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establishment of aerodromes in the areas covered by the Washington Treaty and, in particular, the question of constructing an aerodrome at Hong Kong.
"(iii.) That owing to the prolonged boycott at Canton and its resultant effect on the financial position of Hong Kong, conditions may have changed since the above-mentioned proposals were put forward, and accordingly they recommend that the Colonial Office be requested to obtain further information from the Governor with regard to the financial aspects of the scheme.
"(iv.) That the formation of a local police air unit, being less urgent, should be postponed for further investigation by the Sub-Committee on the composition and organisation of local forces when that body deals with the local forces of Houg Kong."
3. The Secretary of State for Air shortly afterwards circulated to the Committee of Imperial Defence a Memorandum by the Air Staff drawing attention to the need for the immediate purchase of the Kai Tak area (C.I.D. Paper No. 286-C).
4. After consideration of these Memoranda the Committee of Imperial Defence
on the 25th November, 1926, reached the following conclusion*
"That a telegram should be sent to the Governor of Hong Kong stating that great importance is attached to the establishment of an aerodrome, and asking him to give an estimate of the cost, and to state what steps can, in his opinion, be taken (by acquiring an option on the land or otherwise) to ensure that the Kai Tak reclamation area shall be readily available when the moment arrives for constructing an aerodrome."
5. A telegramt in this sense was accordingly despatched to the Governor, who, on the 11th January, replied that the cost of buying out the Company (1 million dollars) and of completing the reclamation (738,000 dollars) remained unchanged, but that an additional sum of 298,500 dollars was required for covering nullahs and forming a flight gap in accordance with the strong recommendations of local Air Force officere. The Governor repeated his conviction that it was essential that the scheme should be undertaken at once.
6. In a subsequent telegram,† dated the 1st February, the Governor stated that the question of acquiring an option on the land did not arise since the Company were precluded from selling to others without the permission of the Colonial Government.
7. In the meantime, in the course of a discussion on developments in China, the Committee of Imperial Defence had, it is understood, expressed the view that the establishment of an aerodrome at Hong Kong had become a matter of pressing importance. On the 22nd January the Foreign Office agreed that this was the case, and that the recommendations of the Committee of Imperial Defence could be carried out without prior consultation with the United States and Japanese Governments. Finally, on the 3rd February, urgent representations were received from the Air Ministry that the Governor should be authorised to complete the first stage of the scheme at a cost of £4,000.
8. In view of the urgency, and without prejudice to the question of the incidence of cost, the Governor was authorised by telegramt on the 7th February to proceed with this preliminary work, and to report whether further expenditure would be required to complete it. On the 17th February the Governor replied that the estimate of £4,000 (a) provided only for temporary covering of nullahs, (b) omitted the rost of acquiring the area, estimated at 573,437 dollars (say £57,500). As to (a), he had been compelled to sanction a further expenditure of £400 to save subsequent waste of money. The expenditure involved in completing the first stage would thus appear to be approximately £62,000.
9. On the 21st February a further despatch (see Appendix) was received from Governor dated the 18th January explaining, in amplification of his telegram of the 11th January, that, in view of the representations of the local Naval and Air Force Officers, it had been considered desirable to extend slightly the area comprised in the original scheme (paragraph I), and stating that the revised cost was as follows :-
Amount estimated to buy out the Kai Tak Company
Amount estimated to complete the reclamation
Estimated cost of covering in nullahs
Dollars.
1,000,000
739,000
275,000
23,500
2,036,500
* C.I.D. 218th Meeting, Minute 4
† Not printed.
Estimated cost of extension
Of this sum it was hope that at least 500,000 dollars would be recoverable by the sale of outlying portions of the area which might eventually prove not to be required for the aerodrome.
10. It is now requested that the Committee of Imperial Defence may be invited to make definite recommendations on the following heads
(a.) Whether it is essential for defence purposes that land for an aerodrome on the
Kai Tak site should be acquired forthwith;
(b.) If so, which of the three following schemes is recommended:---
(i.) The scheme originally submitted in the Governor's despatch of the 18th February, 1926 (total cost 1,738,000 dollars, with perhaps additional expenditure not exceeding 275,000 dollars on covering in nullahs, and less any proceeds of sales of outlying portions). (i.) The extended scheme submitted in the Governor's despatch dated the 18th January, 1927 (total cost 2,036,500 dollars, less proceeds of sales of outlying portions estimated at 500,000 dollars'.
(iii.) A modified scheme representing the completion only of the first stage of (i) and (ii). On the assumption that it would be possible to acquire the necessary land without purchasing the rights of the Kai Tak Company in respect of the whole reclamation area the total cost of the land, including the pre- liminary work already sanctioned, would be approximately 620,000 dollars.
The
(c.) From what source are the necessary funds to be provided. The prolonged boycott and the subsequent trade depression have resulted in the exhaustion of Hong Kong's liquid surplus, and it has been decided that the Government must borrow in order to balance the budget for the current year. Colony is already paying to His Majesty's Government an annual defence contribution of 20 per cent. of its revenue, and in more prosperous days made a special contribution of £250,000 towards the cost of the Singapore Base. In these circumstances it is felt that Hong Kong is already co-operating in defence expenditure to the maximum of its capacity, and that in view of the existing financial stringency and the hazardous condition of trade with China, which has involved all classes in great loss, it would not be justifiable to seek to impose this additional burden on the Hong Kong community.
Colonial Office, March 17, 1927.
APPENDIX.
Copy of a Despatch from the Governor of Hong Kong to the Secretary of State for the Colonies. (No. 2. Secret.)
Government House, Hong Kong, Sir,
January 18, 1927. WITH reference to your secret despatch of the 23rd June, 1926, and your telegram of the 10th December. 1926, to which I replied by my telegram of the 11th January, regarding the proposed aerodrome in Hong Kong, I have the honour to inform you that the question has, since the receipt of your despatch, been further considered in conjunction with Commodore J. L. Pearson, Captain R. Eliot, of H.M.S. "Hermes," and Wing Commander R. Leckie.
2. As the result of this further examination of the scheme, it is now recommended that the area to be reserved for the aerodrome should be rather larger than that suggested in my secret despatch of the 18th February. I enclose a report from the Director of Public Works, dated the 8th January, 1927, together with a copy of the plan referred to therein, showing the area now proposed for the aerodrome. This area comprises the greater part of the undeveloped Kai Tak Reclamation, and is edged in
† Not printed.
B 2
• Printed as Appendix III to C.I.D). Paper No. 282-0.
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