CO129-458 - Public Offices & Others - 1919 — Page 456

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impossible to insure "with average"; whereas the insurance rate for the two cargo liners under the scheme is 3 per centum for "total loss only*, and 6 per centum "with average". These liners may be taken as representative of all the liners on the China Coast.

4.

On the 18th December Mr. Long telegraphed to the effect that the Government of the Straits Settlements had

protested against certain action of the Government of Hong Kong in connection with the control scheme; and as nothing was known of the protest locally the telegram was at once repeated to Singapore with a request for particulars. The attached copy of a letter, with enclosures, from the Governor of the Straits Settlements shows the grounds upon which the protest was based.

5.

The main cause of the complaint lies in the statement that this Government has "consistently permitted charters at enormous figures which undoubtedly have the effect of keeping up freights, and of course resulting in lack of Government control of runs". It is clear from this statement that the two Governments have a fundamentally different conception of the proper interpretation of the instructions regarding the control scheme which were issued by His Majesty's Government.

6.

It is the case that the HongKong Government

has allowed the owners to charter or to run at market rates all vessels not required for special pruposes; and its policy has been based upon the following considerations. Mr. Long in his Confident- ial Despatch of the 15th March, 1917 forwarded a copy of a circular letter from the Ministry of Shipping outlining the Imperial Liner Requisition Scheme, in the third and fourth paragraphs of which

it was stated "Unless and until you are otherwise directed, it is not the desire of the Government to interfere wither

with the nature of your business or the method of conducting

it which would have been followed if the steamers had not been requisitioned.......You will therefore continue to run the vessels as for yourselves, though actually for the account of the Government". The inception of the Hong Kong Scheme dates from Mr.

Long's

เ