ABSTRACT
While these political pledges were being made the permanent staff of the Colonial Office and the Treasury continued to debate the justifications for and the terms of the proposed new scheme. Naturally Colonial Office and colonial government enthusiasm for new development legislation would depend on the degree of aid offered and its method of administration. The financial attractiveness of the measure would depend upon the arrangements, firstly, for raising capital and, secondly, for paying interest. A choice would have to be made between the several alternatives mooted in the various proposals put forward. Colonies could be left to raise capital under the Colonial Stock Acts, or they could be assisted, particularly where those acts were inapplicable, by Imperial government guarantees. The Commission on Closer Union and the Treasury had favoured this idea. The commission had also suggested that capital could be raised instead by the Imperial government, as under the Local Loans procedure, and advanced to colonies. There was also the possibility of capital being provided from a colonial development fund. It was generally accepted that many colonies could not afford to meet interest payments at once from their revenues, and that was why the Commission on Closer Union and the Treasury suggested that an amended guaranteed loan system should allow interest to be paid initially out of capital. But there were, for the Imperial government, more expensive alternative suggestions involving their payment of interest charges. JoynsonHicks had favoured that approach, and by March 1929 the Treasury appeared ready to accept the suggestion of Amery and the Commission on Closer Union that an annually-supplied colonial development fund might be used to meet interest payments, by grant or loan. Disagreements remained, however. There was a wide gap between Amery’s idea of a block grant leaving administrative responsibilities solely in the hands of the Secretary of State and the proposal of the Commission on Closer Union preferred by the Treasury that the vetting of schemes should lie in the hands of a body predominantly of businessmen. It is evident that the political commitment made by Baldwin on 18 April 1929 was based on no unanimity as to the terms of the proposed legislation. More than three months were to pass before the Colonial Development Act was passed.
