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Sinking Fund Scheme.
The main provisions of the sinking
fund schemes are:—
(a) A sinking fund of 7s. 6d.
per cent. per annum for 58 years
on the nett debt at 1st July, 1927;
to this sinking fund the Commonwealth
 contributes 2s. 6d. per cent.
and the States 5s. per cent.
(b) A sinking fund of 10s. per
cent. per annum for 53 years on
all new debt raised after 1st July,
1927; to this sinking fund the
Commonwealth to contribute 5s.
per cent. and the States 5s. per
cent.
(¢) A contribution of 4% per
cent. per annum on debt redeemed
out of the above contributions
(contributed by the States).
Contributions commenced from Ist
July, 1927, in the case of all States
except New South Wales, which State
commenced on lst July, 1928. .
On the nett debt at 1st July, 1927
the annual contributions are: —

ES]
Payable by Commonwealth 802,000
Pavable by States ... 0 1,604,000

2.406.000

Control.

The management of funds is in the
hands of the Commonwealth National
Debt Sinking Fund Commission.

Sums Available for Redemption.
The Financial Agreement was not
‘atified until August, 1928, but the
sinking fund contributions were payible
 as from 1st July, 1927.
The amount available for redemption
 of debt during the current year
is £4,508,000, including a balance of
approximately £1,900,000 on account
of contributions for 1927-28.
This sum will be applied in the
following manner :—

o

London—
Purchase and redemption
 of
State securities.
Purchase of Commonwealth
 se
curities issued ox
behalf of the
States ... es

1.063.000

166,000
— 1.929.000

New York—
Purchase of Com:
monwealth securities
 issued on
behalf of the
States ... vee
Aunstralia—
Repurchases and
redemptions on
maturity wn
Special payments
under existing
contracts gu

121.000

2.743.000

410.000

4.505.000

Application of Funds.

Broadly speaking, funds are being
applied in Australia, London and
New York:—
(a) in meeting obligations under
existing contracts;
(b) in repurchases on the
market ;
(¢) in redemptions on maturity.

Redemption of Combined Overseas
Debt

The total funds that are being
applied this year in redemption of
overseas debts (Commonwealth and
State combined) amount to approxi
mately £3,700,000 — (Commonwealts
£2,000.000. State £1.700.000).

(4/29) (4492r—%) Wt.

250 5/29 H, St G.3