PUBLIC RECORD OFFICE
Reference :-
minimui
FILC.O. 882
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PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH——NOT TO
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half ounce letter) is allowed to the Colony, to pay the expenses of the local establish- ment. The postal rates are fixed by treasury warrant in sterling, and so long as the Proclamation of 1844 remains unrepealed, sterling money cannot be refused if tendered at the post office. There is, however, so little British sterling money in circulation, and the saving that would be effected by obtaining it is a matter of so little moment to the merchants, whose post office accounts are settled monthly, that two-thirds of the revenue of the office is received in dollars at 45. 2d. From the dollars so received the colonial share is deducted, and paid into the treasury in dollars at 48. 2d., and for the balance of the dollars a bill on London in sterling for the amount, calculating each dollar at 48. 2d., the rate at which it was received, is purchased, and remitted to England, the profit on the dollars, about 12 per cent., being given by the Imperial Government to the Colony. The sterling money received at the post office, there being no way in which it can be disposed of without loss, is paid into the Commissariat Chest, where it accumulates, and will I suppose have eventually to be remitted to England. Thus the Colony derives the profit on the postages paid in dollars, and the Imperial Government bears the loss on those paid in sterling, which appears to me to be by no means an equitable arrangement.
30. I would suggest as a remedy that the Colony be allowed to provide postage stamps, and that the postal rates be inscribed on them, not in sterling, but in cents at the rate of 48. 2d. to the dollar (thus a 6d. rate will be 12 cents). That the use of these stamps be made compulsory. The practical result of this would simply be that all the postages would be paid in dollars at 48. 2d., instead of only a large proportion of them, as at present, and the whole of the Imperial share would then be remitted home by the Colony in bills of exchange free from all loss. The expense of the stamps would fall on the Colony, and the Colony would derive the profit on remitting the Imperial share so long as the exchange continued unfavourable to the mother country. The Colony should therefore bear the loss on remitting, if the dollar ever were worth in exchange less than 4s. 2d., as in 1849, when it fell to 38. 11 d., equivalent at a par of 48. 2d. to five per cent. premium sterling; and I do not think it an impossible contingency that the balance of trade may again become, as formerly, unfavourable to China, now that so many new ports have been opened, which may become consumers of imports, but have no exports suitable to foreign trade to give in exchange.
31. I will now as briefly as possible recapitulate my proposals in the order in which they should be carried out:--
Ist. I recommend that the Treasury instruction requiring the colonial accounts to be kept in pounds and shillings be forthwith withdrawn, and the accounts at once kept in dollars and cents.
2dly. That as soon as the necessary arrangements can be made the Proclamation of 1844 be revoked, and another substituted for it, declaring the dollar and its parts the only legal tender in Hong Kong.
3dly. That a local Ordinance be at the same time passed, converting all items of either revenue or expenditure, calculated in former Ordinances in pounds, shillings, and pence, into dollars at the rate of 4s. 2d.; and that in all subsequent legislation money calculations be expressed in the currency of the place.
4thly. That, concurrently with the publication of the Proclamation and Ordinance referred to, the under-mentioned coins be issued at the Treasury to the public in payment of sums below a dollar, and in exchange for dollars to all who may desire to purchase them:
A CASH.-A coin composed of some cheap alloy, weighing as nearly as possible 58 grains, and representing one thousandth part of a dollar. The coin to be a legal tender up to a certain amount only; say one dollar.
A CENT.-A copper coin representing one hundredth part of a dollar, and a legal
tender up to the same amount as the cash.
A TEN-CENT PIECE.A silver coin weighing 416 grains, representing one-tenth
part of a dollar, and a legal tender up to the amount of two dollars.
5thly. That the Home Government cause the coins specified above to be procured in England at the expense of the Colony, and that the following quantities of each be sent to commence with :---
20,000,000 Cash
1,000,000 Cents
100,000 Ten-cent pieces
$20,000
10,000 10,000
These would have to be followed by constant additional supplies, the extent of which can be determined hereafter. As there is a profit to the Colony on all payments which can be made in England, the insurance, freight, shipping charges, and every expense on these coins should be paid in England. And in the hope
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that Her Majesty's Government will sanction these proposals, and to avoid any delay on the score of funds, I have ordered a sum of 8,000%, in bills at six months to be forthwith remitted to the Agent General for Crown Colonies. 6thly. That, concurrently with the passing of the new Proclamation, the Lords Commissioners of Her Majesty's Treasury should issue instructions as to rate at which the dollar is to be issued to the military and naval services serving in China; or, if possible, what would be far better, a China rate of pay and allow. ances for those services be announced in dollars, in the same manner as the pay and allowances of the troops serving in India are fixed in rupees.
7thly. That the postal receipts be accommodated to the currency of the Colony, by the issue of postage stamps, and by the payment here of the British rates in dollars at 4s. 2d. If legislation be necessary to effect this, and that it be within the province of the local legislature (a point which 1 must leave to be decided by the law officers at home), provision might be made in the local Ordinance already referred to in the 3d recommendation.
32. These arrangements are, I conceive, all that would be necessary to reduce the present confusion to order. They can be carried out without expense to the Imperial Government or loss to the Colony. And all those whom I have consulted, bankers and merchants, as well as Chinese, agree that they would be favourably received by all classes of the community.
I have, &c.
(Signed) HERCULES G. R. ROBINSON.
His Grace the Duke of Newcastle, K.G.
&c.
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(No. 34.)
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No. 3.
COPY of DESPATCH from the Duke of Newcastle, K.G., to Governor Sir H. ROBINSON.
SIB,
Downing Street, March 26, 1862. I HAVE to inform you that I have considered with the Lords Commissioners of the Treasury, and their Lordships with the Master of the Mint, your despatch marked confi- dential, dated the 9th March 1861, recommending certain measures for the reform of the system of currency in Hong Kong which has long been admitted to be in an unsatisfactory state. I annex for your information and guidance copies of the correspondence between this Department and their Lordships Board on the subject of your despatch. I also annex the specimens of new copper cash referred to in the correspondence, and submitted by the Master of the Mint.
C.O. to Treasury, June 29/61. Treasury to
C.O. March 19.
C.O. to Treasury, March 18/62.
2. You will perceive from this correspondence that Her Majesty's Government have now determined on the conversion of the public accounts of Hong Kong from sterling into dollars and cents, on the repeal of the present Proclamation or Proclamations regu- lating the currency, and substitution of a new one, providing that the only legal tender for sums, say of five dollars and upwards, shall be the Mexican dollar, and at the same time authorizing a subsidiary coinage, and, lastly, on the issue for such subsidiary use, of new bronze cents to be struck at the Mint in this country.
3. With respect to your proposals for the issue, for the same subaidiary purposes, of a new coinage of silver pieces of ten cents, and also of British “cash to be made of copper with some alloy, and to pass at the rate of 1,000 to the dollar, Her Majesty's Govern- ment, who have been unable to adopt your recommendations for the reasons explained in the correspondence, have found it necessary to postpone for the present a decision as to what shall be done on these heads. Her Majesty's Government will be glad to receive any further report which you may have to make in connexion with this part of the subject, with reference to the observations made by their Lordships and the Master of the Mint.
4. I have to instruct you to take much steps, legislative or otherwise, as may be necessary to prepare for the proposed changes in the currency system, and at the earliest convenient period you will cause the public accounts of the Colony to be kept in dollars and centa; provided, however, that in the statistical information furnished to this country the amounts are still stated in sterling.
I have, &e. (Signed) NEWCASTLE.
Governor Sir H. Bobinson,
&rc. &c.
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