(No. 115.)
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No. 3.
Copy of DESPATCH from the Duke of NEWCASTLE, K.G.,
to the Acting Governor of HONGKONG.
SIR,
Downing Street, 5th September, 1863. You are probably aware that the attention of Her Majesty's Government has been much occupied during the last two years by the important subject of Colonial Military Expenditure and that a Committee of the House of Commons was charged with the enquiry whether the more wealthy and important of our Colonies might not be properly called upon to defray an increased proportion of the cost of their Military defence.
After a thorough examination of the subject, it was decided that this ought to be done: and in accordance with this decision, Ceylon, Mauritius and the principal Australian Colonies have been or will shortly be called upon to contribute more largely towards the support of the several Detachments of Her Majesty's Troops which are maintained in those Colonies. If this call is made upon Colonies of which some have not for a long period and some have never imposed any sensible charge on the Imperial Treasury on account of their Civil Expenses, it is not to be supposed that a Colony like Hongkong, of which the Civil Establishment alone in the first 14 years of its existence, cost the Mother Country no less than £273,000, should be allowed to escape any longer the duty of aiding in its own defence, except on grounds of plain necessity.
But it is evident that the plea of necessity no longer exists. It appears that the Revenue and Expenditure for the three years 1860-1-2 have been as follows:
1860, 1861, 1862,
Revenue £94,182 £127,241 £131,512
Expenditure £72,390 £109,682 £122,423
that the excess of Assets over Liabilities on the 31st December 1862 was £98,549, and that the estimated Revenue and Expenditure for 1863 were:
Revenue £118,512
Expenditure £125,000
The average surplus Revenue over Expenditure during 1860-2 was therefore more than £15,000 per annum. Meanwhile, no less than £106,465 (or about £35,000 a year) has been expended on Public Works (including, I admit, the necessary repairs to Roads, Streets and Bridges) and I observe that in the Estimates of 1863, a sum of £42,200 has been set aside for objects of that nature.
I notice these charges because, although there is no more legitimate expenditure than that on Works of public utility, the amount of that expenditure is in a great degree regulated by the amount of surplus Revenue of which it in some degree thus furnishes a measure.
I further observe that this prosperous state of the Revenue has been coincident with a large and general increase in the expense of Public Departments, an increase which entitles me to assume that the existing Establishments will be able at their existing Salaries to perform the work required of them for some time to come, or at any rate that increased expenditure will only be called for by increased prosperity, which will furnish the means of meeting it. Although, therefore, I am aware that the receipts from Land Sales may be expected to fall off, I think it undeniable that the general financial position of Hongkong is, and is likely to remain, in a highly sound and prosperous state; I can hardly doubt that, exclusive of the balance in hand, amounting as I have said to £98,000, there will be an annual sum of £30,000 or £40,000 available for public works and what may be called extraordinary purposes. This sum will be obtained by the existing taxes in a Colony of which the inhabitants pay no import duties. Under these circumstances, I cannot think that Hongkong is incapable of contributing towards her Military Defence, of which the average cost to the Imperial Government during the 4 years preceding the China War was about £70,000.
It is contemplated now that the force to be permanently stationed in the Colony shall be about 1000 strong, including Artillery, and although Her Majesty's Government fully admit the probability that the Imperial Force in Hongkong will be in part maintained for Imperial purposes (which purposes, however, are closely connected with the prosperity of the Colony), they cannot doubt that the force, or a large part of it, is also required for the security of the Colony, and for the service thus rendered, they think it but reasonable that Hongkong should now pay an equivalent. That payment may, in my opinion, be properly fixed at £20,000 per annum for 5 years commencing on the 1st of January 1865.
At the expiration of these 5 years, the amount will be subject to any revision which the altered circumstances of the Colony may require.
It had been my intention that this contribution should have come into operation from the 1st of January 1864, but bearing in mind that the Council may possibly have had under their consideration the Estimates of Revenue and Expenditure for that year before the receipt of this Despatch in the Colony, and that the establishment of a Mint, to which I have adverted in another Despatch, will cause a considerable charge on the Revenues of the Colony, I have decided that this demand on the part of the Imperial Treasury shall be postponed until the year 1865.
I have, however, thought it better to make this announcement to you at once, in order that you may lay this Despatch before your Council for their consideration, on the chance of the Estimates being still before them, and that they may thus be made aware how necessary it will be for them to enforce a strict economy in their expenditure, and may not vote monies for new Works without the clear prospect of having ample funds to complete them.
It will hereafter devolve upon Sir Hercules Robinson, with whom I have been in communication, finally to deal with the question in concert with the Council.
For the present, I am desirous not to press too heavily at first on the Colonial Revenues, and thus possibly to retard Works of public utility for which, besides the large balances in hand, a sum of £15,000 or £20,000 per annum would probably remain available.
The Officer Administering the Government of Hongkong.
I have, &c. (Signed) NEWCASTLE.
P.S.-Since writing the above, I have received your despatch No. 128, dated the 9th of July last, transmitting the Hongkong Ordinance No. 7 of 1863, together with the Estimates for 1864.
(No. 199.)
No. 4.
Copy of DESPATCH from the Acting Governor of HONGKONG
to His Grace the Duke of NEWCASTLE, K.G.
MY LORD DUKE,
Hongkong, 10th November, 1863. I have the honor to acknowledge Your Grace's Despatch No. 115 of 5th September last, announcing that from 1st January 1865, this Colony will be charged with £20,000 per annum on account of Military expenditure.
I observe that Your Grace only contemplates my placing this Despatch before the Legislative Council in the event of the Estimates for 1864 being still before them, and that it will devolve on Sir Hercules Robinson to deal with the question finally.
As the Estimates for 1864 were passed in July, and as Sir Hercules Robinson will be here in a month, I have abstained from moving in the matter and hope Your Grace will approve of the course I have taken.
To His Grace the Duke of Newcastle, K.G.,
&c., &c., &c.
(Separate.)
&c.
No. 5.
I have, &c. (Signed) W. T. MERCER.
Copy of DESPATCH from the Acting Governor of HONGKONG
to His Grace the Duke of NEWCASTLE, K.G.
MY LORD DUKE,
Hongkong, 2nd December, 1863. With reference to Your Grace's Despatch No. 115 of 5th September last acknowledged in mine of 10th November No. 199, I trust Your Grace will not think me intrusive
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