§ (1) It shall be the duty of the Trust to obtain advice on the investment of any property held by them under this Act from a person whom the Trust reasonably believe to be qualified to give such advice by his ability in and practical experience of financial matters.
§ (2) For the purposes of the foregoing subsection, the advice referred to therein may be obtained from a person other than an officer or servant of the Trust on such terms as may be agreed between the Trust and that person.—[Mr. Edward Taylor.]
§ Brought up, and read the First time.
§ 11.0 p.m.
The Under-Secretary of State for Health and Education, Scottish Office (Mr. Edward Taylor)I beg to move, That the Clause be read a Second time.
This is one of several new Clauses and Amendments which we are proposing following the helpful suggestions made by hon. Members opposite in Committee. The Clause deals with an important matter which was raised by the right hon. Member for Kilmarnock (Mr. Ross). In Committee—it is columns 207–8 of the OFFICIAL REPORT—I promised to look again at the provisions in paragraph 3 of the Schedule relating to the appointment of agents to advise the Trust on investments. We thought that it might be desirable to be a little more specific, and I have, on reflection, come to the conclusion that the best way to proceed would be to insert this new Clause and delete the corresponding paragraph in the Schedule.
The Clause makes it obligatory for the Trust to obtain advice on investment from an expert in these matters. It leaves it open to the Trust to decide whether this person should be employed as an officer or servant of the Trust—who, in practice, would be the secretary—or be an adviser who would be specially appointed on terms to be agreed. If he is 1222 an officer of the Trust, his terms of appointment will be covered by regulations made under Clause 7(2)(c).
The arrangements we now propose are consistent with the recommendation of the Working Party that the Trust should be required to employ as investment manager and secretary an individual or firm skilled in the management of investment money. The only difference is that we are allowing the Trust to employ the expert without necessarily making him its secretary. We think that the Trust, which will comprise members with financial skills, should be allowed to judge which of these alternatives will suit its arrangements better.
§ Mr. Neil Carmichael (Glasgow, Woodside)I thank the Under-Secretary of State for taking note of the points which we raised in Committee. I am sure that he will agree that it is evident from the Amendments and new Clauses which he has put down that, although our proceedings went on longer than he might have wished, our labours in Standing Committee were not in vain.
The new Clause is the tidiest and best way of meeting the point which we raised in this connection, and I should advise my right hon. and hon. Friends to accept it.
§ Question put and agreed to.
§ Clause read a Second time and added to the Bill.