Campaigning in Feltham and Heston it is clear that, amongst the economic uncertainties created by the turmoil in the Eurozone, at least one piece of good news is understood and appreciated on the doorsteps: the value of Britain's low interest rates.
As the credit rating agency Standard and Poor's this week placed the AAA rated Eurozone members on negative watch it's worth remembering this is exactly where Britain was, on negative credit watch, under Labour. It was George Osborne's decisive action setting out a credible plan to deal with the nation's deficit which restored international market confidence and got Britain back her top credit rating. That has led directly to our low interest rates.
Low interest rates mean that families pay less on their mortgages. And talking on the doorstep to the voters in Feltham and Heston they certainly get this. But does Ed Balls? In 2004 he said that low long-term interest rates were "the simplest measure of monetary and fiscal credibility". Now he’s changed his mind and says that low bond yields are not a good sign!
The fact is that higher interest rates would mean families paying more on their mortgages. How much more? Well, if British bond yields were as high as Italy's last week (and don't forget Italy had lower bond yields than the UK when the Coalition came to office) then the average mortgage interest bill would be £5,000 higher per year. In Feltham and Heston and all around the country families would have to find over £400 per month extra from their budgets to cover higher mortgage interest payments.