1
Supplementary to Question No.
in Lego Meeting op 27.4.88
Mr. CLYDESDALE: Sir, before asking the supplementary
question, I would like to thank the Financial Secretary
for pointing out that interest is, of course, paid to
public funds for the use of our reserves by the Exchange
Fund, but a close scrutiny of my question will confirm
that I did not suggest otherwise. Risks often bring
rewards and I would like to ask if the
Exchange Fund has benefited from the assumption of the
exchange risks referred to by the Financial Secretary or
can the Government confirm that the interest credited
to general revenue for the use of our published reserves
reflects fully and fairly the overall return, including
that on exchange, achieved by the Exchange Fund on the
relevant underlying assets?
FINANCIAL SECRETARY:
Sir, risks bring.
rewards, of
course, but risks also bring certain dangers we could lose
a great deal of money. The
management of the
Exchange Fund itself is kept confidential
for a number of reasons that we believe to be entirely
valid. All I can say this afternoon, Sir, is that it has
benefited from taking certain risks. The full benefits
have not been passed on to general revenue. I think it
would not be appropriate that they should be passed on to
general revenue because they are benefits that arise from