I Complained To My Mp, That My House Fund Savings

[LetsGetReadyToTumble]

I emailed my MP, regarding inflation being higher than savings rates.

This is the reply I received.

It was good of my MP to pass this on, and at least I did get a written reply.

But I found it insulting. The main point in the letter was that savings rates were higher then the Bank rate, so that's OK then.

No consideration that inflation is above savings rates, and that savings are losing value.

I can't help feel I live in a topsy-turvy country.

"Thank you for your letter of x xxxxxx enclosing correspondence from your constituent, Mr xxxxxx xxxx of xxxxx xxxxx , about interest rates for savers. Please accept my apologies for the delay you have experienced in receiving a response.

The Bank of England has operational independence to set interest rates. It is charged with meeting the Government's symmetrical inflation target, helping to deliver price stability. As the Bank of England has stated in its August inflation report, the UK recovery is likely to continue, underpinned partly by considerable momentary stimulus, which includes low interest rates.

The interest rates offered on savings accounts are a commercial decision for providers, and as such vary. However, a number of banks and other institutions continue to offer savings interest rates significantly above the Bank of England bank rate, and savers can ensure they get the best possible income from their savings by shopping around.

The Government is committed to ensuring that consumers have the tools and resources to be able to shop around for the best products, and fully support the Consumer Financial Education Body's roll out of the national financial advice service. This service available on-line at moneymadeclear.org.uk, over the phone on 0300 500 5000 and face-to-face, provides information and guidance on all kinds of money matters. It also provides impartial comparative tables of savings accounts and the interest rates offered.

Please pass on my thanks to Mr xxxx for taking the trouble to make us aware of these concerns.

Signed

Mark Hoban."

[Number79]

why did you find it insulting?

what do you expect an MP to do because barclays wont pay you loads of interest?

you wont get an MP to explain to you that that is how inflation works. That it is how money is effectively stolen from you to pay his wages

Edited November 21, 2010 by richyc

[LeeT]

underpinned partly by considerable momentary stimulus.

Does that mean QE will be unwound soon?

[South Lorne]

The interest rates offered on savings accounts are a commercial decision for providers, and as such vary. However, a number of banks and other institutions continue to offer savings interest rates significantly above the Bank of England bank rate, and savers can ensure they get the best possible income from their savings by shopping around.

...have you shopped around ..?....bearing in mind the higher the return on similar terms ...often it is higher the risk....

[Number79]

...have you shopped around ..?....bearing in mind the higher the return on similar terms ...often it is higher the risk....

yeah, ask him what rate they get on their icesave accounts

[aussieboy]

My life, what an utter waste of your MP's time.

Not to mention some poor numpty in treasury who has to take the time to write a response. I'm not surprised you found it insulting: the poor guy probably thought he was being asked to respond to someone for their school project. I'm surprised he managed to write such a good response.

I suspect your fellow constituents would prefer him to ignore you rather than waste his wages answering questions that better belong being sent to Yahoo.

[jethrotull]

Frankly, I expect the MP to be insulted that you hold him responsible for global interest rates.

All your poor MP can do is vote a certain way or represent you by writing on your behalf. To get the most out of your MP ask him to do something specific like voting or writing.

There are so many ways to get interest rates higher than inflation. You need to advocate a particular course of action. I doubt if your MP has the nous to change the global elites consensus on economics.

They were being polite by assuming it was an issue of education rather than wisdom.

[MongerOfDoom]

I emailed my MP, regarding inflation being higher than savings rates.

As others have pointed out, this is a silly question. Interest rates are set to maintain a particular cpi target (2%?), and so the system is designed to allow inflation to exceed interest rates.

Had you asked why the BoE are not doing anything much about repeatedly busting the inflation target, that would have been sensible. They would have just referred you to the currently regular "dear chancellor" letter.

I suppose another sensible question would be why they felt it appropriate to tax nominal interest when the real rate is already negative. Please let us know the answer if you ask your MP this, as I would be vaguely interested to find out how he justifies that. Perhaps something about broadest shoulders as it only applies to people able to save more than the trivial amount that fits into an ISA?

[okaycuckoo]

Frankly, I expect the MP to be insulted that you hold him responsible for global interest rates.

All your poor MP can do is vote a certain way or represent you by writing on your behalf. To get the most out of your MP ask him to do something specific like voting or writing.

There are so many ways to get interest rates higher than inflation. You need to advocate a particular course of action. I doubt if your MP has the nous to change the global elites consensus on economics.

They were being polite by assuming it was an issue of education rather than wisdom.

What are global interest rates?

The question is about the base rate as set by an institution answerable to MPs. If the MP has no responsibility in the matter, he is useless. If he has to trot off to the treasury for an answer he's worse than useless.

"There are so many ways to get interest rates higher than inflation" - WTF are you talking about? Gold?

[Mr Yogi]

But savings rates are nearly always lower than the rate of inflation. That's just how it is!

To index-link your savings you need to be a little more entrepreneural. Which involves the risk of losing the lot.

[LetsGetReadyToTumble]

My life, what an utter waste of your MP's time.

Not to mention some poor numpty in treasury who has to take the time to write a response. I'm not surprised you found it insulting: the poor guy probably thought he was being asked to respond to someone for their school project. I'm surprised he managed to write such a good response.

I suspect your fellow constituents would prefer him to ignore you rather than waste his wages answering questions that better belong being sent to Yahoo.

I think I have every right to tell my MP how I feel, and I know even from this site that a lot of savers are sick of having their savings obliterated by inflation.

I was not expecting a reply, and especially a letter. I have said I appreciate that.

However, the letter does attempt to 'fob me off' and does not address the real issues. Maybe if more people contacted their MPs, maybe we could get the message across.

I'm surprised by your attitude. Why are you on this site? Are you satisfied with house prices then, or happy with your savings losing value?

....sent to Yahoo? Don't understand.

[LetsGetReadyToTumble]

But savings rates are nearly always lower than the rate of inflation. That's just how it is!

To index-link your savings you need to be a little more entrepreneural. Which involves the risk of losing the lot.

When my housing fund was started some 5 years ago, the saving rate was 5.5% but inflation was between 2 and 3 percent.

[endgame]

When my housing fund was started some 5 years ago, the saving rate was 5.5% but inflation was between 2 and 3 percent.

Dude, you have my sympathies. Your being robbed and it is exactly the right response, tell your MP that you are not happy about it. He says to vote with your feet and move your cash to a competitor, but they are all playing the game of giving you less than inflation, so they are taking money off you. Do you really believe them that above target inflation is only temporary and will fall below target soon? Theres the VAT increase coming soon which will result in a further fall in the purchasing power of your money which will not be reflected in the savings rates. The brave decision is to vote with your feet and reject thier currency as it is not fit for purpose. It is meant to be a store of value of your labour and it is failing to do it. You know what the alternative is and was originally.

[sleepwello'nights]

Dude, you have my sympathies. Your being robbed and it is exactly the right response, tell your MP that you are not happy about it. He says to vote with your feet and move your cash to a competitor, but they are all playing the game of giving you less than inflation, so they are taking money off you. Do you really believe them that above target inflation is only temporary and will fall below target soon? Theres the VAT increase coming soon which will result in a further fall in the purchasing power of your money which will not be reflected in the savings rates. The brave decision is to vote with your feet and reject thier currency as it is not fit for purpose. It is meant to be a store of value of your labour and it is failing to do it. You know what the alternative is and was originally.

Well if inflation is around 3%-4%, there are savings rates around 4.5%, before tax unfortunately. You have to tie them in for 5 years though. Or there are Indian banks offering higher rates.

Real assets could be a hedge against inflation. Why not buy a house?

[Protect Rural England]

I emailed my MP, regarding inflation being higher than savings rates.

This is the reply I received.

It was good of my MP to pass this on, and at least I did get a written reply.

But I found it insulting. The main point in the letter was that savings rates were higher then the Bank rate, so that's OK then.

No consideration that inflation is above savings rates, and that savings are losing value.

I can't help feel I live in a topsy-turvy country.

"Thank you for your letter of x xxxxxx enclosing correspondence from your constituent, Mr xxxxxx xxxx of xxxxx xxxxx , about interest rates for savers. Please accept my apologies for the delay you have experienced in receiving a response.

The Bank of England has operational independence to set interest rates. It is charged with meeting the Government's symmetrical inflation target, helping to deliver price stability. As the Bank of England has stated in its August inflation report, the UK recovery is likely to continue, underpinned partly by considerable momentary stimulus, which includes low interest rates.

The interest rates offered on savings accounts are a commercial decision for providers, and as such vary. However, a number of banks and other institutions continue to offer savings interest rates significantly above the Bank of England bank rate, and savers can ensure they get the best possible income from their savings by shopping around.

The Government is committed to ensuring that consumers have the tools and resources to be able to shop around for the best products, and fully support the Consumer Financial Education Body's roll out of the national financial advice service. This service available on-line at moneymadeclear.org.uk, over the phone on 0300 500 5000 and face-to-face, provides information and guidance on all kinds of money matters. It also provides impartial comparative tables of savings accounts and the interest rates offered.

Please pass on my thanks to Mr xxxx for taking the trouble to make us aware of these concerns.

Signed

Mark Hoban."

No disrespect to you but why do you think your MP gives a flying fig about you and your loss of income?

He/she will only care about "you" when it gets near to votong time.

We have just had an election so no MP could give a flying fig about what the electorate think

[Dorkins]

No disrespect to you but why do you think your MP gives a flying fig about you and your loss of income?

He/she will only care about "you" when it gets near to votong time.

We have just had an election so no MP could give a flying fig about what the electorate think

I'm not sure that's true, I think the majority of backbenchers genuinely do care about their constituents, trouble is they are mostly lawyers with no real understanding of economics. Look at politicians like David Willetts and Vince Cable: their understanding of economics is probably on a par with your average HPCer (i.e. somebody who has actually bothered to educate themselves) and yet they are treated like economic geniuses.

We are being legally robbed through inflation by choice and not necessity, and most MPs are not bright enough to understand that.

[Normal]

Edit, sorry, thought you were someone else...

Edited November 21, 2010 by Hara

[aussieboy]

I think I have every right to tell my MP how I feel, and I know even from this site that a lot of savers are sick of having their savings obliterated by inflation.

I was not expecting a reply, and especially a letter. I have said I appreciate that.

However, the letter does attempt to 'fob me off' and does not address the real issues. Maybe if more people contacted their MPs, maybe we could get the message across.

I'm surprised by your attitude. Why are you on this site? Are you satisfied with house prices then, or happy with your savings losing value?

....sent to Yahoo? Don't understand.

You asked a basic economic question - yahoo answers could answer that with minimal effort on your behalf if it was only information you wanted. How about using google or asking a grown up rather than bothering busy people with your "why is the sky blue" questions?

Other than that, I wonder what you hoped to achieve by sending your letter. Perhaps you expected your mp to change the country's entire macroeconomic policy where interest rate are being kept low to avoid a depression. What did you expect him or her to say? "let's raise interest rates to help the savers oh no, savers have been made redundant because capital is even more constrained now". Don't you understand that savers are also employees of capital constrained companies too? It isn't all about house prices directly.

So, what is the real issue that you're being fobbed off about? You received a very pleasant letter from some poor drome in treasury. And what message are you trying to get across? I'm at a complete loss.

So futile. Why not ask your MP to sit on the beach and try and stop the sea coming in.

[LetsGetReadyToTumble]

Well if inflation is around 3%-4%, there are savings rates around 4.5%, before tax unfortunately. You have to tie them in for 5 years though. Or there are Indian banks offering higher rates.

Real assets could be a hedge against inflation. Why not buy a house?

I've tried Indian banks. You have to be an Indian national, or of Indian stock to get one of these savings accounts, some paying up to 7%.

I've been all through this with HSBC.

I won't buy a house as I believe prices will fall far greater than inflation and savings rates.

[Habeas Domus]

When my housing fund was started some 5 years ago, the saving rate was 5.5% but inflation was between 2 and 3 percent.

Thats only true it you agree with the governments rather capricious definition of inflation.

Another way to compare it is with pay inflation.

Were you getting 5.5% pay rises 5 years ago? will you get a 3% rise this year?

[Democorruptcy]

I emailed my MP, regarding inflation being higher than savings rates.

This is the reply I received.

It was good of my MP to pass this on, and at least I did get a written reply.

But I found it insulting. The main point in the letter was that savings rates were higher then the Bank rate, so that's OK then.

No consideration that inflation is above savings rates, and that savings are losing value.

I can't help feel I live in a topsy-turvy country.

"Thank you for your letter of x xxxxxx enclosing correspondence from your constituent, Mr xxxxxx xxxx of xxxxx xxxxx , about interest rates for savers. Please accept my apologies for the delay you have experienced in receiving a response.

The Bank of England has operational independence to set interest rates. It is charged with meeting the Government's symmetrical inflation target, helping to deliver price stability. As the Bank of England has stated in its August inflation report, the UK recovery is likely to continue, underpinned partly by considerable momentary stimulus, which includes low interest rates.

The interest rates offered on savings accounts are a commercial decision for providers, and as such vary. However, a number of banks and other institutions continue to offer savings interest rates significantly above the Bank of England bank rate, and savers can ensure they get the best possible income from their savings by shopping around.

The Government is committed to ensuring that consumers have the tools and resources to be able to shop around for the best products, and fully support the Consumer Financial Education Body's roll out of the national financial advice service. This service available on-line at moneymadeclear.org.uk, over the phone on 0300 500 5000 and face-to-face, provides information and guidance on all kinds of money matters. It also provides impartial comparative tables of savings accounts and the interest rates offered.

Please pass on my thanks to Mr xxxx for taking the trouble to make us aware of these concerns.

Signed

Mark Hoban."

Is your MP a Tory?

If so you should have reminded him about call me Dave's pre-election promise in Jan 2009

David Cameron widened the gulf between the Tories and Labour over the economic crisis today by announcing that a Conservative government would abolish income tax on savings for basic-rate taxpayers and raise the tax allowance for pensioners by £2,000.

As interest rates have fallen drastically in recent months, there have been an increasing number of complaints from savers who are losing out because the value of their interest payments has fallen. Cameron said that this was "economically stupid and morally indefensible" because the government ought to be encouraging people to save, not punishing them for doing so.

"We need to make a really big change: from an economy built on debt to an economy built on savings, from a country and government that has lived beyond its means to one that lives within its means," he said.

"In order to help deal with Labour's debt crisis and help turn Britain from a spend, spend, spend society into a save, save, save society, it is time to abolish income tax on savings for everyone on the basic rate of tax, with top-rate taxpayers continuing to pay the same, and it is time to raise the tax allowance for pensioners by £2,000.

http://www.guardian.co.uk/politics/2009/jan/05/davidcameron-conservatives

[corevalue]

You asked a basic economic question - yahoo answers could answer that with minimal effort on your behalf if it was only information you wanted. How about using google or asking a grown up rather than bothering busy people with your "why is the sky blue" questions?

Other than that, I wonder what you hoped to achieve by sending your letter. Perhaps you expected your mp to change the country's entire macroeconomic policy where interest rate are being kept low to avoid a depression. What did you expect him or her to say? "let's raise interest rates to help the savers oh no, savers have been made redundant because capital is even more constrained now". Don't you understand that savers are also employees of capital constrained companies too? It isn't all about house prices directly.

So, what is the real issue that you're being fobbed off about? You received a very pleasant letter from some poor drome in treasury. And what message are you trying to get across? I'm at a complete loss.

So futile. Why not ask your MP to sit on the beach and try and stop the sea coming in.

Frankly, I find your attitude extremely insulting. What is the purpose of having representatives if they cannot be asked a basic question, or asked to exert influence to address the voter's grievance? I didn't see the text of the the OP's letter, did you?

I'm going to write my MP making the same basic point: I object to the prudent being made to subsidise the banks losses by way of low interest rates. It seems to me the freedom given to the BoE to set interest rates was an extremely deceitful political move, decoupling the government from any responsibility of proper financial management. "Oh, it's not us, it's them" they cry when the TSHTF. The govenment first took out HPI from inflation figures, then took every step to massage those, and finally steal money from us by devaluing our savings. And you say we should not waste the government's time by complaining!

[Democorruptcy]

Frankly, I find your attitude extremely insulting. What is the purpose of having representatives if they cannot be asked a basic question, or asked to exert influence to address the voter's grievance? I didn't see the text of the the OP's letter, did you?

I'm going to write my MP making the same basic point: I object to the prudent being made to subsidise the banks losses by way of low interest rates. It seems to me the freedom given to the BoE to set interest rates was an extremely deceitful political move, decoupling the government from any responsibility of proper financial management. "Oh, it's not us, it's them" they cry when the TSHTF. The govenment first took out HPI from inflation figures, then took every step to massage those, and finally steal money from us by devaluing our savings. And you say we should not waste the government's time by complaining!

Post them a link to this video

http://www.guardian.co.uk/politics/video/2009/jan/05/david-cameron-tax

[corevalue]

Post them a link to this video

http://www.guardian....vid-cameron-tax

I'm afraid he lost me on the green incubator bit in that video. All I could hear was the sound of more quango's coming along. How is that bonfire coming?

[Democorruptcy]

Frankly, I find your attitude extremely insulting. What is the purpose of having representatives if they cannot be asked a basic question, or asked to exert influence to address the voter's grievance? I didn't see the text of the the OP's letter, did you?

I'm going to write my MP making the same basic point: I object to the prudent being made to subsidise the banks losses by way of low interest rates. It seems to me the freedom given to the BoE to set interest rates was an extremely deceitful political move, decoupling the government from any responsibility of proper financial management. "Oh, it's not us, it's them" they cry when the TSHTF. The govenment first took out HPI from inflation figures, then took every step to massage those, and finally steal money from us by devaluing our savings. And you say we should not waste the government's time by complaining!

Send them this Osborne Osborne one as well:

While the Prime Minister may have forgotten about savers, the Conservatives have not.

However, we also want to help savers on more modest incomes, and take steps to encourage saving and reward financial responsibility. We are looking at the tax system to see what can be done. Our general election manifesto will include policies to help savers and pensioners, as part of our plan to deliver economic change for Britain.

http://www.telegraph.co.uk/comment/personal-view/3835309/Virtuous-savers-and-pensioners-have-suffered-most-under-Labour.html