Jonathan Edwards MP, Plaid Cymru’s Treasury spokesperson, has urged Chancellor George Osborne to take heed of a European Commission report which warns that the UK is heading for a housing bubble unless it tackles soaring house prices and reins in its risky Help to Buy scheme.
The report is designed to inform the five biggest economies in Europe how they can “make growth stronger, more sustainable and more inclusive” and includes a variety of proposals from tackling child poverty to increasing housing supply.
Mr Edwards, who has long warned of the dangers of a housing bubble, said that the Chancellor’s denial over the unsustainable nature of the economic recovery could lead to another period of economic depression and that he should adopt the Commission’s proposals without delay.
Mr Edwards said:
“The European Commission report offers a rational course of action that the UK government must follow if it is to avoid a housing bubble and another period of economic depression.
“Plaid Cymru has long-warned that this precarious recovery is being driven by soaring house prices and inflated personal debt through the Help to Buy policy – a highly risky model which favours short-termism over sustainability.
“The proposals included in the report to improve the availability of affordable quality childcare and cut youth unemployment are also to be welcomed – two fields of policy in which Plaid Cymru has led the way in Wales.
“The Chancellor’s stubborn refusal to abandon the same old boom and bust economic policies which have proven disastrous time and again is leaving UK finances in a very vulnerable position.
“Plaid Cymru recognises that the age of boom and bust must come to an end. That is why, in our Alternative Queen’s Speech, we are proposing an Economic Fairness Bill to genuinely rebalance the economy and address wealth inequality on a personal and regional level.
“While the UK government remains in denial over the dangers of a housing bubble and wrongly accuses the Commission of meddling when it’s in fact offering sound advice, we are putting forward proposals that would prevent ordinary people from having to pay the price for the failures of government yet again.”
