PUBLIC RECORD OFFICE
Reference :-~-~~
TPTRIC.O. 882
9
PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH—NOT TO
144
Such customers could to travel considerable distances to reach the nearest one. not go to a tavern to obtain a glass of arrack whenever they wanted one, but never- theless they had to be supplied. The only way in which the renter could supply them was to sell by the gallon to illicit dealers, who, in their turn, retailed by the glass, and though his profits were very much smaller under this system than they would have been if he had been in a position to sell by the glass direct to all customers, it was to his advantage to sell to the illicit dealer rather than not to sell at all.
Mr. Ellis saw clearly that the most effectual remedy for this state of things would be an increase in the number of taverns, but he did not definitely recommend the immediate adoption of such a step. IIe contented himself with including among the proposals which he commended to the careful attention of Government a recom. mendation that "the question of the number and sites of taverns should be more carefully considered." At the same time he sought some means of securing to the renter a larger profit on gallon sales and of diminishing the profits of the illicit sellers. Ile considered that if this result could be achieved, the renters would bid more for the rents, to the advantage of the general revenue at the expense of the illicit dealers. With this object he recommended that "the clause requiring that arrack be sold at Rs. 4.48 the gallon should be replaced by one prohibiting a sale below that price."
There is no indication that he expected thereby materially to reduce consump tion; still less was such reduction his main object, as the Low Country Products Association erroneously assume. The alteration in the selling price was not designed to have any effect on the retail price of arrack, the price of which when sold by the glass has always been largely in excess of Rs. 4.48 a gallon.
T
J1
6. If the intention of the Low Country Products Association is to base their case on the figures furnished by Mr. Ellis, it will be necessary for them to explain why the Kurunegala rent rose so largely between 1897 and 1910, because the increase cannot be explained by a rise in the price of arrack to the consumer.' The figures given by Mr Ellis on page 18 of Sessional Paper XXXI. of 1897 (the compilation of which is described on page 4 of the Sessional Paper) when compared with the figures now given by Mr. Horsburgh in paragraph 15 of his report show that there has been only a very slight rise in the price paid by the consumer.
7. The fallacy of the argument advanced in paragraphs 8 and 9 of the Memorial-based on a comparison of the populations of Kurunegala and Negombo in the years 1901 and 1911-is so clearly exposed in paragraphs 8 and 9 of Mr. Horsburgh's report that it needs no further comment from me.
8. In paragraph 10 of the Memorial it is stated that revenue officers have always acted on the principle that an increase in the number of taverns means an increase in the quantity consumed, and that they therefore expect and demand a proportionate increase in the rents. This is not a correct statement of the facts: tavern sale means sale by the glass instead of sale by the gallon; the former is much the more profitable, and that is why the renter bids more when taverns are established where previously there was only illicit sale.
9 In paragraphs 11 to 13 the memorialists argue that the Government owner- ship of distilleries and the contract supply system are not suited to the requirements of this Colony. The same argument has already been adduced in connection with previous representations to vou on the subject of the new Excise Scheme, and the system to be adopted has already been explained by Sir Henry McCallum in para- graphs 30 and 31 of his despatch, No. 414 of the 29th July, 1912,* and in paragraphs 19 to 21 of his despatch No. 466 of the 22nd August, 1912.† The Low Country Products Association in their Memorial have not correctly represented the intention of the Government in this matter. The real intention is that Government shall build the distilleries and then lease them out for comparatively short periods. This will have precisely the opposite effect to that which the memorialists anticipate. The successful contractor will only have a monopoly for a short period. At the end of the term of his contract, the monopoly for another short period will be offered for public competition. With distilleries put up by private persons, the owner would have a monopoly, if not for all time, for a much longer period than under the system to he adopted, since, as the Association admits at the beginning of paragraph 18 of the Memorial, private individuals will not build distilleries unless they are given security of tenure for a number of years.
• No. 3.
↑ No. 4.
145
10. In paragraph 14 of the Memorial the Association refer to the much discussed question of separation of the sale of toddy from that of arrack. The reasons for the adoption of this policy have already been set forth in paragraphs 19 to 22 and 35 of Sir Henry McCallum's despatch, No. 414 of the 29th July, 1912. They then go on to refer to the pledges made by the Government when the Excise Bill was considered by the Legislative Council, and they charge the Government with having failed to keep these pledges. A similar charge was made in the statement addressed to you by the Excise Memorial Committee," which was forwarded to you with Sir Henry McCallum's despatch No. 633 of the 27th October last † In that despatch it was clearly shown that Government had not failed to redeem its pledges, and in your reply, No. 544, of the 13th November last, you requested that the Excise Memorial Committee might be so informed.
11.
++
Reference is made in paragraph 15 to the interview which Mr. R. M. Thurley is alleged to have given to the editor of the " Morning Leader " newspaper. It is unnecessary for me to discuss the statement attributed to Mr. Thurley, as he has definitely denied the authenticity of the interview, has repudiated the sentiments attributed to him therein, and has expressed his general adhesion to the excise policy of this Government.
12. With regard to the issue of toddy licences, to which reference is made in the same paragraph, I would refer you to Sir Henry McCallum's despatch, No. 32 of the 22nd January, 1913, § forwarding reports by the Excise Commissioner, in which accurate information on this subject is contained. These and other reports in your possession prove the groundlessness of the allegation which is now made by the Low Country Products Association, that "the allocation of the toddy shops in April last seems to have been settled in a perfectly arbitrary, reckless, and speculative fashion." The failure to secure a proper bid in the case of the two toddy taverns at Radawana, to which reference is made in the concluding sentence of paragraph 15 of the Memorial and in Appendix 1, was due to a temperance movement in the district which affected the rent prejudicially.
13. Paragraph 16 of the Memorial states that " in several instances not only was there no previous demand for toddy, but there existed strong and at times unanimous opposition on the part of the inhabitants of the districts to the opening of toddy shops in their midst." I would invite reference in this connection to paragraph 5 of despatch, No. 633,† which shows that there are other reasons besides enthusiasm for the cause of temperance which will account for opposition to the establishment of taverns. The Memorialists specially mention in paragraph 16 (a) the villages Botala and Pirisyala, which were referred to in the appendices to the Memorial presented on behalf of a public meeting of Buddhists transmitted with Sir Henry McCallum's despatch, No. 652, of the 30th October, 1912,|| and in Appen- dix I. to the second Memorial from the Excise Memorial Committee forwarded with Sir Henry McCallum's despatch, No. 633, of the 17th October, 1912. † The allegations in regard to these two villages were fully dealt with in the above despatches.
14. In paragraph 16 (b) of the Memorial reference is made to the complaints made by "Christian Missionaries, by Hindu and Buddhist priests, and also by various residents and planters as to the opening of toddy shops in places where no such requirements existed."
The following despatches, forwarding various Memorials in which representa- tions have been made on this particular subject, have already been addressed to you :-
No. 414 of the 19th July, 1912,* transmitting a Memorial from the Excise Memorial Committee;
No. 459 of 21st August, 1912,¶ transmitting a Memorial from the Plumbago Merchants' Union;
No. 633 of the 17th October, 1912, f transmitting a statement in support of the Memorial of the Excise Memorial Committee referred to above;
No. 645, of the 29th October, 1912,** transmitting a Memorial from the inhabitants of the Hapitigam Korale;
No. 652 of the 30th October, 1912,|| transmitting a Memorial presented on behalf of the public meeting of Buddhists.
Much the same allegations as are made in the present Memorial were made in each of the Memorials referred to. Full information on each point has been
| 36337: not printed. ** 36333: not printed.
• No. 3.
89487
‡ No. 8.
+ No. 7. 28477 not printed.
4757: not printed.
K