CONFIDENTIAL
(3)
(4)
at Government's expense, during which time the growing rate yield should allow the Council to build up reserves for this purpose; in any case, we suggested, a decision by the Council to undertake any particular level of capital works would quite properly be followed by a request from the Council for a higher rate to finance such expenditure. Despite these explanations, there was a feeling among the Unofficials that the formula for calculating the initial rate should include an additional 1% or 2% rate for this purpose, to avoid any accusations that Government was forcing the Council to incur the odium of seeking a higher rate shortly after the new system was in force. This point will be examined in Finance Committee later this month;
there would have to be control over the Urban Council's market borrowings; this is of course the intention, particularly as this could lead to request for an increased rate. It was confirmed that this was the intention;
it was necessary to clarify the powers of the Chairman, and whether or not a seat vacated in this way should be filled by a new elected or appointed member as the case might be.
One departure from the paper which was suggested on the Official side and agreed by all was not to withdraw the franchise from New Territories residents (see paragraph. 8(o) on pages 9 and 10 of the Ex.Co. paper); the reasoning being that such withdrawal, although logical enough vis-a-vis the Urban Council's area of responsibility, could attract disproportionate criticism.
Sir David explained that these proposals were not negotiable as far as the Urban Council is concerned. The Council would of course be free to present its views on them and these would be considered; but the intention was to go ahead with the main changes proposed however the Urban Council might react to them.
CONFIDENTIAL
../