Supplies nearly ready for shipment from places other than India would be shipped by War Office.
A.
B. Supplies not nearly ready for shipment from places other than Inâia would be shipped by Crown Agents.
C. Supples not likely to be available in forseeable future: no further action would be taken by lur Office to obtain these supplies.
Supplies being shipped from Inåla would be shipped by War Office.
D.
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The two Melayan Governments were told that receipts directly related to the supplies at A, B, and D, above would be credited to U.K. funds "in accordance with the agreed procedure" but that as the Crown Agents were meeting the shipping charges in the case of B, any receipts from sale could e reduced by the appropriate shipping charges on the stores concerned, before being paid over to H.M.G. (Despatch to Malayon Union No. 163: to singapore No. 140 of 18th July, 1946. Note. It does not appear from the file that any corresponding communications were sent to Hong Kong and the three Borneo territories; but nevertheless, those Governments have been proceeding on the general basis that any receipts arising out of expenditure incurred by H.M.G. would be paid over to H.M.G.). The arrangements by which War Office continued to bear the cost of the above supplies was finally terminated in November, 1946.
7.
In addition to the relief and rehabilitation supplies supplied by War Office during the period of the military administrations und subsequent thereto as described Loove, the Colonial Office had its programme of relief and rehabilitation supplies which was originally intended to cover the second six months of liberation. The cost of these latter supplies was met from Mɛlayan funds; and also from Hong Kong funds (assisted by "Lowns in uld" from the Treasury). In the case of the three Borneo territories, however, in view of the constitutional position of these territories, the cost was met direct by H.M.G. up to 31st December, 1946. There was considerable discussion with the Treasury at the time whether the Governments of the three Borneo territories should take over direct financial responsibility for these "Colonial Office" stores as soon as military administrations had terminated, but the Colonial Office eventually persuaded Treasury to continue to meet the cost up to 31st December, 1946, on the under- standing that the Colonies would pay over to H.M.G. receipts from sules, and would in addition, meet any deficiency between the mount of those receipts and the actual cost of the supplies.
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8.. In the course of discussions with the Treasury on the incidence of charge of the cost or these Borneo "Colonial Government programme" supplies, the Treasury reserved the right at to raise the question of the liability of Colonial Governments for supplies ordered by far office, but not shipped until after Civil Administration had resumed., i.e. the stores referred to in paragruphe 4 to 6 above. The Colonial office saw no good grounds on which the Colonies could be asked to go beyond the provisional arrangement by which only receipts from sales were prid over to H.k.G. In a letter dated 6th January, 1947, the Treasury put their case They contended that by 15th July, 1946, at the latest, (1.e. the date when North Borneo reverted to civil udministru.ion, the last Colony to do so) the r Office supply of oods should have been terminated and the Colonies should have taken over full financial responsibility thereafter. The Colonial Office, in a reply a ted the 15th March, 1947, contested that view, arguing that it was understood ut the time that the War Office liability was to complete their programme, irrespective of date of delivery, and the cost was to be treated as part of the cost of the military administration, the Colonies liability being restricted to paying over any receipts from sules. At the same time Colonial Office stated that they were prepared to ask Coloniul Governments to consider a settlement on the lines suggested by the Treasury as soon as the war office submitted
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