Easing the Funding Constraint

The Sinclair settlement on CDC’s financial structure was to be reviewed after three years, as Macleod had promised when making his announcement to the House of Commons in April 1961. CDC was keen for the review to take place and Rendell sought to activate it in April 1964.1 However initial preparations for the review were overtaken by the general election and change of government and Labour’s decision to set up the Ministry of Overseas Development in succession to the Department of Technical Co-operation. Two years passed before officials were ready to activate the review, which took the form of an inter-departmental working party. CDC was invited to attend its meetings without being a member of it. The working party was set up in May 1966 without specific terms of reference and its report was eventually issued in October 1967.2 The long delay in re-examining CDC’s financial arrangements was ameliorated by one helpful interim decision in 1965. The ODM, as it was called, agreed to an outright waiver of interest for seven years on a limited range of equity projects, to be agreed on a case by case basis.3 £6 million of investments qualified for this treatment by the end of 1967, although CDC found the clearance process onerous.