§ 56. Mr. Manuel
asked the Chancellor of the Exchequer if he has studied the letter of protest from Ayr County Council concerning the interest rates charged on local authority borrowing; and What reply he has sent.
§ Mr. Barber
I am aware of the representations made by Ayr County Council. If present interest rates do cause some local authorities to defer certain projects, that is not necessarily a bad thing. Indeed, as my right hon. Friend explained last July, by restraining their expenditure, local authorities can help to relieve the overload on the economy. We do, however, keep these interest rates under constant review and local authorities do, of course, receive substantial grant aid towards most of their capital schemes.