Dáil Éireann debate -
Wednesday, 26 May 1999

Vol. 505 No. 4

Written Answers. - Loan Sanction.

Michael Noonan

Question:

37 Mr. Noonan asked the Minister for Finance if a loan raised by the Department of Health in 1981 to fund Beaumont Hospital was sanctioned by his Department; the reason tenders were not sought from financial institutions other than AIB in respect of this loan; and if he will make a statement on the matter. [13822/99]

Minister for Finance (Mr. McCreevy)

The loan was raised as a contribution towards the then Government's target, announced in the budget of January 1981, to have private sources fund the public capital programme to the extent of £200 million.

The loan in question was at AAA rate and was raised in 1981 by the Beaumont Hospital Board, and not the Department of Health. The board was a body established under the Health (Corporate Bodies) Act, 1961 and it required the consent of the Minister for Health, but not that of the Minister for Finance, to borrow.

The Department of Health approached the Department of Finance for two reasons: to seek agreement to the loan, as being in line with the budget announcement, and to ensure there was no problem with the credit limits imposed on the banks by the Central Bank at that time. Agree ment to the proposed loan was conveyed in a letter of 18 February 1981.