15.
Extract from note of meeting with Govenor
19/6/50
Stong Kong held on
oir 54499/50
Grignial
67
10. Water Supplies.
The Governor said that the main problem at the moment was the question of financing the Tai Lam Chung roservoir. The cost of this (€61 million estimated) was beyond the possibilities of a local loan and it was not likely that a premium bond issue would succeed. The money would be needed over a period of 7 to 10 years
and although he agreed with the suggestion that even with revenue surpluses rumming at their present rate the Colony could manage to finance the expenditure for some time, he said that what was really needed was a firm decision so that Hong Kong could see where the money for the scheme was coming from. The Governor added that it was absolutely essential that the scheme should go ahead.
Mr. Palmer thought it seemed that the only practical source of money would be a loan raised in this country. The difficulties in this were numerous - the loan would have to be fitted in to the overall quota for the Colonies in general, the agreement of the Treasury and the Capital Issues Committee would have to be obtained, proof would be necessary that all possible local resources had been tapped and also the public would have to be persuaded to subscribe. The Treasury might also wish to suggest that if money could not be raised locally by loan,taxation should be increased. If taxation were increased and surpluses continued to be realised Hong Kong would probably be able to mout for several years the preliminary expenditure in connection with the scheme but it was felt that what was probably needed was for Hong Kong to be assured that they would be able to raise a loan by say 1952 (as an earliest date) with a Tresury guarantee.
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The Governor mentioned that a despatch on tho subject was coming from Hong Kong and it was agreed that this should be awaited before the matter was considered further.
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