HC Deb 19 July 1989 vol 157 cc341-2
16. Mr. Stern

To ask the Chancellor of the Duchy of Lancaster if he will make a statement on the future availability of tied loans from breweries to clubs and voluntary associations.

Mr. Maude

As my right hon. and noble Friend the Secretary of State for Trade and Industry announced in his statement on 10 July, we do not propose to prohibit new tied loan agreements. However, we intend to impose the requirement on national brewers that tied loans should be restricted to beer sales and must be capable of termination by the borrower without penalty on no more than three months' notice.

Mr. Stern

I thank my hon. Friend for reiterating the welcome announcement of our right hon. and noble Friend the Secretary of State in confirming that the traditional source of finance available to sports clubs and to other clubs and associations in all our constituencies will remain open.

Mr. Maude

We took the view that tied loans are a particularly useful source of finance for clubs. The only danger arises when clubs or pubs are unable to repay the loan without penalty, and we are taking steps to ensure that that cannot happen.