Explanatory note

This Order provides for the setting up as from 1st April 1993 of a fund with public money under the Government Trading Funds Act 1973 for the operations of the Ministry of Defence known as the Defence Research Agency.

The Order designates the Secretary of State for Defence as the authorised lender to the fund and imposes a limit of £400,000,000 on the amount which can be lent to it.

The Order also provides for the assets (estimated at £197,000,000) and liabilities (estimated at £14,000,000) set out in a Schedule to the Order to be appropriated to the fund, and for 89.6% of the amount by which the values of the assets exceed the amounts of the liabilities to be treated as public dividend capital of the fund. Working capital of £145,000,000 will be issued immediately the fund is established and will be financed by debt; the debt/public dividend capital ratio of the fund will accordingly be approximately 50:50.