Earl Alexander of Tunisasked Her Majesty's Government:
What is the value of that part of the United Kingdom's gold reserves which is to be shipped to Frankfurt in order to comply with European Union legislation.
§ The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish)The EC Treaty provides for the European Central Bank initially to manage foreign reserve assets valued up to ECU 50,000 million in aggregate. Foreign reserve assets will be provided by the national central banks of those countries which adopt the single currency. The amount provided by each of these national central banks will depend on the size of its country's population and 85WA national income. In return, each of these national central banks will have a claim on the assets of the European Central Bank in proportion to the assets which it provides. It is not possible to say at this time how much the Bank of England would need to provide if the United Kingdom were to participate. Although the European Central Bank will be located in Frankfurt, foreign reserve assets may remain in individual countries to allow more efficient use in local financial markets. The Bank of England would not need to provide any foreign reserve assets if the United Kingdom were not to adopt the single currency.