This event is not at all unrelated to the new deal, allied WWII monetary policies, lend lease, the marshall plan, Keynesianism, New Keynesianism (eg Friedman/monetarism) and into the present day.
the Bank(ers) ... purchased the securities in their own names with the bonds then held by the Bank of England on its balance sheet. To hide the fact.. bonds were classified as holdings of 'Other Securities' in the Bank of England's balance sheet rather than as holdings of Government Securities."
The BoE prints £350m of bonds. The BoE sells £100m to the public. BoE declares/lies that they successfully sold all £350m. The BoE buys the outstanding £250m of bonds itself using a virtual credit line backed by BoE bonds. Once the final transaction is completed, £250m of new money exists in government accounts and can be used to fund the war.
This is exactly how UK/US/Etc government deficits work today. Bonds are created. Some are sold. The rest is bought (or kept) by the Fed/BoE itself. The "deception" allows order to remain in the banking world while also allowing governments to fight the war/depression/deficit.
These days, the outright lies are not strictly necessary. Instead, we rely on complexity of ritual, bureaucracy and bond market transactions to "cover our tracks." One thing that has changed in society (if not in central banks and treasuries) is that "what gives money value" has become a non-question. I think that was different 100 years ago.
The researchers write: "The long-held laissez-faire principles of the Liberal and Conservative parties were thus sacrificed to raise the capital upon which the War's outcome depended."
This is a cliche. During the great irish famine 70 years prior, both the King and Prime Minister were involved in almost identical schemes. There are lots of examples.
To me, the odd part is that we can't play it straight and admit that governments invent money... or that it's OK that they do. Every policy that relates to banking, central banking, money printing or such requires some sort of lie. Just like now, FDIC bails out ostensibly uninsured accounts/banks. This seemingly has to come with an assurance that it's not what it looks like... even though it obviously is.
IE, it's not weird that money works like this. It is weird that we have to pretend like it doesn't.