I HAD not heard of “mortgage prisoners” until the other day when I listened to a parliamentary debate on the subject. These are often people on low incomes who are unable to change lender because of rigid affordability rules yet continue to pay the legacy high rates of interest to the rapacious companies that hold their mortgages. Examples quoted include innocent people that were borrowers from Northern Rock; their mortgages were sold by the UK Government after the nationalisation and subsequent liquidation of that company. There was much lamentation about the toothless financial regulator that directs people to the courts for redress where the financial hurdles are far too great for an individual to undertake.

In my email inbox today was a message from a bank. They tell me that due to market conditions they feel able to reduce the interest they will pay on a savings account from 0.75 per cent to 0.5 per cent. All financial institutions have been doing the same thing since the UK introduced what was called the big bang and light touch regulation. They charge high interest on unsecured loans and credit cards yet pay virtually nothing on savings.

These are two sides of the same coin. Financial institutions no longer need to attract investors to raise money to lend. When they make a loan the value of that loan is added to their balance sheet and the capital required appears from thin air. Why would they pay investors for something they can get for nothing? If you save now you are in effect losing and throwing away an asset; the value of your savings gains a little interest but that is unlikely to be enough to offset the rate of monetary inflation and in the long term you end up poorer.

I cannot see our Westminster Government doing anything to change this situation as it is filled with those who profit from the system as it stands. The bankers, the accountants and the lawyers make a very good living from the wheeling and dealing that you and I end up paying for. Maybe time to start again.

DS Blackwood, Helensburgh.