TREASURY BILLS (Motion)

The Minister for Finance (Dr Richard Hu Tsu Tau): Mr Speaker, Sir, I beg to move,

That this Parliament, in accordance with section 3(1) of the Local Treasury Bills Act (Chapter 167, 1988 Revised Edition), resolves that the Minister for Finance be authorised to borrow, by the issue of Treasury bills in Singapore, a revolving sum not exceeding twenty thousand million Singapore dollars (S$20,000,000,000).

Sir, on 4th May 1999, Parliament resolved, in accordance with section 3(1) of the Local Treasury Bills Act (Chapter 167), that the Minister for Finance be authorised to borrow, by the issue of Treasury bills in Singapore, a revolving sum not exceeding S$15 billion. This limit applies to the outstanding amount of Treasury bills.

The demand for Treasury bills has grown rapidly in the past two years due to an expansion of banks' liabilities base. The outstanding amount of Treasury bills issued as at end-July 2001 amounted to S$14.6 billion. The banks' liabilities base is expected to continue to expand over the next few years, thus increasing their demand for Treasury bills as liquid assets. In addition, MAS' efforts to increase the issuance of Treasury bills to support capital market development have also contributed to the need to increase the borrowing limit for Treasury bills.

It is proposed, therefore, that the current ceiling for borrowing by Treasury bills of S$15 billion, be raised by another S$5 billion to a total of S$20 billion.

Parliament is requested to enable the Government to issue the Treasury bills up to a total amount not exceeding S$20 billion.

Question put, and agreed to.

That this Parliament, in accordance with section 3(1) of the Local Treasury Bills Act (Chapter 167, 1988 Revised Edition), resolves that the Minister for Finance be authorised to borrow, by the issue of Treasury bills in Singapore, a revolving sum not exceeding twenty thousand million Singapore dollars (S$20,000,000,000).