7.2
68
in recommending "a properly-constituted Authority. Board, or Imperial Tribunal?"
THE DOCK AND HARBOUR AUTHORITY
Port of Hong Kong-continued
Advisory Port
I
To enable the Government to appraise intelligently the needs of the Port, the Board should study and observe traffic and port conditions, and advise and make recommendations as "to whether the results of these studies indicate the desir- ability of greater channel accommodation, by deepening the fairways; the provision of berthage, increased storage space, road and railway transport facilities; change in the disposition of buoys, lights, etc., modification of the tariffs; ** or advice in any matters which concern the efficient working
of the Port.
"Whilst I have obtained much information to enable me to prepare this report, the various Schemes of Development "are recommended with some reserve as the information
available is insufficient, from which to deduce with any degree of accuracy the nature and extent of actual require- "ments. In the light of further information the various "schemes may require to be modified in detail.... the programme of Port Development works to be constructed by the Government in the near future must necessarily be "limited to the amount of berthage, which there is no doubt "would either become immediately remunerative, or the re- turn of the cost be assured by the disposal of land reclaimed "in connection with its construction. Otherwise, to secure a "return on the capital expense involved in the construction "of berthage in excess of that taken up, would necessitate "either the levying of higher charges for the use of that "portion taken up or increased taxation on shipping. The latter may not only result in driving away existing trade but discourage new trade. The extent of the works recom- "mended for immediate construction is, therefore, limited
by these considerations.
་་
So far the development of the Port has been left to priva❤ enterprise and adequate accommodation has not been made "for shipping. Without the provision of the most economic handling and storage facilities possible, the present develop- ments, together with the advantages of the security pertain ing to British Administration, the Colony's banking facili- "ties, and its excellent harbour, are unlikely to be sufficient inducement for the producer to send forward his traffic so "that Hong Kong may deal with the trade its strategic posi- "tion should secure.
44
Private companies, however, cannot be expected to meet the cost of development works which are necessary to secure true efficiency and economy in the handling of cargoes, as the return on the capital cost is subject to trade "being handled over the works constructed. In this respect "it may be mentioned, that the Port derives little benefit from the large transhipment business at Hong Kong on through Bills of Lading. Nevertheless, private enter- price should be encouraged rather than abandoned. All "obstacles such as any marine and pier rights or other domination of the waterfront in the way of creating modern accommodation for shipping should be removed, if unable "to be co-ordinated in the general plan of developments. Port facilities are in the service not only of the Colony but of South China, and indeed of the many ports with which commerce is interchanged. The control of the Port itself, and of port facilities, as well as all other matters relating to the waterways, construction of quay accommodation, super- vision of all port works under construction, and the general maintenance, amelioration and extension of the accommo- dation for the exploitation of the waters of the Colony, should therefore be retained in the hands of the Govern- ment.
+
"
"Since the shipping or Godown (warehouse) companies themselves cannot be expected to initiate necessary reforms, Government should put into operation such works as are recommended, and such extensions as with the advice of the Advisory. Authority it is considered will best serve the interests of the Port. The construction of the quays, harbour roads, and the carrying out of all necessary dredg- "ing, should be undertaken by Government which would "lease the steamer berths to private operators on long term leases. The junk basins, being as neccessary an adjunct to transport as roads and railways and at the same time providing shelter for small craft during typhoon weather, "should not be a charge on the lessee of the steamer berth. Private enterprise, however, should be required to provide "the shed, cargo-handling, and all other facilities.
21
"
In regard to the granting of exclusive and particularly long term leases for the use of the piers and wharves it would seem well to observe some degree of caution. The recent experience in America has been that such leases may result in less efficient use of the facilities than is desirable for the "best interests of the Port. A lessee, for example, may keep "his wharf idle rather than permit its use by an actual or potential competitor, or he may make such high charges as
"
44
FI
February, 1942
to drive business away from the Port. This actually hap pened in New York during the Great War. If leases are made, they should preferably be in the form of first call on the berth, Government reserving to itself the right, when the berth is vacant, to assign to it vessels other than those be- longing to the lessee, or in which he may hold a direct or indirect interest.
The basis of this Policy is that, while there would be the broad impartial outlook of Government, which would pro- vide the costly works and lease them in reasonable terms "for the exploitation of the Port, the administration of busi- ness would be carried out by commercial people who should be interested in despatch, efficiency, and economy, on the "method of Profit and Loss."
3
It will perhaps now be conceded that Sir David Owen's recom- mendations regarding Policy, control, management and administra- tion are little different from those laid down in my report in 1924, the only difference being that he has elaborated them by going into a great deal of detail.
With so much information and advice on this subject as I know the Government already had in its possession, one is left to conjecture why it was considered necessary to seek further advice and so incur additional expense at a time when Great Britain was already at war and Hong Kong threatened! After all, the pier leases do not expire until 1949 and, in any case, if it was not found possible to adopt a complete scheme of control and form of development in the immediate future, the lessees could have been informed that their leases would be renewed for a period of say 10 years, which, I imagine, would have been sufficient encouragement for them to effect necessary repairs and improve- ments, the cost of which they could retrieve over a period of about 17 years.
Government Policy
Sir David Owen remarks that for years the doctrine of "laissez faire" has characterized the Government's attitude towards this question of control and development. To the uninformed it would indeed appear that the Government was disinterested. On the contrary, the Government, at any rate during the period of Sir Edward Stubbs' governorship (1920-1925), I do know was very conscious of the importance of the harbour-the very life-blood of the Colony. I venture to think that had conditions been more stable than they have been since the general strike in Hong Kong in 1925, and the Government been untramelled by political con- siderations, we should not now, in 1942, be discussing this sub- ject, for the policy of control and development would have been decided long ago; and no doubt by this time many works would have been completed.
Does not the mere fact that a complete stranger to the Colony was asked to make recommendations in the light of physical, economic, and political conditions" in 1941, lead one to conjecture whether political expediency dictated the Government's attitude, and so another report would assist appease for a further time im- portunate demands of people commercially interested in the development of the Port? If so, then Sir David Owen's report has served a very useful purpose and at the same time has added much valuable information on the subject under review.
It is really quite immaterial who first put forward the idea of an Advisory Board, but, as I happen to have been the one who did so, I would like to take this opportunity of stating that the Harbour Board created by the Government in 1929 in no way reflected the Impartial Tribunal which I envisaged as the first need of the Port. As Sir David Owen says its constitution "seemed hardly a happy one." I would even go farther in saying that it would be ridiculous to expect a Board so con- stituted to produce any results.
In November, 1920, I had the pleasure of daily contact, over a period of three weeks, with the late Sir Maurice Fitzmaurice, when he visited Hong Kong at the invitation of the Government. Knowing his views as I do, I would like to avail myself of this opportunity of stating that I concur with Sir David Owen that it was not the intention of Messrs. Coode, Fitzmanrice, Wilson and Mitchell that a Port Trust in Hong Kong should operate any of the facilities which may be provided and/or controlled by it. It is unfortunate that, in their report in 1922, the word " manage was introduced, for, quite naturally, it would lead to miscon ception of the Consulting Engineers' recommendations in regard to administration of the business of the Port.
Constitution of the Board
J
Before passing to comment on the physical developments pro- posed I would like to make an observation on the proposed con- stitution of the Trust which Sir David Owen recommends should remain in being for three years as an experiment.
Whilst he has made it quite clear that this proposed Body of Harbour Trustees should be an absolutely impartial one consisting of eight persons, including an independent chairman, three Gov- ernment officials of high standing, three British subjects nomin- ated by the Hong Kong General Chamber of Commerce and one person nominated by the Chinese Chamber of Commerce, I note he suggests that a quorum at any meeting should be four, and
February, 1942
THE DOCK ANd Harbour AUTHORITY
Port of Hong Kong, continued
that no Trustee “should be allowed to vote on any question dir- ectly affecting his own or his firm's business."'
In order that the Trust should function satisfactorily it is abso- lutely essential that goodwill and mutual trust exist amongst all peoples who have any interests in the Port. For this reason I would suggest an addition to the effect that "no Trustee be allowed to vote on any question directly affecting his own or his firm's business or interests." In this connection may I draw attention to a situation which may quite conceivably arise? And believe me this is no idle flight of fancy!
One or all three British unofficial members of the Trust may
quite possibly be directors of The Wharf and Godown Co., or of The Hong Kong and Whampoa Dock Co., or of The Star Ferry Co., or even of all three. A question of development for the benefit of Messrs. Alfred Holt and Co. (a private company) competitors of The Hong Kong Wharf and Godown Co. may arise. Likewise for Taikoo Dock Co. (a private company) com- petitors of The Hong Kong and Whampoa Dock Co., or for one of the Chinese Ferry Co.'s which may be competitors of The Star Ferry Co. In such circumstances, I am afraid, if the British member or members were allowed to vote, a spirit of apprehension may arise and develop into one of mistrust amongst some of the parties concerned. On the other hand, if they were not allowed to vote, the Trust may at times become bureaucratic. Such con- tingencies should be guarded against.
Another situation that constantly occurs in the tropics is that due to the fact that for reasons of health, it is necessary every three or four years for white people to reside for some time (usually 6 months) in a temperate climate. Doubtless someone would be appointed to take the place of the absent member, but he may not be so conversant with the work of the Trust. It will be gathered, therefore, that the constitution of the Trust would be virtually in a state of constant change and so here again may deteriorate into a bureaucratic body.
It is agreed by all that membership of the Trust should be restricted to the fewest number compatible with securing true efficiency in its work in the best interests of the Colony and all concerned with its harbour, but, having regard to such contin- gencies, and there may quite possibly be other special circum- stances that, by frank and free discussion may come to light, I think it would be well to increase the membership of the Trust, including the chairman, from eight to eleven by the appointment of three additional British subjects, also to be nominated by the Hong Kong General Chamber of Commerce.
This letter is already sufficiently lengthy, so I propose to deal with the proposals for Physical Development in a subsequent communication.
Westbury-on-Trym, Bristol.
12th January, 1942.
Yours faithfully,
JOHN DUNCAN.