HC Deb 21 February 1951 vol 484 cc1287-8
39. Mr. Rankin

asked the Secretary of State for the Colonies why the Kenya Government charge 8 per cent. interest on loans to African farmers.

Mr. J. Griffiths

The rate of interest charged is that recommended by the Committee on Agricultural Credit for Africans. The Committee recommended a rate of 8 per cent. to be reduced to six where a clear title to land existed as security. The rate was calculated as being just sufficient to cover interest payable to Government, working expenses and bad debts, and not being so favourable as to prejudice the chances of forming and developing a system of credit through co-operative societies, including the establishment of a co-operative central bank. The Committee considered that ultimately only such a system could achieve generally the aim of providing the credit required for African farmers.

Mr. Rankin

While welcoming the reduction from 8 per cent. to 6 per cent., may I ask my right hon. Friend to see that more attention is given to this matter, because even 6 per cent. hardly seems a cheap money policy?

Mr. Griffiths

I appreciate that, and I agree entirely with the Committee that the right way to solve this problem is by encouraging co-operation in all its forms.

Mr. H. A. Price

Will the right hon. Gentleman take steps to see that the Kenya Government are not described as "shabby moneylenders"?