§ Mr. ROYCEasked the Chancellor of the Exchequer whether he is prepared to recommend the Public Works Loan Board to reduce to 5 per cent. the interest of the 6 and 6½ per cent. loans raised by public authorities for land settlement purposes; and is he aware that the continuance of the high rates of interest is greatly embarrassing those authorities who were compelled to carry out the provisions of the Land Settlement Act when interest rates on loans were so much higher than at present?
Mr. YOUNGNo, Sir. It is impossible to reduce these rates, which were based on market rates at the time when the loans were contracted. Such reduction would involve heavy loss to the Local Loans Fund which has, of course, to pay interest to holders of Local Loans Stock raised at the then market rates. In view of the fact that the State recoup any 1047W annual loss in respect of Land Settlement Schemes, my hon. Friend is mistaken in thinking local authorities are directly affected by the charge.