Interest Rates: Low Incomes
The question
To ask the Chancellor of the Exchequer, if she will make an assessment of the potential impact of trends in the level of interest rates on people with low incomes.
Answered by Tulip Siddiq
The Government understands the importance of protecting family finances. That is why we are committed to delivering economic stability to grow the economy, maintain low and stable inflation, and keep taxes and mortgages as low as possible. Low and stable inflation is an essential pre-requisite for economic growth and improving living standards, so we are continuing to support the independent Monetary Policy Committee as it acts to return inflation to target sustainably.
We are taking a comprehensive approach—supporting those in immediate need while addressing the structural changes necessary to fix the country's foundations. These combined efforts will help families by boosting wages and putting more money in people’s pockets. Specific actions already taken by the Government to support people on low incomes include: increasing to the National Living Wage from April 2025; extension of the Household Support Fund in England and Discretionary Housing Payments in England and Wales in 2025-26; and introduction of a new Fair Repayment Rate from April 2025 to cap debt repayment made through Universal Credit.
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