Coal Industry Act 1965

1Borrowing by, and loans by Minister of Power to, National Coal Board

(1)Subject to subsections (3) and (4) of this section, the National Coal Board (hereafter in this Act referred to as " the Board ") may borrow temporarily, by way of overdraft or otherwise, either from the Minister of Power (hereafter in this Act referred to as " the Minister ") or, with the consent of the Minister, from any other person, such sums as the Board may require for meeting their obligations and discharging their functions.

(2)Subject to subsection (3) of this section, the Board may borrow (otherwise than by way of temporary loan) from the Minister such sums as the Board may require in connection with their functions for all or any of the following purposes, that is to say—

(a)for meeting any expenses properly chargeable to capital, being expenses incurred in connection with the provision or improvement of assets;

(b)for the provision of working capital;

(c)for acquiring an undertaking or part of an undertaking;

(d)for lending money to, or meeting a guarantee given for the benefit of, any person for the purpose of an undertaking carried on by him or, where that person is a body corporate, an undertaking carried on by a subsidiary of that body corporate within the meaning of section 154 of the [1948 c. 38.] Companies Act 1948 ;

(e)for subscribing for or acquiring shares, stock, debentures, debenture stock, or other securities of a like nature, of a body corporate, otherwise than by way of investment;

(f)to pay off any money borrowed by the Board;

(g)for any purpose for which capital moneys are properly applicable (whether or not specified in the foregoing paragraphs of this subsection).

(3)Without prejudice to subsection (4) of this section, the aggregate amount outstanding in respect of the principal of all sums borrowed by the Board under this section (including the sums which under section 2(1)(a) of this Act are deemed to have been so borrowed) shall not exceed £700,000,000, or such greater sum not exceeding £750,000,000 as the Minister may from time to time by order made by statutory instrument specify; and no such order shall be made unless a draft thereof has been approved by a resolution of the Commons House of Parliament.

(4)The aggregate of the amounts outstanding in respect of sums borrowed temporarily by the Board under subsection (1) of this section (including the sum which under section 2(1)(a)(i) of this Act is deemed to have been so borrowed)—

(a)shall not at any time exceed such limit as the Minister may from time to time direct; and

(b)at the end of any financial year of the Board shall not be such as to permit any accumulated deficit on the Board's revenue account to exceed £30,000,000.

(5)The Board shall not have power to borrow money except in accordance with this section.

(6)The Minister may lend to the Board any sums which the Board have power to borrow under subsection (1) or (2) of this section.

(7)The foregoing provisions of this section (other than subsections (3) and (4) thereof) shall be deemed to have come into force on 28th March 1965 and—

(a)the provisions of the [1946 c. 59.] Coal Industry Nationalisation Act 1946 (hereafter in this Act referred to as " the Act of 1946 ") specified in Schedule 1 to this Act shall have effect subject to the amendments respectively specified in that Schedule, being amendments designed to cause those provisions to apply to sums lent to the Board by the Minister, or borrowed by the Board, under this section as they applied to advances by the Minister to the Board, or sums borrowed by the Board, under that Act;

(b)any advances made to the Board by the Minister under section 26 or 27 of the Act of 1946, and any sums borrowed from the Minister by the Board under the said section 27, being advances made or sums borrowed on or after 28th March 1965, shall be treated as loans made to the Board by the Minister, or, as the case may be, sums borrowed by the Board, under this section; and any directions with respect to any such advances given under paragraph (b) of section 28(1) of the Act of 1946 before the passing of this Act shall be deemed to have been given under the said paragraph (b) as amended by the said Schedule 1 ;

(c)any amounts outstanding at the passing of this Act in respect of sums borrowed temporarily under the said section 27 from any person other than the Minister shall be treated as having been borrowed under subsection (1) of this section; and accordingly any guarantee in respect thereof given by the Treasury under subsection (4) of the said section 27 shall continue to have effect.