I have an aluminum waterpump housing that is off of an original 1965 A990 car. If you look down through the thermostat hole there are two areas I guess would be the way to say it. In the back section which would be the block side there is a hole drilled and tapped with a pipe plug in it with a 1/8 hole drilled in it.

What is the purpose of this?
It is creating a hole that allows coolant to do what?