coloured yellow, the colony wd, only be bound to pay for those portions to the extent to which, the balance due to the War Dept was available in the Col. Mil hands ace & that when that balance was exhausted no further claim wd be made on the colony.

The Wo will be credited with the balance as it were to become a public reserve for future requirements.

My Nathan to see Tur-Lucas, they generally in accord with me after reading through this correspondence.

"Mr. May especially in the matter of the proposed credit to him wd on account of that part of the hill to be converted into a public park.

I do not think that this area should be treated as if it were to become public property for any purposes of the Colonial Government. Government will, if desired, engage to dedicate it to the public for a purpose which according to the late Gov. will be more useful to the troops than to the public.

Government House, Hongkong, 9th March, 1904.

279

I have the honour to acknowledge the receipt of your Despatch No. 26 of the 15th January last, on the subject of exchanges and transfers of land between the War Department and the Colony.

2. Before giving effect to your instructions in these matters, I feel it incumbent upon me to invite your attention to certain facts which, amid the voluminous correspondence on the subject and during the lapse of time that has occurred since it was first mooted, appear to me to have escaped attention.

3. You direct that the War Department be credited in the Military Lands Account with the sum of $493,177 as the value of the area of land in Military Reservation to be devoted to the "King's Park". You indicate that this sum, after making payments out of it for compensation for land in private ownership at Nga Tau Kok, is to be devoted to acquiring any land that may hereafter be required by the War Department. The War Department will no doubt require the Colonial Government to purchase for it private lands or claim to be granted Crown Lands against this account.

THE RIGHT HONOURABLE ALFRED LYTTELTON, K.C., M.P.

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