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Seanad Éireann debate -
Wednesday, 31 Jul 1935

Vol. 20 No. 11

Approved Investments (Amendment) Bill, 1935—Second Stage.

Question proposed: "That the Bill be now read a Second Time."

I wish to apologise for the absence of the Minister for Finance for whom I am taking this Bill. The operative clauses of the Approved Investments Act, 1933, cease to have effect after a period of two years from the passing of the Act. The Act does not expire as a whole, but after that date those clauses under which alone action can be taken to extend the list of securities approved for investment of Government funds or Government moneys cease to be operative. The Approved Investments Act, 1933, became law on the 29th September, 1933, and it will accordingly be impossible to operate it after the 28th September 1935. The purpose of the present Bill is to extend the period of the operation of the Principal Act. As stated above, the Approved Investments Act, 1933, became law on the 29th September, 1933. Regulations had to be made under Section 2 (2) of the Act prescribing the manner in which the shareholding banks should nominate their representatives on the Investments Advisory Committee. As the preparation of these regulations involved consultation with each of the eight shareholding banks, the regulations were not in final form until the beginning of November, 1933; they were formally made on the 16th November, 1933. In the interval, the Chief Justice and the Stock Exchange were consulted as to their nominees on the Advisory Committee.

On the 12th February, 1934, the Committee was formally constituted by the Minister for Finance, and held its first meeting on the 5th March, 1934. It consists of: Mr. Joseph Brennan, Chairman of the Currency Commission; Mr. Justice W.J. Johnston, a Judge of the High Court; Mr. G.B. Symes, the President of the Stock Exchange; Mr. John P. Butler, Director, National Bank, Ltd.; Mr. J.J. McElligott, Secretary, Department of Finance.

After the constitution of the Committee the preparation of the further regulations required under Section 7 of the Act was put in hand in the Department of Finance. These regulations prescribed the form and manner in which application is to be made to the Minister for Finance for the approval of securities under Section 7 of the Act. The draft of these regulations was agreed to by the Investments Advisory Committee on the 10th September, 1934, and the regulations were made on the 29th September, 1934. A notice was published in Iris Oifigiúil stating that the regulations had been made and that copies of the prescribed form could be obtained on application to the Department of Finance.

On the 15th October, 1934, ten applications under seal were received from the Dublin County Borough Council for the approval of securities under the terms of Section 7 of the Act. To enable the Investments Advisory Committee to work out an appropriate procedure, it was decided to refer only one of these applications to the Committee in connection with a single fund, the National Health Insurance Fund Investment Account being chosen for the purpose. The application was formally referred to the Committee on the 11th January, 1935. The Committee disposed of it and of subsequent references with regard to the nine other securities on the 25th April, 1935. The appropriate notice indicating that the Minister for Finance had approved of six of the securities in question was duly published in Iris Oifigiúil. It is proposed to refer the same securities to the Committee for consideration in connection with the National Health Insurance Central Fund Account, and a memorandum outlining the characteristics and requirements of this fund is at present being prepared in the Department of Finance. It should be noted that no other applications were received for the approval of securities under Section 7 of the Act and that no action has been taken to have the Committee advise under the terms of either Section 6 (1) of Section 6 (2) of the Act.

As will be seen from the above account, it took a considerable time to set in motion the rather elaborate machinery prescribed for operating the Act, and, in consequence, the positive results achieved by the measure up to the present date are rather small. This preliminary work will not have to be repeated if the Act is extended, and accordingly more considerable results may reasonably be anticipated for any further period of extension. It is not proposed to take advantage of the legislation to effect any amendment of the Bill. It is quite correct that the original measure was declared to be of an experimental character, but the experience gained has not been sufficient to allow any decision to be reached as to what amendments, if any, ought to be effected in it. That is the main reason for having an extension sought by this amending Bill. I will ask the House to give it its approval.

Question put and agreed to.
Committee Stage ordered for Thursday, 1st August.
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