I do not fully agree with this analysis. I think there are certain parts, and on the distribution part, I absolutely accept where you are going. Of course there is an issue of distribution, but we have to be very careful. Certainly there is a feeling out there in the country that it is the people who struggle and push to sort themselves out on their own who get the least help. Some of this does go towards addressing that; it goes towards addressing the fact that those people who have struggled all their lives and would like their children to buy houses will get some help with that within the lifetime ISA.
Where I perhaps disagree most strongly is that I think the help to buy ISA has encouraged people to save for a home; some of them would not have done so anyway, and for some, it would have taken a lot longer and been a rather depressing period of their life with no wellbeing. We already have a problem with disaffected young people who feel that they are not being given a chance out there, and this does go some way towards redressing that. You paint too dark a picture; I agree with some of the analysis, but I think that is too dark a picture.
The help to buy ISA has been a very positive thing that people have liked. There was this glitch over the exchange versus mortgage deposit point, which I think was a communication glitch from some of the product companies. I know it was in our guide from very early on that it could only be used at mortgage deposit. Actually, the lifetime ISA allows you to do both those points. We need to be very careful. If we look at a product in isolation, we see there are certainly distributive problems and there are certainly gender distribution problems. Looking at this product and simply saying not to do it for those reasons, rather than redressing that balance in a more direct manner, is not the right way to go forward.
Yes, I think this will have an impact on house prices, but because it affects only first-time buyers and we are talking about a level of deposit as opposed to the overall price, it would take a far better economist than me to work out how much will trickle down into the system. I do not think that every £1,000 the Government put in as a bonus will increase the need for a deposit by £1,000. I do not think it will work on that basis. I suspect a far, far smaller figure—way below 50% and probably below 20%—will trickle across. I am not sure that is a reason not to do it.
We need to try something to encourage people to save and there is a bigger picture out there. Whenever I talk about saving on the television, I am asked, “Why are you helping all those people who have got money?”, and I get lots of people saying, “Who can afford to save?”. The fact is there are something like five to six times more savings accounts in the UK than debt accounts. Those people are a big part of our population and in many ways they have been relatively the worst done by since 2008 because of interest rates. Our policy is so down on people who have saved hard all their working lives to put money across. I think we must be very careful not to bite off our nose to spite our face.
I think you are right and all the points you make have some semblance of good distributional analysis and good economics, but the bigger picture is that these are not bad products that are trying to do good things. Yes, they will certainly help some people whom we should perhaps not be helping, but they will also help other people whom we should be helping.