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three months' expenditure. It appears to me
that such a situation provides a prima facie
case for continuing the levy. It has all
the features of a "levy" situation - a heavy
deficit, an obscure financial outlook, and no
clear plans at present for bringing expenditure
down to the lower level of revenue. What the
Governor asks for is authority to announce
that it is proposed to reimpose a salary levy
next year, leaving the actual rate of levy to
subsequent consideration. He couples with
this a proposal that sterling salaries should
be paid on not more than $16 to the £l (i.e.
an exchange rate of 1/3d). On the basis of his
figures I should accept both proposals.
There is a further point. In No. 19
the Governor was informed that the levy ought
not to be prolonged "beyond the time necessary
to prepare and introduce plans for the adjustment
of expenditure to revenue by the normal methods
of effecting economies in administration and
by the imposition, if necessary, of fresh
general taxation." The Governor's despatch
shows that a beginning has been made in this
direction by the careful pruning of the
estimates for 1937 and by certain increases
in taxation, but on the basis of his estimates
for 1937 in which these measures have been
taken into
account, it is clear that only the fringe of the problem has yet been touched.
I
should