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PUBLIC RECORD OFFICE

Reference :-

TELEC.O.882/11

PUBLIC RECORD OFFICE, LONDON

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

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I am informed upon good authority that the number of public servants whose present intention is to retire as soon as possible upon proportionate pension is con- siderable. If the decision not to appoint a. Salaries Commission is adhered to and nothing effective is done to allay the reasonable uneasiness of the public service as to their material prospects, I fear that that number will be so great as seriously to impair the efficiency of the administration and that the standard of service which can be expected from those who are compelled for financial reasons to remain will be lowered. If, however, by the appointment of such a Commission, they are assured of a reasonable consideration of their present demands, and if the emoluments and privileges which result from the recommendations of that Commission are adequately safeguarded by the new Order in Council I have every reason to hope that a number who would otherwise depart will elect to remain, and that those who would remain in any case will do so in a spirit of contentment rather than in one of resignation to a lot which they would avoid if they could, but which a lack of other prospects compels them to accept.

6. I hope that these reasons, in addition to those put forward elsewhere, will induce Your Lordship to reconsider your decision not to appoint a Salaries Commission. Should you adhere to that decision, I hope that the disappointment of the memorialists may be mitigated in so far as may be possible, by a full explanation of the reasons for which it has been found impossible to comply with their requests.

I have, &c.,

B. II. BOURDILLON, Officer Administering the Government.

C. 73230/9/30 (No. 23].

No. 20.

THE OFFICER ADMINISTERING THE GOVERNMENT to THE SECRETARY OF STATE.

(Received 1.15 p.m.,

14th July, 1930.)

TELEGRAM.

No. 80. 14TH JULY. Secret and Confidential. Your telegram No. 69.* In view of various developments of past few days regret I must advise postponing announcement of decision to appoint Salaries Commission until Budget is through Will explain fully by despatch leaving on 23rd July. In the circumstances Johnson

will return.

C. 73230/9/30 [No. 32].

No. 21.

THE OFFICER ADMINISTERING THE GOVERNMENT to THE SECRETARY OF STATE. (Received 11th August, 1930.)

(Confidential (2).)

MY LORD,

[Answered by No. 23.]

Queen's House, Colombo, 23rd July, 1930.

I HAVE the honour to invite a reference to the correspondence ending with my Secret and Confidential telegram No. 86 of 14th July, 1930,† on the subject of the appointment of a Salaries Commission.

2. On the morning of 10th July I addressed the Legislative Council on the occasion of their reassembling after the usual hot weather recess. In my address I dealt at some length with the budget estimates for 1930-31, and the budget was formally presented to the Council by the Acting Colonial Secretary the same afternoon. The depressed condition of the rubber and coconut industries, which has had its inevitable reaction upon general prosperity, has produced an universal demand for refrenchment. This demand has been strengthened by the opposition to the Income Tax Bill which has been encountered from practically every quarter which is likely

† C. 73230/9/30 [No. 22]: not printed.

* C. 73230/9/30 [No. 19]: not printed.

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to be in any degree affected by the introduction of this form of taxation. Unollicial Members have abandoned their previous habit of pressing extravagant demands on behalf of their constituencies, and have concentrated their energies upon the demand for retrenchment, in the hope that if the existing burden of taxation cannot be lightened, fresh taxation may at any rate be avoided. I may perhaps be permitted to suggest that, in view of the approaching elections for the State Council, they have not been uninfluenced by the idea that "less taxation " may prove a more popular electioneering cry than more amenities.'

3. The budget has been framed with due regard to the gravity of the financial situation and the consequent necessity for strict economy. I have, however, with the full concurrence of my advisers refused to adopt an attitude of panic, and have endeavoured, in so far as possible, to avoid measures of retrenchment which are likely to prove uneconomical in the long run. The Budget has been received with disappro- bation by the Press, but the criticisms have (at any rate judged by the standards to which I have become accustomed since my arrival in the Island) been expressed in comparatively moderate terms, and I am encouraged to think that behind them all is a realization that the Government is not altogether indifferent to the welfare of the country and has really made considerable efforts to cut its coat according to its cloth. However that may be, and although the present temper of the Unofficial Members is by no means unfriendly, the atmosphere during discussions of the budget is likely to be somewhat highly charged, and I judge it inexpedient to drop into it even the mildest explosive material. Not only would this atmosphere be likely to intensify the hostility with which the appointment of a Salaries Commission may in any case be received, but the announcement of the appointment of such a Commission might, I fear, increase the difficulty of securing the passage of a satisfactory budget. In view of Your Lordship's ready and sympathetic response to my despatch of 11th June,* I was naturally reluctant to take any action which might bear the appearance of receding from the attitude to which I gave expression in that despatch. That attitude, in fact, remains absolutely unchanged, but the considerations detailed above have led me to the conclusion that an immediate announcement that Your Lordship has decided to accept my recommendations might endanger the ultimate success of the course which I have advocated. In advising a postponement I have the support of those among my advisers who are most strongly in favour of a Salaries Commission. The disadvantages of postponement are lessened by the fact that, according to my latest calculation, it is most unlikely that the State Council will be able to assemble before July, 1931.

4. While my main reason for advising a postponement is that which I have given in the two preceding paragraphs of this despatch, there are other minor considerations to which a certain amount of weight must attach. One of these is the attitude of the European non-official community. A short time before Sir Herbert Stanley wrote his despatch of 7th April,† the European Association passed a resolution advocating the appointment of a Salaries Commission. I do not consider that much importance attaches to that resolution, or that it necessarily represents the feeling of the majority of the European non-official community. But I can say without hesitation that a decision to impose a Salaries Commission as an original condition of the acceptance of the Donoughmore Scheme would have received the warm approval of that com- munity. At the present moment, however, while they still continue to think that the case of European officials merits consideration, I have reason to believe that they would consider as untimely any proposal involving an increase of emoluments, however strongly they might, in principle, sympathize with that proposal. A proper statement of the objects of a Salaries Commission made after the budget has been finally passed would. I believe, find them as sympathetic as ever.

5. It is not improbable that the Select Committee on the budget may attempt to reduce the total votes for Personal Emoluments, either by repeating their previous suggestions that sterling salaries should be paid in Ceylon at 1s. 6d. to the rupee, or by suggesting that the sanctioned increase in Clerical Salaries be postponed or even (though I consider this unlikely) by proposing an all-round deferment of increments. It would be useful to know what attitude they are going to adopt in this regard before announcing the appointment of a Salaries Commission.

6. It has been hinted to me that the Select Committee may press strongly for the appointment of a Retrenchment Commission or a Cadre Commission.

I propose

to consider later in the despatch the effect which such a demand might have upon the decision to appoint a Salaries Commission.

* No. 19.

† No. 13.