Building Societies (Hansard, 17 June 1982)

§ 11. Mr. Squire
asked the Chancellor of the Exchequer if, in view of his assessment, Official Report, 13 May, c. 312, that it might be desirable to legislate with respect to building societies, he will list the areas in which he judges additional provision to be necessary.

§ Mr. Bruce-Gardyne
As my right hon. and learned Friend said in his recent speech to the Building Societies Association, it seems increasingly likely that there will need to be a major re-examination of building society matters, and possibly legislation, during the course of the next Parliament. The contents of the legislation will depend on the conclusions of the Government on that reexamination. Two of the major topics for re-examination, and so possibly legislation, are those of the powers of societies, and of the constitution of societies, including the accountability of their boards.

§ Mr. Squire
Is my hon. Friend aware that many who congratulate building societies on their role in widening home ownership are none the less concerned about the actions of a few societies, the directors of which appear to try to restrict their accountability to their members? Will he confirm that, without question, should that practice continue and not be regulated by the movement, legislation will be produced to counter it?

§ Mr. Bruce-Gardyne
It is important not to get the matter out of perspective. One or two well-publicised incidents naturally cause anxiety. I can assure my hon. Friend that it wound be suitable for us to cover such matters in legislation, if there is such provision, in the next Parliament.

§ Mr. Ashton
Does the Minister accept that if the Government want to put up inflation by increasing the price of petrol by 20p they have to come to the House and do that in the Budget, but if the building societies want to put up mortgages by £20 a month they do not have to ask anybody? Surely the House should decide when mortgage interest rates should go up, not a tiny handful of men in the building societies?

§ Mr. Bruce-Gardyne
On the whole, our experience of Government trying to regulate the price mechanism in the private sector is that it does not have much to recommend it.