§ 33. Mr. PRINGLEasked the Chancellor of the Exchequer whether his attention has been called to the decision of the principal Glasgow law agents to raise the rate of mortgage interest from 4 per cent, to 4½ per cent.; and whether, seeing that this action will raise rents and limit housing accommodation, the Government propose to take action in the matter?
§ 35. Mr. SNOWDENasked the Chancellor of the Exchequer if he is aware that in consequence of the high rate of interest on the new War Loan the mortgagees on all property are sending in notices calling in the mortgages with the alternative of an increase in the rate of interest; that this increase in mortgage interest and the increase in the Income Tax on property, together with the increase in local rates due to the higher rate of interest now being charged on municipal loans, are being made the reason for an increase of rent, amounting generally to about 12½ per cent.; that this means that the burden 1485 of the War Loan is being put upon the tenants of property, and that the further effect is that the building of workmen's cottages will cease until rents have risen by the sum stated; and, in view of these facts, will he take steps to fix a limit of 4½ per cent, on mortgages during the War, or make it illegal to call in mortgages during the War, or in some other way do something to protect the tenants and owners of property from having imposed upon them an unfair burden of the cost of the War while others escape their fair share?
§ Mr. McKENNAMy attention has been called to the fact that mortgagees in some cases have recently given notice to raise the rate of interest. Under the provisions of the Courts (Emergency Powers) Act mortgagees cannot call in mortgages without the leave of the Court, which has discretion to postpone the date of payment if the mortgagor is unable to pay the mortgage debt immediately, and such inability is due to circumstances attributable directly or indirectly to the War. I doubt whether it would be equitable for Parliament to interfere further as between mortgagor and mortgagee to prevent the raising of the rate of interest on mortgages proportionately to the general increase in money rates, but mortgagees should remember that it is essential in the national interest that existing contracts of this character should be disturbed as little as possible. The whole position will continue to be carefully watched by the Government.
§ Mr. PRINGLEIs my right hon. Friend aware that in the case of the Scottish mortgages it is not necessary to call up the mortgage in order to raise the rate of interest?
§ Mr. McKENNAI was not aware of that fact.
§ Mr. HOGGECan my right hon. Friend say whether the Government have yet considered the question of establishing Fair Rent Courts, particularly in Scotland?
§ Mr. SPEAKERThat does not arise out of the question on the Paper.
§ Mr. SPEAKERYes, but it is not usual to ask the Minister on the spur of the moment whether the Government have 1486 decided to set up Fair Rent Courts. That is a matter which requires consideration.
§ Mr. J. SAMUELI should like to ask if the Chancellor of the Exchequer is aware that a similar practice is operating in this country with regard to the raising of the rate of mortgage interest?
§ Mr. McKENNAThere are cases of the kind, but I have given all the facts in the answer.
§ Mr. WATTIs the right hon. Gentleman not aware that a decision to the contrary effect is given in his answer?
§ Mr. McKENNANo, Sir, lam not aware of any.