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Draft herewith. I have made semi-official because we do not yet seem to be at the stage of a formal reply to the Governor's despatch at (2). It follows the lines indicated, taking in also Mr. Palmer's comments in his minute of the 18th July; but there are two points with which I am not altogether in sympathy:
(a)
(b)
I agree with Mr. Cox that the proposed use of H.. G.'s grant does not wholly conflict with the Chancellor's wishes, as Mr. Palmer considers it does. I feel lir. Palmer had at the back of his mind that the grant ought not to be used for recurrent expenditure: but, as Mr. Cox says, the uses proposed seem to meet the Chancellor's terms of development and rehabilitation", which are not qualified, in (44) on the 1948 papers, by any reference to capital costs only. Technical objections may rule it out, but unless they do I think the device proposed might answer;
I rather doubt whether an increase in fees from $500 to 2600 (£37.10s.) a year will materially discourage students; there must be few such charges which have not risen by more than 50% since 1941.
On these points I should prefer to be
a little less discouraging.
2. There are also a number of loose ends on the file:
(a)
the minutes copied at (8) ask us to bring. to the attention of Hong Kong the requirements which a University must meet to be allowed to administer C.D. a . grants. In August 1948 {vide Gα Mr. Wallace felt it would be sorely infuriating to send suci communication at the same time as we were damping Hong Kong's hopes of receiving C.D. & 7. grants. This still applies, but I have included a brief reference in the draft to the requirements;
(b) I presume there is still money in the C.D. & W. Higher Education allocation which could be made available to Hong Kong if her case was approved; no doubt Finance Department will confirm this before the draft issues;
(c) the last paragraph of Mr. Paskin's minute of the 7th May refers to the need to lay the "Lugard functions" before the F.E. (0) C. in relation to the situation in China. This is not the time for that, but it will have to be borne in mind;
(a) paragraph 11 of Kiss Ruston's minute of the 15th July refers to the University's request that the British Council should be asked to provide the salaries of two Lecturers; this must be taken up later;
(e)