Dáil Éireann debate -
Tuesday, 2 Nov 1993

Vol. 435 No. 3

Written Answers. - Small Dwelling Acquisition House Loans.

Paul McGrath

Question:

36 Mr. McGrath asked the Minister for Finance the level of borrowings made to local authorities under the heading of small dwelling acquisition house loans by his Department; the interest rates on these loans payable to his Department; if these interest rates are fixed; if his Department has now renegotiated these loans on the financial markets; if so, the saving, if any, that has been made as a result of these renegotiations; and when he will pass on these savings to the local authorities and to the mortgage holders.

Minister for Finance (Mr. B. Ahern)

The amount outstanding to the Exchequer from local authorities at 31 December 1992 on foot of loan advances to them from the Local Loans Fund for the purposes of house purchase loans was £586.109 million. Almost all of these loans were advanced prior to 1 July 1986 and since then such financing has been mainly provided through the Housing Finance Agency plc.

Fixed rates of interest ranging from 5.5 per cent to 12 per cent related to the cost of long term borrowing at the time the loans were advanced, applied to the loans made by the Local Loans Fund. These rates remain at their fixed level whether interest rates rise or fall.

The loans in question were financed out of General Exchequer borrowing and the question of renegotiation of specific loans in this context does not arise.