CO537-5142 — Page 187

(III)

2

The Governor says that, with increasing Defence commitments, the capital cost of the new studios, totalling $285,000 (£19,000), "is far more than the Colony can afford to expend at the present juncture." He suggests three alternative remedies:-

6.

(a) reducing the total capital cost of the

new studios to the cost ($150,000 or £10,000) for which Government can provide;

(b) handing over the broadcasting service to the

commercial Company which already conducts the wire rediffusion service under licence;

(c) continuing with the present service and current

plans, subject to the contribution by His Majesty's Government of the difference between the original estimate of $150,000 (£10,000) and the final capital cost, which is estimated at $285,000 (£19,000) plus cost of air-conditioning and furnishing, but in any case not exceeding a total contribution of $250,000 (£16,666).

The Governor does not favour (a). which, he thinks, would give the service no better studios that it has at present. He would be willing to co-operate in (c). But he would like (b) best of all. His reasons appear to be

(1) "the Colony is too small to support two

broadcasting organisations" ( (90, para 4).

-

(ii) "since we are going to be very short of money

for the next few years what will happen will be that the service given by Rediffusion will get better and better, whilst that given by Government broadcasting will get worse and worse" ( (92), para 1).

The Financial Implications of Both Projects.

7. If these estimates were to be accepted it would mean that His Majesty's Government would be called on to contribute:-

Capital

£

Recurring

Foreign Office Project 1,150,000 76,666

(Plus cost of transmitters,

their conversion and

750,000

£ 50,000

shipment)

(Plus a contribution to

rental of studio premises not yet estimated)

Domestic Project

250,000 16,666

Nil

N11

(IV)

Matters for Decision.

8.

The following main matters seem to call for decision:-

(1) Are H/K's proposals for the service to China now

acceptable from the technical programme and financial aspects?

(ii) If so, what immediate action is to be taken (e.

.g. conversion of Singapore transmitters, recruitment of staff)?

(iii) Assuming that H/K's alternative (a), which not even the Governor favours, is out of the question, which of the other two courses is to be chosen (b) handing