§ Mr. WattsTo ask the Chancellor of the Exchequer whether he will review the arrangements for providing exchange risk cover for official borrowing in foreign currency; and if he will make a statement.
§ Mr. LilleyThe terms of the exchange cover scheme for official foreign currency borrowing have been reviewed in the light of this year's substantial increase in the United Kingdom's foreign currency reserves. My right hon. Friend has decided that exchange cover should continue to be provided only for official foreign currency loans of $25 million equivalent or above and that the interest rate benefit of ½ per cent. currently available to those who borrow under the scheme should now be withdrawn. The614W $25 million limit will not apply to loans associated with grants from the European Community. Certain other minor changes have also been made in the scheme. Nationalised industries, local authorities and others are being informed of the details.