HC Deb 26 October 1944 vol 404 cc441-2

(1) The rate of interest for any period after the commencement of this Act on compensation which fell or falls, in default of agreement, to be ascertained in accordance with the Acquisition of Land (Assessment of Compensation) Act, 1919 (whether as originally enacted or as amended by this Act), in respect of land compulsorily purchased on which entry has been made before the payment of the compensation shall, in lieu of being the rate of 5 per cent. specified in Section eighty-five of the Lands Clauses Consolidation Act 1845, be 4 per cent per annum or such other rate as may be prescribed by regulations made by the Treasury under this Section.

(2) The Treasury may from time to time make regulations prescribing the rate at which such interest as aforesaid for the period after the coming into force of the regulations, and before the coming into force of any subsequent regulations made under this Section, is to be payable.—[Mr. W. S. Morrison.]

Brought up, and read the First Time.

Mr. W. S. Morrison

I beg to move, "That the Clause be read a Second time."

This Clause prescribes that the rate of interest, which, as provided under the Land Clauses Act of 100 years ago, is not more than 5 per cent., shall, in accordance with modern practice, be only 4 per cent., and may be varied from time to time.

Earl Winterton (Horsham and Worthing)

I do not quite follow my right hon. Friend's statement. I understood him to say that, formerly, 5 per cent. was payable, and it is now being reduced to 4 per cent. Can the Minister explain that?

Mr. Morrison

On the general grounds that interest rates are lower now than they were 100 years ago, when 5 per cent, was prescribed, and that a rate of 4 per cent. is a fair rate of interest in modern times.

4.0 p.m.

Earl Winterton

I am not so certain that it is so. I am not sure that this has regard to the normal rate paid by private lenders or borrowers as the case may be, and you will find that it is below the ordinary level. It should certainly be at the rate of five per cent.

Mr. MacLaren (Burslem)

Ask the usurers.

Question put, and agreed to.

Clause added to the Bill.