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Dáil Éireann debate -
Wednesday, 11 Nov 1931

Vol. 40 No. 10

Ceisteanna.—Questions. Oral Answers. - Convertible Government Securities.

asked the Minister for Finance to state (a) the amount in dollars due to holders of Free State Government securities; (b) the amount of Free State Government securities issued in sterling but convertible to dollars; (c) to give an estimate of the extra cost of such loans by way of interest and sinking fund due to the fall in the value of sterling; (d) what provisions the Minister will make to meet the State's extra liability if the value of sterling drops further or if sterling should be stabilised at a value below par.

The Second National Loan is the only Saorstát security the stock of which is convertible into dollar bonds. On the 1st November, 1931, the amount of dollar bonds of this loan outstanding was $2,623,000 and the amount of stock was £6,186,123. Owing to the various uncertain factors that would enter into the calculation, I am unable to make any estimate of the increased cost (if any) that will be incurred at the next and subsequent dividend dates on account of the fall in the value of the Saorstát pound. The full charge for National Debt services falls upon the Central Fund and no question of special provision arises.

The Minister is, of course, aware that interest became due on the bonds on 1st November, and surely his Department had it brought to his notice that the increase had to be provided for, and they would also have brought to his notice what this loss was to the State in the way of interest and sinking fund as against what the cost was supposed to be when the loan was floated. Is the Minister not going to take an opportunity of looking into the matter and intimating to the Dáil how the country stands with regard to it?

I have nothing further to say.

Does the Minister mean to say that he is prepared to allow things to go on as they are, and if it turns out that that particular loan is going to cost the State 20 per cent., he is going to do nothing to avert the extra cost?

He is afraid to face up to it.

There is nothing more to say.

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