Analysis reveals households will see a hit of £18,917 in London and £18,160 in the South East over a five-year fixed-rate mortgage.
Lib Dems warn it is a “kick in the teeth” as party calls for scrapping of severance pay for failed ex ministers.
Liz Truss’s severance package of over £18,000 has been branded “a kick in the teeth” for families who face paying a similar amount over the coming five years due to soaring mortgage rates caused by her calamitous mini budget.
This comes after Liz Truss’s ‘growth rally’ today, where she was pushing for the policies introduced during her disastrous 49 day premiership.
New analysis using figures provided by the House of Commons Library reveals that families in London fixing their mortgage for the next five years are facing an average hit of £18,917, while those in the South East face a hit of £18,160.
The Liberal Democrats are calling for severance payouts for disgraced ex ministers like Liz Truss to be scrapped.
Liberal Democrat Treasury Spokesperson Sarah Olney MP said:
“Liz Truss cashing in £18,000 despite trashing our economy will come as a kick in the teeth to families in London paying the price of her recklessness.
“It adds insult to injury that a year later, the Conservative party has welcomed her back with open arms as she calls for the same disastrous approach.
“If Rishi Sunak had a spine, the least he’d do is scrap these insulting payouts for disgraced ministers like Liz Truss.”
Notes to Editor:
A mortgage calculator by UK region provided by the House of Commons Library is available here.
Liz Truss’s severance pay is available in HMT Annual Report and Accounts 2023-24, pp131-134.
Interest rate figures provided by the House of Commons Library:
The average interest rate for two year fixed rates that were agreed in September 2021 (two years ago) was 1.88%.
On 19 September 2023, the average quoted five-year fixed mortgage was 6.08%.
Source: MoneyFacts via Times, Will UK mortgage rates go down in 2023? Updated 19 Sept 2023
Borrowers who just saw their deal expire are typically coming out of interest rates of around 1.88%. Those going on to take out a five-year fixed-rate deal have a interest rate of 6.08%.
With the average outstanding loan in the capital currently at around £150,000, it means Londoners will cough up an extra £18,917 by the fifth year. Families in the South East of England, where the typical outstanding mortgage is around £144,000, will pay an extra £18,160 when remortgaging over the next five years.