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that he is not yet in a position to give a complete estimate of the cost of providing the additional accommodation for the increased Garrison, but he hopes in a few months' time to furnish such estimates for certain definite portions of the scheme, which will serve to check the confessedly rough estimate in Appendix "D."

The £50,000 mentioned in that Appendix as a very rough estimate for replacing the accommodation that will be lost by the proposed sale of lands, does not include any amount for sites.

The view of the Secretary of State is that the Colony should provide such sites on Crown lands, but that it should not be called upon to purchase them at its sole cost, considering the very high price of land in many parts of Hong-Kong.

As the War Department is not prepared to pay any large sum for the purchase of sites, it will be necessary to

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