that can drive sustainable growth and help build a new economy. But stopping over-excitement in the property market may hit the feel-good factor that the Chancellor is hoping will distract from the failure of government policy to rebalance the economy.”   

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