If the society is of the view that the requirement to maintain 75 per cent. of its assets in mortgage lending is unduly inhibiting on its activities, it will have another reason for converting, if it wishes to do so. It is for the society to decide whether that is a condition under which it can operate, in which case it should remain a building society, or whether the condition is unduly onerous, in which case it can break free from the building societies legislation and operate under the Banking Act 1987.

I do not see why, in the course of the building society making that transition, special provisions should be made to compensate for what in other respects might be regarded as an unsound judgment on its part. Building societies must decide under which legislation they wish to operate.

I see no justification for special transitional arrangements, for the further reason that the potential loss of immunity from takeover is a matter over which the societies have control. The provisions of the Bill do not stop one of the newly converting societies going on the takeover trail. It may still do so. Building societies are in no way inhibited from expanding their position by acquisition if they want to do it that way. They would do it in the full knowledge that if they chose to take that route, they would trigger the loss of the immunity. The decision is entirely theirs to live with the consequences of their action. That is why I do not believe that transitional arrangements are necessary. The decision is part of an overall judgment as to whether plc status suits a business. If plc status does not suit it, it should not leave the legislative framework applicable to building societies.

I have the greatest difficulty in understanding the argument of the hon. Member for Normanton (Mr. O'Brien), who tried to argue that the amendment provided protection for existing mutuals. Exactly the opposite is the case. It does not provide protection for existing mutuals at all. If the hon. Gentleman contributes again to the debate, perhaps he will explain his views.

There seem to be some drafting defects in the amendments, which the Building Societies Association has clearly identified, particularly in relation to the question of when a mutual financial institution encompasses a company and when it does not. Even if one embraced the principle, which I hope the Committee will not, the amendments would have to be redrafted.