Great Britain Almost GREAT WAR DEBT FREE A Century After WWI Outbreak

At last After a century since the outbreak of the First World War, Great Britain is almost GREAT WAR DEBT FREE, meaning, it has almost paid in full the over £2.11 billion it owed to fund the war efforts during the Great War.

The Treasury of Great Britain has recently announced that the government will be able to repay all the outstanding war bonds by the March 9, 2015 — almost 100 years after they were first issued.

It can be remembered that the government has accumulated a total debt of over £2.11billion just so the country could fund the war efforts which lasted from 1914 to 1918. Much of that money came from ordinary citizens who bought the special war loans known in those times as gilts or bonds.

Chancellor George Osborne was the one who announced the decision in his Autumn Statement 2014. According to him, The government owes a total of £2.1 billion worth of 3.5% and 4% war loans. That amount will be paid back by next year leaving only an outstanding £15 million in the country’s Great War debt.

Chancellor George Osborne during his Autumn Statement 2014
Chancellor George Osborne during his Autumn Statement 2014

Reportedly, the move is part of the government’s plan to eradicate all historic gilts some of which date back to the 18th century.

In the records, the most widely held government bond within the UK is the 3.5% War Loan. It has over 20,000 holders with a total worth of  £1.9 billion. Additionally, private individuals compose over 97,000 of the war loan holders with an average of less than £1,000 worth of bonds each. However, bigger institutions hold the largest stake in the WWI debt.

Before the Great War broke out in August of 1914, Great Britain only had £36 million worth of gold reserves. The government feared that it wouldn’t be enough to fund the country’s army as the war dragged on, thus, the gilts or bonds were introduced.

The government issued its first WWI gilt in November of 1914. The second one followed during the height of the Great War — in 1917. It was during the release of the latter that the government issued an appeal to the country’s citizens through newspaper adverts to invest in 5% bonds.

According to a professor of contemporary history at King’s College London, Richard Roberts, Britain already has a long history when it comes to distributing loans to fund its wars. he added that the debt the country accumulated during the Great War was the biggest debt there ever was in those times throughout world history.


Heziel Pitogo

Heziel Pitogo is one of the authors writing for WAR HISTORY ONLINE