§ MR. MORRELL (Oxfordshire, Henley)
I beg to ask Mr. Chancellor of the Exchequer whether his attention has been called to the recommendations contained in the recent Report of the Select Committee on Housing (paragraphs 89 to 95) as to the rates of interest charged by the Public Works Loans Commissioners on money advanced for housing purposes; whether he is aware that, although the statutory minimum under The Public Works Loans Act, 1897, is 2¾ per cent., the rates of interest actually charged under the Treasury Minute of 3rd March, 1904, vary from 3½ per cent. in the case of loans for twenty years to 4¼ per cent. in the case of loans for fifty years, so that the Treasury are making a profit on these loans not intended when the Housing Acts were passed; and whether, under the powers conferred on him by The Public Works Loans Act, 1897, he will at once issue a further Minute authorising a reduction of the rate.
§ The CHANCELLOR of the EXCHEQUER (Mr. Asquith, Fife shire, E.)
The recommendations of the Select Committee are receiving my careful consideration, and I am in communication with my right hon. friend the President of the Local Government Board on the subject. The proposals of the Government will be made known in connection with the Bill of which he has given notice. The Public Works Loans Act, 1897, prescribes that the rates of interest upon loans out of the Local Loans Fund shall be fixed by the Treasury from time to time, having regard to the duration of the loans, and shall be such rates not less than 2¾ per cent. as in the opinion of the Treasury are sufficient to enable the loans to be made without loss to the Local Loans Fund. This last proviso, of course, makes the adoption of the minimum rate in the present condition of the money market impossible. I should add that any profit which may result from existing rates does not go to the Treasury. The surplus income each year is carried to a Surplus Income Account of the Local 834 Loans Fund, which, under the Public Works Loans Act, 1905, is liable to make good any deficiency on the Capital Account of the Fund caused by the issue of stock at a discount.