Clause 24.—(RIGHT FOR PERSONS BORROWING OR APPLYING FOR LOANS BEFORE 1ST APRIL 1968 TO OPT FOR SUBSIDY.) (Hansard, 8 March 1967)

§ Mr. MacColl
I beg to move Amendment No. 78, in page 20, line 28, at the end to insert: 'or except that both: (a) the application has been so made, and (b) the principal sum outstanding in respect of the loan is treated between the borrower 1695 and lender as including the amount of a further advance or re-advance made before 1st April 1968 on the same security as the loan but not itself satisfying the requirements of paragraph (b) of the said section 23(1)'. This important Amendment deals with the subsequent loans which may be made on the security of the house. The position is that whatever the money has been used for, it cannot be used for the option because it would be impracticable to dig back into the history of the loan and find out in detail what the money has been spent on. Therefore, the reasonable course, if one is dealing with an existing loan, is to accept that the money has all been used on the property.
In the case of new loans, the subsidy will Only be paid on additional loans which are spent on the property. It is not the intention under the scheme to pay subsidy on loans which are to be used for non-housing purposes.

§ Mr. Eyre
Can the Parliamentary Secretary say what kind of evidence would be expected of, for instance, the solicitor who would try to satisfy the building society and ultimately the Government? What administrative arrangements has the hon. Gentleman in mind for dealing with this point?

§ Mr. MacColl
When a person makes an application he will be warned that he will not be able to get his option on the subsequent loan unless it is spent on the house. Then when he fills in his application form he will certify that so much of the money is to be used on the house and so much of it is not to be so used. I do not think that my right hon. Friend had in mind that there would be any complicated policing. It will be assumed that people making applications will act as honourable men and will make clear what the money is to he spent on.

§ Mr. Eyre
Bearing in mind the administrative difficulty, will the Parliamentary Secretary agree that no burden should be placed on professional people who have to deal with this money to ensure that the money is used as it should be used? In other words, will the written statement of the applicant be accepted as evidence?

§ Mr. MacColl
Yes.