From ‘The New War Loan’, The Spectator, 26 June 1915:
The case for a new War Loan is overwhelming. Since the yield of the last War Loan ceased to cover the cost of the war, the country has been living from hand to mouth on money brought in by the issue of Treasury bills. These bills are issued for short periods, and there is a liability to pay them off when they fall due. No prudent Chancellor of the Exchequer could permit this liability to go on extending indefinitely. It was absolutely necessary to take steps to assure the country possession of a sufficient sum of money to meet present needs unencumbered by a liability for repayment after a few months’ interval. The Loan which Mr. McKenna has now issued with the consent of the Cabinet and the House of Commons postpones the liability for repayment to the year 1945, while reserving to the Government an option to repay, if it should be in a position to do so, in 1925. The Loan bears interest at the rate of 4.5 per cent, and is issued at par. Some critics have already suggested that 4.5 per cent is a needlessly liberal rate of interest. The answer is that we have to get the money, and it is worth while in the present emergency to err on the side of liberality in order to attract, if possible, money from neutral countries, and especially from America, as well as from residents in the United Kingdom. It is better to pay an 0.5 extra per cent, than to run the risk of the Loan failing.
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