Bank told to reveal how it will police Help to Buy

In a three-page letter, Andrew Tyrie MP has asked Bank of England governor Mark Carney to reveal how the BoE will police the Help to Buy mortgage scheme.

The letter points out that ministers, including Nick Clegg and Grant Shapps, have twice tried to tackle fears about the Help to Buy scheme by claiming the Bank of England has the power to intervene if it believes another housing bubble is occurring.

Critics warn unless the three-year scheme is properly policed it could drive up house prices and create a housing bubble that might burst when interest rates increase.

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The letter stated: “Can you confirm that, contrary to the remarks of several ministers, the FPC does not have a veto on any decision to maintain the scheme?”

Mr Tyrie said: “The scope and limits of the Bank’s role in this scheme need a good deal of clarification, both to safeguard the Bank’s authority to act in fulfillment of its statutory responsibility for financial stability and to safeguard its independence.”

The Bank of England had not responded at the time of writing.