INTEREST rates for homebuyers and savers may have to change to cover higher national insurance, a building society boss has warned. Mike Lazenby, chief executive of Chatham-based Kent Reliance Building Society, said the society's payroll costs would rise by at least one per cent from next April.

The society employs more than 100 people in Sun Pier and its branches countywide. Those extra costs would have to be found from somewhere and it could mean lower rates for savers and higher rates for borrowers. He said: "As a mutual organisation where our main focus isn't profit, we give as much back as we can already so if we have to pay more that can only come from the products and services we offer. Somebody has got to pay and it's going to have an impact on interest rates."

Higher NI costs for individuals would also reduce the amount of money available for spending on homes and investment. He said that anyone earning more than £25,000 would be worse off from the Budget. There was nothing to encourage saving.

"People are going to have less money in their pockets but it's not going to stop them buying houses," he said. His overall verdict: "A clever Budget, good news for health, reasonable news for education but bad news for most people."