C.I.N.
1. B. C. Mac Dermot (FO).
LC
5195/54/452
9-1-48
2
2.
Gov.
Put by.
P. Jhana
tel. 28 Sor
Mr. Seel (through Mr. Cox)
1.
174
12-1-48
On the receipt of No.2, I passed on its 2A substance at once to the Secretary of State in
accordance with an Office ruling. The Secretary of State raised certain questions which are set out, together with the answers, in the note attached at (3).
3
2. The financial proposals now put forward provide for the re-establishment of the University on its pre-1941 basis and involve subsidies from Hong Kong funds of $4,000,000 (£250,000) for capital expenditure and $1,500,000 (£93,790) for recurrent expenditure. This is a heavy burden for Hong Kong, but, subject to what is said below, there seems to be no other prospect of getting the money, and
I think we had better seek Treasury approval forthwith. We have already paved the way with the Treasury to a certain extent (see in particular paragraph 7 of Mr. Pitblado's letter to me at No.50 on -/47 file) and we can, I think, pursue this satisfactorily with the Treasury on a Departmental basis.
3. What is said in the foregoing paragraph is subject to this, namely, that it has been suggested in connection with the proposals for a general financial settlement between H.M. G. and Hong Kong, that the capital cost of rehabilitating the University, namely $4,000,000, should be taken into account in arriving at the figure of the grant, which, it is suggested, should be made to Hong Kong from U.K. funds to assist in meeting liabilities including those arising out of the war. This suggestion need not delay us in approaching the Treasury on the lines proposed in the preceding paragraph, but if it is to be put forward from here as part of the proposals for a general financial settlement, it had better be mentioned in the present approach.
4. The Foreign Office are aware that we have decided that we shall have to proceed with the re- establishment of the University on a pre-1941 scale instead of carrying out the wider scheme recommended by the University Committee, but I propose to keep them in touch with what is going on by sending them copies of the correspondence for information.
5. The draft public statement submitted by Hong Kong, which cannot of course be issued until Treasury agreement to the expenditure involved has been obtained, will require careful consideration as will also the question of the publication of the report of the Hong Kong University Advisory Committee. We must also consider whether, in view of the past Parliamentary interest in this matter, arrangements should be made for the decision to be announced in the House of Commons by means of an arranged Question and Answer.
6. It