NESS secretary Vince Cable yesterday blamed the destruction of Britain’s building societies for the lack of mortgage lending, and hinted at plans to help spark a house-building boom that could boost the construction sector.
In a speech to the Centre Forum given in the City, Cable compared today’s economic slump with the depression of the 1930s.
He said the existence of 1,000 building societies in the 1930s had helped stimulate lending and in turn housebuilding and described their destruction from the 1980s as “one of the great acts of economic vandalism in modern times”.
Cable emphasised that the government could do more to help housing associations get access to cheap credit by using government guarantees, which he said “could trigger a significant volume of housing investment”.
“The public sector balance sheet has to be used to leverage in private capital, particularly in housing,” he added.