or this solution put to Sir A Mme & Sw M.K, ho by the
8
unless something is done fairly quickly, immediate and drastic measures must be taken to reduce expenditure by the University. A solution which has not yet been considered, but which Mr. Palmer and I suggest should be put to the Governor, is the use of Japanese assets for this purpose. The present proposals which are due to be announced in the near future are that Japanese assets in the United Kingdom should be used for the direct benefit of ex prisoners of war and ex-internees in specially needy circumstances who are in the U.K. at the time of payment. Japanese assets in the Colonies are to be at the disposal of the Secretary of State for the Colonies in consultation with the Governments of the Colonial territories concerned. In Hong Kong telegrams 748 and 760 the Governor has pointed out the difficulties of adopting a similar procedure in Hong Kong and now proposes that an ad hoc committee "should be set up to advise the Government how best the available money should be utilized to benefit the whole community". In his previous telegram 748 he thought the disposal of these assets would revive a demand for compensation for war damage and even under his present proposal it is considered "impracticable to deal with individual cases, or generally to meet claims for loss or damage incurred as a result of the war". Japanese assets in Hong Kong are estimated to amount to £1 million and in view of the difficulties which are likely to arise in formulating a scheme for their disposal, could not the Hong Kong Government consider setting aside the whole amount or even a proportion of it in order to establish an endowment fund for the University, which after all serves the whole community and covers an even wider area and also suffered considerable damage and loss as a result of the Japanese occupation?
14. The meeting on Monday 16th July ended with the suggestion that Sir Arthur Morse and Sir M.K.Lo might be given an opportunity of expressing their views personally to the Secretary of State. If the use of Japanese assets as a source of capital for the Endowment Fund is to be pursued it is for consideration whether the Governor's reactions to the proposal should be obtained before the suggested meeting with the Secre- tary of State in the first instance. If the Governor is prepared to consider the proposal it might not be necessary to take up the Secretary of State's time wit.. such a meeting and I would recommend that we approach the Governor first.
I submit a draft for conson.
17. 7. 1951.
Puntuan kom Lo
theclar
Mr. Paskin
I think Mr. Hall's minute sets out quite reasonably the past history and the main points in this extremely difficult matter. There is no doubt whatever by the tone of what was said by the Hong Kong Unofficials in Sir A. Morse and the Vice Chancellor of the University at the meeting over which I presided on the 16th July, that they felt
(a) that H.M.G. has some moral obligation to see the
University established on a sound economic basis;
(b)
that any reduction of the University's activities as is envisaged in paragraph 7 of No. (3) would be
dian interpreted in Hong Kong as an indication that H.M.G. had no confidence in its ability to stay there or in the Colony's future;
/ (c)