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Commonwealth Development Corporation Act 1999

Financial assistance by Government

Section 11: Guarantees; Supplemental

39.Section 11 contains provisions to supplement section 10. Subsections (1) to (3) are technical provisions concerning the sources from which sums needed to meet calls on guarantees are to be drawn (i.e. to pay the third party if CDC or its associated company defaults), and the destination of any sums received to repay the Government under the agreements made under section 10(7) (see above).

40.Subsections (4) to (7) place on the Treasury and the Secretary of State certain duties to give information to Parliament about guarantees. If the Treasury gives a guarantee it must lay a statement of the guarantee before each House as soon as is practicable after giving it: subsection (4). Under subsection (5), if the Treasury makes a payment under a guarantee, it must:

  • lay a statement relating to the sum before Parliament as soon as practicable after the end of the financial year in which the payment was made (and in practice that statement will appear in the annual Supplementary Statements to the Consolidated Fund Accounts); and

  • as soon as practicable after the end of any subsequent financial year in which an obligation guaranteed by the Treasury is still outstanding, the Treasury shall lay a statement relating to the sum owing before each House.

41.Under subsection (6), as soon as practicable after the Secretary of State has

  • given a guarantee under section 10, or

  • made a payment to fulfil a guarantee,

he shall lay a statement of the guarantee or the sum before each House. Subsection (7) requires the Secretary of State or the Treasury to lay a statement before each House if CDC or an associated company fails to make any payment required of it under an agreement made in accordance with section 10 (7).

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