CLAUSE 43. (Hansard, 20 May 1898)

§ MR. VESEY KNOX
I should very much like to know whether it would not be possible in some way to make a few provisions with regard to the nature of the securities in which these funds should be invested. Of course, I do not suppose that honourable Gentlemen are going to take a very wide power, and an investment clause would be a very long thing; but I quite conceive that the Treasury may require to invest this money in some other securities than Government stock. I know that while there are a great many ways of getting money into the Treasury, there are a very great many methods by which the Treasury can hang it up without its producing very much interest. I also know that where they desire to make a good show they can invest it in such a manner that it will produce a great amount of interest. For instance, supposing the Government desire to make a good show, they proceed to invest the money in Irish securities, bearing considerable interest; or if they do not—it is absolutely in their own power—they can put it for investment in special funds which can never under any circumstances depreciate in value, and where, in consequence the interest is correspondingly low. There was a sum of under £200,000 under the Irish Lands Act. When that £200,000 commenced to accumulate Consols were at £94, and if that money had been invested in Consols with the compound interest it would be 30 per cent. more value than it is in these seven or eight years. I venture to hazard a guess—I have never been able to find out what it was invested in—but I venture to hazard a guess that that money was invested in stocks that never depreciate, and consequently the interest is small. Upon the other hand, where stocks rise and fall, like the local loan stocks, it is 172 always pointed out as a reason that they cannot pay off except at an enormous premium. Therefore I think that specific instructions should be given in the laying down the way in which these moneys should be invested. I cannot myself conceive why there should not be specific instructions put into the Act as to the investment of these funds. The terms ought to be dictated by the Act itself. Invest them in the public funds of the United Kingdom, and then if there is a rise we shall get the benefit of it. But if it is left in the hands of the Treasury we do not know what becomes of the money.

§ MR. GERALD BALFOUR
We should invest these moneys in Government securities, which is exactly what this Amendment is moved to do; but what the honourable Gentleman wants is that a clause shall be so worded that we can only invest them in certain securities. Really, Sir, I think that might be left to our discretion. Honourable Gentlemen opposite must not always suppose that the Treasury is plotting for their destruction.

§ MR. VESEY KNOX
May I ask what the £200,000 is invested in? That will illustrate whether we can trust the Treasury. There are many things in which it can be invested which do not give the same advantages as Government funds. There are several works which are constantly creating special stocks, and those stocks are constantly being depreciated in value.

§ MR. GERALD BALFOUR
It is obviously impossible to say at the moment.

§ * MR. DILLON
I do not know whether the Amendment I have put down here is necessary or not, but if it be, no doubt, the Government will accept it.

§ MR. GERALD BALFOUR
I will accept the honourable Member's Amendment slightly corrected. It is obvious that you cannot lay the accounts upon the Table of the House, you can only lay the audit of the same.