§ Mr. WhiteTo ask the Chancellor of the Exchequer what proposals he has to review the link between the Treasury standard interest rate and mortgage rates. [104841]
§ Miss Melanie JohnsonThe Treasury sets a number of interest rates. Most rates are set in relation to National Loans Fund rates, which in turn are set by the Treasury marginally above the rate at which the Government can borrow in the gilts market.
The Bank of England's Monetary Policy Committee sets official interest rates in order to meet the Government's inflation target. Changes in official rates affect market interest rates, including mortgage rates. Mortgage rates are set by the lenders concerned taking into account market conditions and other factors. The Government has no plans to set Treasury rates by reference to mortgage rates.