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Objects and Reasons.
1. The Object of this Ordinance is to empower the Governor to raise a loan of $25,000,000 for the purposes specified in the Schedule. It is estimated that by the end
of 1934 between ten and eleven million dollars will have been advanced out of surplus balances on account of public works, while a further $3,400,000 approximately will be required to pay off the Hong Kong Sterling 34% Inscribed Stock 1918/1943. Thus by the end of 1934 some $14,000,000 will be required to liquidate the position.
The remaining $11,000,000 will be expended in the following three or four years in completing the various schemes.
2. As it is obviously impossible to foresee the exact expenditure that will be incurred on each item, provision is made in section 3 (2) for the transfer of money from one item in the Schedule to another, but no such transfer can be made unless it has been approved by a resolution of the Legislative Council and by the Secretary of State.
3. Sections 4, 6, 7, 10, 12, and 13 are reproduced, mutatis mutandis, from the corresponding sections of the Public Works Loans Ordinance; 1927, Ordinance No. 14 of 1927.
4. Section 5 provides for the redemption of the bonds issued at the annual rate of one twenty-fifth of the amount of each issue of such bonds. It is intended to raise about $14,000,000 forthwith and the balance by a further issue or issues as required. The bonds of each separate issue are to be redeemed at the rate of one twenty-fifth in each year starting in the year after that in which the issue was made.
5. Section S makes provision for the appropriations from revenue for the redemption of the loan.
6. Under Section 9 interest on the loan is to be 31% which is payable half yearly.
7. The bonds drawn for redemption each year and the half-yearly interest are payable at the Hong Kong office of the Chartered Bank of India, Australia and China, to which also. under s. 11, the bonds drawn are to be delivered for cancellation.
8. Section 12 makes this loan a trustee investment.
9. No provision is made for the establishment of a sinking fund as the system of annual drawing provides for the redemption of the loan.
10 Section 13 exempts all appropriations for the payment of interest and for the redemption of the loan from liability to military contribution,
R. E. LINDSELL.,
Attorney General.
:
May, 1934.
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