576
The Government itself acts on this principle in the matter of advances to Civil Servants made by the Secretary of State. Repayment is made by monthly instalments calculated at the rate current at the time the advance is made, irrespective of any subsequent rise in exchange.
no
6. Your Excellency has said that "house rent is the chief if not the only expense of living which is not lower in this Colony than in most others, where customs duties are levied and where wages are higher "--and the Secretary of State has added that "the scale of pay of Government Servants in Hongkong compares favourably with that obtaining in most other parts of the Empire' - with great respect we submit that is is not possible to compare either the price of goods or the amount of salary in a Colony where the currency fluctuates in value with the price of goods or amount of salary in other Colonies where there are exchange fluctuations. For even if the comparison were favourable when the dollar is at 1/8, it has ceased to be favourable when the dollar is at 2/24 We submit that the only way of stating the case is that the price paid for goods to-day in Hongkong does not compare favourably with the price paid for goods 2 years ago; because the purchasing value of the salaries paid to Civil Servants to-day compares very unfavourably with the value of those paid 2 years ago. But even taking the dollar at 1/8 both rent and the price of commodities in Hongkong are considerably higher than that in other Colonies, of which some of us have had experience. Hongkong is, probably, the dearest Crown Colony in the Empire, and this even with the dollar at 1/8. There are many things which tend to make it so:-the expenses of living are far higher than in any other Colony and they are enormously increased by many causes: the chief of which is the rapid deterioration owing to the climate of clothes, books and stores. So far as European tradesmen are concerned the price of goods has for long been at the rate of one dollar to one shilling charged in England, and there is no sign of any alteration being made in this respect. This excessive scale of profit is accounted for in part by high rents and rapid deterioration of goods. It compares unfavourably with prices in other Colonies within our experience: even where customs duties are charged, which at most add 10% to the price. High rent is the keynote of the situation, and it is certain that if rents are high everything else will be high in proportion. The considerable rise in wages paid to Chinese servants is in fact partly due to the enhanced rents which they themselves have to pay for their families.
It is we think advisable that the Secretary of State should realize what rents are paid in the Colony. Rents for medium-sized houses, decently situated, vary between $180 to $250 a month. Considering this from the point of view of sterling, with the dollar at 1/8 taking a mean rent of $200 a month (apart from rates), the rent is £16.13.4 a month or £200 per annum. With the dollar at 2/2 (the rate at which salaries were paid this month) the rent is £22.1 8 a month or £265 per annum. Considering the question from the silver point of view with the dollar at 1/8, the mean salary including exchange compensation of first class appointments may be put at $1,000 a month; but with the dollar at 2/24 such a salary is reduced to $755 a month.
It will thus be seen that rents in Hongkong are higher than those paid in England ; and far exceed the recognised proportion which rent should bear to income.
But putting this on one side, whichever way it is looked at, either the increasing sterling rent, or the diminishing currency salary, the question of house rent is not merely the principal item of expenditure affected by the exchange, but is such an important one that even if it stood alone it would, we respectfully submit, be sufficient warrant for the relief which we seek. In the case of second class appointments, the item for rent can hardly be diminished, and it therefore bears a disastrous proportion to the officers' salaries. It is hardly possible to anticipate any reduction of rent, for the cost of building and of continuous repairs is such that even at the present high rents landlords do not find house property a profitable invest- ment. Similarly with regard to the rates: the monthly rate for a house rented at $200 is $26-
this at 1/8 in sterling is £2 3s. 4d.
at 2/2 it is £2 17s. 5d.
The Government has not reduced the dollar value of the rates in consequence of the high rate of exchange, nor would it be possible for it to do so. There are a number of smaller items the charges in respect of which always remain constant, and are not affected by the rate of the dollar; such as doctors' charges, servants' wages, coolie hire, gas, tram ticket, chair hire. In all these, and some others of a simllar nature, the actual cost as expressed in £ S. d. has kisen owing to the rise in the dollar, e.g., the quarterly tram ticket on