CO129-621-11 War damage compensation 2-4-1948 - 21-4-1948 — Page 4

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The Governant agrees with the Commissioner that a genur 1 schame of compensation should not be introduced. la hopes that the United K gdon Chattels compensation scheme will be extended in the manner referred to in

paragraph 4 above. For the rest he considers that any assistance His Majes Government can give Hong Kong should be used for the benefit of the community as a whole rather than for the benefit of those who suffered losses, au that this will not cause widue hardship among any class of claimants. The question of His Majesty's Goverment giving some such general assistance to Hong Kong is under separate consiueration.

7.

Finally the Governor recommends that Mr. Matheson's report should not be published as some statements therein are likely to cause ill feeling. (This may refer to the statements of the high profits made by several firms since liberation).

8. It is recognised in the Colonial Office that Hong Kong has enjoyed considérable commercial prosperity since the liberation and that in consequence most firms and many persons who suffered losses have probably already recouped themselves, in respect of those losses, from subsequent profics. To that extent compensation is not essential. If, however, a comensation schme is set up in Malaya, even on a strict austerity basis, ( and such a schome is nar under consideration depending very largely upon the extent to which His Majesty's Government can give financial assistance), we have to consider (a) whether on Kong will still be able to resist setting up a scheme (b) to what extent His Majesty's Government has committed Hong Kong to a scheme by various announcements made from time to time.

9. As regards 8 (a) above, to the extent that His Majesty's Goverment assist 'alaya by means of loans, the ultimate liability will fall on the local Government, Hong Kong sexis quite clear that it cannot accept any such liability; The ant can be put be Hong Kong, but there seems little doubt that ilong King will maiutain its procent attitude on this matter, even if “alaya ups

-Ongavicki sehama, This attitude

the Goon tel

Noyor

is

very largely confirmed

10. As regards 8 (b) above, all statements made by lis Majesty's Govensmurt regarding the setting up of the Commissions, and all correspondence with claimants either by the Colonial Office or Board of Trade, where the point arises, have made it clear that the setting up of the Commission did not commit the Hong Kong Government to rayment of compensation. Inevitably the setting up of the commission gives rise to some expectation or eventual payment, but the Sạcretary of State if challenged can always point to the specific warning co-tained in various statements. The defence for non-payment of compensation is to be found in the Comissioner's report and the Governor's comments thereon.

In particular-if his Majesty' Goverment eventually greas to extend the free cover of the Nited Kingdom Chattels Compensation Scheme to private individual s who remain in this country who cannot be said to have benefitted by Hung Kong's post liberation commercial prosperity, the Secretary of State's dm'ance will be considerably strongtheneds

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11.

The statements by His Majesty's Goverment referred to in the previous paragraph are as follows:

s that

(a) In 1942 and 1943 certain correspondence took place between the Colonial Office and Sir Jolm Hay, on the subject of war losses in the Fur Bant. correspondence contained the first public stata ent on the subject, copies attached

Colonial Office letter; 27th October, 1942. Sir John Hay's letter, 26th November, 1942. Colonial Office letter 12th January, 1943.

(b) The (then) Secretary of State's statement in the House of Commons on the 16th February, 1946 on the setting up of the Commissions, paragraph of which was as follows:

"Pending assessment of claims, it is not possible to state the extent to which it may be ossible to award compens tion and the setting up of a Clairs Com ission does not commit the Goverment of the territory concerned. to the payment of compensation, save in the case of claims acmissable under existing looal law."

(c) In an answer to a Parlimentary question on 51st October, 1945 it was stated that registration of claims must not be consid-red as cou itting the Hong Kong Government to pay ont of copensation.