HC Deb 09 August 1966 vol 733 cc1653-8
Sir K. Joseph

I beg to move Amendment No. 29, in page 23, line 20, at the end to insert: but excluding any charges whether by way of interest or otherwise for the service of lending money on mortgage", Perhaps it would be convenient to discuss with it Amendment No. 52, in page 23, line 20, at the end to insert: but excluding any charges whether by way of interest or otherwise for the loan of money". We want to know some more about the applicability of different parts of the Bill to interest charges, and in particular to mortgage charges. The relevant Clauses are Clauses 2, 7 and 26. I would ask the Parliamentary Secretary to tell us not only what Clause 26 means but whether powers exist in the previous Clause in connection with interest charges.

5.0 a.m.

We are interested above all in mortgage charges. We have been told by the Government that they have power under Clauses 2 and 7 to refer mortgage charges for report to the National Board for Prices and Incomes and that Clause 7 would attract to such a reference the standstill provisions of Part II. We are told equally categorically by the honourable Chairman of Standing Committee B, corroborated by the Government, that Clause 26 does not cover mortgage charges. What we do not understand is the magic distinction between the words used in Clauses 7 and 26, any charges for the performance of services and in Clause 2, charges or other sums payable under transactions of any description … or to services of any description … How do the Government distinguish between these apparently similar phrases and say that Clauses 2 and 7 do and Clause 26 does not apply to mortgage interest?

When the Government have answered this question—we hope the Attorney-General may be willing to help them to make it plain—we should like to know to what extent lending money at interest, be it by a pawnbroker or by a bank, or indeed from one friend to another, is a charge for the performance of services. We should like to know whether hire purchase comes within Part IV or Part II, or neither.

I hope that if the Government are unable to give us the answer in detail now, they will undertake to write clearly to us for publication in the papers the answer to these most important questions. I reserve the right, with the leave of the House, to return to the subject if the answer is not adequate.

Mr. William Rodgers

There was an extensive and somewhat confused discussion of the position of mortgage charges in Committee at a very late hour one day last week. I am glad to have this opportunity to restate how they are affected by the Bill.

The right hon. Gentleman will be aware of the statement in the House this afternoon by my right hon. Friend the Minister of Housing and Local Government. I think his words on that occasion made the position quite clear. He said in his statement that we did not intend to use compulsory powers as far as mortgage rates were concerned. He also said that this emphasised the need for voluntary action. [Interruption.] If the right hon. Gentleman will be a little less impatient I will return to the Bill which I think ought to be seen against the context of what my right hon. Friend said.

I should have thought that if the right hon. Gentleman considers the purposes of the different parts of the Bill he can find answers to his questions in the context of what my right hon. Friend said. Under Clause 2 we possess the power to refer mortgage charges to the National Board for Prices and Incomes. As he knows, this is precisely what we have done. It is equally clear, because Clauses 7 and 26 involve the use of statutory powers, that these Clauses do not apply to mortgage charges.

Mr. Higgins

We are trying to clarify the situation. The hon. Gentleman says that it is clear that the Government will possess the powers under Clause 2 and that they do not possess the powers under Clause 26. The whole purpose of the Amendment is to clarify the situation. What particular expression in Clause 2 covers mortgage rates and what expression in Clause 26 excludes mortgage rates? Will he also say whether mortgage rates and the lending of money at interest are regarded as a service or not?

Mr. Rodgers

The late hour seems to have confused the hon. Gentleman more than it has confused me. I thought I made abundantly clear in answering questions asked by the right hon. Gentleman what the position is, that under Clause 2, which is concerned merely with references to the National Board for Prices and Incomes, we can make a reference on mortgage charges, but under Clauses 7 and 26, which are concerned with statutory powers for standstill, we cannot deal with mortgage charges.

Sir John Hobson (Warwick and Leamington)

I know that the hon. Gentleman said that the Government do not intend it, but what we are concerned with is the words in the Bill and not the intentions of the Government. Why is not the lending of money a service, whether secured on a mortgage or unsecured? If it is not a service, what else is not a service? If it is a service, is it said or is it not said that interest is not a charge? Can the hon. Gentleman explain how it is excluded?

Mr. Rodgers

The question now raised is one of definition. If at this stage I am being asked to enter a semantic argument about the meaning of certain phrases, I am prepared to do so, but I think that it would meet the wishes of the House to know the position as we see it. A question about the interpretation of the Bill is a later stage. I have been asked how we intend to use the Bill. Clause 2 refers to prices, charges or other sums payable under transactions of any description relating to any form of property or rights or to services of any description or to returns on capital invested in any form of property, including company dividends". This phraseology in Clause 2 is absent from Clauses 7 and 26, where there is a reference to charges for services.

Sir J. Hobson

Is the hon. Gentleman really telling the House that because one phrase is used to describe something in one Clause and a different phrase is used in another Clause, they cannot refer to the same thing?

Mr. Rodgers

I do not know what meaning language has unless it means that if one uses a different form of words one sometimes means a different proposition. That is precisely what I am saying. The right hon. and learned Gentleman asked a specific question: What form of words made a distinction between Clause 2 and Clauses 7 and 26? I have indicated what form of words involves this distinction, and I hope that I have satisfied him.

Mr. Higgins

I am sure that the House is anxious to clarify the appalling confusion into which the Government have got themselves. First, all that the hon. Gentleman has done about Clause 2 is to read out the whole provision. He has not told us which specific words cover mortgages in Clause 2. Secondly, does he regard the lending of money at interest as a service or not?

Mr. Rodgers

The second point is something that is not properly related to the Bill. If the hon. Gentleman asks whether I regard the lending of money as a service, it is not relevant except in so far as I may say what the Bill means when it refers to services. What I am saying, and I hope this is clear— and I hope that the hon. Gentleman will not cause confusion where confusion does not exist—is that the references to services in Clauses 7 and 26 do not involve a reference to the lending of money. As to Clause 2, I do not know whether the hon. Gentleman wants me to read out the phrase again. I think that it would serve the purpose of the House much better if he would look at it himself. However, I repeat that it says prices charges or other sums payable under transactions of any description relating to any form of property or rights or to services of any description or to returns on capital invested in any form of property". I should have thought that "property" there was a very clear indication, taken with the other form of words, that we can bring in mortgages here where mortgages are not eligible for consideration under the rest of the Bill.

We are considering Clause 26 at the moment. I have dealt with the point. I have said again what was made clear the other evening in Committee, though at the end of a long and complicated argument. I can quite understand it if the Opposition were a little doubtful. I have made it clear that the Clause does not include mortgage interest, and it is not our intention, as it would not be within our power, to use that Clause for the purposes of mortgage interest.

Sir J. Hobson

I am sorry that the Attorney-General has left. Is the lending of money or hire purchase a service? Is the lending of money by a bank a service? Is the ordinary lending of money by a moneylender a service? I have always understood that such were services. In the view of the Under-Secretary, after the legal advice he has received, are those, or are they not, services within Clauses 26 and 7, which deal with charges for services, whereas Clause 2 deals with incomes?

Mr. Rodgers

As I am advised, the lending of money is not a service within the meaning of these Clauses.

Sir K. Joseph

Is the Under-Secretary telling us that he has no power under Clause 26 to deal with hire purchase in any way under Part IV?

Mr. Rodgers

As I understand it, under Clause 26 it would not be possible to involve hire-purchase charges, which are, after all, charges made for the lending of money.

Sir K. Joseph

So that the whole range of goods covered by the hire purchase and the offer of them to the public is not covered under Part IV and, therefore, by the freeze arrangements and the power given to the Minister under Part IV? From our point of view, this is not the most important thing in life. What we want to know is what the Government regard as their powers. This is what the Under-Secretary is telling us?

Amendment negatived.