CO129-349 - Governor Sir Lugard - 1908 [10-12] — Page 90

the present, farmer from the date of its purchase to the

declared and a permit to store obtained", and as Mr. Clementi was able to trace every tael of opium bought by Memoranda Page 3 of F.Lugard's opium

Page VII

Memo. with

25273 para

L

date of its sale", it should not be impossible to

ascertain the loss sustained

-

whilst we have the auth- ority of the Straits Opium Comission for the state- ment that "opium consuption varies inversely with the price".

If this suggestion is accepted we might put it, to the Governor, and so, whilst giving a ruling on the divans, reserve the farmer's compensation for a final decision.

The larger question of policy will, I take it, stand over until the Straits Opium Report has been considered and until the present Hongkong farm expires, Scalso will the financial question.

But there remains to be decided the question

of publication of Sir F.Lugard's Memorandum,I think it should be avoided, if possible, because

(1) it deals largely with matters which are (or will be) under discussion by the International Commission. (2) it discloses on Page 9 what would be held to be the official policy of the Hongkong Government

(3) it contains the suggestion for non-abolition of divans, which, I assume will not be accepted.

I presume that Colonel Seely will wish some reference made in our reply to paragraph 10 of the confi dential despatch of 27th October which deals with his speech in the House of Commons on July 28th last.

894 2/12.

1st Foot-

to Page 81 Sir F.Lug {report.

Till The Internation Commisvin complated it h

Hansard pag

1259.

His Majesty's Governmetnt will presumably not be con-

vinced by this extraordinary despatch so far as te

reverse the decision that the dens mast be closed.

In that case it seems to me useless to adopt a piecemeal

policy. If only a few of the dens are elesed their patrons

will doubtless take to frequenting these that remain

⚫pen and nothing will have been effected. Unless the

declared policy is to be reversed the only rational

course is to close all the dens.

That brings up the question of opspensation. But here we

get little help from Sir F Lugard wke has entangled

kimself in a centradiction. Either the closing of the

dens will decrease consumption and se cause less to the

farmer or it will net decrease consumption and therefere

the farmer will net lese. Either point of view is tenable

but betk cannot be held at ence. Before considering

the question of compensation it seems essential to decide

between these alternatives and this can only be done

by experience. I submit that the right course is te

inform the farmer that the divans are to be closed at

•nce; that in consideration of this change in the cireus-

stances the Govt is willing te relieve him of his contract

if he likes but will net pay him anything for less eff

expected profit! ir, an the other hand, he wishes to

keep sp his contract he can de se but ne compensation

will be paid his unless he can shew that he has sustained

less by reason of the closing of the divans. He sust

For Jamage

prove this by an action before the Supreme Court.

This measure may seem drastic but I think it is perfectly

equitable.

*

Hong Kong will not like it but they will be

soothed if H.M.G undertake to pay a considerable part

of the damages. It seems desirable te knew now how much

H.M.G are prepared te de in that direction.

283077-

W. & S. Ltd.-16679-6000--10-07.

-1979-6000-4-08.

T

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