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PUBLIC RECORD OFFICE

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ELLICO. 882

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PUBLIC RECORD OFFICE, LONDON

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agreement should be determined by anticipating the Government's decision, at the expiry of his agreement, in regard to retaining or dispensing with his services. I am of course aware that it is very difficult and in many cases impossible to forecast the probability of an officer's service proving satisfactory, especially when his engagement is of comparatively recent date. But the Government in practically all cases will know when it engages an officer, whether the post for which he is engaged is only wanted to supply a passing need, or is likely to be permanently required, in which latter case the officer will no doubt be offered the permanent appointment, if his service is satisfactory to Government.

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3. Such a distinction had, in fact, heen already drawn, as pointed out in paragraph 3 of my despatch, No. 175, of the 6th of June last, in deciding what officers on agreements should receive exchange compensation on half their salaries; and it is difficult to see what additional element of doubt is introduced by the fact that exchange compensation is to be on the whole instead of the half salary. This latter point, although put forward in my despatch referred to above, is not directly dealt with in your despatch under acknowledgment.

4. Mr. Taylor's Minute in regard to the Ceylon practice shows that a similar distinction to that drawn in the Straits Settlements and the Federated Malay States is also laid down in Ceylon, except in regard to the second of the classes specified by him. The exchange compensation given in Ceylon, however, only amounts to an addition of about six per cent. to an officer's emoluments; that given in the Federated Malay States on half salaries amounts, at present rates, to an addition of not less than thirty-five per cent. I cannot, therefore, regard the fact that the second class of officers is in Ceylon excluded from the comparatively small benefit of the exchange compensation allowance as a sufficient justification for the serious step of depriving similar officers of this allowance in the Federated Malay States, where it is an important emolument. In fact, you do not propose so drastic a measure, although Mr. Taylor's comparison would logically suggest it.

5. The case is, after all, not one of granting exchange compensation to men who have not hitherto had it, but one of granting the allowance on the full salary to officers who have hitherto received it on their half salary; and the Ceylon practice is therefore not in point.

6. I adhere, therefore, to the decision already announced, viz., that, without discussing in each case whether the officer can claim double exchange compensation in terms of his agreement, the privilege should be granted to all officers, serving under agreements, who are entitled, under the ruling referred to in paragraph 1 of the Resident-General's letter in your despatch, No. 147, of the 23rd April,† to exchange compensation on half their salaries.

I have, &c.,

40588

No. 92.

FEDERATED MALAY STATES.

J. CHAMBERLAIN.

HIGH COMMISSIONER SIR F. A. SWETTENHAM to MR. CHAMBERLAIN.

(No. 329.)

SIR,

(Received September 29, 1902.)

[Answered by No. 106.]

Government House, Singapore, September 4, 1902.

I HAVE the honour to acknowledge your despatch, No. 159, of the 13th June, approving the Federated Malay States Sterling Scheme, and I have noted the various points laid down for my guidance.

2.

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With reference to your paragraph 4, not only will the increased average cost thrown on the Federated Malay States by this Scheme amount to about $250,000 annually, but a further expenditure will be caused by raising the salaries of sub- ordinates in the various Departments of the Service. Even when this has been done the relative cost of Establishments in the Federated Malay States will be very low indeed, and probably compares favourably with any administration under the British Crown. The Federated Malay States are fortunately in such a position of prosperity that they can easily meet these increased charges, and as I have already stated the scale of salaries which you have now approved is, in my opinion, only a fair payment for services rendered under the conditions prevailing in the Malay States.

3. I would again press upon you the case of the Resident General's salary. I do not think it should be less than £2,500 a year. As I said before, I am in favour of an arrangement by which the whole of that sum should be salary, any locum tenens receiving an Entertainment Allowance at the rate of $2,400 per annum without com- pensation, but if you have any strong objection to this proposal, then I recommend that the Resident General's salary be fixed at £2,360 a year, with the Entertainment Allowance as stated. Having regard to the extent and importance of the Resident General's duties, to the fact that the States under his control cover an area of 25,000 square miles, with a revenue of $17,000,000, and also bearing in mind that you have just approved a salary of £2,000 a year for the Chief Justice of the Straits Settle- ments, I trust that you will be able to reconsider the case of the Resident General and grant him the salary I have recommended, viz., £2,500. I agree with the latter part of paragraph 5 of your despatch under reply, and may observe that my suggestion was made principally to meet the pension difficulty.

4. I have reduced the salary of the Legal Adviser to £1,200 in accordance with your suggestion. This officer will have no private practice and when the post is not filled by a man with special local knowledge it will be of great importance that the Federated Malay States should secure a Legal Adviser of high standing and ability.

5. In reply to the question contained in your paragraph 7 I have to state that the reason why the 6 additional appointments were not included in class VI. of the Cadet Service, was that they are not now held exclusively by Cadets, and it is con- venient to the Government to have some appointments of this kind and at these rates, which are not exclusively reserved for Cadets. You point out that a Passed Cadet would lose by accepting one of these six additional appointments, but whilst I con- sider that any officer holding any of these posts would be sufficiently remunerated by a salary of £300 to £360 (and, therefore, these appointments should not be in class VI. where the rate is £350 to £400), there may be no vacancy in Class VI. when a Cadet passes his final examination, and it might then be convenient to the Government, and not disadvantageous to him, to give him one of these additional posts until there was a vacancy in Class VI.

6. As regards your paragraph 8 the Medical Officer of the Malay States Guides, who ought to be able to speak Hindustani, is of the same class, and possesses the same qualifications as the Apothecaries who are now designated Assistant Surgeons. There is no need to make any different arrangement.

7. With reference to your paragraph 9 I have gone into the question of the Public Works Department with the Resident General and the Director, Public Works, and I find that if the five grades of Executive Engineers were reduced to only two the Department would be divided as follows:-

Director, 1.

State Engineers, Perak and Selangor, 2.

State Engineers, Negri Sembilan and Pahang, and 1st Grade Executive

Engineers, 4.

2nd Grade Executive Engineers, 17.

Assistant Engineers (pensionable after 3 years' approved service on Agree-

ment), 12.

This division of posts and salaries is, I think, you will agree, not a very good one, and I therefore recommend that the number of 2nd Grade Engineers be reduced to

• No. Gl.

† 19401 ; not printed.

‡ No. G8.

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