§ Mr. Matthew TaylorTo ask the Chancellor of the Exchequer, pursuant to his answers of 19 January 2000,Official Report, column 516W, on Government debt over the 1975 to 1999 period, what the estimated interest cost of the difference between nominal and gross debt values is; what measures have been undertaken to ensure this will not occur again; and which officials responsible for the debt funding decisions have been disciplined in connection with this matter. [113468]
§ Miss Melanie JohnsonThe answer of 19 January 2000,Official Report, column 516W, on Government debt gave figures for central Government gross debt at (a) nominal and (b) market prices. These are two different valuations of the same debt and so the interest on them would always be the same. The reason for this is that the market values the debt, some of which may have been issued when market conditions for interest rates were different, to reflect current yields. Thus actual interest divided by debt at market valuation is in line with current rates of interest, whereas actual interest divided by nominal debt reflects the mix of historic market conditions when the debt was issued.