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out to low-water mark or a little beyond it. This would be highly beneficial, both to the town and to the Military Authorities. The inconvenient interruption to the Praya might be done away with, whilst providing the Naval and Military Authorities with deep-water wharf accommodation and boat chambers, affording far greater facilities for their work than they now possess. It is probable that the advantages which the public would obtain by the completion of the Praya, past the War Department's property, would be sufficient to justify the Colonial Government in incurring a very considerable proportion of the expense of this work.
4. The Surveyor General (Mr. PRICE) has furnished the following report to the Colonial Secretary :-
"In accordance with the instructions of His Excellency the Governor that I should prepare a plan and estimate of the junction of the Eastern and Western Prayas by a Marine Embankment and roadway running across the sea-frontage of the Artillery Barracks, Naval Yard, and the water-side premises to the East, so as, among other objects, to carry out the sanitary recommendations of Mr. CHADWICK, I have now the honour to transmit to you the plan called for. The cost of carrying out this work will be Two hundred and thirty thousand dollars ($230,000). The equivalent to about £15,000 in English money. The extent of area reclaimed will be over 7 acres, about 5 of which will fall to the Military Authorities, while the Naval Yard will be extended by over a quarter of an acre of dry land and three quarters of an acre of water area in the shape of a new basin."
5. I annex the plan of the proposed embankment and roadway which has been prepared by Mr. PRICE. It will be remembered that Sir JOHN COODE furnished some valuable suggestions, which were forwarded with the despatch from the Colonial Office, No. 111 of August 29th, 1876.
6. It is estimated by the Surveyor General (as was stated above) that this important project would cost about forty-five thousand pounds (£45,000), and would take about three years in execution; so that the annual expenditure on it would be fifteen thousand pounds (£15,000) for three years. This sum has been already voted by the Finance Committee of the Legislative Council. It is proposed that the entire work should be executed by the Colonial Government, but that the Imperial Government acting on behalf of the Admiralty and War Office, should contribute hereafter to the cost whatever sum the Home Authorities may decide to be just and equitable, considering the great value of the reclaimed land which will be added to the Naval and Military property, and the improved sanitary conditions for the Garrison which will doubtless follow the completion of the embankment.
7. It has been suggested here, and I submit the suggestion for Your Lordship's favourable consideration, that the Colonial Government should pay two-thirds of the entire expenditure of forty-five thousand pounds (£45,000) at the rate of ten thousand pounds (£10,000) a year for three years; and that considering the large benefit which would be derived by the Naval and Military Departments, the balance of the annual expenditure should be supplied by an annual deduction for three years of five thousand pounds (£5,000) from the Military Contribution of twenty thousand pounds (£20,000) paid by the Colony to the Imperial Government.
8. It will be recollected that, in 1875, the War Office and Admiralty both signified their consent to the proposed embankment and roadway in front of their respective establishments, provided that the work should be carried out at the expense of the Colonial Government; and only demurred to the payment of any contribution from the special funds of the Naval and Military Departments. This difficulty would be at once removed, while the equity of the case would be satisfied, by the adoption of the suggestion made in the last paragraph (par. 7).
9. The Executive Council, in common with myself, strongly recommend this work; and the Financial Committee of the Colonial Legislature have already (as was stated above) voted the sum required, and expressed the opinion that negotiations should be entered into without delay with the Naval and Military authorities.
10. Accordingly, I put myself in communication on this subject with Major-General SARGENT, C.B.; Commanding Her Majesty's Troops, and with Vice-Admiral WILLES, C.B., Commanding Her Majesty's Naval Forces in China.
11. I find that the Naval and Military authorities, while fully recognising the importance of the proposed work on sanitary and other grounds, now claim that greater additions and facilities should be granted to their respective departments, at the sole cost of the Colony, than are provided in Mr. PRICE's plan, or than (as it would appear) were contemplated by the War Office and Admiralty when they both, in 1875, gave their consent to the scheme. It is to be feared that the expense of the additions now insisted upon would be too heavy for the finances of the Colony. However, the Surveyor General, (Mr. PRICE), is in consultation with the Naval and Military Departments; and, it is hoped, that, in the course of a few weeks, I shall be enabled to transmit further plans showing the further claims now advanced on the Colonial Treasury.
12. Meanwhile, I have considered it to be my duty to place Your Lordship in possession of the present state of the question so that (if it is thought proper) the Colonial Office may re-open the former negotiations respecting it with the War Office and the Admiralty. It is presumed that those Departments will not withdraw the general consent which they gave in 1875.
13. Finally, it will be seen that the main object of the projected embankment is to remove, on urgent sanitary, commercial, and other grounds, that "dislocation of the City of Victoria, which was deprecated by the late Lord DERBY while he was Secretary of State for the Colonies. He wrote to the first Governor of Hongkong (Sir HENRY POTTINGER) in the following terms: ---
"Her Majesty's Government concur generally with you in the opinion that "we must depend on our Naval Superiority for the complete security of our future "commercial establishments in Hongkong, and that these establishments had better "be allowed to develop themselves in the manner contemplated by you, "without being impeded or dislocated by Military Works or Dock Yards."
I have, &c.,
The Right Honourable
THE EARL OF DERBY,
Her Majesty's Principal Secretary of State for the Colonies,
G. F. BOWEN.