§ [The question was as follows:
§ To ask His Majesty's Government, whether they have any statement to make on the negotiations with the British North Borneo (Chartered) Company.]
§ LORD WINSTERMy Lords, agreement has now been reached between the Government and the directors of the Company on the terms for the transfer of the North Borneo rights and assets to the Crown. These terms are embodied in a draft agreement which has been circulated to the shareholders of the Company with the directors' recommendation for its acceptance. Under the draft agreement the compensation to be paid by the Crown to the Company is to be determined by an arbitrator on the basis of (a) the net maintainable revenue and (b) the number of years purchase which, in the opinion of the arbitrator, should be applied thereto. It is proposed to execute an agreement in the terms of this draft if the shareholders approve it at their meeting on the 25th June, and I hope that it will be possible for the Borneo rights and assets to be transferred to the Crown on July 15 or shortly afterwards, as the Government cannot set up a civil administration in that territory to replace the existing military administration before the date of transfer.
It will be necessary to provide a grant-in-aid towards the cost of the administration of the territory, owing to the loss of revenue-earning capacity resulting from the Japanese occupation; provision must also be made for rehabilitation costs, for the compensation to be paid to the Company and for the cost of the arbitration tribunal. This expenditure will be included in Supplementary Estimates to be brought before Parliament in due course.
I should like to add that the Chief Civil Affairs Officer in North Borneo, who has had over thirty years' service in that territory as a civilian, has reported 1009 that there is no question but that all communities in North Borneo would welcome the proposed transfer. He went on to indicate that there was general recognition of the fairness and justice of the Chartered Company rule, but that the general feeling was that the change would accelerate the development of the country and bring with it a consequent increase of prosperity.
VISCOUNT CRANBORNEMy Lords, I should like to ask two supplementary questions, one of which concerns the attitude of the general population in North Borneo to the agreement. We have had a rather unhappy experience in regard to Malaya, where it turns out that the general population do not quite see eye to eye with the views expressed on their behalf by the Government in this House. The answer says that the Chief Civil Affairs Officer states that there is no question but that all communities in North Borneo would welcome the proposed transfer, and I have no reason to doubt that. Is that his own personal view or has he taken steps to ensure what the general population think on this question? My second question is whether the Government will lay the draft Agreement on the Table of the House?
§ LORD WINSTERMy Lords, I am not in a position to say upon what conversations or consultations the Chief Civil 1010 Affairs Officer in North Borneo has based his opinion, but he is an officer of reputation, worth and ability. I am informed that certain Borneo representatives in this country for the Victory Parade expressed themselves in terms which go to confirm the report made by the Chief Civil Affairs Officer. Certainly the Government would wish the draft Agreement to be made available to the House and that purpose will be served by putting a copy in the Library.