§ 49. Mr. W. THORNEasked the Minister of Health if he is aware that the West 1846 Ham Board of Guardians have borrowed from the Ministry £350,000 during the current half-year; that they have had to make arrangements with their bankers for an overdraft of £300,000; that, if the present Bank rate is maintained, the guardians will be called upon to pay to their hankers an extra £2,000 because of the rate being increased from 4 to 5 per cent.; that the guardians will have to make arrangements with the Ministry to borrow for the half-year ending December £300,000; whether they will be called upon to pay the extra 1 per cent.; and if he intends taking action in the matter?
§ The PARLIAMENTARY SECRETARY to the MINISTRY of HEALTH (Sir Kingsley Wood)My right hon. Friend is aware of the facts stated in the earlier part of the question. The rate of interest payable on loans already advanced by his Department has not been fixed by reference to the Bank rate, and will not be affected by the present increase in that rate. The rate of interest of any further loan which it may be necessary to advance to the guardians will be determined in the light of the circumstances existing at the time when the advance is made.
§ Mr. THORNEHas the hon. Gentleman's Department considered the very damaging effect that this increase will have upon all local authorities in regard to future borrowing?
§ Sir K. WOODNo, Sir, the hon. Member must not assume that.
§ Mr. THORNEIs the hon. Gentleman not aware that it will cost the country millions?
§ Sir K. WOODNo, Sir, I am not.
§ Mr. THORNEThen you ought to be.
§ Mr. A. V. ALEXANDERIs the hon. Gentleman's Department now prepared to consider the waiving of interest which has accrued to date on these loans?
§ Sir K. WOODI must ask for notice of that question.
§ 51. Mr. THORNEalso asked the Minister of Health what effect the new Bank rate will have upon the rent that will have to be paid for the new Louses now being built?
§ Sir K. WOODMy right hon. Friend does not apprehend that the recent in- 1847 crease in the Bank rate will have any effect On the rent of new working-class houses, as there is no reason to believe that either the cost of building or the cost of the long-period loans raised by local authorities in connection with their housing schemes will be adversely affected
§ Mr. THORNEHas the hon. Gentleman noticed in the paper the oteer day a statement made by a man who knows—[HON. MEMBERS: "Name!"]—it. was Major Barnes, formerly a Member of this House—declaring that the extra cost of the Bank rate would increase the rent of a non-parlour house by ls. 6d. a week, and the rent of a parlour house by 1s. 9d.
§ Sir K. WOODNo, Sir; the suggestion is entirely unfounded.
§ Mr. THORNEAll right—wait and see
§ Mr. JOHNSTONIs the hon. Gentleman not aware that builders, merchants, and everybody engaged in the building, trade, frequently require overdrafts from their banks? Will they not, in consequence, have to pay an increased sum to their hanks, and will not that require to be put on to the cost of these houses?
§ Sir K. WOODNo, Sir. We have given Very careful consideration to this matter, especially having regard to the suggestion made by the right hon. Gentleman the Member for Shettleston (Mr. Wheatley) in the Debate last week, and there is no reason to believe that there will he any increase in the rent of working-class houses on account of the matters mentioned in the question.
§ Mr. THORNEHas the hon. Gentleman not declared—well, you have declared—
§ Mr. SPEAKERThe hon. Member has answered his own question.