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Development Corporation (Treasury Advances)

Volume 498: debated on Wednesday 26 March 1952

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asked the Secretary of State for the Colonies upon what terms and at what rate of interest the Colonial Development Corporation borrows money.

Long-term Exchequer advances are made for periods of 40 years, repayment being by means of 33 annuities comprising interest and capital beginning in the eighth year. Interest is in accordance with the rate current for Government credit in redeemable securities at the time the advances are made (at present 4¼ per cent.) so calculated to take into account the fact that no interest will have been paid during the first seven years.

Short-term advances, which are given for periods of six months, similarly carry the current rate for such loans, which is at present 2½ per cent. Borrowing from other than Government sources is by private arrangement in accordance with usual commercial practice.