Explanatory note

This Order provides for the setting up as from 1st April 2004 of a fund with public money under the Government Trading Funds Act 1973 (“the 1973 Act”) for the operation of the Driver and Vehicle Licensing Agency (article 3). It designates the Secretary of State for Transport as the authorised lender under the fund (article 4).

The Order specifies the assets and liabilities that are to be appropriated to the fund. It requires £4,775,000 to be treated and maintained as a revaluation reserve and £20,748,000 to be treated and maintained as government grant reserve. It also provides for £18,002,000 (part of the difference between the value of the assets and the amount of liabilities of the fund) to be treated as public dividend capital of the fund (article 5).

The maximum borrowing of the fund, being the total outstanding of the amounts issued to the fund under section 2B of the 1973 Act plus the total of the fund’s public dividend capital, is not to exceed £50,000,000 (article 6).

A full regulatory impact assessment has not been produced for this instrument as it has no impact on the costs of business.