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14
Mr. Caine.
Would you please see Mr. Sloss's note at (25).
You will see from (14) that in February last the Treasury authorized the payment from Hong Kong funds
of
(a)
a free grant to the University's funds of £70,000 to enable the University to meet its liabilities in respect of salaries and payments due from the Provident Fund; and
(16) a free loan or £30,000 towarüs the cost of
providing equipment for immediate reconstruction needs.
As you know our Provisional Powers Committee has authorized the payment or arrears of salaries and payments from the Provident Fund. See minutes of our meeting on the 22nd March at (22). Mr. Sloss now asks that the grant and loan authorized by the Treasury should be paid into the University's account to cover the expenditure already made and that for which he now seeks authority namely expenditure on equipment. You will no doubt agree that this transfer should now be made and I submit a drart letter to the Crown Agents accordingly. (As I am about to go on a month's leave I have signed the letter in anticipation or your approval, but please alter it if you do not agree with it.)
As
singe the Civil Government has been re-established since these arrangements were authorized it is I think necessary to explain to them the circumstances in which this transfer of Hong Kong funds is being made authorized and I attach a draft despatch on the matter to the Governor.
You will see from (25) that Mr. $loss estimates that £35,000 will be needed for equipment for medical and civil engineering laboratories alone and that this will more than exhaust the University's account even when the loan of £30,000 has been paid into it. Mr. Sloss suggests an approach to the Treasury for an additional grant. As however there is no indication that the present estimate will cover all that is required even for immediate needs, (and indeed I feel sure that it will not) I suggest that the question of a further approach to the Treasury should be left over for the present. As, however, Mr. Sloss is satisfied as to the immediate necessity for this equipment I suggest that he should be authorized to place the necessary orders and to arrange for an overdnít with the Bank for the time being.
There will also be expenditure on long term needs if the proposals about to be put forward by the Advisory Committee considering the future of the University are accepted. These needs are being estimated in an Appendix on Finance attached to the Committee's Report. (The report is at present at the stage of a first draft only and is a somewhat unwieldy document. I will if I may send it to you when it emerges as a second draft.) Inevitably there must be discussion on the finances or the University with the Treasury in the next few months. You may agree, therefore, that arrangements for liquidating the
/overdraft