My hon. friend is quite right. The purpose of 3 (1) (b) is this. Where loans are secured on consumer goods which are purchased at retail by an individual 3 (1) (b) creates the presumption that the loan has been taken for the purpose of purchasing the goods; and as was done during the war, the regulations will provide that the provisions of the act will not apply to a loan made foy a borrower. I am reading from the old order. "The provisions of this bill"-that was the wartime order-"shall not apply to a loan made to a borrower who signs a statement that the proceeds of the loan are not intended to be used and will not be used in whole or in part toward the purchase of goods, or to replace money used for the purchase of goods, and no person shall make a false statement to this effect." If consumer goods are purchased by a borrower at retail and1 are then used as security for a loan a presumption is created as a result of this section that the loan has 'been obtained for the purpose of making the purchase in whole or in part; unless the borrower takes an affidavit, makes a declaration to the lender, that that is not the case, that the loan is not for the purpose of purchasing the goods
and that was followed all during the war. In the personal loan department of banks the borrowers were required to make a declaration that the loans which they were making were not for the purpose of purchasing goods on terms contrary to the provisions of the consumer credit order. Admittedly there would be opportunities for evasion in that case, and a hundred per cent enforcement would not toe possible. But proceeding on the presumption that I believe to be the case, namely, that the vast majority of people are honest, and will not make false declarations, I am told that the operation and enforcement were reasonably satisfactory.
Then paragraph (c) of course relates directly to a loan, the proceeds of which are used to pay for consumer goods purchased
by the borrower at retail. It is clear in its terms, and the point which my hon. friend has quite properly raised is, what is the distinction between (to) and (c)? And that is what I have endeavoured to explain.
I have an amendment to this section which I shall have to ask one of my colleagues to move. In drafting it and attempting to make it restrictive we referred to the repayment of loans, but did not indicate that the restriction should apply as well to the loan itself, and therefore my amendment would add as the concluding words of 3 (1):
And with respect to the amount of loans referred to in paragraphs (b) and (c).