asked the Minister for Education if his Department have informed vocational education committees that they should borrow privately to meet their essential requirements until the next budget.
Ceisteanna—Questions. Oral Answers. - Vocational Committees Borrowing.
82.
Mr. R. Burke
My Department have not so informed vocational education committees.
The Deputy may, however, have in mind the established practice whereby committees may raise finance by way of temporary short-term loans. In accordance with normal procedure some committees have been so authorised in respect of the period ending 31st December, 1974, where the circumstances warrant such action.
My information is that committees were asked to borrow privately.
Mr. R. Burke
Not privately.
The committees themselves?
Mr. R. Burke
They are empowered under the Vocational Act, 1930, to borrow by means of over-draft from the banks or otherwise for general purposes or by means of long-term loans for capital work.
I take it that no committee were asked to borrow privately?
Mr. R. Burke
Not privately in the sense that they would be doing so——
Does the Minister know what I mean by "privately"?
Mr. R. Burke
Yes, if they are doing it under the section——
They might get it in their own name. This is what I mean. I take it from the Minister's answer that no such direction was given to any committee. I accept his word, but it seems a contradiction of my information.
Mr. R. Burke
The Deputy may be seeking clarification of established practice whereby pending receipt of a long-term loan the committee may be seeking bridging finance for their treasurer to defray urgent or unforeseen expenditure on capital undertakings.
My information is that bridging loans were guaranteed by the Department and no private borrowing was ever asked of committees. I may be wrong; I accept the Minister's word that no vocational education committee was authorised to borrow privately.
Mr. R. Burke
In most cases they look to the Local Loans Fund to finance capital undertaking. What tends to happen towards the end of the financial year is that applications for loan instalments exceed the amount which the local loans office may be authorised to pay in a particular time. It is usual in these circumstances to authorise certain committees, those with substantial building works in progress or needing deposits for private purchases, to raise with their treasurers short-term or bridging finance to meet their commitments. Bridging finance may also be necessary to enable committees to undertake unforeseen emergency capital works or to meet price increases on building projects for which specific provision may not have been made in the financial programme for a particular year. This must be done under section 49 or section 50 of the Act.
Will the Minister agree that that was private borrowing?
Mr. R. Burke
I do not agree that it is private borrowing.
It is departing from general practice.
Mr. R. Burke
It is not. This has been the practice over the years.