The purpose of this Bill is to provide for the setting up of a committee which will prepare for the Minister for Finance a list of investments in which Government moneys under the control of the Minister may be properly invested. It will be seen from Section 1 of the Bill that the expressions "Government fund" and "Government money" mean respectively a fund and money which is under the control of a Minister who is head of a Department of State and may lawfully invest it, but do not include the sinking fund in connection with any National Loan nor the Costs Fund established by the Section 5 of the Land Act of 1923 nor moneys for the time being standing to the credit of the Exchequer Account. The effect of that is that it is only Government moneys in respect to which some power of investment already exists that will come within the ambit of this measure. It is in order to provide for this and to restrict the powers under the Bill in this way that the definition of the terms "Government fund" and "Government money" which appear in the Bill has been decided upon. I do not think it will be necessary for me to point out to the Seanad why it has been considered necessary to exclude sinking funds because in the respective prospectuses relating to them the provision for the investment of these funds and the holding of these funds was clearly set out. The same principle relates to the Costs Fund, the Land Bond Fund and the moneys which are standing to the credit of the Exchequer Account. I do not know whether any further explanation is necessary in regard to Section 1 of the Act.
Section 2 provides for the establishment of the committee, and prescribes the manner of its constitution. As will be seen, it will consist of five persons, the first of whom is to be the Chairman of the Currency Commission, who will be chairman of the committee. Then there are a judge of the High Court nominated by the Chief Justice, a person nominated by the Minister after consultation with the committee of the Stock Exchange, a person nominated in the prescribed manner by or on behalf of the shareholding banks, and a person nominated by the Minister on his own behalf. The section, I think, in this connection is self-explanatory. In addition to the duties assigned to it by Section 2, it is anticipated that the committee will be requested to act also as a committee of inquiry to examine into cases of investments in ordinary trustee funds, with a view to recommending legislation on the point. It is felt that the present legislation in regard to that matter is now obsolete and out-of-date and that the various provisions governing investments in trustee funds should be overhauled. The matter has been under consideration in the Department of Finance for a long period but it has been difficult to come to any conclusion on it. It is hoped that when this committee has had some experience of the nature of the funds which possibly will come before them from time to time, and the nature of the investments that are available, that they may be able to make some recommendations to the Government which will enable us to crystallise our opinions and introduce the necessary legislation to give effect to our views in due course.
Section 3 merely provides for the procedure of the committee. It is to the effect that the committee may regulate its own procedure, and that the quorum for a meeting of the committee shall consist of three members. Section 4 provides for the staff and accommodation of the committee. Section 5 provides for the appointment of a Deputy-Chairman of the committee. Section 6, which is the operative section, provides for the consultation of the committee by the Minister. Sub-section (1) empowers the Minister to request the committee to prepare and submit to him a list of securities they regard as suitable for particular Government funds. Under sub-section (2) the Minister may ask the committee to advise him as to whether a particular security is a suitable investment for a specific fund. Sub-section (3) merely provides that whenever the Minister requests the committee under the section to prepare lists of securities, or to advise him as to the suitability of a specified security, the committee shall with the necessary expedition deal with the request of the Minister.
Section 7 provides for the application to be made to the Minister by a promoter or other person for the approval of a security. Applications to have securities approved, which can only be made by the person responsible for their issue, must be made to the Minister, who at his discretion may reject them or submit these applications to the committee. The purpose of this is to ensure that frivolous applications will not be submitted to the committee, the consideration of which might involve a waste of their valuable time. I should like to make the point clear that the Minister's reference to the committee will only be evidence that there is a prima facie case for consideration and that reference to the committee for their consideration is not to be taken in any sense as a recommendation or approval of any investments which may be submitted to the Minister and which he may possibly afterwards refer to the committee. Section 8 sets out the factors which the committee should take into consideration in determining the suitability of an investment for approval. Section 9 provides that whenever the committee furnishes to the Minister in pursuance of this Act a list of securities suitable for the investment of a particular Government fund or particular Government money the Minister may, at his discretion, approve of the committee's recommendations.
Section 10 gives the Minister powers to withdraw his approval of securities with or without reference to the committee. The point I should like to bring out in this connection is that the Minister can, in fact, at any time, by simply selling his holding in any security, withdraw his approval of it, if the circumstances so warrant. The point is to make it quite clear that the Minister is the person responsible for the proper investment of Government funds and that the committee shall act merely in an advisory and consultative capacity. Section 11 is an operative section and provides that the Government moneys may be invested in accordance with the approval given by the Minister for Finance. It also provides, however, that this investment may be made in spite of any existing statutory restriction on investment. I should also like to make it quite clear that the power of investment can only be exercised in the case of a security that has been approved of by the committee; that is to say, that the Minister cannot, under this section, invest in any security unless he has first referred that security to the committee for its approval as a proper instrument for the investment of Government moneys.
Section 12 provides that, on the initiative of the Minister for Justice, acting with the approval of the rule-making authority of the High Court, securities which are approved under this Bill may be sanctioned, after consultation with the Advisory Committee, for the investment of court funds, and any such funds may be invested in any security thus sanctioned notwithstanding any rule of court to the contrary. This section, I should like to point out, has been inserted with the approval both of the Minister for Justice and of the Chief Justice. Section 13 provides for the withdrawal in connection with any future rule of court of the trustee status which is afforded to securities approved for court investment by paragraph (o) of Section 1 of the Trustees Act, 1893. It is generally agreed, I think, that the rule-making authority of the High Court is not the most satisfactory body for determining what additional securities should be regarded as trustee securities generally. The court list in this connection is framed for its own use from a point of view different in many respects from that which must govern an ordinary trustee investment. It may be that an investment suitable for Government funds would not be suitable in every case for the investment of settled funds by trustees in certain circumstances. Accordingly, it was decided not to provide that approved securities should thereby, without qualification, become recognised investments also for ordinary trust funds.
Section 14 merely provides for the publication in Iris Oifigiúil of a list of approved securities from time to time and the additions which are made to such lists from time to time. Section 16 merely provides for the expenses of the Act and Section 17 is the short title. As I have said, the whole purpose of the Bill is to enable an approved list of securities to be drawn up in which Government funds or moneys may be invested. It does not alter the trustee status of any existing investment, and it does not confer trustee status upon any security which would be added to the list.
