National Loans Act 1968

JurisdictionUK Non-devolved
Citation1968 c. 13


National Loans Act 1968

1968 CHAPTER 13

An Act to establish a National Loans Fund, to substitute the National Loans Fund for the Consolidated Fund in certain enactments, including enactments relating to Government lending and advances, the Exchange Equalisation Account and government annuities, to make profits of the Issue Department of the Bank of England payable into the National Loans Fund and to make other provision as to the said Department, to charge the whole of the national debt on the National Loans Fund, and to amend the law about Government borrowing; to make further provision for loans by the Public Works Loan Commissioners, and to authorise advances out of the National Loans Fund for the purpose of such loans; to transfer to Votes certain payments charged on the Consolidated Fund; and generally to make provision for the management of the Government's financial business.

[13th March 1968]

Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

S-1 The National Loans Fund.

1 The National Loans Fund.

(1) The Treasury shall have an account at the Bank of England, to be called the National Loans Fund.

(2) Money paid into the National Loans Fund shall form one general fund to meet all outgoings from the Fund, and daily statements of all money paid into and out of the Fund, in such form as the Treasury may direct, shall be sent by the Bank of England to the Comptroller and Auditor General.

(3) The Comptroller and Auditor General shall from time to time at the request of the Treasury grant credits on the National Loans Fund for sums payable out of the Fund under this or any other Act and, subject to section 18 of this Act, all payments out of the National Loans Fund shall be made by the Treasury in accordance with credits so granted.

(4) Section 34 of the Finance Act 1936 (signature of requisitions for credits under the Exchequer and Audit Departments Act 1866 ) shall apply to a request for a credit under subsection (3) above as it applies to such a requisition.

(5) In section 1(2) of the Parliament Act 1911 (which defines a Money Bill as one dealing exclusively with subjects which include the imposition of charges on the Consolidated Fund) after ‘Consolidated Fund’ there shall be inserted ‘the National Loans Fund’.

(6) In section 22 of the Interpretation Act 1889 (definition of financial year) after ‘Consolidated Fund’ there shall be inserted ‘the National Loans Fund’.

(7) No provision in any Act requiring money to be paid into the Exchequer shall be construed as requiring or authorising money to be paid into the National Loans Fund.

(8) Where the intention is that money be paid into the Consolidated Fund it shall be sufficient to enact that it be paid into the Consolidated Fund (instead of enacting that it be paid into the Exchequer).

Government lending

Government lending

S-2 Substitution of National Loans Fund for Consolidated Fund in scheduled enactments.

2 Substitution of National Loans Fund for Consolidated Fund in scheduled enactments.

2. The enactments in Schedule 1 to this Act (which—

a ) authorise advances or loans out of the Consolidated Fund, or
b ) create commencing capital debts or other obligations to the Consolidated Fund, or
c ) authorise payments out of the Consolidated Fund which are to be repaid out of Votes)

and the enactments in Schedule 2 to this Act (which authorise payments out of the Consolidated Fund under certain international monetary and financial agreements) shall be amended in accordance with those Schedules.

S-3 Local loans.

3 Local loans.

(1) The Treasury may issue out of the National Loans Fund such sums as are required by the Public Works Loan Commissioners (in this Act called the Loan Commissioners) to make loans as authorised by this Act, or by any future Act.

(2) Interest on loans made by the Loan Commissioners shall be paid at such rates as the Treasury may determine from time to time in accordance with section 5 of this Act.

(3) All sums paid or applicable in or towards the discharge of the principal or interest of any loans made by the Loan Commissioners, whether before or after the coming into force of this section, shall be paid by the Loan Commissioners into the National Loans Fund:

Provided that where security for a loan is enforced in any manner the net receipts only shall be so paid into the National Loans Fund.

(4) Any sum payable in respect of Irish land purchase annuities which, but for the provisions of this section, would be payable into the Local Loans Fund under section 26(2) of the Government of Ireland Act 1920 , or under any other enactment, shall be paid into the National Loans Fund.

(5) Subject to the limit in this Act, and to any limit in a future Act, the Loan Commissioners' power of making loans shall include power to enter into undertakings to make loans.

(6) The Loan Commissioners shall, as respects each financial year, prepare in such form and manner as the Treasury may direct an account of all loans made by the Loan Commissioners in the financial year, and of the sums paid or applicable in the financial year in or towards the discharge of the principal or interest of all loans made by the Loan Commissioners, whether before or after the coming into force of this section, and send it to the Comptroller and Auditor General not later than the end of November next following the end of the financial year and the Comptroller and Auditor General shall examine, certify and report on the account and lay copies of it, together with his report, before each House of Parliament.

(7) So much of paragraph (3) of section 5 of the Public Works Loans Act 1875 as fixes the time by which the Loan Commissioners are to send their report of their transactions to the Treasury, and by which the report is to be laid before Parliament, shall cease to have effect.

(8) On 1st April 1968 the Local Loans Fund shall be wound up, and all liabilities of the Local Loans Fund to the Consolidated Fund under section 30(4) of the Finance Act 1935 or section 3(3) of the Local Authorities Loans Act 1945 (repayment of Exchequer advances) shall be extinguished.

(9) As soon as may be after the coming into force of this section, any cash balance standing to the credit of the Local Loans Fund at the close of business on 31st March 1968 shall be paid into the National Loans Fund.

(10) Immediately before the winding up of the Local Loans Fund the principal of the loans made by the Loan Commissioners and described in Schedule 3 to this Act (which are irrecoverable) shall be extinguished, and all arrears of interest thereon shall be remitted; and the said principal shall, so far as not already so dealt with in pursuance of the Public Works Loans Act 1887 , be written off from the account of assets of the Local Loans Fund.

(11) The descriptions of loans which the Loan Commissioners may make are those set out in Schedule 4 to this Act (which correspond in material particulars to the loans which the Loan Commissioners may make under section 9 of the Public Works Loans Act 1875), and that Act and the enactments amending that Act shall apply to loans made in pursuance of this section.

(12) In the following provisions of this Act ‘local loans’ means loans made by the Loan Commissioners in pursuance of this section.

S-4 Power to make local loans.

4 Power to make local loans.

(1) Local loans may be made in the period beginning with 1st April 1968, but the aggregate of—

(a ) the commitments of the Loan Commissioners outstanding at any time in respect of undertakings entered into by them to grant local loans; and

(b ) the advances in respect of local loans made by the Loan Commissioners under this section up to that time,

shall not exceed the limit specified in subsection (2) below.

(2) The said limit shall be one thousand million pounds, but the Treasury may, on not more than three occasions, by order contained in a statutory instrument, increase or further increase that limit by a sum specified in the order, being a sum not exceeding one thousand million pounds.

The Treasury shall not make an order under this subsection unless a draft of the order has been approved by a resolution of the Commons House of Parliament.

(3) For the purposes of section 1(2) of the Public Works Loans Act 1967 (no sums to be issued under that Act after the end of the period when a further Act comes into operation) the said period shall end with 31st March 1968.

S-5 Rates of interest.

5 Rates of interest.

(1) This section has effect as respects any rate of interest—

(a ) which under any provision in Schedule 1 to this Act is to be fixed in accordance with this Act, or

(b ) which is to be determined by the Treasury under section 3 of this Act,

and, where any enactment passed after this Act provides for the...

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