The government has paid off all debt from the First World War
Chancellor of the Exchequer George Osborne today confirmed he had redeemed £1.9billion from an outstanding bond.
The bond, known as the 3.5 per cent War Loan, was issued in 1932 by then-Chancellor Neville Chamberlain as part of a campaign to reduce the costs of servicing the national debt.
It was issued as an exchange for the previous five per cent War Loan 1929-47, which had originally come out in 1917 as part of a campaign to raise money for the First World War.
The Debt Management Office estimates that Britain has paid some £5.5 billion in total interest on the five per cent and 3.5 per cent war loans since 1917.
This is a moment for Britain to be proud of.
Mr Osborne said he would repay the money in December last year.
Speaking at the time, he said: "This is a moment for Britain to be proud of. We can, at last, pay off the debts Britain incurred to fight the First World War.
"It is a sign of our fiscal credibility and it’s a good deal for this generation of taxpayers.
"It’s also another fitting way to remember that extraordinary sacrifice of the past."
Everyone registered as a bond holder will be contacted by financial firm Computershare Investor Services PLC about getting their money back.
The Government is also in the process of repaying a range of other bond and gilt loans - some dating back to the 18th century.