I move amendment No. 12:—
In page 5, Section 7 (g), in line 56, to delete the words "and issued not less than one year" and substitute the words "which have been offered for public subscription or tender", and in line 57, after the word "bank" to insert the words "and are officially quoted on the Dublin Stock Exchange and the Cork Stock Exchange".
Deputy Mulcahy will remember that, I think, he and Deputy Cogan had amendments down on the Committee Stage to remove the limitation of two years that was originally proposed and which was amended later, on the Committee Stage, to one year. A number of Deputies again urged that there should be no limitation put on the power of the bank to purchase these securities. It was pointed out that the bank would have power to purchase securities of any Government other than the Irish Government without limitation of this kind and that we were showing very little confidence in ourselves in putting this restriction on the board of the central bank in regard to our own securities. After considerable consideration and investigation, I decided to go the length set out in this amendment to meet the criticisms that were put up on the Committee Stage. Now the only limitation will be that these securities should be officially quoted on the Dublin and Cork Stock Exchanges. It would mean that there would have to be no doubt as to the genuineness of the securities that were offered. We do not want to have an opportunity for too ready access by the Government to the central bank for loans. The central bank is not intended to exist to finance the Government by buying its securities. We are anxious to secure that when securities of the Government are purchased by the bank it shall be done when the loan in the ordinary way has been floated, taken up by the public, the savings of the people brought to operate, and that the loan should be accepted and officially quoted. There will be a safeguard in that way that the Government will not be free to go to the central bank in any panic way in time of great emergency and float a loan freely with the central bank without the public being called in, as it were, to bear testimony to the reliability of the security offered by the Government, by having a loan floated in the normal way, taken up by the people and, possibly, by the banks and then quoted on the stock exchange.
There is a certain safeguard in the condition that these loans should be quoted on the stock exchanges because the stock exchanges, according to their rules—of course their rules are changeable—do not quote loans of this kind, as I understand, unless at least two-thirds of these loans have been taken up in the ordinary way by the public. There is that safeguard that, I think, it is wise to insert so that people might not be able to charge the Government or the central bank with issuing a loan, the Government going to the bank and getting money printed right off to meet an emergency that might arise or to meet some political crisis that might arise, the central bank being able to get the Government of the day, maybe under pressure, out of an awkward financial difficulty. That safeguard, I think, is a wise one. It is not an extreme one. It is not one that will hamper unduly any Government or, certainly, any bank. It is a wise condition that will enable the Government to get money in the normal way, but which will not enable it to go to the central bank in times of panic for loans that have not been proffered to the public and taken up in the ordinary course of business.
