31
—
J
Revenue,
A monopoly by Government was tried and resulted in a decrease in the Increases receipts in the second year to less than half those of the first year, due to the impossibility of coping with the smuggling and illicit "preparation of opium. The Revenue lost by Government was therefore so much additional profit to the Smuggler, instead of going to the Farmer who provides the Preventive Service and to the Government which uses its profits for the maintenance of Police, Sanitation, Education, etc. A Government monopoly is moreover more likely to tend to venality and corruption of subordinate officials. In view of what I have said it cannot be justly argued that the Government delegates its functions to an individual and loses prestige, since it co-operates in the duties of search and arrest, while avoiding the odium of employing informers and of making a direct profit by the sale of opium.
Under the terms of his licence the Farmer is entitled to withdraw from bond, Amount
exported.
(in order to "prepare" it), 1,800 chests per annum. This may be increased by drawn and imports of prepared and dross opium (not of raw) and he may export as well as supply the local demand. It appears to be a fact that in former years the Farmer did import prepared opium from Singapore, and that much was smuggled to China, but he states that none has been imported for 15 years. However that may be Mr. Clementi's examination of his books proved beyond question that none is imported now except opium dross, "halan ", and "tautsingko" which are imported from Canton and Macao to be used in the "preparation" of crude opium for smoking.*
Although Macao was always a rival in the export trade and secured the greater share of it, the Hongkong Farmer does a certain amount of business in this line. The markets of Australia and the Philippines are now closed, and more recently (by the prohibiting Ordinance of 1908) that of China also, but it is probable that he still exports about 12 per cent of his opium. The actual number of chests withdrawn by him from bond, since 1895 is as follows:-
1895 16072 1899 1749 1896 1515
725
1903 - 990 1907 1904 725 1908 934 † 1905 858
-
-щад
1900
1098
1897 1589 1898
1901
1036
1704
M
1902 929 1 1906 497
J
The low figures in 1904 and 1906 were due to financial embarrassments of the Farmer in those years, caused by the fact that he had tendered for a larger payment to Government than the monopoly could afford. The payment which stood at $2,041,940 in 1905 and 1906 fell in the next contract (March 1907) to $1,452,000. In fact in 1906 the Farmer had to suspend the operations of the farm altogether for some mouths and adulterated opium was sold. The average for the period excluding these two years is 1,253 chests per annum.
price and de-
Since the year 1901, the farm has been in the hands of Singapore merchants, Increased who have put up the local retail price from $2 per tael (in 1901) to its present Preased con- rate [$3.37] and by this means,-aided by the reduction in the Government sumption. rent,-hare succeeded in making it pay, in spite of the cessation of smuggling to China the loss of the Australian and other markets.
This great increase in local selling price would naturally result in a con- Sarable decrease in smoking, for the poorer classes could not afford to buy so much, but since there are no records of the quantities of prepared opium imported and exported (whether legitimately or otherwise) by the Farmer, it is not possible to gauge the decrease precisely, by the quantities of raw opium drawn from bond by the Farmer. It will, however, be noted that this decrease in smoking, together with the abolition of the smuggling traffic, have conbined to reduce the revenue received by Government as rental for the Farm by $588,000, since the lust contract was made. It will be noted also that the amount of opium prepared by the Farmer has greatly decreased since 1898 in spite of the acquisition of the New Territories in that year which added about to the population.
* Table 6 (b) and (c) of Mr. Clementi's Memo.
113 of these chests were Chinese Opium.
The Straits Commission are emphatic in their view that opium consumption varies inversely with the price, and the dearer it is the less is consumed. The price in the F.M.S. is 40% to 50% less than in the Straits and the consumption per head is nearly double which is undoubtedly attributable to the relative cost". Report $67-69. They however point out that the danger of increasing the price is that it induces smokers to take to cheaper substitutes. The consumption of morphia increased when the price of opium was raised. It also induces an increase of smuggling. Ibid §248, 256.