asked the Minister for Local Government if he will consider amending the regulations to raise the present income limits of applicants for local authority housing loans from £1,200 to bring the figure more into conformity with rising building costs.
Ceisteanna—Questions. Oral Answers. - Local Authority Housing Loans.
60.
As indicated in reply to question No. 41 on the 16th December last the primary objective of the local authority house purchase loans scheme is to enable persons of modest means to buy their houses as an alternative to seeking accommodation from the local authority.
In the quarter ended 31st March, 1970, more than 50 per cent of applicants for loans had incomes of less than £1,050 a year and the remainder, almost without exception, had incomes of less than £1,200 a year. At the 31st March last the value of applications for loans which local authorities had on hands was £10.7 million, compared with £6.1 million and £9.4 million on the corresponding dates in 1968 and 1969 respectively.
The value of house purchase loans advanced by local authorities has risen continuously in recent years. An all-time record of £9.13 million was advanced in 1969-70, compared with £6.7 million in 1968-69 and £4.85 million in 1967-68. This represents an average annual increase of 37 per cent over each of the last three financial years.
In view of the level of demand for these loans, it is clear that the present income limit is not inhibiting the operation of the scheme and I do not propose to increase it at this stage. I am, however, keeping the position under constant review.
Perhaps the Minister would tell us when this figure of £1,200 was fixed by regulation.
The current income limit of £1,200 was fixed in June, 1965.
Will the Minister not agree that £1,200 is no longer a realistic figure when one considers what building costs are in May, 1970? In view of the representations made for an increase in that figure, would the Minister not consider reviewing the whole position, remembering that there is no charge on public funds?
The limits do not apply in the case of loans financed from sources other than the Local Loans Fund or to tenants of local authority houses who are prepared to surrender their tenancies on getting loans. In view of the increasing demand for loans within the income limit in operation I would not be justified in increasing the income limit at this stage.
The Minister is aware no doubt that persons with incomes of £1,200 and under are not permitted to seek loans from sources other than housing authorities.
The local authority may finance loans with internal capital and the limit would not then apply.
But building societies will not.
I did not mention building societies.