§ 17. Mr. William Priceasked the Minister of Housing and Local Government what discussions he has had with the building societies on the level of mortgage rates, following the recent reductions in the Bank Rate.
§ Mr. GreenwoodI have continuing discussions with the builders and the building societies. The general view of the Building Societies Association is that in order to support a rising programme of housebuilding, the societies will have to retain their present investment and lending rates for the time being.
§ Mr. PriceWould my right hon. Friend kindly urge the building societies to "pull their fingers out"? Is it not becoming obvious that they pay far more attention to the Bank Rate when it goes up than they do when it comes down? If, as we are led to think, all that goes up must come down, why should this not apply to mortgage rates?
§ Mr. GreenwoodMy hon. Friend will appreciate that my concern is that funds should be available for building private houses, particularly in anticipation of the operation of the option mortgage scheme next year. So far as pulling their fingers out is concerned, my hon. Friend will be glad to learn that, in March, the receipts of the building societies were £153 million, and their new commitments £139 million, which is approximately double the amount in December, 1966.
§ Sir G. NabarroIs it not a fact that this is a problem afflicting owner-occupiers? As mortgage interest may be chargeable against Income Tax assessment, is not the proper recourse to increase the Income Tax allowances for mortgage interest? Would not that solve the problem?
§ Mr. GreenwoodThe best thing would be for the hon. Gentleman to read the Housing Subsidies Bill and the proposal for option mortgages.