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R.C24 JUL OS,

Government House,

Hongkong, 18th. June, 1909.

My Lord,

I am surprised & regret to have received Mr. Phelips' letters & that which is such as to suggest doubt whether it is not hard to excuse him from being replaced by an officer with a just sense of the duty for which he is paid.

I confess that I cannot see such pertinence in Mr. Phillip's letter of May 4th as to justify the strictures on the Local Auditor. Summer does not say more than that the town feels aggrieved at the reception of the forces. A portion of the moving crowd showed no deference to the wishes of the authorities in camping on the ground.

In view of the fact that there is an office in Hong Kong "Ghost Office" in the service of the Govt.,

I have the honour to transmit for the consideration of the Comptroller and Auditor-General the enclosed copy of letters which have passed between the Colonial Secretary and the Local Auditor, together with copies of three minutes written jointly by the Colonial Treasurer and Postmaster-General to whom I referred the matter both because their Departments together provide 90 per centum of the ordinary work of the Local Auditor, and because the Postmaster-General has previously acted and will shortly again be acting as Colonial Treasurer.

2. I consider it very unsatisfactory that the examination of accounts should be relegated to a Portuguese Clerk in these important Departments, and I think it important that the Local Auditor should be required to keep a journal shewing the daily record of all the work done by his Department and to submit this journal

To

THE EARL OF CREWE,

C.

No. 471

Hongkong.

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Enclosure

Enclosure 1 to 3

R.S.S. 4/8.

4/11 atome

AB

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247

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