§ Mr. Colvinasked the Chancellor of the Exchequer what is the current Public Works Loan Board rate of interest; and how this is fixed in relation to base rate.
§ Mr. Ian StewartThe Public Works Loan Board lends at both fixed and variable rates of interest. The rate depends on the type of loan and on the method and period of repayment. Rates are not fixed in relation to commercial banks' base rates. Fixed rates are derived from current yields on gilt-edged stock and are published regularly in the London and EdinburghGazettes. Variable rates are set at a small margin, which is currently ⅛ per cent. above eligible bill rates in the case of loans with one or three-month interest periods, and above the lower of eligible bill rates or six-month LIBOR in the case of loans with six-month interest periods. The rates prevailing on any particular day are available to borrowers on application to the board.