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from China - "drop-outs" from Kwantung, as the Governor put it - to benefit under the scheme. He suggested that the Chinese authorities might regard a residence qualification of less than his proposed three years as a positive inducement to illegal immigration. This said, the Governor pointed out, as he has done in his telegram that it is always open to the Director of Social Welfare to make discretionary payments, regardless of whatever criteria are laid down, under the public assistance scheme in cases of evident need.
4.
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The Governor further explained that in proposing what might appear fairly stiff criteria he had in mind the desirability of establishing fairly elementary machinery for administering benefits. Some new kind of employment service would probably have to be established but his aim was to see the scheme administered with the minimum degree of bureaucracy and with the maximum degree of humanity. Recipients of benefits under the present public assistance scheme were given "books of tickets" which they cashed at a time of their own choosing and when they were no longer entitled to benefits they were expected to (and generally did) surrender their books to the Social Welfare Department. The Governor said that he hoped it would be possible to work out some similar scheme for "unemployment benefit" (as he allowed himself to call it) since he did not want "dole queues". If, as he hoped,, the new scheme was to be "policed loosely" it was not unreasonable that a person should not be entitled to draw benefits until he had satisfied adequate qualifications with regard to residence and a period of unemployment.
5. Having explained the position in this way, the Governor asked me whether we were more concerned about the proposed residence qualification or the qualification concerning the period of unemploy- ment. I told the Governor that we had not had time to consider the proposed criteria in detail but that at first sight both had, as stated in Lord Goronwy-Roberts' telegram, appeared to us "unduly restrictive". It was for this reason that we had said that we would like to be consulted when precise proposals were being formulated but that I was sure we would be prepared to reconsider our attitude in the light of any further arguments that he wished to put forward. At the same time, I told the Governor that I did not think I would be speaking out of turn if I were to say that we would hope he could avoid being drawn into detail at his press conference about the proposed criteria for the new scheme. The Governor said that he would do his best to avoid saying anything about the proposed criteria but he would not
wish to give the impression that the "overnment had given no thought to the criteria under which the new scheme might operate. He might therefore have to say that the residence qualification would probably be more than the period of one year which operated in the case of the existing scheme. He said that he would probably send a further report giving a fuller case for the criteria he has proposed. I encouraged him to do this so that we could consider the matter more thoroughly.
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CONFIDENTIAL
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