CO129-368 - Acting Governor May - 1910 [8-9] — Page 542

and expressing the opinion that in these circumstances

£12000 a year for 2 years would be the least amount which

the justice of the case demanded.

On the 28th of July the Treasury stated that they regarded £9000 as being a liberal figure and that "They prefer to leave the question of future contribution to be dealt with later in the light of actual results of new taxation etc".

}

The reply to the Treasury on the 4th of August, after disposing of the supposition that Hong Kong regarded the grant as being liberal stated that it was highly desirable that the Colonial Government, which had the estimates for 1911 under consideration, should know as early as possible what further assistance was to be expected. The letter again pointed out that new sources

+ that in of revenue were pecessary in any case; these cir- cumstances Land Crewe fel strongly that any further

fealt

grant by His Majesty's Government should be made without reference to the results of the new taxation; and the grant of £12000 a year was again urged.

On the 5th of August the Acting Governor telegraphed

for information as to the amount of His Majesty's Govern- ment's contribution, a copy was sent to the Treasury on the 6th of August with a request for an early reply.

On the 30th of August the Treasury replied.

They were not prepared to give any undertaking as to 1911 (no mention of 1912) until they had details of the estimated revenue and expenditure for 1911, together with such revised figures as might be available for 1910 and 1909. While this letter was under consideration the Acting Governor again telegraphed twice asking about the con- tribution, as the estimates for 1911 were being closed

(21.442). Wt.32,656-3. 6000, 2/10. A.&E.W.

(26.462). 5058--28. 6000. 6/10

77

and

Brothing

to the posit

Ал

In grant in

#1 Kew pass

538

and showed a deficiency of $110,000(£9625). The Acting Governor was told to retain the subhead in

actual

The position

A

the estimates but not to insert any sum. is therefore that after a year's negotiations the Treasury have given £9000 in respect of 1910, a sum

rather less than half the direct loss; and have refused

to consider any grant in respect of 1911 without details of revenue and expenditure. The acting Governor has

repeatedly telegraphed asking what amount may be inserted in the Estimates for 1911, and the refusal of the Treasury to agree to any sum or to any principle of computing it has caused great uncertainty and em-

barrassment. The letters from the Colonial Office have

proposed, with reasons and arguments in full detail and after examination and rejection of possible alternatives as impracticable, that His Majesty's Government's con- tribution should be a sum representing half the direct loss of opium revenue for three years. It has been indicated more than once that the revenue and expendi- ture of the Colony could not properly afford any basis for the settlement of the amount of the grant, since additional taxation was in any case necessary for fresh needs, apart from the loss of opium revenue,

and as regards expenditure for which new provision has to be made, the Colony has to limit itself in framing its programme by the means likely to be at its disposal including the promised contribution from His Majesty's Government. The acting Governor has recently reported that "the financial condition is unsatisfactory and the prospect for the future is more than unsatisfactory. Many important public works, notably in connection with an increased water supply await funds for their pro- secution; the Railway is not likely to be remunerative

}

5-760

for