CO129-534-6 Loans for public works 24-2-1931 - 11-8-1932 — Page 14

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(see 82850/31) that the Colonial Secretary has

no intention of proceeding with any work until

his investigation is complete and its results

considered.

As regards the new gaol, I think the

Governor makes out a good case for meeting the

expense from loan funds. Our despatch (No.3)

was written under a misapprehension as to the

financial prospects of the Colony, due to the

very inaccurate estimates of the position at the

end of 1930 compiled by the late Treasurer.

despatch

In

I think

fact, as this position and the draft Estimates

show, the present position and future prospects

are much more cheerful than we thought.

too that we should not be too strict in confining

loan works to works which are actually revenue

producing.

I think anything which is going to

last for many years and is going to benefit

posterity can legitimately be made a charge on

posterity by being financed out of a loan instead

of out of current revenue. In fact, if Hong

Kong goes on as it is doing at present, it may be

found that some of the expenditure at present being

charged to surplus funds as an advance in

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anticipation of the raising of a loan cannot be

charged finally to surplus funds, and the raising of

a loan to meet it be dispensed with. In that case

the $4,500,000 involved here may, in fact, be found

from accumulations of revenue and not from loan.

It will be seen from the Estimates that the

Governor has included provision for the gaol in the

loan works programme in anticipation of the

Secretary of State's approval.

In the circumstances,

a telegram approving it at this date may be

thought