€
177
years to come for the employment of a larger staff of officers in the Fublic Works Department.
5.
Regarding the Estimates as a whole, I
think that the financial position may be considered satis- -factory. The Estimates, as framed, shew a balance in favour of revenue of something over four hundred thousand dollars but I think that it is fairly certain that this figure is too low. The dollar has been converted for the purpose of ster- -ling payments at 3/-. This rate was recommended by the Treasurer after consultation with the Chief Manager of the Hongkong and Shanghai Banking Corporation and the Estimates had been prepared on this basis before my arrival. Had this not been the case, I should have had no hesitation in taking a considerably higher rate, since it seems almost inconceiv- -able that the dollar can fall to anywhere near the level of 3- during the period covered by the Estimates.
6.
Against this probability of an increased balance in favour of revenue must be set the fact that the Estimates do not provide for the increases to the emoluments of Government servants which will be necessary, nor for the deficit which is certain to result from the Government's trans- -actions in rice. I hope to address you very shortly on the former matter but until the various questions involved are disposed of it is difficult to suggest even approximately what will be the amount of extra expenditure involved. It will be observed that a sum of 8465,000 has been inserted under Miscellaneous Services to cover the special allowances which are now being paid and that amount will of course be available pro tento towards meeting the permanent increases, Something more will undoubtedly be required but I do not think that it is likely to amount to 8400,000 so that, even so, the Estimates would still show a balance on the right
gide.
On