July 30 1896.
On the next item, Governor and Legislature, 82,714.30 Hon. T. H. WHITEHEAD said-I am in favour of this item, but at the same time. I's quite fail to see why the rent of Craigieburn should not have been known and included at the time the estimates were formed. It must have been within- {
The ACTING COLONIAL TREASURER-It was known. It used to be debited to miscellaneous services, but the Secretary of State ordered it to be debited to Governor and Legislature, and in order to carry out that instruction it was neces- sary to take a separate vote.
The CHAIRMAN-It is merely a transfer from one bead to another.
Item recommended.
The next item on which there was discussion was Sanitary Department, $9,406.10.
Hon. T. H. WHITEHEAD-In regard to this item I desire to refer to the resolution I moved at the last meeting of the Council asking for certain papers in connection with the proposed reconstruction of the Sanitary Board. The Governor then stated that all the papers would be laid on the table after the decision of the Secretary of State was received.
The COLONIAL SECRETARY-Excuse me, the Governor said he did not propose to lay any papers upon the table until the Secretary
of State's decision had been received.
Hon, T. H. WHITEHEAD-I may mention now that it would be well if the Government changed their policy of concealment in regard to papers of public importance, and gave them now in order that we may have the opportunity of studying the correspondence, and if matters have not been fully represented we would then have an opportunity of putting things right. It will be of very little service-in fact no service at all-to have the papers after the decision has been arrived at, because the Secretary of State's order will have been issued without our having the opportunity of considering the papers. If we have them now we will have that opportunity. I think the Council has a right to them And should have the opportunity of consi- dering the
papers
and to have the chance of referring matters home through the Government There can be nothing which has been said or written that will not bear the light of day, and I can scarcely realise any reason which can justify the Government in with- holding the papers any longer.
now
The CHAIRMAN-The hon. member had the fullest opportunity of stating his views at the last meeting of the Council. Why he did not avail himself of that opportunity I cannot quite understand. My impression is that the rea son was that he was not supported by his unof ficial colleagues, who were quite satisfied to wait until the decision of the Secretary of State arrived. Of course I may be wrong, but the hon. member's colleagues will correct me if I am. (After a pause.) No contradiction.
F
CHINA OVERLAND TRADE REPORT.
The item was then recommended, and the remaining items were recommended without discussion.
The CHAIRMAN-The items, gentlemen, have all been recommended by the Finance Committee, and the report of the Committee will be brought up at the next meeting of the Council. There is no other business.
ADJOURNMENT.
The Committee then adjourned.
THE MILITARY CONTRIBUTION.
The following despatches on the subject of the military contribution were laid before the Legislative Council on the 22nd July. The been published, but we repeat it, as the references memorialof the unofficial members has already in H.E. the Governor's despatch would be unintelligible without it :—
Government House,
Hongkong, 21st April, 1896. Sir, I have the honour to forward the en-
closed memorandum from the Unofficial Mem bers of the Legislative Council on the subject the following observations on the several points of the Military Contribution, and to submit raised by them.
in paragraph 1 of their memorandum is, in my 2.---The position assumed by the memorialists opinion, untenable and calls, I think, for no special remark.
3.-As regards the contention in paragraph 2, the Unofficial Members seem to forget that Postal Service except for services actually no monies are paid away in respect of the rendered. It seems to me erroneous to main tain that the revenue collected on behalf of the Imperial Government or of the Postal Union brings no profit to the colony. With out the services of the Imperial Government and the Postal Union, which are paid for by this revenue, the Postal Service would either come to a standstill or the colony would have to make direct arrangements for the formance of those services, which might be a less economical method than that which at present exists. This part of the expenditure is, in fact, just as necessary to the service as the salaries
per.
of the Post Office staff. At the same time it
appears to me that there are strong reasons why the entire portion of the revenue which is expended on the Postal Service should be exempted from the Military Contribution. That service is one of the few commercial undertakings which are now controlled and managed by Government on behalf of the public, and I believe that it is generally recognized as a fundamental principle that, so far as is possible, only so minch profit should be derived from a postal service as is necessary to meet such ex- tensions and improvements as may be required Hon. T. H. WHITEHEAD Before the vote profit derived from the service, except when so from time to time in the service itself. Any is passed I would really urge on the Gov-applied, constitutes a special tax upon that ernment again the desirability of confiding in us to the extent of giving us the papers bear- ing on the subject. I think there is every reason why we should have them. My unofficial colleagues voted unanimously with me when I asked for them in the month of December or January last. I then asked for the papers, and I was under the impression that certain members would have supported me when I asked for the papers at the last meeting of the
Council.
***
The CHAIRMAN—However, you withdrew your motion.
Hon. T. H. WHITEHEAD-I withdrew my motion, but have not changed my mind.
The CHAIRMAN -You have changed your mind since then.
Hon. F. H. WHITEHEAD-I wanted nothing unreasonable when I asked for the papers;
The CHAIRMAN-Your change of mind will be noted in the minutes. It will be noted that you wish the papers to be published.
The ACTING COLONIAL TREASURER-I do
not see that this is relevant.
section of the public which makes use of the service, from which the remaining portion of the community is exempt, while a deficit is equivalent to a tax upon the whole community for the benefit of one portion of it, viz., those who send and receive correspondence through the post. This is so manifestly unfair that tariffs are invariably. so arranged as to guard against such a possibility, with the result that the profit may be and frequently is considerably in excess of the amount required for improve- ments in the Postal Service, the balance going to swell the general revenue.
A deduction of 17 per cent. from such revenue as might be raised to meet a deficit would constitute a tax on general revende and therefore from the present point of view would be unobjectionable, but this case is not likely to occur in practice.
A deduction of a percentage on profits also seems to be open to no grave objection, provided that such part of the profit is exempted as may be devoted to necessary improvements in the
service.
The CHAIRMAN It is not really relevant; On the other hand the levying of the contri. but with the object of not allowing it to ap-bution upon the gross revenue derived from the pear that there is any desire to prevent the hon, member from expressing his views, I have permiffed him to proceed, although he had ample opportunity of expressing his opinions at the meeting of Council.
Post Office appears to be equivalent to the exaction from a merchant of 174 per cent. of his capital and income, and I venture to submit that the revenue derived from the Post Office (or at least that part of it which is required for
光
expenditure on the Postal Service) shot regarded as the capital of the -using of the community held in trust, for administered on its behalf by the Gov I consider that the Government, sho in a position to provide a Postal for the letter-writing public on as cheap terma (inasmuch as it is not its object to mak a large profit) as could be offered by private firms, but at the same time without expense to the non-letter-writing portion of the community The impost of 17 per cent. on gross re ceipts renders this position quite impossible- In cases where the General Post Office competes to some extent with private firms (e.g., in carrying of parcels the latter must enjoy an immense advantage at any rate if the parcels principles, without assistance from general post is to be conducted on strict business
revenue. Again in cases where the General Post Office exercises a monopoly, owing to this impost of 17 per cent. there will be unneces sary, hardship either to the general public or to the Post-using section of it, and the hard- ship will increase as the business of the Post Office is extended. I venture to hope that in view of these considerations it may be decided Contribution that portion of the revenue which to exempt from the deduction for the Military
the memorialists is upheld, the amount to be de- is devoted to the necessary expenses of the Postal Service. I should add that if the contention of
ducted in respect of 1895 on account of transit, would be $145,711.00. The total revenue of the charges and expenses of the Postal Convention
of $50,209.44. For the reasons I have stated, I Post Office in 1895 was $244,449.71, while the expenditure was $194,240.27, leaving a balance consider this to be the largest sum on which the impost of 173 per cent. should be charged.
4. The contention in paragraph 3 is ob. viously sound, ad the water accounts with departments are simply a matter of book- keeping: the amounts are merely book entries simply be transferring money from one account no money actually passes and if it did it would
to another.
. 5.—I agree with the memorialists also that the items classed last year as appropriations in aid 'should fairly be exempted. For example, the Government might hand over Queen's College or the Government Civil Hospital to a public body, paying to such body the difference between the cost of upkeep and the amount of the fees collected. The revenue would be thereby diminished by the amount of the fees, while it would scarcely be contended that Go- vernment should not entrust the management of such institutions to a public body simply be- cause to do so would decrease the amount of the Military Contribution. Items of this nature are practically Refunds of Expenditure. A list of the amounts of the appropriations in aid for 1895 is enclosed.
6. The item referred to in paragraph 5 of the memorial should also, I think, be exempted. The sum mentioned, viz., $15,000, has been pro- vided in the Estimates to meet the expenditure on account of refunds of revenue.
to add to the remarks contained in paragraph 5 7.--As regards paragraph 6, I have nothing of my despatch No. 267 of 28th August, 1895, except that the memorialists are in error in supposing that the revenue derived from Water Rates and the Central Market will in course of time cease and determine, although they might be decreased.
8.-I shall be glad to be favoured with an early decision on the several points raised the memorialists.
9-It is satisfactory to note that the Unoff cial Members have raised no objection to the principle of appropriating a percentage of 17 per cent, of the Colonial Revenues to the use of the Imperial Government as a Military Contri- bation, and I trust that, if it is possible to meet a their wishes as regards some of the details to which attention has been drawn in their memo- [-is randum, this much vexed question will be satisfactorily and finally settled — honour to be, sir, your most obedient
SERWILLIAM ROB The Right Honourable Mr. Jog
lain, M.P., Her Ma tary of State for the Colonies, Downing Street, London
Jast
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