| Admin History | The Overseas Investment Office was created in May 1966 in the Overseas Department. Its function was to administer the restriction of direct and portfolio investment in the developed countries of the sterling area (Australia, New Zealand, South Africa and the Republic of Ireland) as proposed by the Chancellor of Exchequer on 3 May 1966, to help the heavy balance of payments deficit. The restriction was on a voluntary basis, known as Voluntary Restraint or the Voluntary Programme, initially planned for a year or two, but actually ran until 22 March 1972.
Two hundred companies were asked by letter from the Chancellor to co-operate in the programme by postponing any plans they had for investment in the four countries, or for any projects which could not be postponed, to find finance from outside the UK. For those projects at a cost of more than £25,000 they were asked to submit their proposals to the Overseas Investment Office for examination, and dependent on the scale of the benefit to the balance of payments, to then withdraw or postpone that proposal. At the same time, institutions were asked to keep their portfolios of investments in the currencies of the four countries to no more than their present level, except for growth.
A Scheduled Territory Investment Committee was formed, also in May 1966, to work alongside the Foreign Exchange Control Committee, with the Treasury in the Chair, the Overseas Investment Office as secretaries, and attended by the Board of Trade and Ministry of Technology. The Overseas Investment Office briefed it on schemes involving remittances from the UK of over £100,000 in value (from 1971, £1 million in value) and on questions of policy.
As the arrangements were voluntary and not backed by Exchange Control powers, the Overseas Investment Office was not part of the Exchange Control Office, but the two were closely associated and not separately staffed, so when the Voluntary Programme ended, it was deemed unnecessary to continue to have it separate from the Exchange Control Office, and so it was abolished on 28 April 1972.
(Taken from history in 9A393/11) |