3. You will also no doubt consider in what way the needs of the emall investora might be met by encouraging the use of Savings Banks and possibly by issue of Savings Certificates,
4 The special sxpenditure included in the estimates should be financed from loan funds rather than from current revenw assisted by loans from H.L.G. It is possible that 877 million provided in the estimates will not all be spent in 1945-7 owing to shortage of supplies. Consideration should therefore be given to estimating the amount required for special expenditure in the next few years which should be included under a Loan Ordinance authorising the raising of a loan locally or in London, as circumstances permit. I en consulting appropriate authorities as to possibilities of raising the loan in Londen but I should prefer a local loan if the terms are not appreciably less favourable than those obtainable in London. In the meantime the question of the possibility of advances being made from the Joint Colonial Fund to finance special expenditure pending the raising of a lean, is being taken up with the Crown Agents for the Colonies,
5. In view of assistance réquired from H.M.C.
Treasury control over Hong Keng finances is in force. The presise form of control has not yet been laid down but, in the meantime, it will be necessary generally to obtain Treasury agreement to any major new commitment. Thus whilst I
appreciate the abnormal situation in Hong Kong which confronts you and the necessity for re-establishing the Colony as a going concern as quickly as possible and the difficulties in foresceing far in advance expenditure which will need to be incurred, I trust that you will keep me informed of y” major new commitments which you propose to undertake order that I may consult with the Treasury before ar subatantial expenditure is incurred.
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Treasury Crown Agents
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Mr. R.L.M. James. Mr. J. Goldburg.
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