138
4. The statement of the reserve held by this Government given in paragraph 2 does not appear to include the amount of the depreciation fund which was on 31st October last 263,810 dollars.
5. I am also to point out with reference to paragraph 5 that the presentation of large quantities of notes would imply a redundancy of the circulation, and low exchange, and in that case the Currency Commissioners would, no doubt, find it desirable to redeem the notes by selling transfers on London.
47225
SIR,
I have, &c.,
ARTHUR YOUNG,
Colonial Secretary, Straits Settlements.
No. 192.
COLONIAL OFFICE to TREASURY.
Answered by No. 195.]
Downing Street, 10th January, 1907. I AM directed by the Earl of Elgin to transmit to you, to be laid before the Lords Commissioners of the Treasury, copies of despatches* from the Governor of the Straits Settlements regarding the currency, together with the draft of the replyt which, with their Lordships' concurrence, it is proposed to return to Sir J. Anderson.
305
SIR,
Lord Elgin would be obliged if the matter could receive early consideration.
I am, &c.,
C. P. LUCAS.
No. 193.
COLONIAL OFFICE to TREASURY.
[Copy to Governor, 11th January, 1907. Confidential. L.F.]
Downing Street, 10th January, 1907.
I AM directed by the Earl of Elgin to acknowledge the receipt of your letter of the 3rd instant, enclosing the draft of an Order in Council to regulate the cur- rency of the Straits Settlements, and to request you to inform the Lords Commis- sioners of the Treasury that his Lordship concurs in the terms of the draft.
As the Deputy Master of the Mint hopes that the first batch of new dollars will be ready for shipment to the Colony about the third week of the present month, I am to ask you to move their Lordships to cause the draft Order in Council to be submitted to the King in Council at the earliest possible date.
I am, &c.,
C. P. LUCAS.
+
139
Enclosure in No. 194.
SIR,
Royal Mint, 4th January, 1907. WITH reference to Sir Edward Hamilton's letter of the 3rd instant, I am desired by the Master of the Mint to state, for the information of the Lords Com- missioners of His Majesty's Treasury, that he concurs with the terms of the draft Order in Council regulating the currency of the Straits Settlements, a copy of which was enclosed, except in regard to the remedy of fineness specified in the first and second schedules thereof.
The proportion is that indicated in my letter of the 11th December last, but subsequent experience gained in melting for recoinage the 416 dollars at Birming- ham shows that this proportion leads to a large number of pots proving to be of incorrect composition, no less than 11 per cent. having been set aside for remelting on this account.
It may be laid down as a general principle that the remedy of fineness allowed in the case of silver coins should be greater than that in gold coins, owing to the well known lack of uniformity in silver copper alloys. Different parts of a single silver coinage bar vary in composition by two or three parts per 1,000. Owing to this and other causes, the composition of individual silver coins differs from the mean composition of a quantity of coin by more than two parts per 1,000. This fact has been frequently exemplified in the Straits Settlements dollars sent for For these reasons the examination to this Department by the Indian Mints.
remedy of fineness proposed in 1894 for the British dollar is not now concurred in as suitable either for these coins or any other silver coin guaranteed by a Government Department. The remedy of fineness adopted for the British dollar and subse- quently for the Straits Settlements dollar was taken from the Indian rupee of 916 8 fineness, while the remedy for weight is the same as that of the Imperial five- shilling piece, which corresponds closely to the Indian rupee.
In the case of the United States dollar, the Mexican dollar, and the Hong Kong and Straits Settlements subsidiary silver coinage, the remedy of fineness is three parts per 1,000. For British Imperial silver the remedy is four parts per 1,000. The fact that the coins which are dealt with in the proposed Order in Council are of unlimited legal tender does not in any way preclude the application of the conclusion stated above.
I have, therefore, to submit that the words "two thousandths "in the schedules
of the proposed Order in Council be omitted, and the words "Three thousandths"
be inserted as the remedy of fineness for both coins.
I may add that if the remedy had been three per 1,000 instead of two per 1,000, only one instead of 33 pots out of 298 would have been rejected at Birmingham.
I am, &c., The Secretary,
WILLIAM ELLison MacartNEY.
Treasury, S.W.
2198
No. 196.
1894
No. 194.
TREASURY to COLONIAL OFFICE. (Received 14th January, 1907.)
[Copy to Governor, 18th January, Confulential, 1907. L.F. See No. 204.]
Treasury Chambers, 12th January, 1907.
SIR,
WITH reference to Treasury letter of the 3rd instant, I am directed by the Lords Commissioners of His Majesty's Treasury to transmit, for the information of the Secretary of State for the Colonies, a copy of a report, dated 4th instant, from the Master of the Mint proposing an alteration of the remedy of fineness specified in the schedules to the draft Order in Council regulating the currency of the Straits Settlements.
I am, &c.,
SIR,
TREASURY to COLONIAL OFFICE.
(Received 18th January, 1907.)
Treasury Chambers, 17th January, 1907. WITH reference to Mr. Lucas's letter of the 10th instant (No. 47225/1906),* I am directed by the Lords Commissioners of His Majesty's Treasury to acquaint you, for the information of the Secretary of State for the Colonies, that they concur in the terms of the draft despatch which Lord Elgin proposes to address to the Governor of the Straits Settlements on the subject of the recoinage of Straits dollars, and the relations between the currency note reserve and the gold standard reserve. My Lords agree that it is not desirable to offer a commission to the banks as an inducement for them to send in old dollars for recoinage, if it can be avoided, though they do not regard it as certain that the substitution of new dollars for the old ones can be expeditiously carried out without some special measure. I am, &c.,
E. W. HAMILTON.
E. W. HAMILTON.
• Nos. 187 and 191.
↑ See No. 196.
‡ No. 190.
+
B1104
* No. 192.
PUBLIC RECORD OFFICE
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