12.

Acceptance of these figures would involve a

reduction in the basic salaries of the Governors of

the Bahamas and Bermuda.

But in both these cases

the local cost of living is exceptionally high.

In any case the Governor of Bermuda is on a contract which could not be reduced; and appointment has already been offered to the Governor-designate of the Bahamas at the same rate of emoluments as his predecessor. I therefore propose that for the time being these be left as they are.

13. All the others involve increases, some modest

But I believe that these are some very considerable.

equitable and defensible.

I submit them now to you

as justified; for I believe that Colonial Governors have been allowed to slip behind to an unfair degree.

14. Hong Kong clearly could (and I believe readily would) increase its Governor's salary to the level

CONFIDENTIAL

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