§ 3. Mr. Richard Wainwrightasked the Chancellor of the Exchequer if he will make a statement on the implications for the public sector borrowing requirement and the central Government borrowing requirement of continuing his preferential loans policy for local authorities via the national loans fund.
§ Mr. Peter ReesOur policy of encouraging local authorities to borrow from the Public Works Loan Board raises the central Government borrowing requirement, but has no effect on the public sector borrowing requirement.
§ Mr. WainwrightAlthough the present pattern of interest rates encourages local government to go to the Public Works Loan Board voluntarily, that will not always be so. Can the Chief Secretary assure the House that he does not intend to ask for powers to compel local government to bypass the market and use the Public Works Loan Board?
§ Sir William ClarkTo what extent has borrowing by local authorities been reduced because of the sale of council houses?
§ Mr. ReesI cannot say precisely how much, but such sales have represented a useful contribution to local authorities finance. About £1 billion has been gained in the past year.
§ Mr. SkinnerWill the Chief Secretary confirm that local authority borrowing has increased mainly because they have to pay ten times as much as they receive from the sale of a house to build a new one? Is he aware that in many constituencies mortgage arrears now exceed rent arrears in the housing revenue account?