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PUBLIC RECORD OFFICE

Reference :-

C.O. 882

8

PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO

£15,056, and we advanced the amount against scrip of the unissued Lagos Govern- ment Loan, with interest at Bank rate varying, on account of the Mauritius Sinking Fund Ordinances Nos. 43 of 1902 and 38 of 1903.

3. As, however, it now appears, from the enclosures to your letter under acknowledgment, that the Colonial Government contemplates that the amount will be used at once in paying off a portion of the Colony's debt, we have transferred the sum in question from the Sinking Fund to the General Account, and have repaid an equivalent amount on account of the advances which we have made to the Colonial Government.

4. The transaction appears in our account with the Government of Mauritius on the 31st of August.

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No. 208.

I have, &c.,

E. E. BLAKE.

MR. LYTTELTON to GOVERNOR SIR C. BOYLE.

(No. 213.) SIR,

Downing Street, September 3, 1904. I HAVE the honour to acknowledge the receipt of Sir G. Bower's despatch, No. 258, of the 22nd of July,* forwarding reports on the possibility of assisting the small Indian planters in the transportation of their canes by means of mechanical road traction.

2. It appears, from the end of paragraph 2 of the Surveyor-General's report, that certain owners are proposing to give up using their traction engines and auto- mobiles, and I thought that it might be possible for arrangements to be made by which these engines might have been placed at the service of some of the small planters. I must, of course, leave to the Colonial Government the question of how the small planters can best be assisted, and I should be glad to know what action it is proposed to take.

3. I have received this report on the utility of automobiles and traction engines with surprise and regret, in view of the recommendation made to Mr. Chamberlain by the Mauritius Government for the issue of a loan which included funds to purchase these machines.

30965

(Paraphrase.)

No. 209.

I have, &c.,

ALFRED LYTTELTON.

MR. LYTTELTON to GOVERNOR SIR C. BOYLE.

(Sent 11.50 a.m., September 6, 1904.)

TELEGRAM.

[Answered by No. 210.]

Referring to my telegram of 30th August,† loan of Ceylon officer on full pay leave cannot be arranged without additional expense to Ceylon. Consider that Council of Government should be invited to vote sum necessary to cover such expense. including suitable honorarium to officer if vacation leave spent in service of Mauritius.

• No. 201.

↑ No. 206.

31544

(Paraphrase.)

No. 210.

GOVERNOR SIR C. BOYLE to MR. LYTTELTON.

(Received 9.10 a.m., September 9, 1904.)

TELEGRAM.

[Answered by Nos. 214 and 211.]

Your telegram of 6th September.* I deprecate asking Council of Government for any such vote. The financial embarrassment is most serious, and I am urging rigid economy. As a Ceylon officer is not available, I will endeavour to make temporary arrangements here, if necessary asking your assistance later. The deficit of current year will, I am afraid, be as large as reported, and that of year ended on 30th June is over Rs. 1,200,000, whilst amount of reserve is not now Rs. 70,000, and the Treasury balance, given at one million, largely consists of Trust funds. I am advised that extra taxation would not produce more revenue, and recourse to a loan is urged. This in aid of revenue seems unavoidable, but I have not expressed any opinion here, pending the receipt of your instructions, which I am awaiting,

27542

SIR,

(No. 222.)

No. 211.

MR. LYTTELTON to GoVERNOR SIR C. BOYLE.

Downing Street, September 10, 1904. I HAVE the honour to acknowledge the receipt of Sir Graham Bower's despatches, Nos. 236 and 237, of the 1st of July last, submitting the Estimates of Revenue and Expenditure of the Colony for the year ending the 30th of June, 1905, and reporting on the financial position of the Colony.

2. The revenue for the year is estimated at Rs. 10,269,970, and the expenditure

at Rs. 10,688,221, leaving an estimated deficit on the year's working of Rs. 418,251. The deficit for 1903-4 will, I understand from Sir G. Bower's address to the Council, be found to amount to about Rs. 790,245, making a difference between expenditure and revenue for the two years of over Rs. 1,200,000.

3. The seriousness of this position is evident, and it is rendered more acute by the strong probability, for I can hardly call it less, that the estimates of revenue will not be realised without increased taxation. The revenue last year, though originally estimated at Rs. 10,251,176, has only realized, I understand, about Rs. 9,535,284, and I cannot help thinking that Mauritius will be fortunate if this year's revenue reaches Rs. 10,000,000 on its present basis. Moreover, it must not be forgotten that the majority of the planters and bailleurs de fonds to whom advances were made under Ordinance No. 43 of 1902 proved unable to meet their obligations to the Government in respect of the repayment last June of the instal- ments then due.

4. The excess of expenditure over revenue is no new phenomenon in Mauritius, and the present position must be viewed in the light of past experience. In his despatch, No. 191, of the 23rd of September, 1898, Mr. Chamberlain commented at length on the failure of the Mauritius Government to pay its way. He pointed out that during the years 1884-1897, inclusive, there were deficits on nine occasions, and that the total excess of expenditure over revenue for that period amounted to no less than Rs. 4,374,599. He indicated how much the crisis which then prevailed in Mauritius, and which in its results, if not in its immediate causes, was similar to the present one, was attributable, so far as the Government was concerned, to the policy which had prevailed since the change in the Constitution in 1885 of incurring annual deficits and meeting them out of the accumulated surplus balances of former years instead of increasing the revenue by additional taxation. result of the 1898 crisis, increased taxation was imposed, and during 1899 and 1900 substantial surpluses were realized. Expenditure, however, soon again overtook the revenue, and the last three years have shown deficits.

• No. 209.

† Nos. 191 and 192.

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