Page 257
satisfactory financial settlement could be arranged. It is on the latter point that negotiations are at present held up.
8. The attitude of the Hong kong Government is that the size of the garrison when the Colony's defence contribution was fixed at al million was far greater thau is now proposed, even with the addition of the two artillery units. Further, the long Long Legislative Council is acutely conscious of the fact that Hong Kong has been left to bear unaided the great burden of the re-settlement of 700,000 Chinese refugees, and the Covernor is very doubtful whether he would be able to persuade unoii'icial members of the Council to agree to maintain the defence contribution at the present level, let alone increase it by the extra cost of the units (approximately £250,000 a year each,. Even though they were brought to agree to such an increase the Covernor feels that it would create such a bad and lasting impression against H.M.G. that the effects would be permanently serious. If they did not agree, the Covernor could only get the money by using the official majority in egislative Council, and this could only be done after a debate in which things would be said which would shake H.M.G. 's position in the Colony to the foundations. He is very reluctant to do this.
9.
The Governor therefore proposed in overber that, as part of a deal on this question, the war office should surrender its lands in the naval dockyard area and that, in consideration of this and of an extra or two artillery units, the Tone Long Covernment would maintain its defence contribution at 1 million for the next five years, plus half the additional cost of maintaining the additional units for the same period. The Covernor feels that an arrangement or this kind would have a practical appeal to unofficial members which would enable him to present it to them in a L'avourable way. This proposal, which was supported C.5.7., Hong Kong, was explained to the war tirice and the ministry of Defence at a meeting under Sir Richard Dowell's chairmanship on Toverber 19th, and at that meeting the kar Office was asked to examine:-
(a, whether it contemplated giving up its
property in the dockyard or continuing to use it;
by
(b)
the value of the property; and
(0)
the details of title.
No indication has yet been received by the Colonial Office as to whether this examination is complete,
Page 257
Page 257
7end