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On the basis of this calculation a total sum of $1,967,979 per annum would have to be collected as revenue by this Government, in order to pay for the cost of its waterworks. In point of fact, however, the income of this Government from waterworks during 1928 was as follows:-
2% rating tax
Excess water charges and meter rents
$567,673.03 768,898.60
$1,336,571.63
Therefore, upon this estimate, our revenue from waterworks is $631,408 less than it should be. Moreover, as I have already said, it is safe to predict that the Hong Kong Government will have to spend a further sum of about ten million dollars upon waterworks construction additional to that already sanctioned and now in progress. It is also quite certain that anually recurrent maintenance expenditure both on the island and the mainland will increase and that in future years the salaries of the waterworks staff will cost us more. Assum- ing then that our total capital outlay on waterworks will before very long amount to 28 million dollars and that our annually recurrent waterworks expenditure, when that time comes, may be (say) $760,000, then on the basis above indicated we should have to collect an annual revenue of just three million dollars, in order to make our waterworks, not remunerative, but self-supporting.
There is another consideration which must be carefully weighed. I have said that it is the aim of the Hong Kong Government to give every house connected with the waterworks, both on the island and on the mainland, a full supply of filtered water throughout the year. But, if this is to be done, it is clearly necessary to take steps to impress upon all householders and residents in the Colony the civic duty of conserving, and not wasting, water. I can think of no better way of doing this than to make all who consume water pay by meter for what they consume. If that is to be our policy, then the so-called "free allowance" would have to be abolished. We should also have to abolish the 2% water rate: and, of course, the rider- mains. Instead we should require all houses connected with the water-mains to instal meters, and the consumers of water to pay for their metered supplies in accordance with a sliding scale, which would be comparatively low for the first few gallons a day, but steadily increase for each gallon thereafter, in order to check excess consumption. It would also be desirable that water accounts should be rendered monthly, and not quarterly as at present. Such a change would, of course, involve a certain amount of extra work both at the Treasury and in the Waterworks Office. But the advantages quite outweigh this objection. With monthly accounts, high con- sumption is at once forcibly brought to the notice of consumers; the chances of bad debts or fraud are much diminished; and a large sum of money is brought into the Treasury several months earlier than under the quarterly account system.
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It is evident, gentlemen, that we ought soon to reconsider both the methods by which we raise our waterworks revenue and also the rates which we charge. But I am reluctant to move in this matter until the waterworks now under construction have advanced to the stage at which we can give Hong Kong island and the main- land a full supply throughout the year, instead of the intermittent supply which has been only too common during recent years. No motion on this subject will, therefore, be brought before you in connection with next year's budget. But it is more than likely that, when the budget for 1931 is under consideration, you will be invited to give the question of waterworks finance your special attention.
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