CO537-1651 — Page 13

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with sufficient responsibility during the early years of its existence.

I therefore submit that the general scheme put forward by the Governor should be approved subject to comment on the few matters of detail to which I have drawn attention above.

In view of Mr. Caine's service with and interest in the Government of Hong Kong and his association with the work that was done during the planning period he would no doubt like to have the opportunity of commenting on these proposals.

18.11.46.

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I entirely agree that the Governor's open despatch at No. 69 and its enclosures present a clear and concise picture of the developments which have taken place in Hong Kong during the past six months on the constitutional issue, and that all credit is due to Mr. Hazlerigg for the work which he has put in. I think that an expression of the Secretary of State's appreciation both of the Governor's despatch and of Mr. Hazlerigg's work

t should be included in the reply to the Governor.

But I must confess that the Governor's

confidential despatch at No.70 raises serious misgivings in my mind as to the main proposal to set up a Municipal Council. It seems clear from that despatch that the great majority of the Chinese inhabitants of Hong Kong, comprising some 97% of the total population, are either apathetic or apprehensive about this proposal. This being the case, it seems to me to be very doubtful whether we can rely on that degree of co-operation from the population which would be necessary to ensure that the Municipal Council would, in fact, be a representative body and thus constitute a definite advance along the constitutional road. If there is not a reasonable chance of achieving this, our main objective, then I feel that we should seriously consider whether we ought to proceed with the project at present, bearing in mind the risk of wholesale jobbery and corruption, to which the Governor refers in paragraph 10 of his confidential despatch, and the possibility that because of the apprehensions of the people and the opportunity that this would afford to the K.M.T., an attempt to hold the election would give rise to serious disorder and disturbances. I think that this is a point on which we should have the Governor's views before a decision is taken on his main recommendation. In consulting the Governor on this point, it would, of course, be desirable to refer to the positive nature of the announcement which was made last May, with its reference to the policy of His Majesty's Government that the Constitution should be revised on a more liberal scale as soon as possible.

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