CO129-625-6 Hong Kong University- endowment fund 1-5-1951 - 30-9-1951 — Page 13

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Mr. Sidebotham

The memorandum at (16) was prepared before the telegram at (17) came in in which the Governor, after consulting the Unofficial Members, has agreed that if Japanese assets are placed at Hong Kong's disposal, $12,000,000 (£750,000) should be set aside for the establishment of the University Endowment Fund. This, if invested in local utilities, should provide an annual income of about $1 million in addition to the $11 million which the Hong Kong Government grants annually to the University. In the savingram at (6) on the 1950 file we had already agreed that money provided by Hong Kong could be invested in public utility shares though our intention at that stage was that any money provided by H.M.G. would have to be invested in gilt edge securities. I think, therefore, that we can agree that any sums realised from Japanese assets can be invested locally.

The Unofficial Members have suggested that some of the income from the Endowment Fund should be set aside for the establishment of ten to twelve 4-year scholarships for students from local schools. The reason for this is that it might help to reduce possible local criticism that Japanese assets were not being utilised to benefit the whole community. The tele- gram says that the value of a full Government scholarship at the University is about 4,200 a year. This appears to be a high figure and Telegram Section are checking whether it is correct or not. The scholarship proposal appears to be reasonable and I do not see why we need object to it.

The Governor ends by suggesting that if these proposals are approved it is most desirable that they should be announced as an H.M.G. decision. This will, of course, require further consideration in the light of any decision reached about the disposal of Japanese assets in the colonies generally.

Any Japanese assets remaining after the $12,000,000 have been set aside for the establishment of the Endowment Fund, will be utilised according to the recommendations of the ad hoc Committee referred to in the telegram at (10.B).

It is for consideration whether the meeting arranged for Friday morning is still necessary. The purpose of that meeting was to enable Sir A. Morse and Sir M.K. Lo, members of Hong Kong Executive Council, to put their views to the Secretary of State about the necessity of H.M.G. assisting the University financially. Providing there is no hitch in the disposal of Japanese assets in Hong Kong, the necessity for a contribution from H.M.G. does not now arise. It is not, therefore, really necessary for the Secretary of State to see these gentlemen. On the other hand, as the meeting has been arranged, and I feel certain that Sir A. Morse and Sir M.K. Lo would be disappointed if it was cancelled, perhaps we could leave the arrangements as they stand? I doubt, however, whether it is necessary to bring Mr. Sloss up from Oxford for this meeting and, if you agree, I will telephone him and inform him that in view of further developments his presence is no longer required and that we regret any inconvenience this may have caused him.

My Hall

23. 7. 1951.