(5) Commitment." Co. for vessels # 1,920

Signalling of vessels

(6) Maintenance of Lighthouses FB. 2,500

$113,409

deducted from this expenditure might be and a few thousand dollars for pensions of officers formerly in Harbour & Lighthouse depts.

I don't think that Lighthouse Harbour Dover should be seen as a moderate profit in Hong Kong; but I can see no harm in levying Harbour Dues on the clear understanding that they shall never exceed the Harbour Expenditure. It would probably be better that the proceeds of the Dues should fall well below the expenditure, and as it is perhaps disputable whether the Observatory is wholly kept up in the interests of shipping.

I would therefore propose a compromise between the two following alternatives:

English Shipping Co. - better than reduction from $113,000 to $90,000.

Taxation in HK (as a reduction of revenue on which the military contribution is based, we are bound by an agreement with the Military Dept. to consult that dept. before reducing these Dues, but I don't think they will make any difficulty about such a moderate reduction).

Lord Selborne - why a copy of dispatch should not go to the Petitioner.

I do not see why a letter embodying Mr. Johnson's minute, giving the two alternatives as being at present under consideration, and adding that her Majesty's Govt. would give their observations duly considered in due course if they wish, should not be sent.

C.P.L. 2 March

Either (1) to levy a uniform due of 2 cents per ton, producing about $90,000, or

(2) to levy dues on a sliding scale (as in Schedule B of Harbour Order of 9th Sep. 1884) with a maximum due in vessels of (say) 1800 tons.

This would probably please the Shipping Co.

As amended, I approve.

52/3

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