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later an arbitrary rate of exchange has been adopted for 80
per cent of the salary. None of these expedients has provided
a satisfactory solution of the problem and I think that it
must be recognised that it is really insoluble in the shape
in which it has been raised. I suggest therefore that the
matter be dealt with on new lines and that in future salaries
should be fixed in the dollar currency in which they are
paid, while leave pay and pension are fired in sterling.
It is not perhaps essential that there
should be any definite relation between the dollar salary and
the salary drawn on leave, and there is the precedent of the
Indian Civil Service for the assignment of pensions on a basis entirely apart from that of salary, but there are of course obvious advantages in the existence of such a relation f and the course which I recommend is that all salaries should!
now be fixed in dollars but that for purposes of leave pay
and for the calculation of pension the officer's salary should be taken as the equivalent of his salary at 2 shillings to the dollar i. an officer drawing $10,000 a year should be regarded for purposes of leave and pension as receiving
£1,000 a year.
This proposal amounts practically to the same thing as fixing the salaries in sterling and paying them at the rate of 2 shillings to the dollar, as suggested by the Salaries Commission, but it seems to me to be more satisfactory as it gets rid of an artificiality. On the assumption that Your Lordship will accept this suggestion the salaries referred to later in this despatch are express- -ed in dollars: if, however, it is desired to retain the system of fixing salaries in sterling the figures need only
to be divided by 10.
I should add that I consider that during vacation leave in China and Japan the dollar salaries
:
should