HC Deb 05 February 1951 vol 483 cc1329-30
36. Mr. Marlowe

asked the Minister of Fuel and Power if he will make a statement as to why he has not given any statutory directions to the British Electricity Authority to ensure their observance of the Government's policy to discourage the use of funds for the financing of hire-purchase agreements.

Mr. P. Noel-Baker

The policy of His Majesty's Government is to restrict the borrowing of money for the extension of facilities for hire-purchase. The electricity boards borrow no money for this purpose; they finance their hire-purchase sales from trading surpluses. The value of the sales by the boards of appliances on hire-purchase terms is, at today's prices, well below the level of sales by the electricity supply industry before the war; and if the appliances on hire are included, the amount is less than one-third. Nevertheless, I am considering whether any restrictions are required.

Mr. Marlowe

Will the right hon. Gentleman take some urgent action in the matter? Is it not the case that the Treasury have issued a directive that this kind of financing of hire-purchase agreements is inflationary? If it is inflationary when it is done by the banks, is it any less inflationary when it is done by a nationalised authority? Will the right hon. Gentleman give an assurance that this matter will receive immediate attention?

Mr. Noel-Baker

The Treasury instruction was about the expansion of hire-purchase, and there has been no such expansion.

Mr. Assheton

Does the right hon. Gentleman not understand that an authority of this sort, which has the support of British credit behind it and can raise money on the market at very cheap rates, is competing with private industry? Is it not grossly unfair to allow this competition to go on?

Mr. Noel-Baker

The right hon. Gentleman is quite wrong. There is an agreement between the associations of manufacturers and the boards about this matter.

Mr. Marlowe

When the right hon. Gentleman says that there has been no expansion, will he be good enough to refer to the Second Report of the British Electricity Authority, which shows that, as compared with 1939, hire-purchase sales were 10 per cent. and cash sales 90 per cent., whereas last year hire-purchase sales were 25 per cent. and cash sales 75 per cent., which is an expansion of two and a half times?

Mr. Noel-Baker

Yes, Sir, but there has been a very great contraction on hiring, which is even more inflationary. I am considering the whole matter, but I am very reluctant to make it impossible for poor people to buy cookers, vacuum cleaners and other labour-saving devices which help women in their homes.