CO129-625-5 Hong Kong University- establishment fund 1-3-1950 - 31-1-1951 — Page 18

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Extract from Confidential letter to Mr. J.B.Sidebotham from Mr. J. F. Nicoll, Hong Kong, dated 5th October, 1950.

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In your letter of 9th September you asked me to give a push to the ball about Hong Kong University matters. I am sorry there has been so much delay in replying to you, but the University seems to have got in a tangle about becoming an authority for C.D. & W. purposes and we cannot get a final reply out of them. However, I have spoken to Ride who has promised to stir his people up.

I have sent you an interim reply in my telegram No. 1135 which I hope will enable you to take further action.

While Cox was here I got together all those concerned with University finances, but unfortunately the result was inconclusive. The short point is that an endowment fund of £ million sterling would not produce a sufficient income to cover the estimated deficit arising out of the development of the University if, in accordance with the usual practice, the funds are invested in trustee stock. If, however, we can get your agreement to invest, the £2 million in local public utilities which are paying about 12%, we could bridge thegap.

We discussed ways and means of getting sub- stantial mums from local people for the endowment fund. The only method suggested which might be successful in getting the large sum required was reminiscent of the "sale of Honours" scandal at home years ago and is not acceptable. We will do what we can to encourage the local rich to turn their attention to the University and as I mentioned in some recent correspondence Robert Ho Tung has recently subscribed another $1 million for a hostel, but I doubt whether we will be successful in getting anything like the amount required. We hope therefore that you will find it possible to agree to the admittedly unorthodox idea of investing funds in other than trustee stocks. One argument for this suggestion is that the University belongs to Hong Kong, also the public utilities belong to Hong Kong, and they must therefore ultimately stand or fall together.

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