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4.

In connection with the salaries of sterling

paid officers it is worthy of note that the

Hon. Mr. Shenton, who was not present at the meeting

of the 22nd of October, though his speech was read by

the Hon. Dr. Ts'o, has ceased to be the advocate in

chief of reductions, his place having been taken by the

Hon. Mr. Mackie. It was inevitable that the

announcement that sterling salaries were to be paid in

full at the current rate as from the 1st of January next

should have met with opposition from the Unofficials;

their conduct in the past practically forced this course

upon them.

I am however of the opinion that this

opposition has lost considerably the force which was

formerly behind it; and the subject is ceasing to be

good 'copy' in the local English press.

5. As I stated in my address, the dredging of

the harbour is a matter which will require serious

consideration in the near future. But until further

data is available from the hydrographic survey it is

not possible to say in what parts of the harbour and to

what extent it will be necessary, though it is probable

that it will be sufficiently costly to require

financing from loan. I will address you further on

this matter at a later date.

6. The other points raised by the Unofficials

were in the main matters of detail, and were adequately

dealt with in the reply of the Colonial Secretary.

It

is therefore unnecessary for me to refer to them in this

despatch.

7.