§ 5. Mr. Leachasked the Minister of Labour what is the total amount of interest charged to the Unemployment Insurance Fund on debt accounts and the total amount earned on surplus account; the respective percentage rates of each to the nearest date ascertainable; and whether he will consider calculating both at the same interest rate throughout in fairness to the Fund?
§ 22. Mr. Thorneasked the Minister of Labour how much is the amount of the reserve of the Unemployment Fund which is receiving interest at about is per cent.; how much of the quarterly debt payment is interest; and what is the present debt of the Fund?
§ Mr. E. BrownAt the present time the charge on the General Account of the Unemployment Fund in respect of interest on the debt, which now stands at £103,000,000, is at the rate of about 3i per cent., equivalent to an annual charge of £3,250,000; the remaining part of the annual debt charge of £5.000,000 a year is in respect of repayment of principal. The present yield from investments is at the rate of less than 2 per cent. equivalent to about £1000,000 per annum on the balance of £59,000,000. In regard to the difference between the rates of interest, I would remind the hon. Member that the debt is funded for a long term, whereas under the existing law the Fund's balances are necessarily invested in short-dated securities, which bear a lower rate of interest. The hon. Member will be aware that certain proposals in this connection are included in the Unemployment Insurance Bill now before the House.
§ Mr. LeachMay I ask the Minister to reply to the latter portion of my question with regard to the suggestion that the rate of interest should be equalised; otherwise would he not agree that the arrangements are grossly unfair to insured persons?
§ Mr. BrownThe hon. Member will find that I answered that part of his question. The Bill is for the purpose of doing that very thing. I shall be introducing it later, so perhaps we had better postpone our discussion until after 4 o'clock.