HC Deb 23 March 1959 vol 602 cc887-9
9. Mr. Slater

asked the Minister of Agriculture, Fisheries and Food what is the present rate of interest charged under Section 54 of the Agriculture Act, 1947, which deals with loans for working capital; what is the latest figure of applications; and how this compares with those for the years 1955, 1956, 1957 and 1958.

Mr. Godber

The answer to the first part of the Question is 6¼ per cent. The answer to the second part contains a number of figures which I will, with permission, circulate it in the OFFICIAL REPORT.

Mr. Slater

Is the Minister not aware that many smallholders, such as those in my constituency, have found things most difficult during the last two or three years because of the high interest rates charged? Does he not think it is time we had another review of these interest rates now being imposed in view of what people want to do on their smallholdings? In view of the rates which have operated during the last three years, since 1957, which have appeared in the Smallholdings Report for 1957–58—from 6 per cent. to 6½, from 6½ to 7 and 7¼, from 7¼ down to 7 per cent., and then, on the hon. Gentleman's own figures, now down to 6 per cent.—does he not think that something more ought to be done to ease the burden?

Mr. Godber

I agree that the rates have been high, although, as I have indicated, they have fallen somewhat to 6¼ per cent., not 6 per cent. They have been as high as 7 or 7¼, which I realise has inhibited people, but I hope that the downward tendency which has begun will give some help. I fully take the hon. Gentleman's point about the need to keep these rates as low as possible.

Sir A. V. Harvey

Will my hon. Friend bear in mind that the most effective way to help farmers, small farmers particularly, is to arrange for them to have cheap money, which, as a method, is preferable to having a lot of subsidies?

Mr. Godber

I think that it is necessary for credit to be at commercial rates. I think that it is far better for the farming community to receive support through the system we have of deficiency payments and other means and that they should have the same form of credit rates as are available to industry generally.

Mr. Champion

Will the Minister agree that what happens here by deficiency of payments is that money is taken out of the taxpayer's pocket and paid to the farmer in order that he can give it to the moneylender?

Mr. Godber

It could be argued the other way round, too. What we want is to see that farmers are in a position to pay a fair commercial rate. Why a fair commercial rate is always spoken of as a rate for the moneylender, I cannot really understand; I think that it is always effective whatever Government may be in power.

Following is the information:

From the 1st April, 1958, to 28th February, 1959, 97 loans to smallholders were approved, amounting to £112,215. The position during the three preceding financial years was as follows:—

April-March Number of loans approved Total amount of loans
£
1955–56 … … 187 209,729
1956–57 … … 120 132,318
1957–58 … … 114 122,971