After decades of campaigning, the
Slavery Abolition Act 1833 (
3 & 4 Will. 4. c. 73) was passed. The
plantation owners in the Caribbean, represented by the
London Society of West India Planters and Merchants (now the
West India Committee), had opposed abolition. The 1837 act paid substantial amount of money constituting 40% of the
Treasury’s tax receipts at the time to the former slave owners, but nothing to the liberated people. The act empowered the
Commissioners for the Reduction of the National Debt, under the direction of the Treasury, to either pay the compensation that was still owing to slave owners out of the West India Compensation Account, or to transfer a proportionate amount of 3.5% government annuities. The various acts of
William IV relating to slave compensation were to be considered, as far as applicable, to apply to this act. Slave owners were paid approximately £20 million in compensation in more than 40,000 awards for enslaved people freed in the colonies of the
Caribbean,
Mauritius and the
Cape of Good Hope, according to a government census that named all owners as of 1 August 1834. This represented around 40 per cent of the British Treasury's annual spending budget, and has been calculated as equivalent to around £16.5bn in today's terms. Approximately half went to
absentee landlords in the UK, while the rest went to slave-owners in Africa and the
West Indies. The largest total amount paid in compensation was to
Sir John Gladstone, 1st Baronet, father of prime minister
William Gladstone, who was paid £106,769 (enough to purchase goods that would cost about £10.3m in 2021, or labour worth about £95m at 2021 prices) in compensation for 2,508 enslaved men, women and children they regarded as property across nine plantations. Payments of the bonds to the descendants of creditors was only finalised in 2015 when the British Government decided to modernise the
gilt portfolio by redeeming all remaining undated gilts. The long gap between this money being borrowed and the final repayment of any portion that may still have been outstanding was due to the type of financial instrument that was used, rather than the amount of money borrowed. British historian
Nicholas Draper, in his book
The Price of Emancipation: Slave-Ownership, Compensation and British Society at the End of Slavery, states that "
Nathan Rothschild and his brother-in-law
Moses Montefiore led a syndicate underwriting the issue of three new series of securities to raise £15 million: we don’t know how much they distributed or sub-underwrote. A further £5 million was paid out directly in government stock". == Legacy and evaluation ==