asked the Minister for Finance if it is intended to reduce the bank rate; and, if so, by how much.
Ceisteanna—Questions. Oral Answers. - Bank Rate.
10.
If the Deputy is referring to the rediscount rate of the Central Bank, I can give no advance information about any pending change. The rate is normally fixed at monthly intervals by reference to the arrangements relating to public issues of Exchequer Bills. If the question relates to the rates of interest paid on deposits and charged for loans by the commercial banks, I would refer the Deputy to the press announcement by the Irish Banks' Standing Committee on 11th June, 1965.
Would the Minister not agree that the commercial banks are maintaining the high rate of interest because they have not the money available to them due to the fact that the Government have absorbed all the credit the banks can place at the disposal of the country, to the detriment of private enterprise?
The truth of the matter is, as I have already stated in my Budget speech and on other occasions, the banks have been lending at a greater rate than resources permitted. In other words, they are not getting deposits to the same extent as they have been lending.
The reason they are lending to a greater extent is that the Government are taking more money out of the banks and there is nothing left for anybody else.
The Opposition are always urging the Government to spend more money.
No, we are not. The position is that the Government are spending money which is not to the real advantage of the country and are preventing private individuals from getting credit, causing tremendous hardship to small businessmen, farmers and to the community as a whole. That is the problem.