Keir Starmer clashes with Rishi Sunak over Iceland worker’s mortgageon January 31, 2024 at 4:28 pm

Sir Keir Starmer has accused Rishi Sunak of “laughing” at an Iceland supermarket worker who is struggling to pay his mortgage.

The Labour leader said Phil, from Warrington, “told me that his mortgage is going up by a staggering £1,000 a month”, at Prime Minister’s Questions.

He said the PM “just doesn’t get how hard it is for millions of people across the country like Phil”.

Mr Sunak said help was available for people coming off fixed rate mortgages.

And he said inflation had halved thanks to actions taken by the government and workers across the country were benefitting from National Insurance cuts.

Commons Speaker Sir Lindsay Hoyle started this week’s PMQs by urging both sides to exercise “self-restraint”.

But he was still forced to step in several times to calm MPs down.

At one point Sir Keir – who was being heckled by Conservative MPs – told the Commons: “Laughing at an employee at Iceland who is struggling with his mortgage – shame.”

He later accused Mr Sunak himself of laughing at Phil – as he continued his recent campaign to portray the PM as being out of touch with the lives of ordinary voters.

He said higher mortgage payments were a direct result of the Conservatives “crashing” the economy – and he mocked the PM over Tory MP George Freeman saying he had quit as a minister because he was struggling to pay his mortgage.

“He [Mr Sunak] says everything is fine, people are better off, but when people see their mortgages going up, their council tax going up, food prices still going up, who does he expect them to believe, his boasts or their bank accounts?” said the Labour leader.

In a swipe at Mr Sunak’s personal wealth, he said a mortgage rise “might not sound much” to the prime minister, but that “most people don’t have that sort of money”.

Mr Sunak hit back by accusing the Labour leader of resorting to “the politics of envy”.

He then turned his fire on Labour’s pledge to borrow to invest £28bn a year on green policies, arguing that it would have to be funded by higher taxes.

There are disagreements within Labour about whether to scale back or impose new conditions on the plan. While they decide what to do, Mr Sunak took pleasure in highlighting the issue repeatedly.

The PM also said he was “genuinely surprised” to see shadow chancellor Rachel Reeves say Labour would not reinstate a cap on bonuses for bankers.

He told Sir Keir: “I don’t know if he mentioned that to Phil when he was having a chat with him.

“I can tell him that trust and economic credibility come from sticking to a plan, but it’s becoming clear that you cannot trust a word that he says.”

The SNP’s leader at Westminster. Stephen Flynn, called Labour’s position on bankers’ bonuses “shameful” and accused Sir Keir’s party of joining the government in being “completely out of touch with public opinion”.

But the session was dominated by claim and counter-claim about higher mortgage rates when fixed-rate deals expire, with the PM talking up government support he said was available.

“As a result of the ability to extend their mortgage term or switch to a six-month interest-only mortgage they will be able to save hundreds of pounds,” said the PM.

If you put the example the prime minister gave into a mortgage calculator it is clear that extending the term can reduce the monthly payments by hundreds of pounds, but it also significantly increases the total amount paid over the lifetime of the mortgage, so it is not an overall saving.

And he claimed “Phil and millions of workers – not just at Iceland but across the country – are benefitting this month in their pay packets from a tax cut worth hundreds of pounds for someone on an average salary”.

Sir Keir disputed this, saying: “For every £2 he says he’s giving people back, he’s taking £10 out of their back pocket in higher tax.”

The claim is based on forecasts from the Office for Budget Responsibility (OBR), but as BBC Verify has pointed out they are for 2028-29, so it is misleading to apply them to the present day.

Challenged on the PM’s claims that people coming off fixed rate mortgages could essentially be paying the same amount, when this is only true for a small number, Downing Street said: “Rates will vary depending on circumstances.

“What’s important is through halving inflation you’re starting to see signs that mortgage rates are coming down. We have introduced a raft of support.”