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PUBLIC RECORD OFFICE

Reference :--

TPELTIC.O.882/11

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PUBLIC RECORD OFFICE, LONDON

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Holiday Warrants for three double journeys a year-vide Hansard 1920-21, pages 136- 144. When the next stage in the Salaries Scheme, viz., the Salaries Commission of 1921, was reached, the Commissioners extended this privilege to the Ceylonese higher officers also to compensate them for the loss of the concession of free passages which had been allowed for a few years to all higher officers irrespective of domicile vide paragraph 54 of Sessional Paper XIX of 1921.

10. The Select Committee of the Legislative Council on the Budgets of 1929-30, 1930-31, respectively recommended the curtailment of this privilege to one double journey a year, but on both occasions the Legislative Council rejected the recom- mendations, and restored the full amounts required for a maximum of three double or six single journeys a year.

11. It will be seen from the foregoing historical review that the increase from one double journey a year to three double journeys was intimately connected with the Passage scheme and the circumstances which necessitated it. The arguments for the reduction of one will, therefore, apply equally to a reduction of the other.

12. Finally, the Board of Ministers desire to add that the country is strongly opposed to the continuation of these concessions in their present form and, it is prac- tically certain, that the State Council will not agree to the inclusion of provision for them in next year's Budget.

C. 83227/31 [No. 10].

No. 35.

I have, &c.,

B. H. BOURDILLON, Chairman, Board of Ministers.

THE GOVERNOR to THE SECRETARY OF STATE. (Received 17th September, 1931.)

on the

(Secret.) MY LORD,

Queen's Cottage, Nuwara Eliya, 24th August, 1931. IN connexion with my Confidential despatch (3) of to-day's date,* subject of a request by the Board of Ministers that you will consent to a reduction in the number of free passages and holiday warrants allowed to public servants in Ceylon, I have the honour to address you on the general question of the attacks which are likely to be made in connexion with the 1931-32 Estimates upon the emoluments and privileges of public servants.

2. The Board of Ministers themselves, apart from their two suggestions in regard to passages and holiday warrants, are, the Chief Secretary informs me, unlikely to propose any actual cut in salaries, although it is not improbable that they may propose a reduction in rent allowances. After careful consideration I have come to the con- clusion that, except possibly in a very few cases, there is no real justification for a reduction in rent allowances, and, further, that no equitable formula for a reduction which would only affect the few cases in which a reduction might be justified is prac- ticable, at any rate, without exhaustive examination, so long as the present system remains in force. I have, therefore, instructed the Financial Secretary to resist any proposal for a reduction which may be put forward in the Board of Ministers. Should a majority of the Board persist in pressing such a proposal, it will probably be neces- sary for me to consult you by telegram as to the course that I should pursue.

3. It is, however, certain that, whatever attitude the Board of Ministers may take in preparing the estimates, proposals to reduce, at any rate temporarily, the emolu- ments of public servants will be made by individual members of the State Council during the debate on the Budget. The Board of Ministers, at the interview described in my despatch under reference, made it clear that they anticipated such proposals, and the Press has recently been full of references to prospective salary cuts, one journal having gone so far as to state, with every pretence of inside knowledge, that a cut will be proposed by the Financial Secretary himself. While it is not certain what form the proposals will take, there are three obvious suggestions which may be

made:-

a percentage cut in all salaries;

(ii) a deferment of increments;

(iii) the payment of sterling salaries at the current rate of exchange.

* No. 34.-

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The form which the proposals may take is, however, of little importance, as I feel sure that you will agree with me that any proposal which will have the effect of reducing, even temporarily, the salaries of existing public servants must be disallowed. I have, in the tenth paragraph of my despatch under reference, indicated briefly the reasons why I do not consider that the financial situation justifies any such measure. Upon the very serious effect which your approval of any such measure would have upon the confidence and morale of the public services it is scarcely necessary for me to enlarge. The Civil Service Association and the Public Services Association have, in various memorials addressed to Your Lordship, expressed their apprehension that the new Order in Council does not provide sufficient safeguards for their interests. A reduction of their salaries during the first few months of the life of the State Council would be, to them, convincing proof that their apprehensions were well founded.

4. If you agree with me that any attacks upon the emoluments of public servants should be resisted, it remains to consider in what way they should be resisted, and what steps, if

any, can be taken to prevent their being pressed to a point which would recessitate either the use of my reserve powers or your rejection of a proposal approved by the State Council.

5. It would appear at first sight that any proposal of the nature indicated above falls within the purview of the first part of Article 87 (1) of the Order in Council, and that I can prevent the discussion of any such proposal in the State Council by refusing to allow it to be made. Such action on my part would, of course, be desired by the services, but I am not sure how far it would be wise for me, in the present temper of the State Council, to stifle all discussion on this matter. Nor is it certain that it will be beyond the ingenuity of members of the State Council, during the discussion of the Estimates, to devise a method of opening a discussion on salaries which will not fall strictly within the purview of Article 87 (1). Much will depend upon the attitude of the Speaker. It is, I think, impossible for me to decide beforehand how far it will be either possible or wise for me to make use of my powers under this Article. I shall have to depend upon the advice of the Officers of State (and possibly of their anofficial colleagues on the Board of Ministers) in the light of the nature of any proposal brought forward, and the temper of the State Council.

6. I believe it to be your wish that I should, at the outset of the new Constitution, avoid, in so far as may be possible, the use of my reserve powers, without a prior reference to you. I feel personally, without any desire to shirk my responsibilities, that any conflict with the State Council at this stage is less likely to prejudice the smooth working of the Constitution if the onus and the odium of such conflict falls upon Your Lordship rather than upon myself. And I am not without hope that a definite pronouncement, at the proper moment, of your views upon any proposal to reduce the emoluments of public servants may tend to induce the State Council to refrain from pressing such a proposal to the extent of passing a resolution to which they know that your assent will be refused. Such a pronouncement would, at any rate, serve to maintain the confidence of the Services.

7. I would suggest, therefore, that you should communicate to me by telegram, at as early a date as possible, a message, to be delivered to the State Council at my discretion, explaining fully your views in regard to a reduction of the emoluments of existing public servants, and your reasons for holding those views.

8. I do not consider it desirable that this despatch should be communicated to the Board of Ministers, and the message should, therefore, emanate from Your -Lordship without reference to any suggestion by myself that such a message might be sent. The message might, I suggest, begin with a reference to the proposal to reduce passages and holiday warrants, to articles in the Ceylon Press which have come to your notice, in which a reference has been made to forthcoming proposals to make a temporary cut in salaries, and to your consequent anticipation that some such proposal will be made during the discussion on the Estimates for 1931-32.

I have, &c.,

GRAEME THOMSON,

Governor.