§ Mr. HoodTo ask the Chancellor of the Exchequer what the outcome was of the ECOFIN Council held on 20 January; what the Government's stance was on the issues discussed, including its voting record; and if he will make a statement. [150137]
§ Mr. Gordon BrownI attended ECOFIN on 20 January.
The Irish Presidency presented its work programme. The focus of the first three months would be on the Lisbon economic reform agenda and enlargement for the final three months. I stressed the importance of the Lisbon Agenda, the need for ECOFIN Ministers to be fully engaged in the forthcoming debate on future financing of the EU and the importance of re-invigorating the EU/US economic relationship.
The Council agreed opinions on the updated Stability and Convergence programmes for Denmark, Austria, Finland and Sweden.
The Council discussed the Report of the Employment Task Force (Kok Report) on the basis of a note prepared by the Economic Policy Committee. The report set out that the EU was likely to miss the 2005 and 2010 Lisbon employment targets without immediate implementation of labour market reforms. I welcomed the report and its recommendations and stressed the onus was now on member states to demonstrate the political will to reform. The Presidency agreed concluding that follow-up to the Kok report was a priority for the spring Council.
Following a French request, the Council again briefly discussed VAT reduced rates. There was no consensus and the Presidency concluded that the item would return to a future ECOFIN. The Council also discussed a French paper on raising minimum rates on tobacco tax. The Commission and Presidency agreed there was little prospect of agreeing further harmonisation of rates.
The Commission reported to the Council on discussions with the International Accounting Standards Board (IASB) on proposed revisions to International Accounting Standards 32 and 39, relating to accounting for financial instruments. The Presidency welcomed the setting up of a High Level Group under IASB chairmanship to help find agreement on the outstanding issues.
The location of the three Lamfalussy Committees of banking, insurance and securities supervisors was agreed at lunch. The Banking Committee will be located in London, the Insurance Committee in Frankfurt and the Securities Committee will remain in Paris.
No votes were taken at the meeting.
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§ Mr. ViggersTo ask the Chancellor of the Exchequer how much has been received from the sale of gold since 7 May 1999; how the receipts have been reinvested; and what the current market value of those reinvestments is. [152144]
§ Ruth KellyThe proceeds from the sale of part of the United Kingdom's gold holdings between 6 July 1999 and 6 March 2002 totalled approximately $3.5 billion. These proceeds were invested in interest-bearing foreign currency assets in broadly the same proportion as currently held in the net foreign currency reserves (40 per cent. dollars; 40 per cent. euros; 20 per cent. yen). The gold sales reduced risk by around 30 per cent. (as measured by value-at-risk) and are not expected to deliver a loss in return when measured over the medium to long-term, the appropriate time horizon for such a decision.
The United Kingdom has been at the forefront internationally in promoting openness and transparency in reserves data. Details, including currency composition, are available from the Bank of England's website: www.bankofenqland.co.uk. The investment policy for the reserves is also outlined in the Exchange Equalisation Account Financial Accounts, most recently published on 1 December 2003 for financial year 2002–03. We do not provide market-sensitive information, however, about individual assets within the reserves portfolio.