The State Guarantees (Transport) Act, 1962, provides that the Minister for Finance may guarantee the due payment by Córas Iompair Éireann of any moneys payable by the Board under contracts for the provision of goods and services or both goods and services entered into by the Board with my approval, given with the consent of the Minister for Finance.
I have been advised that the State Guarantees (Transport) Act, 1962, does not provide explicity for guarantees of payments due under contracts entered into by the Board to be expressed in any currency other than Irish currency; and the purpose of the present Bill is to remedy that defect. The only guarantee given under the 1962 Act was in respect of a contract entered into by the Board in 1962 in US dollars for the purchase, by extended payments, of diesel locomotives from General Motors Corporation, USA.
Amending legislation of a somewhat similar nature was necessary in the case of Aer Lingus and other companies covered by the State Guarantees Act, 1954 and, more recently, in the case of the Electricity Supply Board; and the necessary provision was made in the State Guarantees (Amendment) Act, 1964 and the Electricity (Supply) (Amendment) Act, 1965. In the present case, however, the guarantees which the Minister for Finance may give extend only to payments in respect of contracts for the provision of goods and services and do not extend to borrowings.
Section 2 of the Bill extends the powers of the Minister for Finance in the State Guarantees (Transport) Act, 1962 to enable him to guarantee payments by the Board in foreign currencies and establishes the method of calculating the equivalent in Irish currency of moneys due by the Board in foreign currency. Rules for conversion follow those in the State Guarantees (Amendment) Act, 1964. Such conversion is necessary to determine the value in Irish currency of the guarantees given by the Minister for Finance for the purpose of subsection (2) of section 2 of the State Guarantees (Transport) Act, 1962, which prescribes the maximum amount of principal in Irish currency which may be guaranteed at any one time.
I recommend the Bill to the House.