I should like at the outset to condemn some of the statements made by my colleague, Deputy Clinton, with regard to my efforts and the efforts made by the previous Minister for Local Government in this matter. Deputy Clinton said I gave a public assurance that something would be done about the increased rates of the building societies. He stated that nothing concrete was done and this was a condemnation of me. As a public representative of an area in which a large number of people had expressed their dissatisfaction regarding the interest rates charged by building societies, I gave a public assurance that I would urge the Government to look into this problem in a speedy and efficient manner. That assurance was given and was given back to me by the then Minister for Local Government, by the then Minister for Industry and Commerce and by the Minister for Finance who was directly involved at that time.
I represent a constituency in which there is a large number of young married couples. Many of these young people have been tortured by the increased rates demanded by the building societies during the years. I express my sympathy with borrowers whose interest rate has been increased, in particular those who originally were charged a rate of 5 per cent and now find themselves having to pay 8 per cent. This is no credit to the building societies in view of the fact that many of these borrowers were within two or three years of completing payments on their houses. Many of the people who found themselves in this position had to re-budget their family income. People such as gardaí or civil servants or those in similar occupations had to adjust their budgets in an effort to meet the increased costs of the building societies. It was unjust that they should have been put in this position when they were within reach of owning their homes. For most couples the only piece of property they will ever own is their own home and it was shattering to find that they had to continue payments for another four or five years. I express sympathy with these people and I hope the Minister in his reply will give some hope and assistance to the people who have suffered as a result of these increased rates.
We must recognise that building societies borrow money on short term and loan it on a long term basis and this course cannot be recommended. I realise that people are inclined to invest their money for a period and, having made substantial profits, they withdraw it when they need it for themselves. The building societies should encourage long term investment and they can do this by offering attractive terms. The societies should realise that long term investment may be the solution rather than increasing the interest rates as has been done in the recent past.
A large number of building societies advertise on television and radio. They are all looking for money and I see no reason why they cannot join together and run a joint advertising campaign rather than each conduct an expensive advertising campaign. At the moment six building societies are advertising on television and radio; three are from one company and two are from another company. It appears ludicrous to me that they do not cut their costs by having a joint campaign. By doing this they could save a considerable amount of money which might be diverted towards helping to reduce the high interest rates now charged. There should not be any problem for the societies to get together in the manner I have outlined. If the Government decided that the building societies should come together there would not be any difficulty in having joint managership and having the societies operate as a single entity. I feel very strongly about this matter. I consider that amalgamation such as I have outlined would eliminate duplication of expense and would be a worthwhile course to follow.
The Government should urge young people to invest money in building societies and to help the societies which play a major role in our building industry. I am on record on the 15th November, 1969 in the Evening Press and the Irish Times as having said that I realised the building societies play a vital role—a role the Government would not be able to play at the moment. If the Government decided to do this they would need tremendous financial resources which could be expanded so that other less well off sectors of the community could benefit. In this way the building societies could help the Government and help themselves by allowing young people to invest their money on a long term basis so that when the time came for requesting a loan from the building society, the early investment by these young people would reap its reward. They would gain the facilities which they would normally expect to gain from the local authority or some other body.
I requested an inquiry. An inquiry is being carried out, and here I want to differ from my colleague, Deputy Mark Clinton, who said nothing has been done. However, I urge the Minister, in the interest of all the middle-class people who are burdened with these increases, which will continue if we do not do something about it, to ensure that when loans are granted building societies will make it quite clear to the borrowers that the rate can be increased. I have had numerous letters from young people who did not know whether they should seek a lawyer's advice or go ahead and pay the increased rate. Deputy Clinton made a case here for a person who did not pay it and went on paying the old rate. I had a similar case, and the person who paid the old rate discovered afterwards he would never own his house by paying the old rate. He therefore, had to pay the new rate which was such a heavy burden that the family had to readjust their financial affairs. The Minister should ensure that the terms of building society agreements are legible and that important conditions are not to be concealed in small print in the document.
I have expressed my dissatisfaction about this matter in the newspapers and I shall continue to do so until something is done about it. This motion requests an inquiry, but an inquiry is being held. I would urge the Minister to do what he can to expedite this inquiry and thus ease the minds of the thousands of borrowers who are completely dismayed and many of whom, as I say, have had to adjust their incomes or, perhaps, sell their houses and live in flats because the payments were beyond their means. The Minister is capable of tackling this problem, and I do not believe there is any necessity for this motion. However, the principle is a good one, and it is not merely the concern of the Opposition that is involved here. There is concern in the Government benches also for the middle-class people who are shouldering the greatest burden here.
If it is necessary for the Government to take over the building societies this should be done. That may be a very drastic remedy but if something positive is not done there will be complete dismay among borrowers. No resources will be available to help them, and the payments will be too heavy for them. If this happens our whole building industry will fall asunder. I do not want to see that happen, and I am convinced that if the problem is tackled in a workmanlike way it can be solved. I would ask the Minister to look into this matter and to let us know in his concluding speech when the findings of this inquiry will be made known to the public.