Dáil Éireann debate -
Wednesday, 25 Oct 1967

Vol. 230 No. 10

National Loan 1987-1992. - Statement by Minister for Finance.

Minister for Finance (Mr. Haughey)

A new National Loan will open for subscription on Monday next, 30th October. The loan will be for £25 million but £5.3 million of the stock is being allotted to certain life assurance offices and other financial houses in respect of firm pre-issue applications and an application for £5 million is being made on behalf of funds under my control. The balance of £14.7 million will be available for public subscription and has been underwritten jointly by the associated banks and the Government. In the event that applications in excess of £14.7 million are received from the public, the allocation to departmental funds will be scaled down.

The rate of interest will be 7 per cent per annum and the price £98½ per cent. The stock will be redeemed at par not later than 1992 and may be redeemed at any time from July, 1987. The yield to final redemption is £7 2s 7d per cent.

Stock of the issue will carry the usual income tax and death duty concessions. These are: it will be accepted at its nominal value as the equivalent of cash in satisfaction of death duties on estates of which it forms a part; interest will be paid without deduction of income tax at source though, of course, holders ordinarily resident in the State will be liable for whatever tax on the interest is appropriate to their respective incomes. The stock and the interest on it will be exempt from all Irish taxation, present and future, if owned by a person neither domiciled nor ordinarily resident in the State.

Holders of 6 per cent National Loan, 1967, which is due for repayment in cash on 15th December next, will be given an option before that date to convert their holdings into stock of the present loan at a price which will be announced and an additional amount of the loan will be issued for this purpose.

The issue is being made under the authority of the Central Fund (Permanent Provisions) Act, 1965, and other statutes. Both principal and interest will be a charge on the central fund. The attractive return on the stock, the tax privileges attaching to it, and its status as a trustee security make this loan an excellent investment.

The proceeds of the issue will be used for the financing of State capital outlay on agriculture and industry, on housing, sanitary services, schools, afforestation, telephones, fuel resources, transport and other schemes of national development.

The prospectus will be published in tomorrow morning's newspapers and copies, with application forms attached, can be obtained from any bank, stockbroker, post office or trustee savings bank.

I feel confident that every Deputy will support the issue.

Mr. Cosgrave

In giving the customary benediction to this loan, I think it right to emphasise that national development can be maintained and continued only if adequate capital is available for schemes such as were referred to in the speech of the Minister. For productive purposes of an economic nature and for social or other essential or desirable projects, capital must be made available, irrespective of Party views on the manner in which the State is administered or on the priorities decided upon from time to time. It is essential, if work of a national character, financed by national loans and financed by State subvention, is to continue, that adequate finances be made available. It is necessary, however, to express the view that we hope the greatest possible care will be taken to ensure that this money is devoted to productive purposes, productive in the economic sense or productive in a wider social context of desirable, objective such as housing, education, and so on.

There has been a great deal of talk about housing. If there were somewhat less talk and more action, it might be possible to speed up the urgent national work of providing houses in the urban as well as in the rural areas. It is a matter of national concern that it should clearly be understood that, in national expenditure—whether it be of a capital or a current kind—the greatest care must be taken to avoid waste or any expenditure that is not entirely justified by the projects to which it is devoted.

The terms of this national loan are particularly attractive and should commend themselves not merely to the larger investors but also to the small individual investor. In that connection, I think the question of the return, particularly in the case of smaller investors, from former loans must at some time require consideration by the Government and by the House. This loan is particularly attractive. It is designed to enable the national development programme to continue and, as such, must commend itself not only to Deputies but to the public for generous and willing support.

Mr. S. Dunne

We, on these Labour benches, realise that a national loan has traditionally, and quite correctly, never been a matter of Party controversy and we heartily commend this loan and its terms to investors everywhere. We are vitally concerned with the uses to which these funds will be put and, in particular, we may mention the matter of housing. We are, as we know, in a situation which requires a maximum effort by everybody to solve the very pressing housing problem which extends to every town and village and rural area throughout the State. Similarly, in agriculture, industry, in matters such as sanitary services, the provision of schools, afforestation, telephones, fuel resources, transport and so on, which have been mentioned by the Minister, it is essential that money should be made available for these requirements.

We will dispute, and we will always reserve our right to dispute, the method of tackling these problems, but there can be no question about the desirability of having the capital available to the Government's hand to do what it is necessary to do to solve these problems. In the light of that fact, and in the light of the tradition which has long existed in this House, full support should be given to Government effort of this kind to raise funds, and we of the Labour Party urge the loan on the people in the strongest possible terms.