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1611
I agree generally with the above minutes,
with some important reservations as to the
main matter
f
1.E. the conversion of sterling
and sterling-dollar salaries into silver dol-
lars.
We have had in the past to give exchange
compensation to men on dollar salaries, becauss
the exchange value of the dollar went down.
This compensation was eventually extended te vo
stated as to put the whole dollar
salary on a sterling basis. We then took the
further step of fixing salaries in sterling
for newcomers. Then after a few years we had
to give compensation because the exchange
value of the dollar went up, and this we did
by converting sterling and sterling-dollar
salaries into dollars at 2/- whenever the
dollar rose above that point.
The Gov. now comes forward with a propo-
sal which has more logic about it than any
previous attempt at a solution. He divides
salaries roughly according to the proportion
x
M
× Iave thi convenient way f
reforting to Jitter inlerin carryi full Exchange compensation Offe
thb
Jalwife to sp offiers, but in H.K. the
to advantagesy The seller
278
of an officer's expenditure in sterling and in
dollars respectively-putting it at 20 per cent
and 80 per cent respectively. To the extent of
80 per cent he proposes to pay an officer's salary
as fixed in sterling or sterling dollars into dollars
at 1/9, approximately the rate of exchange when
the sterling salaries were fixed. The remaining
20 per cent will be changed into dollars at the
rate of the day fixed on a monthly average of
the demand rate )..
As regards the passage marked ▲ in Mr. Robinson J
minute, I think it is clear that the Gov. cannot
mean to convert this 20 per cent at the a rate not
exceeding 2/Q to the dollar. In any case we could
not agree to such a proposal, since ex hypothesi
agree
this portion of salary represents liabilities in
sterling, and however much the exchange value of
the dollar rises above 2/- what the officer receives
on conversion at the average demand rate for the
month will represent the same amount of sterling.
In accepting the Gov.'s proposals it is impor-
tant to keep our hands as free as possible for the
future, since the dollar might rise and remain so
compensation special rate f leave & Stu
Va
at the end of every three years.
I would especially keep an absolutely free hand
high as to embarrass us seriously. I would therefore
reserve the right to re-consider the arrangement