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PUBLIC RECORD OFFICE

SIR,

36

No. 26.

TREASURY to COLONIAL OFFICE.

Treasury Chambers, November 20, 1886.

I AM directed by the Lords Commissioners of Her Majesty's Treasury to transmit herewith, for the information of Mr. Secretary Stanhope, with reference to the letter from this Department of the 10th August last.f a copy of a letterf which my Lords have caused to be addressed to the War Office on the subject of the conditions of employment of military officers by the Colonial Governments.

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5. I am to state that Mr. Stanhope thinks it important that this point should be definitely settled, because, as any saving of expenditure in these cases under the new rules will accrue to the Colonial and not to the Imperial revenue, it is necessary that he should be in a position to explain the principle of the arrangement.

The Secretary to the Treasury.

I am, &c.,

(Signed)

No. 28.

ROBERT G. W. HERBERT.

Reference :-

C.O.

8855 PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

COPYRIGHT PHOTOGRAPH-NOT TO

SIR,

The Under Secretary of State,

Colonial Office.

No. 27.

I have, &c., (Signed)

R. E. WELBY.

COLONIAL OFFICE to TREASURY.

Downing Street, December 2, 1886.

I AM directed by Mr. Secretary Stanhope to acknowledge the receipt of your letter of the 27th of October,§ with reference to the question of consulting the Lords Commissioners of the Treasury respecting the salaries of officers drawing Imperial non-effective

pay who to request that you will call their Lordships' attention to the following extracts from may be employed by certain Colonial Governments, and I am the correspondence which has passed on the subject.

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2. In their Lordships' Minute of the 25th of September 1885 it was stated: "These "rules will not apply to

salaries paid out of the revenues of Colonies which receive no contribution from Imperial "funds" ; and in the letter from this Department of the 15th of February last inquiry was made as to the nature of the contributions which would bring a Colony within the rules in question, it being "apprehended that Western Australia, in which "the Governor is paid a portion of his salary from the Exchequer, would not be included, sceing that the money is paid to him direct, and does not pass through "the Colonial accounts." Their Lordships replied on the 3rd of April that the test

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of a Colony receiving a contribution from Imperial funds, within the meaning of the minute above referred to, would be the submission of its annual estimates for Treasury sanction and its accounts for Imperial audit.

3. So far the wishes of their Lordships were clear, but in their letter of the 11th of Septembertt mention is made of "Exchequer-aided Colonies" and of "Colonies directly or indirectly aided from the Imperial Exchequer," and it therefore became necessary to ascertain whether these phrases had the same meaning as "receiving a contribution from Imperial funds," the expression previously used. Mr. Stanhope, therefore, addressed to their Lordships on September 181 a letter intimating that it was presumed that the test for "aid from the Imperial Exchequer" would be the same as for receiving contributions from Imperial funds, namely, the submission of the annual estimates of the Colony for Treasury sanction and its accounts for Imperial audit.

4. Their Lordships in reply now state that they are of opinion that the Treasury should be consulted by this Department regarding the salaries of such officers drawing Imperial non-effective pay as may be "employed by any Colony directly or indirectly "aided from the Imperial Exchequer, whose estimates are subject to the control of "the Secretary of State, even though those estimates may not also be submitted to "the Treasury"; and as Mr. Stanhope feels difficulty in satisfying himself as to the proper construction of the words "indirectly aided," and fears that they may lead to misunderstanding hereafter, he would suggest that they may with advantage be omitted from the terms of the understanding between the two Departments, the spirit of which he will fully adhere to.

† No. 22.

Enclosure in No. 28.

§ No. 25.

¶ No. 16.

No. 9.

†† No. 23.

No. 24.

SIR,

ADMIRALTY to COLONIAL OFFICE.

WITH reference to previous correspondence relative to the general question of

Admiralty, December 3, 1886. the employment of naval and military officers in naval or military appointments under Colonies which receive no contribution from Imperial funds, I am commanded by my Lords Commissioners of the Admiralty to transmit herewith, for the information of the Secretary of State for the Colonies, copy of a letter which they have received on the subject from the Lords Commissioners of the Treasury dated 20th ultimo.

In view of the concessions contained in this Treasury letter, no further question appears to exist, and my Lords will accordingly take steps to procure the necessary Order in Council with regard to naval and marine officers.

I am to add that my Lords propose departmentally to fix a limit on these Colonial appointments of three years from date of taking up appointment.

The Under Secretary of State, Colonial Office.

SIR,

I am, &c.,

(Signed)

EVAN MACGREGOR.

Enclosure in No. 28.

Treasury Chambers, November 20, 1886. I AM directed by the Lords Commissioners of Her Majesty's Treasury to transmit herewith, for the information of the Lords Commissioners of the Admiralty,

a copy of a letter which my Lords have caused to be addressed to the War Office on the subject of the conditions of employment of Military Officers by the Colonial Governments.

I am to state that my Lords consent to the application of like rules to naval officers. The Secretary, Admiralty.

SIR,

I have, &c., (Signed)

R. E. WELBY.

Treasury Chambers, November 19, 1886.

THE Lords Commissioners of Her Majesty's Treasury have had before them Mr. Knox's letter of the 11th ultimo, respecting the employment of naval and military officers by Colonial Governments, and direct me to state that, on the reccomendation of Mr. Secretary Smith, they agree to the following rules, which, it will be observed, involve a further and very important concession to the Colonies at the cost of the British taxpayer.

(1.) If the officer be on the active list of the army, he will draw no pay from Imperial funds during his employment by the Colonial Government, but, if the Secretary of State see fit, his service under that Government may count towards promotion and retirement, as though it were service in the Imperial army, and the retired pay earned by his Colonial service, so long as he remains on the active list, will be chargeable upon Imperial funds.

(2.) If the officer retire from the army whilst serving under the Colonial Govern- ment he may at once draw so much of his retired pay as was earned by army service prior to his entering the Colonial service; and on retiring from the Colonial service he

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