asked the Minister for Local Government if he will give some indication when the building societies will be in a position to resume the issue of purchase loans in respect of previously occupied dwellings.
25.
Ceisteanna—Questions. Oral Answers. - House Purchase Loans.
24.
asked the Minister for Local Government if the announced Government proposals to restrict loans from building societies to new houses only, with a limit of £7,500 per house, will in effect mean that many middle income groups will now have to rely on local authority housing.
With your permission, a Cheann Comhairle, I propose to take Questions Nos. 24 and 25 together.
Building societies generally were informed by my Department on the 24th September that to qualify for the special subvention which the Government introduced in May last they should not enter into new commitments for mortgages exceeding £7,500 until further notice, or for mortgages in respect of the purchase of previously-occupied houses until after 1st January, 1974, when the matter would be reviewed. These conditions are designed to concentrate resources where the need is greatest by putting the maximum emphasis in the shortterm on the provision of mortgage facilities for new houses which are not of a luxury standard. If the inflow of funds to the societies and their rate of issue of loan approvals improves sufficiently, I will be prepared to review the need for the conditions.
Would the Minister tell us how many houses have been completed in Dublin over the past few months and have not been occupied because of the inability of prospective purchasers to get mortgages?
Would somebody show Deputy O'Malley how to read an Order Paper? Obviously he cannot read Questions Nos. 24 and 25 or he would not be asking that supplementary question on them.
The Minister is not able to answer it.
Will the Minister agree that I told him before the summer recess that there was every likelihood that mortgage rates would have to go up to 14 per cent? Now it is stated that the rate is 13 per cent. Is the Minister satisfied that the steps already taken by the Government will prevent this situation?
Does Deputy Lemass know what the mortgage rates are? Are they 13 per cent? The Deputy said 13 per cent.
I forecast some months ago that mortgage rates would go to 14 per cent but as a result of State intervention that will now be 13 per cent. Does the Minister not agree that this is very likely?
No. I think Deputy Lemass is, as usual, talking about something which he knows very little about.
So is the Minister. The Minister is not making a good job of it.
I know more about it than the Minister.
Is the Minister satisfied that the building societies will comply with the directive or does he have power to make these directives under present legislation?
The only powers which the Government have over building societies are, first, we are giving a one per cent subsidy which can be withdrawn if the conditions are not accepted and, secondly, there is the income tax remission which could also be withdrawn. Those are the only ones and if the building societies do not want these things they can decide to go ahead and charge any interest rates they like.
Does the Minister get regular reports on the activities of these building societies?
Audited reports, yes.
Would the Minister agree that hardships are created for people moving from jobs to different areas when they try to sell their houses because of the fact that loans are not readily available? Would the Minister not consider certain cases on their merits?
I agree that there are individuals who will find this a hard ship but they are a very small number. A very small number of indivi duals will be affected by this regulation which, I should add, was introduced by the previous Government in 1965 for a limited period also. While I agree that it will create a hardship, it is only right to add that it is for a period of three months. After this the situation will be reviewed. I would not be prepared to recommend that there should be exceptions to it because if there are, then there was no point making the regulation at all.
1965 and 1973 have no relevance at all. We are dealing with 1973 and my question related to 1973.
I gave a very global reply.
There is no com parison between the number of people being hit in 1973 and those who were affected in 1965.
There is no evidence at all that that is so.
(Interruptions.)
I am calling Question No. 26.
There are several Deputies wishing to ask supplementary questions and the Chair should not allow itself to be bullied by the conduct of the Minister.
The Chair would like to remind the Deputy that the Chair will not be bullied by anybody. The Chair is bullied by nobody and the Deputy should not be making reflections like that.
I have tried to attract the attention of the Chair in an orderly way and I hope the Chair does not force me to adopt another way to attract attention.
That is a threat.
The Minister, I am sure, will agree that he has stultified his own efforts to solve the housing problem by not making mortgages available for previously occupied houses. People cannot sell them in order to buy new houses. The Minister is defeating his own end unless he makes the money more fluid for previously occupied houses.
I should like to make it very clear that it is the Government's responsibility to help people who want to own their homes for the first time. Some people who are selling second-hand houses want to move on to a bigger or a more expensive house. While this may be a good idea, I do not think that the responsibility lies on the Government to make money available to them to do that. We are anxious to succeed in providing houses for those who need them and who have not got them.
Question No. 26.
Am I being allowed to ask a supplementary question?
The Deputy is well aware of the procedure to be followed in this House.
I have risen on a number of occasions to ask a supplementary question.
The Chair has called the Deputy previously for supplementaries.
I made an effort to ask a supplementary three minutes ago.
If the Deputy feels that he wants to criticise the Chair, there is a method of doing so.
I do not wish to do that at all. I wish to be allowed to ask a supplementary.
The Chair is endeavouring to conduct the business of the House to the best of its ability.
Am I not being allowed to ask a supplementary question by the Chair?
If the Deputy wishes, he may ask one but it will be the last supplementary on this question.
I got no clear indication from the Minister of what his reply was to Question No. 24. On that question he was asked to indicate when the building societies would be in a position to resume the issue of purchase loans in respect of previously occupied dwellings.
I stated that if the inflow of funds to these societies and their rate of issue of loan approvals improve sufficiently, I will be prepared to review the need for the conditions. When the announcement was made first, I said the 1st January.
Is the Minister aware that because the building societies are issuing very few, if any, loans for the purchase of new houses that there are persons who have been forced to take loans at 15 and 17 per cent and that this is a disastrous situation as far as they are concerned? These people have been forced into doing it and the situation has become extremely serious throughout the whole sphere of activities in the housing field in the past few months. The Minister has not given any indication as to what further action he intends to take to alleviate the terrible financial burden that is crushing these people into the ground.
I am not aware that people are paying 15 or 17 per cent. They must be pretty well off if they can afford to do so. I have stated on at least four occasions this afternoon that the Government are making the necessary provision to provide whatever money is needed to carry on the building programme in this country and that includes the question of making money available to those who want to borrow money at a reasonable rate of interest. I cannot make it any clearer than that.
If that is so, why are these restrictions being imposed? Why the restriction of £7,500 on secondhand houses if the Minister is going to make as much money available as is required?
For the very simple reason that if the Government have to provide the necessary money they necessarily have to ensure that that money is spent in the proper way. There is not, as Deputy O'Malley is well aware, an endless supply of money in the State coffers.
Listening to the Minister, one would think that there is an endless supply of money for housing.
Would the Minister consider making building society investments trustee stock so that unions can become involved?
As Deputy Lemass knows, the rules of a trade union do not allow them to do that.