Dear listener,

When George I opened Parliament on 23 November 1719 he told the assembled Lords and MPs that after “some extraordinary expence” on the country’s wars in Europe “I must desire you to turn your Thoughts to all proper Means for lessening the Debts of the Nation.”

No such direct appeal from Elizabeth II this week when she opened Parliament. The closest the Gracious Speech came to mentioning money was “My government’s overriding priority is to ensure the stability of the British economy during the global economic downturn.” And “Estimates for the public services will be laid before you.” In fact estimates – aka the Pre-Budget report – had been laid the week before, which said that the interest on the government’s debt would rise to £34bn this year on net debt of £602bn. Rather more than the £1.5m annual interest on government debt which concerned George I.

*** ON MONEY BOX THIS SATURDAY ***

Another month, another rate cut – October half a percentage point; November one and a half percentage points; December one percentage point. Hard to believe that just over a year ago the Bank Rate was 5.75% and the talk was of the rate rising to control inflation. This week it was cut to 2% - it has never been lower – and (without sounding like the mystery voice on the lottery) it’s only the 25th time in 825 rate fixings that rates have fallen by 3% or more in three months. Most recently in 1993, 1981 and 1914. So will this cut work any better than the last two?

Banks are accused of not passing on the rate cut to their mortgage customers. But why should they? And what about the plight of savers if they do?

The government promises to meet the costs of allowing some people in mortgage arrears not to pay for up to two years. Details awaited. We may even have more on the programme.

Small bank fails. No-one hurt. The collapse of London & Scottish affects 10,000 savers and 70,000 borrowers with mortgages or doorstep loans. A buyer is being sought. Meanwhile savers will get all their money back. And borrowers should carry on paying as usual.

We look at the plight of tenants facing eviction when their buy-to-let landlord can’t pay the mortgage.

And the Revenue wants savers to pay less tax. It has to deduct tax from their savings interest automatically. But it doesn’t want to, really, if they are not taxpayers – especially if they are pensioners.

At least most of that – and perhaps some breaking news – in Money Box on Radio 4, Saturday at noon, repeated Sunday at nine. You can listen to all the items on all our programmes through our website. Money Box and Money Box Live are available as podcasts you can download or subscribe to. And if you want to read what was said we publish a transcript shortly after the broadcast.

Best wishes,

Paul

PS Don’t forget the programme taster on BBC Breakfast between quarter to nine and nine o’clock. If you miss it, you can watch it on the web. And if you missed last week’s - about pensions - you can see it here:

http://news.bbc.co.uk/1/hi/business/7756253.stm

You can also watch me on BBC News on 4 December 2008, talking about how interest rate cuts affect us:

http://news.bbc.co.uk/1/hi/business/7765190.stm

And about how the interest rate cut affects income from savings:

http://news.bbc.co.uk/1/hi/business/7765166.stm

Plus this week, on BBC Radio 4’s More or Less website, talking about why people could be making an expensive mistake if they take little or no interest in numbers:

http://news.bbc.co.uk/1/hi/programmes/more_or_less/default.stm

And on Wednesday each week you can catch up with the latest news by watching Samantha Washington’s money headlines on our website.

Most recently: Relief for some struggling with mortgages and more duty free for less: http://news.bbc.co.uk/1/hi/business/7763432.stm

e-mail Paul Lewis