COMMITTEE ON STRAITS BETTLEMENTS CURRENCY.
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are more than 10,000,000 to 12,000,000 of all varieties of dollar coins in circulation at the present time through-
We recom out the Colony and Federated Malay States. mend the adoption of the English sovereign as the basis of our currency with a Straita dollar-fixed at the value of 28.-subsidiary to it. The present subsidiary silver coinage to remain as it is.
59. The procedure of the Government would be not to let its intention be known, and, when a decision is arrived at, to pass a law at one sitting of the Legislative Coun- cil, and immediately thereafter issue a notification to the effect that during a term sufficiently brief to pre- vent importation all dollar coins then legally current in the Colony would be received at certain specified places and Government currency notes given in ex- change; and that, after the expiry of each term, the British, Merican, and other dollars in circulation would be demonetised. The Federated Malay States would have simultaneously to promulgate the same law. The recently passed Currency Note Ordinance would have to be amended in the direction of relieving the Govern- ment, for the period of three or four months, of the obligation of paying coin in exchange for its notes, and during that time the Government would have to raise a temporary sterling loan in London, and import a gold reserve in sovereigns. The position of bank notes would not be affected, except that the law must provide temporarily for the banks holding Government notes as
• reserve against their own notes, and paying Govern- ment notes against their own notes. No current debts would be affected by the transition, they being made payable in the new currency, at the fixed rate of 10 dollars to the 9. With the large stock of silver that would come into the Government's hands, a limited num ber of Straits subsidiary dollars could be coined, and these could conveniently be only 60 per cent. to 75 par cent. of the weight of the present dollars. The Govern-
mant would have to submit to a loss in disposing of the balance. Before making change in the currency, the Government, to protect themselves against possible further depreciation of the metal, might contract to sell silver for forward delivery, and subsequently cover such male with the demonetised dollars as these are re- ceived and converted into bullion.
Our view is, that if judiciously managed, the conver- sion to a gold standard, on lines as indicated above, could be affected without greater coat to Government than they would be compensated for within a short period of years,
As an instance of such compensation, let us assume that there may be a further serious decline in the value of the dollar, asy to ls. 6d. In 1806 the Government remittances for this Colony for "Home Charges," at the higher rates of exchange then ruling, amounted in round figures to £88,000-let it be taken that exchange compensation for 1888 will, with the dollar at 2s, be about £14,000 to this should be added, for account of the Federated Malay Statee, the further rough esti mate, for 1898, of £50,000 for "Home Charges and Ex. change Compensation." These give a total (estimated) of £162,000, which sum, at 2a. exchange, would involve an expenditure by the Colony and Federated Malay States of 1,520,000 dollars; whereas, if the Government had to provide the dollar equivalent of £152,000 st ex- change Is. 6d., the cost would be 2,026,666 dollars, a low, if the dollar should fall to that rate, of 506,666 dollars annually.
Singapore, 6th November, 1897.
JOHN ANDERSON, G. 8. MURRAY,
AD. LASPE,
C. STRINGEE.
APPENDIX No. 18.
Correspondence received by ov laid before Committee, in chronological order, according to date of receipt.
No. 1.
Governor Sir F. A. SWETTENHAM to the Earl of Onslow (for the Secretary of State).
(Received 10th December 1902.)
Telegram.
I have just received a petition in favour of gold standard of currency, numerously and influentially signed by representatives of all olssses and nationalities, especially Europeans. I believe there will be counter
petition from silver party. Recent action in Siam and Philippine Islands `"strengthens arguments for gold standard here.
No. 2.
Governor Sir F. A. SWETTENHAM to the EARL OF ONSLOW (for the Secretary of State).
(Received 7.15 a.m., 13th December 1902.)
TELEGRAM.
Planters Association, Federated Malay States recommend gold standard coinage.
(813.
PA
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