§ 7.33 p.m.
The Minister of State, Northern Ireland Office (The Earl of Gowrie)
My Lords, I beg to move that the Draft Financial Provisions (Northern Ireland) Order 1982 be approved. This is the latest in a series of such orders which have been presented at intervals of approximately two years to deal with miscellaneous matters of a financial nature. The last order in the series was the Financial Provisions (Northern Ireland) Order 1980. The main purpose of these orders is to increase as necessary limits imposed by Northern 763 Ireland legislation on certain financial transactions and to deal with other fairly routine matters with a financial content. The orders do not deal with appropriation of resources for public services. I shall deal briefly with the substance of the main Articles.
Article 3 deals with two items in respect of which statutorily limited issues may be made from the Northern Ireland Consolidated Fund. The first item relates to issues made to the Agricultural Loans Fund for on-lending to farmers. The present limit is £18 million and it is proposed to increase it to £20 million. The Agricultural Loans Fund is being phased out and the new limit should be sufficient to meet commitments until it is finally abolished. The second item relates to issues made for capital expenditure by the Northern Ireland Housing Executive. The present limit of £950 million is to be increased to £1,300 million to accommodate estimated expenditure until about March 1985.
Article 4 deals with another statutory limit and proposes an increase from £15 million to £25 million in the aggregate amount of loans and grants which may be made to harbour authorities by the Departments of Economic Development and Agriculture for harbour works. The present limit is exhausted and the new limit should cover expenditure until March 1985. Article 5 again deals with a statutory limit, in this case imposed on the aggregate amount of principal which may be guaranteed by the Department of Finance and Personnel in respect of borrowing by health and social services boards for the purpose of making loans to general medical practitioners for the provision of practice premises. The present limit of £600,000 was set in 1967 and the proposed new limit is £1,200,000.
Article 6 has the effect of abolishing the Capital Purposes Fund. This fund has outlived its usefulness. It was devised in 1950 to enable money voted for capital expenditure to be carried forward from one fiscal year to another at a time when it was particularly difficult to forecast expenditure because of such factors as shortages of building supplies. Articles 7 to 15 provide for certain loans to be made from the Northern Ireland Consolidated Fund. The loans, which are described in Schedule 1, are currently made from the Government Loans Fund and these articles re-enact those provisions of the Government Loans Act (Northern Ireland) 1957 necessary to enable the lending functions to transfer to the Consolidated Fund. The 1957 Act is repealed by Schedule 4.
Article 16 provides for the prolongation of the term of an issue of Ulster savings certificates to be achieved by means of direction of the Department of Finance and Personnel. Currently changes of this nature have to be made by means of subordinate legislation. The new provision will bring Northern Ireland practice into line with that operating in Great Britain (to whose analogous issues the Ulster savings certificate issues are tied) and will significantly alleviate administrative inconvenience in the responsible department. I would remind the House that throughout all this we are not voting any new funds, and I commend this order to the House.
Moved, That the draft order laid before the House 764 on 14th December be approved—(The Earl of Gowrie.)
§ Lord Underhill
My Lords, I thank the Minister for explaining this order, and in general we give it our support and approval. I believe the noble Earl said that the Agricultural Loans Fund was to be phased out. I must confess that I had not ascertained that from the order. Perhaps he would explain where it is mentioned in the order. The provisons for agriculture, harbours, health and personnel purposes are welcomed as is that for the Housing Executive. May I ask the noble Earl whether the increase, which I gather from him will carry through requirements until March 1985, reflect just possible inflation price increases or will it represent increased activity? Will it help to relieve the housing problems in Northern Ireland, bearing in mind that from figures which I saw the other day I understand that in the construction industry in Northern Ireland there are as many unemployed as there are in employment; and there are many problems to be relieved.
The other question I would ask as to the abolition of the Capital Purchase Fund, which seems a commonsense procedure, is this. In the conditions laid down in Part III and Schedule 1 regarding the Government Loans Fund—and to check this would require a lot of research on other orders—are there any notable changes to which the noble Earl should draw our attention; or are the changes in conformity with what has happened previously? The change in the Ulster savings certificates again seems a very reasonable provision.
§ 7.39 p.m.
§ Lord Blease
My Lords, I should like to indicate first my support for the remarks of my noble friend on the Front Bench. The part of the order to which I wish to draw attention and which concerns me is Article 16 which deals with Ulster savings certificates. Whatever may be the arguments for or against Ulster savings certificates as being an obsolete or expensive way for Governments to undertake borrowing, I believe that the Ulster savings certificates have the support of the Northern Ireland people. Since they were first introduced some 60 years ago the Ulster savings certificates have provided an easy, useful and attractive method for savings by Northern Ireland people of limited means. I understand that there are some 140,000 registered certificate holders who have currently about £350 million invested in Ulster savings certificates.
I am convinced that there are considerable amounts still to be attracted to the Ulster savings certificate form of investment. As we know, there is at present great and vigorous competition for this personal-savings type of finance, from trustee savings banks, the Post Office, national savings, building societies and other areas.
However, what I should like to see is a more aggressive marketing of Ulster savings certificates in Northern Ireland, coupled with much more easily and readily available up-to-date information, particularly about the interest earning potential of the earlier issues of the Ulster savings certificates. I think that the current issue is the 25th one. Details about the 765 earnings potential adds considerable attraction to the present issues, especially if there is confidence and information readily available about past issues. I should be grateful to the noble Earl if he would kindly undertake to examine this point. I have not given notice of it and I do not expect a reply this evening.
The Earl of Gowrie
My Lords, I am grateful to both noble Lords on the Benches opposite. I share the enthusiasm of the noble Lord, Lord Blease, for the work regarding Ulster savings certificates. I have been to see the people concerned on site and I have addressed them in the course of my duties in Northern Ireland. The point that he made is not strictly appropriate to this order. However, I shall have a look at the general point that he made.
May I say to the noble Lord, Lord Underhill, that this is not simply a matter of making adjustments in the light of inflation or in the light of need. This is a mechanism in respect of moving money about, if I may put it that way. Any new monies determined by inflation or need would have to he voted accordingly. Articles in this draft order which fix financial limits simply enable issues to be made from the Northern Ireland Consolidated Fund for the services concerned. It enables you to get the money out, so to speak.
Nothing I have said tonight or which I am seeking to move in your Lordships' House prescribes the amounts which are allocated to any of these concerns in any given financial year. For instance, the noble Lord, Lord Underhill, asked me about the Housing Executive. What happens is that this Housing Executive borrows from the Consolidated Fund to finance its capital expenditure on new building, rehabilitation, improvement, land acquisition, home loans, office accommodation and the like. The revised borrowing limit has been framed having regard to the agreed physical programme and approved resource allocations. That approval is sought separately.
On the question of the Agricultural Loans Fund, to which the noble Lord, Lord Underhill, referred, he may be aware that in recent years there has been a significant reduction in the level of demand for loans and, following consultation with representatives of farming interests in the Province, it was decided that the lending facilities should be terminated. No loan applications have been accepted since November 1979. Therefore the Agricultural Loans Fund is being phased out in any case. It is not being phased out by this order which is why the noble Lord could not find it, but this order makes consequential changes. I commend the order to the House.
§ On Question, Motion agreed to.