HC Deb 06 August 1980 vol 990 cc650-1

Lords amendment: No. 130, in page 87, line 21, leave out from "date" to "as" in line 22 and insert— but not earlier than the end of the period of account

Mr. Geoffrey Finsberg

I beg to move, That this House doth agree with the Lords in the said amendment.

Under the clause as drafted the Secretary of State may demand interest on surpluses accumulating in the grant redemption funds at rates to be decided by him for any period beginning up to 12 months before he serves a notice on a particular association to direct the use of the surpluses. However, this carries a risk that associations will be charged interest for a period during which they had no knowledge that interest would be payable, or at what rate. Clearly that is not a satisfactory position for them to be put into.

I believe that the amendment puts matters right. In practice, my right hon. Friend intends to make a general announcement in advance of the rate at which interest on surpluses arising will become payable where those surpluses remain in the funds after the end of the accounting period in which they were generated. When the Secretary of State subsequently gives a notice to an individual association to direct the use of its surpluses, the amendment provides that the earliest date from which interest will be payable is the end of the accounting period. The amendment therefore removes the risk of associations incurring unknown liabilities.

Question put and agreed to.

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