CO882-(8-9) — Page 521

99

PUBLIC RECORD OFFICE

Reference :--

C.O. 882

9

PUBLIC RECORD OFFICE, LONDON

| ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-——NOT TO

the vexed question of Trinenmali, the maximum contribution should he stated to the Colony as three-quarters of the cost of the whole garrison This was done (see Colonial Office despatch to Governor, dated 31st July, 1×96*), and the arrangement then come to has remained in force up to the present time

6 From the foregoing remarks, it appears clear to the Council that the recent abandonment of Trincomali involves a reversion to the basis of full cost in fixing the maximum contribution

7 As already stated, the fixed percentage of revenue to be appropriated as the Colony's military contribution was estimated to yield in 1895, £81,558, as against While the cost of the garrison rose, the the maximum limit of about £115,000. revenue rose also, and to a far greater extent, with the result that for the year 1905-6 the maximum" stipulation operated for the first time, the fixed percentage of the revenue yielding £157.139, as compared with the sum representing three quarters of The latter was accordingly the amount the cost of the garrison, viz, £143,625

"

The garrison paid by the Colony as its military contribution in respect of that year. has since been considerably reduced, and its cost is now estimated at no more than £115,000 It will thus be seen that under the proposal now made the Colony would pay no larger sum than that named as the maximum in 1895, and that there would be a very substantial reduction on actual contributions paid in respect of the years 1901-6. It must also be remembered that the maximum contribution payable by the other Eastern Colonies is already fixed at the full cost of their respective garrisons, and the Council know of no reason, now that the garrison of Trincomali has been withdrawn, for continuing to accord preferential treatment to Ceylon.

༢ I am accordingly to express the hope that Lord Elgin will see his way to move the Colonial Government to take the necessary steps to fix the maximum con- tribution payable as from 1st January next at the total cost of the garrison.

38419

SIR.

No. 126. CEYLON

I am, &c.,

E. W. D WARD.

THE SECRETARY OF STATE to “HE GOVERNOR

No. 561)

[Ansieved by No. 135,]

Downing Street, 9 November, 1907.

I HAVE the honour to transmit to you the accompanying copy of a lettert from the War Office, in which the Army Council ask that the maximum military contribution payable by the Cevlon Government shall be fixed, as from the 1st of January next, at the total cost of the garrison, instead of three-quarters of that

cost.

2. I shall be glad to receive your views on this proposal, the grounds for which I may observe that, subject to any observa- are fully set out in the War Office letter. tions which you may have to offer, the contention of the Army Council appears to me to be reasonable.

38419

No. 127. CEYLON.

COLONIAL OFFICE

to WAR OFFICE.

I have, &c.,

ELGIN

Downing Street, 9 November, 1907.

SIR,

I AM directed by the Earl of Elgin to acknowledge the receipt of your letter of the 31st ultimo,t with regard to the maximum military contribution payable by the Ceylon Government, and to request you to inform the Army Council that his Lordship is communicating a copy of it to the Governor for his observations.

I am, &c.,

11155 not printed.

C. P LUCAS.

↑ No. 125.

43644

No 128

STRAITS SETTLEMENTS.

THE GOVERNOR to THE SECRETARY OF STATE.

(Confidential.)

(Received December 14, 1907.)

[Answered by No. 141.]

MY LORD,

Government House, Singapore, 21st November, 1907. I HAVE the honour to transmit to you, for your consideration, copies of the recent discussions in the Legislative Council on the subject of the military contri- bution paid by this Colony.

2. The heavy debt incurred by the Colony in connection with the acquisition of the docks and wharves and the harbour works in course of construction, coupled with the serious falling off in the opium revenue, has given rise to considerable apprehension in the minds of the public as to the financial position of the Colony, and has led to a renewal of the discussion of this question.

3. The various terms upon which the loan had to be raised renders it doubtful whether it will be possible for the Dock Board to find the full amount of the interest payable on the cost of expropriation and also on the cost of the new works, which are urgently required to bring the facilities of the port up to date and prevent the Colony losing its position as a port of call and also a commercial collecting and distributing centre.

4. No doubt the Dock Board has considerable assets in its surplus lands, but, until the new works have been completed and these lands have been levelled and filled, these assets cannot be realised, and, in any case, their realisation must be a comparatively slow process, in view of the continued stagnation of the land market. 5. In the meantime the Board has to meet the interest charges on a debt of 3 millions sterling in round figures, which, by the end of five years, will be 4 millions, and, when the new large graving dock is completed, will amount approximately to five millions sterling.

6. From the enclosed report* of the Board for the half year ended the 30th of June last, it will be seen that the net profit of the undertaking during the two years that it has been under the administration of the Board has amounted to $2,979,811.28, or an average of $1,498,955.64, without making provision for fire insurance or extensive renewals, for both of which purposes reserve funds are being created. To provide interest at 4 per cent. on a capital of five millions sterling requires an annual sum of, say, $1,700,000, and, unless during the next five years there is a considerable expansion of the revenues of the Board, it will not be possible for it to pay its way, and the Colonial revenues will probably have to bear a charge of some $200,000 a year to cover the deficit. No expansion of revenue can be looked for from increased charges at the wharves and docks, as these have already reached a point beyond which an increase would certainly mean a loss.

7. The works at Tanjong Pagar and Telok Ayer are not the only ones that the Government will have to undertake in Singapore. Your Lordship is aware, from previous correspondence, how urgently the rebuilding of the walls of the Singapore River is required. It was intended to include the cost of this work in the Loan Act, but, as the majority of the Unofficial Members at the moment was opposed to the Government's proposal for placing part of the cost on the proprietors adjacent to the river, it was dropped. Since that time further experience has proved that the work cannot be delayed. A considerable length of the wall on one bank has collapsed, and many parts are in an unsafe condition.

How far this is due to the dredging operations which have been going on for the last few years, and how far to the operations of the Municipality in connection with the improvement of the surface of the roadways which run along the banks it is difficult to say. In any case, everyone is satisfied that the matter cannot be further postponed, and I propose shortly to bring in another Bill providing for the reconstruction of the walls, the cost to be borne as to one-third by the Government,

• Not reprinted.

24658

|

G