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expended, I hope to lay before you supplemental returns which will be necessary for the carrying on of these works. There is one question raised in this memorandum which I consider is unfortunate, inasmuch as it is a matter of principle. Section 4 of the memorandum reads "Whilst we are ready to concede that certain of the contemplated works in the New Territory may be defrayed out of the general revenue, we are most decidedly of opinion that the principal works for developing it should be provided for by a loan. The public works on this island have been long deferred for want of funds, and now that they are available for proceeding with the most important of these works we feel bound to deprecate, in the strongest manner, any proposal to divert such funds to any other purpose whatever." Now my instructions are very definite from the Secretary of State, and those instructions are that the revenue of the New Territory shall be a portion of the general revenue of the colony, and that being the case the necessary expenditure on the New Territory must come out of the general revenue of the colony. Apart from the fact that Her Majesty's Government do not consider that a loan is advisable for these works in the New Territory and I may say at once that I concur entirely in the opinion of the Secretary of State, the fact remains that we have a certain amount of money over what we require. There is a prima facie necessity in the New Territory. That prime necessity is a road to connect this place with the deep water at Mirs Bay. That road having been made and the police stations built or well in hand, I do not know that, with the exception possibly of the Kowloon Water Works, there are any other important works for which money will be required for the present. I know that it has been proposed that we shall make a number of roads, and I believe that in the future a number of roads will be made, but I think it is well to know by experience what it is absolutely necessary to spend in the first instance. No doubt it will be necessary to connect these roads in the future, but I do not think any burning necessity exists at present except for that particular road to Mirs Bay, which will give me immediate command of the district. Police Stations of course are necessary. As you know, the amount of money required for the policing of the New Territory is a good deal in excess of what was estimated at the time Mr. Lockhart first saw the country. We thought a very few police would be sufficient; now we know the condition of the country and that from time immemorial clan fights and armed robberies have been the order of the day. I admit that one of the works it will be necessary to go on with in the near future is the Kowloon Water Works. Then the question of a loan may be finally considered if we have not the money to go on with the work, but at the present moment we have plenty of money for the works we propose to take in hand.
Then there is another question, a question of principle, and one which will have to be considered later. That is the question as to how far we are justified in the colony, in asking for public works which are not works of permanent utility, like waterworks or sanitary works, in considering the premia derived from land sales as available for the purpose. It must be admitted by you gentlemen, who are business men, that in using premia we are using the capital of the colony, and the question arises as to whether that or a certain portion of it should not be put to a reserve fund in view of ...
That is a matter which requires very careful consideration, especially at a time like the present when we derive a very large income from land sales. I am not at all sure that that large income is going to continue in years to come. This is one of those matters which will have to be considered here and also in London.
With regard to the fifth paragraph in the memorandum, I am entirely in accord with it, and I think I may say the same with regard to the memorandum as a whole. I am as anxious as you that these works should be carried out. I see the honourable member for the Chamber of Commerce was anxious about a New Post Office, a shelter for chair coolies at the Peak, and public latrines. I entirely agree with him. It is my intention that a shelter for chair coolies at the Peak shall be put up next year, it is my intention that as many latrines as possible shall be built next year, because I think they are of cardinal importance; these money ... future requirements.
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