MPC MINUTES: HOUSEHOLD DEBT SHACKLES RATES DECISION

11.03.02am BST (GMT +0100) Wed 18th Jun 2003

Matthew Taylor MP, Liberal Democrat Shadow Chancellor

Commenting on this morning's Monetary Policy Committee minutes showing a 6-3 vote against cutting interest rates, Matthew Taylor MP, Liberal Democrat Shadow Chancellor, said:

"The MPC can't deal with Britain's boom and bust housing market. That is the Chancellor's job, regardless of whether we are in or out of the Euro."

"With no sign that exports are rebounding, investment not meeting expectations and household debt building, Britain's underlying economic problems are beginning to impact directly on businesses, and on ordinary people looking to enter the housing market.

"As the pressure on the Prime Minister intensifies, Gordon Brown's credibility is diminishing too."

ENDS

Notes to editors

1. One of the key arguments considered was whether 'the

build-up of household debt' meant that a 'reduction in interest rates risked adding unnecessarily to that vulnerability [of households to external shocks]'

2. The minutes also noted 'no signs that exports were

rebounding' and 'lower-than-expected investment'