Tag: Ian Murray

The below Parliamentary question was asked by Ian Murray on 2014-04-10.

To ask the Secretary of State for Business, Innovation and Skills, who made the decisions and on what basis were the decisions made on how many shares would go to each priority investor, each institutional investor and each retail investor in respect of the privatisation of Royal Mail.

Michael Fallon

The Government set the overall allocation policy with the aim of getting the right balance between longer-term, stable investors, retail investors and shorter-term investors who provide liquidity in the market.

Allocations were made to a number of institutions who in the early stages of engagement were willing to place non-binding orders despite the risks attached to the IPO such as the industrial relations situation. These investors gave us confidence that there was sufficient demand to proceed with the IPO.

We had nearly three-quarters of a million retail applications so their allocations were scaled back as they were for institutional investors. Given this high demand, Ministers decided to prioritise smaller investors and put in place a cut-off above £10,000 and give everyone below that the same number of shares. Around 95% of retail investors were allocated shares.

The below Parliamentary question was asked by Ian Murray on 2014-04-10.

To ask Mr Chancellor of the Exchequer, what recent estimate he has made of how much the reduction in the additional rate of income tax to 45 per cent will be worth each year for a person earning £1 million a year.

Mr David Gauke

I refer the hon. Gentleman to the answer I gave today to the hon. Member for Sefton Central (Bill Esterson).

The below Parliamentary question was asked by Ian Murray on 2014-04-28.

To ask the Secretary of State for Business, Innovation and Skills, when the stabilisation period in respect of the privatisation of Royal Mail, as detailed in the engagement letter between his Department and the underwriting banks, ends; and how that period has been defined.

Michael Fallon

The stabilisation period, also known as a "greenshoe" or "over-allotment" option, is a market-standard provision that allows the Initial Public Offering’s (IPO) stabilisation manager to provide share price stabilisation (if required) for up to 30 days post-commencement of conditional dealings. In the case of the Royal Mail, the stabilisation manager was UBS and the stabilisation period ended on 8 November.

In the engagement letter, the payment of the discretionary fee was linked to the ending of the stabilisation period. However, we informed the banks involved that a decision would not be taken in the timeframe set out in the engagement letter given the volatility of the Royal Mail share price after the IPO.

We have not set a rigid timetable for the decision on the payment of the discretionary fee which remains unpaid.

The below Parliamentary question was asked by Ian Murray on 2014-04-28.

To ask the Secretary of State for Business, Innovation and Skills, what the default rate has been on each of the Government’s export guarantee funds since May 2010.

Michael Fallon

UK Export Finance (UKEF) supports UK exports, principally through the provision of guarantees to banks extending loans to overseas buyers and insurance to UK exporters against the risk of non-payment. From 1 May 2010 to 31 March 2014, the percentage of guarantees and insurance policies issued by UKEF that have subsequently defaulted resulting in a claim being paid, or where a claim is currently under examination, is 0.2%.

Given the tenor of transactions that UKEF typically supports, which can be up to 15 years, an in-year default rate does not give a clear indicator of the performance of UKEF’s portfolio. In accordance with the financial objectives and risk measures agreed with HM Treasury, UKEF measures the Expected Loss of its portfolio. Expected Loss is the statistical estimate of the amount of UKEF’s contingent liability which could be expected to turn into claims that are irrecoverable. Full details of UKEF’s performance and risk management can be found in its Annual Report and Account which is available in the libraries of the House.