Postal Services Act 2011

Postal Services Act 2011

2011 CHAPTER 5

Commentary on Sections

Part 4: Special Administration

Financial support for companies in administration

Section 81: Guarantees where postal administration order is made

352. This section enables the Secretary of State, with the consent of the Treasury, to give guarantees in relation to a universal service provider in postal administration.

353. Subsection (2) states that the Secretary of State may guarantee while a postal administration order is in force:

a)

the repayment of any sum borrowed by the company;

b)

the payment of interest on any sum borrowed by the company; and

c)

the discharge of any other financial obligation of the company in connection with the borrowing of any sum.

354. Subsection (4) requires the Secretary of State to lay a statement of the guarantee before Parliament as soon as practicable after giving a guarantee under this section.

355. If sums are paid out by the Secretary of State under a guarantee given under this section, subsection (5) requires that the company must pay the Secretary of State:

a)

such amounts in or towards the repayment to the Secretary of State of those sums as the Secretary of State may, with the consent of the Treasury, direct; and

b)

interest on amounts outstanding under this subsection at such rates as the Secretary of State may, with the consent of the Treasury, direct.

356. If a sum has been paid out under a guarantee given under this section, under subsections (7) and (8), the Secretary of State must lay a statement relating to that sum before Parliament as soon as practicable after the end of the financial year in which the sum is paid out; and after the end of each subsequent financial year until the company has discharged the liability (including interest).