§ Mr. Austin Mitchellasked the Chancellor of the Exchequer what are the arrangements for financing the exchange equalisation fund; and what rate of interest is paid on the funds put at its disposal.
§ Mr. Ian StewartUnder section 2 of the Exchange Equalisation Account Act 1979, the EEA is issued with funds by the national loans fund. The EEA's holding of sterling forms part of the balances held by the Paymaster General at the Bank of England. These balances are lent back to the NLF each night and help to reduce Government borrowing. No interest is paid either on advances to the EEA or on balances held by the PMG.