HC Deb 27 July 1971 vol 822 cc189-90
6. Mr. Walter Johnson

asked the Chancellor of the Exchequer what recent communication he has received from the Building Societies Association on the subject of interest rates; and if he will make a statement.

Mr. Higgins

None, Sir.

Mr. Johnson

Is the Minister aware that there is growing public indignation about the building societies still charging 8½ per cent. interest to mortgage borrowers when Bank Rate has been reduced to 6 per cent? In addition, the building societies have benefited from a 50 per cent. reduction in S.E.T. and a reduction in corporation tax and income tax. When will the general public get some benefit from this reduction, and will the Chancellor make immediate representations to the building societies' organisation to get the interest rates down?

Mr. Higgins

As was made clear in my exchange with the hon. Gentleman at a recent Question Time, building society mortgage rates are essentially a matter for the societies concerned and not for the Government.

Mr. Fletcher-Cooke

Does my hon. Friend remember that in our recent exchange on this matter, when I asked him whether he would consider referring this ring relating to interest rates to the Monopolies Commission, he said he was considering the matter under the whole question of credit control? Has he anything further to say on that subject?

Mr. Higgins

With respect to my hon. and learned Friend, I think I pointed out that this was a matter for the Department of Trade and Industry. It is, of course, relevant to the question of control. The consultative document which was issued by the Bank of England makes reference to this and indicates that the authorities are aware of the overall question of monetary control and will bear in mind building society interest rates.