3.
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expenditure of $29,598,148, and a deficit of $830,514, i.e.
surplus balances will be reduced by that amount below
$10 million by the end of 1936.
7.
s.d.
This situation has been made clear to you in Sir W. T. Southorn's telegram No.211 of 30th August
which drew attention to the fact that the estimates for
1936 have as stated above been framed on a 1/8d. dollar,
but that it is impossible to predict what the rate will
actually be next year. The average rate for the first nine months of the current year was slightly over 2/. and if it remains at this level throughout 1936 the deficit
of $830,000 will be turned into a surplus. If Revenue
and Expenditure are otherwise as estimated the critical
exchange point below which the Budget will not balance is
about 1/10 d., which gives a margin of nearly 2d. on the
present exchange rate. Should exchange drop below this
point it is proposed first of all to appropriate the sum
of half a million dollars from the profits on the Trade
Loan, the transference of which to general revenue you have
2 authorised in your telegram No.142 of 2nd September. Should
there be a further fall in exchange it will be necessary
to consider the imposition of a levy on salaries and of
additional taxation. Meanwhile a scheme for a levy on
salaries (which would be submitted to you for prior approval)
and methods of raising more revenue by additional taxation
are being considered.
8.
Taking a longer view there are two more hopeful
features, of which the first is that most of the major works
of Public Works Extraordinary at present in hand will have
been completed by 1936 and all by 1937, so that the
expenditure on Public Works Extraordinary in subsequent years
can be very materially reduced should the financial position
of the Colony necessitate such a course. The second point