By the end of last year a total of €365.5 million from the sale of passports had been put aside in a special fund intended to finance projects of public interest.

However, so far only a small fraction has been committed for such purposes while a significant amount was used for the acquisition of Government Stocks and a 49 per cent shareholding in a commercial bank.

Details on the National Development and Social Fund were published in the 2017 annual report. Established in January 2015 by virtue of the passport scheme or the Individual Investor Programme as it is called, this fund receives 70 per cent of the proceeds.

Projects of national importance, social housing, better governance and healthcare improvement initiatives are among the list of purposes for which this fund may be used.

First funds were deposited in July 2016

The money is administered by a board of governors and the first funds were deposited in July 2016.

From the annual report it transpired that the board adopted an “investment policy” whereby the fund was split in two separate portfolios. The bulk of the money (70 per cent) are being channelled in a “directed portfolio” for social and development purposes in line with the overriding principle of the fund.

However, it transpired that the rest of the funds (30 per cent) will be placed in a “discretionary portfolio” with the objective of “the preservation of capital and the re-investments of investment returns over the long term”.

Notwithstanding this policy, the board still reserves the right to leave funds unallocated in any portfolio.

So far the board has used the money to acquire €40 million in Government Stocks, while last March it acquired 49.01 per cent of the Lombard Bank shares.

However, the board has insisted that it had no intention to increase its holding and justified the move on the grounds that it wanted to facilitate the exit of a Cypriot major shareholder in that bank.

On the other hand, the only ‘social’ measure mentioned in the report was a €950,000 grant to the Mater Dei Hospital Cardiology Department to upgrade its Catheterisation Suites.

The report makes no reference to a €5 million grant to Puttinu Cares and the €50 million social housing project, which the Prime Minister had announced in March and May, respectively.

In this respect, the board says that it would be identifying “the real social and economic needs of the country and will seek to allocate its funds to those priority sectors where the highest social and economic impacts are likely”.

However, no specific projects are highlighted.