U.K. pushes to unlock mystery donor’s millions meant to pay off national debt

The British government is going to court to get its hands on a £475-million fund meant to pay down the national debt, which has been sitting in legal limbo for 90 years due to a frustrating bit of fine print.

An anonymous donor set up the National Fund in 1928 with a £500,000 contribution and left specific instructions that the money only be used to pay off the national debt. The fund has grown by 799 per cent since then, but British officials say they’ll likely never get their hands on it unless a minor stipulation in the fund is changed.

Here’s the catch: the fund will only be released to the government when it’s sufficient to pay off (or help pay off) the entire national debt, which is approximately £1.7 trillion. The National Fund’s value, by comparison, has never been more than 0.066 per cent of the debt, according to the U.K. government.

In other words, it’s going to be a long, long time before the fund will be worth enough to pay off trillions of pounds in debt.

WATCH BELOW: Canadian government’s market debt tops $1 trillion

2:32 Federal government’s market debt tops $1 trillion

U.K. Attorney General Jeremy Wright applied to the nation’s High Court on Tuesday for permission to remove the stipulation and access the fund, in hopes of using the money for debt relief. The £475-million fund is worth approximately US$638 million, or $815 million in Canadian dollars.

“Almost 90 years ago an anonymous donor bequeathed the money to the nation, and yet we have not been able to put it to good use,” Wright said in a statement posted on the government’s website Tuesday.

“The fund could be used to benefit the nation by helping to do what the original donors intended.”

Tweet This Click to share quote on Twitter: "The fund could be used to benefit the nation by helping to do what the original donors intended."

Wright argues that the fund is essentially stuck in “legal limbo,” and will likely never be enough to pay off the entirety of the debt.

The British government’s public records show the National Fund had an income of £7.4 million in the last financial year, bringing its total assets up to £481.9 million, with £7 million in liabilities.

“The aim of the charity is to create a fund, that either on its own or combined with other funds is sufficient to discharge the national debt,” the National Fund’s description says.

British lawmakers have been sparring over what to do with the fund for nearly a decade, ever since the fund managers declared its original purpose to be out of reach.

The government argues the funds should be spent on the debt, in keeping with the spirit of the original donation.

Steve Reed, the Labour Party’s shadow charities minister, argued earlier this month for the money to be distributed to the country’s charitable causes.

“This money would help charities feed the hungry, house the homeless and care for the sick, as well as supporting other worthy causes,” Reed said in Parliament on May 10.

U.K. politician Stanley Baldwin, who later became prime minister, helped touched off a wave of donations to the national debt after the First World War, when he announced he was giving one-fifth of his fortune to the cause.

However, he failed to attract enough donors to achieve his ultimate goal.