D (1) 2
4. The Government purchased a certain quantity of raw opium towards the end of 1913 through Messrs. David Sassoon & Co. who acted as agents. Later an arrangement was come to with the Indian Government for a regular monthly supply. The shipping arrangements were left in the hands of Messrs. David Sassoon & Co. and have been very satisfactory.
5. The Opium Factory at Wantsai which had been used by successive farms was leased by the Government and the fittings which had been in use were taken over. The factory was put under the charge of Mr. H. Alan Taylor who was appointed Monopoly Analyst. Practically the whole of the Opium Farmer's boiling staff were re-engaged, and Sergeant G. Watt of the Police was appointed a Revenue Officer to supervise their work. The work at the factory has proceeded smoothly from the commencement. A laboratory was fitted up at the factory and all analytical work connected with opium and intoxicating liquor is now done by the department.
6. For the packing and sale of prepared opium, the shed at the back of the Harbour Office, formerly used by the Sanitary Department, was converted into offices. The packing staff and other employees of the Farmer were taken over as far as possible and their work has been satisfactory. In the Northern District of the New Territories the Farmer had a branch office at Taipo and this was kept on under the charge of Mr. H. Anderson who had formerly worked with the Farmer.
7. The arrangements for the retail of opium were a little difficult. In Singapore opium is sold to licensees who are allowed to retail to the public at a rate which gives them roughly 10% profit on their turn-over. It was thought that if this system was adopted in Hongkong licensees would have too much incentive in increasing their sales and that there would therefore be a danger of their encouraging attempts at illicit export. At the same time it would have been difficult and expensive to establish a system of branch offices all over the Colony. To prevent attempts to import illicit opium it is necessary to have Government opium available at the various centres where there is a demand. Two kinds of licences were therefore issued, but in both cases the retail price is fixed by the Government. In places where a big business is done in prepared opium licensees are paid a fixed sum per month to sell opium for the Monopoly. They are in a sense paid servants of the Monopoly but they have to pay for their opium in advance. In those districts where the sales of opium are small, and where the danger of illicit export is not so great, licensees are paid a commission on their sales the rate varying with the accessibility of the locality. Care is taken to see that their sales do not exceed certain limits, and the rate of commission is reduced if their sales show signs of any unusual increase. The system introduced has been very satisfactory.
8. The prepared opium sold through licensees is all packed in earthenware pots done up in such a way as to make its conveyance and therefore smuggling as awkward as possible. A finer quality of
D (1) 2
4. The Government purchased a certain quantity of raw opium towards the end of 1913 through Messrs. David Sassoon & Co. who acted as agents. Later an arrangement was come to with the Indian Government for a regular monthly supply. The shipping arrange- ments were left in the hands of Messrs. David Sassoon & Co. and have been very satisfactory.
5. The Opium Factory at Wantsai which had been used by successive farms was leased by the Government and the fittings which had been in use were taken over. The factory was put under the charge of Mr. H. Alan Taylor who was appointed Monopoly Analyst. Practically the whole of the Opium Farmer's boiling staff were re-engaged, and Sergeant G. Watt of the Police was appointed a Revenue Officer to supervise their work. The work at the factory has proceeded smoothly from the commencement. A laboratory was fitted up at the factory and all analytical work connected with opium and intoxicating liquor is now done by the department.
6. For the packing and sale of prepared opium, the shed at the back of the Harbour Office, formerly used by the Sanitary Department, was converted into offices. The packing staff and other employees of the Farmer were taken over as far as possible and their work has been satisfactory. In the Northern District of the New Terri- tories the Farmer had a branch office at Taipo and this was kept on under the charge of Mr. H. Anderson who had formerly worked with the Farmer.
7. The arrangements for the retail of opium were a little difficult. In Singapore opium is sold to licensees who are allowed to retail to the public at a rate which gives them roughly 10% profit on their turn-over. It was thought that if this system was adopted in Hongkong licensees would have too much incentive in increasing their sales and that there would therefore be a danger of their en- couraging attempts at illicit export. At the same time it would have been difficult and expensive to establish a system of branch offices all over the Colony. To prevent attempts to import illicit opium it is necessary to have Government opium available at the various centres where there is a demand. Two kinds of licences were therefore issued, but in both cases the retail price is fixed by the Government. In places where a big business is done in pre- pared opium licensees are paid a fixed sum per month to sell opium for the Monopoly. They are in a sense paid servants of the Monopoly but they have to pay for their opium in advance. In those districts where the sales of opium are small, and where the danger of illicit export is not so great, licensees are paid a commission on their sales the rate varying with the accessibility of the locality. Care is taken to see that their sales do not exceed certain limits, and the rate of commission is reduced if their sales show signs of any unusual increase. The system introduced has been very satisfactory.
8. The prepared opium sold through licensees is all packed in earthenware pots done up in such a way as to make its conveyance and therefore smuggling as awkard as possible. A finer quality of
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