-3-m
46
It appears unlikely, however, that either of these sources
can meet colonial requirements in full, and we have, therefore
looked up the arrangements made in 1914-1918 for meeting
urgent oversea requirements. In their letter No. 2402/14
of the 24th of November, 1914, the Treasury agreed in
principle to an advance being made from the Vote of Credit
to the Malay states upon the some conditions, as indicated
in Treasury Minute of the 17th of November, 1914, as the
Exchequer loans made to the Dominions. As, however, the
Vote of Credit had been provisionally allocated for other
services, the Treasury proposed that arrangements should be
made with the assistance of the Bank of ängland for temporary
advances to the Crown Agents, and they were prepared to me
their good offices with the Bank to obtain the necessary
aacomodation. It was decided also that these arrangements
should be extended to other debtor Colonies and Frotectorates,
on the condition that the assistance of the Bank of england
would only be invoked to meet net total advances by the
Crown Agents after they had used any funds at their disposal
for such borrowings.
what we should now like to suggest is that, if it
is decided that borrowing for a Colonial Government is just-
ifiable, arrangements should be made for funds to be
provided from the proceeds of loans raised by His Majesty's
Government, on the undertaking that payment of interest at
whatever rate may be appropriate should be made by the
Colony concerned. Cther detailed conditions would no doubt
have to be considered. For example, it might be desirable
to lay down that, at the end of the war or at some agreed
date thereafter, the colony should fund the debt by issuing
a loan in the usual way, the proceeds going to extinguish
the capital debt to His Majesty's Government. But points of
this kind can be takes up later if we can reach agreement on
the