CO129-574-2 Draft programme of public works 5-8-1938 - 23-9-1938 — Page 3

3

(see 53643/38)

•

(see 13 on 53652/37)

(see 53687/37)

received much of the trade which formerly used to

go through Shanghai. The surplus of assets at the

end of 1937 amounted to $14,002,278 of which,

however, $10,320,268 have been advanced to Loan

Funds pending reimbursement from the issue of the

remainder ($11,000,000) of the 3 Dollar loan. It is possible that the cost of these works cannot

be met at the present level of revenue but I think

there would be no objection to raising the low level

of taxation. It would no doubt be preferable to do

this rather than raise the balance of the 1934 Loan

at the present somewhat unfavourable time and the

Colonial Government's amount of cash in hand does not

leave any considerable margin in case of a deficit

on the budget.

It should also be remembered

that these works are additional to the Waterworks on

which $3,185,000 will be spent during the next few

Those works also are being financed from

years.

revenue.

The drawback to increasing taxation,

namely that it would involve an increased military

contribution may not arise in this case, as the

Governor has recently submitted proposals involving

a fixed contribution over the next five years.

? Acknowledge and approve the

Governor's proposals in general saying that the S. of S. has noted with satisfaction that a comprehensive plan

of works over the next five years has been drawn up.

Say that he notes that the Governor

considers that extra taxation may be necessary

in

order to meet an extension of the current charges

and that the S. of S. will be prepared to approve this

should it prove necessary.

We might also refer to our despatch

at