The MP for Islwyn, Chris Evans, has accused the Government in the House of Commons of being unprepared for a rumoured rise in interest rates in November after failing to receive an answer on the matter at Treasury Questions.
Speculation in The Financial Times and other national newspapers regarding a possible rise in interest rates was sparked by a continued rise in consumer price index inflation to 3% earlier this month.
The Bank of England’s Independent Monetary Policy Committee will meet next month to decide whether to raise interest rates.
Mr Evans said: ‘Is the Chief Secretary concerned by speculation the Bank of England is about to increase interest rates by 0.25% in November will have an adverse effect on public spending?’
Responding for the Government, the Chief Secretary to the Treasury, Liz Truss MP, said: ‘Well of course, that is one of the reasons that we need to make sure we are reducing our debt and reducing our deficit to reduce interest payments as a result of the previous Labour Government leaving us with the highest deficit in history.
‘We do have an independent Bank of England and it is very important that as a Government Minister I am not telling them what to do on interest rates.’
Speaking after the question, Mr Evans said: ‘I am disappointed by the answer from the Minister. She did not answer the question I asked, which was about the effect rising interest rates might have on vital services.
‘The answer received was purely about scoring cheap party political points with no substance. Perhaps the lack of an answer means the Government is unprepared to deal with a possible rise in interest rates, and shows little concern for the vital public services which might be affected, which is very worrying.’