Healey says repossessions should always be a last resort

By Alex Smith / @alexsmith1982

UPDATE: Tim Montgomerie of ConHome has tweeted that “he tends to agree” with Jim Pickard at the FT, who wrote that John Healey “was right” to say what he did and that this was not a Lamont moment.

Yesterday, Guido Fawkes and then ConservativeHome ran a story that John Healey, the Labour housing minister, said it “can be the best option” for people to have their homes reposessed.

The story duly made its way to the BBC website, but — in spite of the comments being made on a BBC show — only after Guido and ConHome had made their broadsides.

In fact, Healey’s comments were made in a much broader conversation, and have been largely quoted out of context. The minister made it clear that repossessions should only ever be a last resort, but that they necessarily remain part of the system.

Clarifying his remarks, Healey said:

“If families are deep in debt and there is no way they can keep paying their mortgage, then repossession might be the only way they can get their finances and lives back on track. But my job as Housing minister is to ensure this is always the last resort and that they have been able to explore all other options first. So far around 330,000 families have received help or advice and this has meant repossessions are running at around half the rate of the last recession.”

Referring to Grant Shapps, the Tory shadow housing minister, who attacked the comments, Healey said:

“Obviously, Grant Shapps needs reminding of the record repossessions that took place during the early 90s recession. Families were left to sink or swim, as the Tories left the recovery to the market. This Labour government has put support for homeowners at the heart of our response to the downturn. We tightened the rules so repossession is the last resort for lenders and over a third of a million homeowners have had mortgage help and advice since April 2008. Contrast that with the Tory approach then or now.”

Sarah Teather also attacked the Housing minster brutally, saying he “should just shut up”.

Interestingly, in the past 24 hours, John Healey tells me he has received lots of messages of support for his honesty on the issue, including from debt advisors and someone claiming to be a lifelong Tory.

He’s also had support from a Lib Dem councillor, Richard Baum, who came out in defence of Healey, and criticised his Lib Dem colleague Sarah Teather for her attack:

“I find it incredibly frustrating when politicians say nuanced and considered things about a small proportion of people, which are then seized upon by their opponents as sweeping generalisations about anything and everything. It makes me wonder why politicians ever say anything remotely controversial, and reminds me why most never do.

It happened to John Healey, a Housing Minister, today. On the whole I think the government’s housing policy could be improved in lots of ways. But I don’t disagree with Mr Healey when he says that “for some people it can be the best option for their home to be re-possessed. Even in cases [where lenders look at repossessions as a last resort] some families may not be able to keep up with mortgage repayments even if they’re re-negotiated and rescheduled.”

Sarah Teather, Lib Dem Shadow Housing Minister, said that Mr Healey shouldn’t “dismiss the misery of homelessness.” Sorry Sarah (and sorry to anyone not wanting me to criticise my own party ever) but I don’t think he was doing that.”

UPDATE:

In the last recession in the early 1990s, repossessions were at 75,500 in the peak year, 1991, or 0.77% of all mortgages. During this recession, under Labour, there have been 46,000 properties repossessed (2009), or 0.43%, of all mortgages. In 1992, 352,000 mortgages were in arrears over six months (3.6%), compared with 188,330 (2.5%) in 2009.