156
Annexure B.
Annexure C.
£21,875
£140
₤37.
37.10 0
-2-
will be found in the current financial year by savings that have resulted from the late arrival of appointees or from the failure to find satisfactory candidates for vacant posts. The University hopes, by economies in the two succeeding financial years, to find $100,000 to meet the total required for rehabilitation. The problem of repayment of the sum of $480,000 (£30,000) interest-free loan made through the Colonial Office in 1946 is yet unsolved. It is difficult to guess what the financial position of the University will be at the end of three years but in respect of invested funds it certainly will be worse off than it was before the war. It has already found that of its silver investments it must write off something more than $1 millions, the result of the almost complete loss of funds invested in Shanghai.
3.
His Majesty's Government's grant of £250,000. Annexure B gives details of the University's proposals for the financing of a part of a scheme of develop- ments recommended by a Committee that sat in 1939. These have been modified in the light of recommendations of the Secretary of State's Committee on the Development of the University that sat in 1946.
4.
It is proposed that the sum of $4 millions (£250,000), representing His Majesty's Government's grant, should be invested in the Hong Kong Government 31% Rehabilitation Loan, and that equal annual drawings of capital and interest should be made over a period of 15 years. This would give an annual income of $347,300 (see Annexure C). This sum, however, is not sufficient to meet the cost of the development, about $510,000, that the University thinks necessary for healthy continuance.
5.
It is already agreed that the University must increase its income from fees. At present the basic tuition fee is $500 a year, an increase of only 25% over the rate in 1941. A greater increase of fees was avoided in 1946 because hostel charges, which make the hostels merely self-supporting, had to be fixed at $2,250 as against $300 in 1941. The University in effect was deprived of income in order to keep down the overall cost to students. In the University budget for 1941-42 it was estimated that tuition fees would meet about one sixth of the total expenditure; in 1948-49 fees will meet only about one-tenth of the expenditure, though provision for maintenance is very low, since most of the equipment is new, having recently been purchased under a separate rehabilitation budget. Expenditure has almost doubled; in a year or two it will have more than doubled and fees have been increased only by one quarter. The University has already decided that in the next academic year tuition fees must be raised to $600, an increase of 50% over the 1941 rate, but this is regarded as by no means a final increase.
6.
•
All attempts to forecast the financial position of the University are complicated by the present need to pay high cost of living allowances. If these should be ended or materially reduced, after the increase of fees proposed becomes effective, the University would have funds to meet costs of developments. It is held that even if costs of living were reduced to a point that would justify the abolition or substantial reduction of these allowances, the increase of fees by 50% would still be justifiable on the grounds :
(a) that pre-war fees were too low, and