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Bring Me Sunshine


Not since the glory days of Morecambe & Wise have a double act so apparently “in tune” with each other graced our TV screens. The pictures last night of Messers. Clegg & Cameron playing off each other with a mixture of business-like seriousness and mock-comic light-heartedness was, it has to be said, scarily refreshing.

By all accounts the two really have hit it off which can only be good news for a country that, love ‘em or hate ‘em, desperately needs “strong & stable Government” to tackle our debt issues.

The problems of course, will probably not come from the two at the top, but in the day-to-day working differences between the ministers below and the hard-line party activists. It is a massive test of both Cameron’s and Clegg’s leadership to ensure that these differences are managed and cast aside whilst the similarities and common goals are magnified.

There are many people eating their words at the moment who said that a vote for the Lib Dems was a wasted vote as they will never get close to power! A Deputy PM, 5 cabinet members and a minister in every department is not bad going eh?

So to the job in hand. On the face of it out go some of the more “silly” policies on both sides whilst they concentrate on what they agree on. This is a good thing for us all and we can look forward to a tough old budget in 50 days time!

The cuts will be tough, VAT will probably have to rise and all manner of other arrangements to cut the deficit put in place.

What everyone in the mortgage industry wants to know is what changes can we expect to see? First off it is looking more likely that the FSA will stay. I for one think this is sensible and never saw the point of wasting money scrapping them and building another slightly different organisation probably employing most of the same people!

The FSA have come a long way, they have been through the toughest times and learnt from it just as we all have. There is a way that the Bank of England and FSA can work together more efficiently for all our good.

But never mind all that. The real issue is one that many seem to forget. There is the small fact that there is a £300 billion funding gap in the lending sector as Government aid needs to be repaid. As Rob Thomas, senior policy adviser at the CML highlighted last week, “How realistic is it to believe that retail deposits can be the source of funding to pay back the £300bn the government wants back?”

You can bet your bottom dollar that every lender has this issue at the top of their list and is no doubt at the root of many of the decisions we are seeing that affect us.

How the Government deal with this issue, as well as the wider banking world, is of great importance, but they cannot expect the banks to be able to lend more, pay back the monies owed and raise their capital adequacy all at the same time in the current environment.

As an optimist I actually believe that when it comes down to it the Government will come up with something to plug the £300 billion gap and ease the pressure before lending dries up, but it could well be “squeaky bum” time for a while.

In the meantime, however, whether or not you voted for the newly-weds, we need to all hope that this partnership does confound the rising divorce rates and brings us all a little sunshine, maybe not in the short-term, but certainly in the long.

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Andrew Montlake

Written by Andrew Montlake

Andrew Montlake, better known as Monty, began his journey with an Hons degree in Economics & Politics before starting in the mortgage industry in February 1994. As a main founder of Coreco in 2009, he successfully grew the brand, marketing, and communications, and was made MD in 2019 focussing on the overall vision, strategy, and culture of the company. As Coreco’s media spokesperson, Andrew can often be seen or heard on TV and radio as well as regularly commenting in the national, local, and trade press. He is the author of this acclaimed Mortgage Blog and is well-known for his social media, podcasts, and public speaking. Andrew is now proud to serve as Chairman of the Association of Mortgage Intermediaries, (AMI) as a cheerleader for the Mortgage Industry as a whole and continues to work at the coal face, writing mortgage business and advising clients.

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