Mr. Stephen Rance:

We are talking about an increased stimulus through mortgage insurance. The problem we have seen in the past is that the regulator does not necessarily have the subtle tools needed to manage the intricacies of the housing market or lender decisions. When a market starts to heat up, lenders get more competitive and that stokes the market. By giving the regulator control of a national consortium-based mortgage insurance scheme, the regulator can then influence the insurers' decisions. If the insurers will not insure the loans, then the lenders will not be able to cause the market to overheat. That is the sort of experience we have seen in Canada, I believe, where the worst excesses of lending at the height of the market were controlled through the availability of insurance and through more subtle measures. We do not start to talk about basic LTV ratio caps or basic house price caps. We look more into the intricacies of what stimulates lending and overheats the market.