Secretariat File No. 37/2321/47.
CONFIDENTIAL.
No. 292.
.54126/4/47
GOVERNMENT HOUSE,
HONG KONG.
12th December, 1947.
12
40
(38)
54126/1/46
(6)
Encl. 1
Sir,
I have the honour to refer to Sir Mark Young's despatch No. 48 of the 24th July, 1946, in which he gave some indication of the very heavy expenditure which it has been necessary for this Government to meet in order to make good the ravages of war. In paragraphs 16 to 18 of that despatch, he suggested that there was a strong case for the grant by H.M. Government of some substantial measure of assistance to Hong Kong, and he expressed the hope that it would be found possible to approach the Treasury with a view to a free grant, on the lines of that given to Malta, receiving sympathetic consideration..
2.
In reply, in your confidential despatch No. 208 of the 14th June, 1947, you explained that, before such a question could be considered, it would be nccessary to have before you a complete appreciation of the financial position, particularly in regard to the commitments arising from the war. The preparation of an accurate statement has presented some difficulty owing to lack of information regarding the payments made on behalf of Hong Kong during the occupation period, and the source from which the funds to meet such payments were found. It has now, however, been possible to prepare a fairly accurate picture of the position, and I enclose a copy of a summary of revenue and expenditure through the London accounts, covering the period 1st September, 1941, to the re-establishment of Civil Government. The date 1st September, 1941, has boon taken because the last Crown Agents accounts received before the Japanese attack was launched related to August, 1941. Only expenditure in London has been taken into consideration as all local expenditure from the date of re-occupation to the date on which the Military Administration handed over to the Civil Government was mot from War Office funds.
3.
It will be observed that, apart from recoveries relating to accounts due to the Hong Kong Government before the capitulation, the expenditure in London during the period under review was mot from incomc from the Exchange Fund totalling £1,802,059, together with advances from the Imperial Government, amounting to £2,500,000. A comparatively small portion of these funds was utilised to moot normal outstanding liabilities of the Hong Kong Government, but the bulk of the exponditure related to commitments directly or indirectly connected with the attack on the Colony and its occupation by the Japanese.
4.
Included in the category of commitmonts directly arising from the war are volunteer pay and pensions totalling £444,546, passages for non-officials £19,455, maintenance and relief payments £1,048,745 and payments to Civil Defence workers and other temporary Civil servants, such as Food Control officials, ctc. amounting to £78,970, making a grand
THE RIGHT HONOURABLE
ARTHUR CREECH JONES, M.P.
RECEIVED
19 DEC :747
C. O. REGY
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