Mr. Gouldasked the Chancellor of the Exchequer what was the costs to the taxpayer in 1982 of selling long-dated gilts through overfunding and then buying short; and what purpose is served by this practice.
§ Mr. Moore[pursuant to his reply, 18 July, 1983, c. 66]: The reasons for selling large amounts of public sector debt to the United Kingdom non-bank private sector, and the consequential money market operations, were discussed in the "Bank of England Quarterly Bulletin," June 1982 edition, page 201. It is not possible to quantify the cost/profit to the taxpayer of a particular combination of long-dated gilts sales and purchases of short-dated paper, relative to some other combination, as long and short-term interest rates are affected by the combination chosen to an unquantifiable extent.