465
f
world to maintain their independence of foreign domination, and bear moreover not only the whole cost of their own defence but in a very large proportion the cost of Colonial defence also.
And now as regards the financial position. When I read the Honourable Member's speech I at first intended to supply in detail the results of an exhaustive examination of this subject; but this is now impossible consistently with the performance of work absolutely necessary to be done in the short time before my departure, and any regret I might feel on this score is much lessened by the con- sideration that for reasons above given a general discussion ou the financial position, is only to an extremely limited extent pertinent to this subject of salaries, and that it had for other reasons be better postponed until the consideration of the Estimates for 1892. I am able, however, to say enough to reader it clear that our financial position though not wholly satisfactory is not one which gives any more reason for alarm and despondency than the general condition of the Colony. I observe the Honourable Member states that according to the latest official information there will at the end of the year be a deficit in our finance of $100,000. Presuming him correct, or as I think very possibly under the mark, I need scarcely say that such a statement without explanation gives a very wrong impression to the outside world; inasmuch as it leaves entirely out of sight not only the enormous sums which have in the last few years been expended out of Revenue upon public works, elsewhere ordinarily provided for by Loan, but also omits to notice (which is for the purpose more important) that $820,000 of this year's expenditure which is estimated to cause this deficit, is also for Extraordinary Public Works. Allowing for a considerable falling off in certain items of Revenue (as to which however I should mention that the great fall in assessed taxes anticipated by the Honourable Member is I understand in fact not likely to exceed 24 per cent.) allowing however I say for a considerable falling off in certain items of Revenue, and in the matter of expenditure for the increased Mili- tary Contribution, and for the payment under the new instructions during the current year of December salaries (amounting to some $90,000) which in previous years have been paid in the following January, I am of opinion, as previously stated, that the deficit will at the end of this year be considerably more than the $100,000 mentioned by the Honourable Meinber, if the full amount of $820,000 were to be expended on Extraordinary Public Works. But judging from the rate at which the Department works I am disposed to think that this estimate of expenditure would have been considerably beyond the mark in
any circum- stances. And in view of the fact that some new works, such as Governor's Peak Residence (the prosecution of which I abandoned immediately after my return to the Colony) will not be proceeded with for the present, and that there has been a temporary cessation of all new public works in consequence of the recent telegram from the Secretary of State, I question whether at the end of the year there will be more than a very small deficit, even if, as I scarcely antici- pate, the whole increase of salaries voted by the Council should be approved by the Secretary of State. As on the other hand there is likely to be little or none left of our surplus balances, there would in all probability be a considerable deficit by the end of next year, if we continue to defray out of Revenue the great drainage and water distribution works now in progress. This however is not likely, and there is every reason to believe that the Secretary of State, when be has been placed in a position to estimate the condition of affairs, will sanction a loan for public works such as in every one of the larger dependencies of the Crown would have been raised long ago. What should be the amount of such a loan I will not undertake to estimate. It of course depends on the extent of the Public Works which it may be determined to undertake. But I may mention that from statistics furnished to me, estimate at $50,000 the increased Revenue from the New Central Market, from the new or extended depôts for eattle, sheep and swine and from the public laundries and at $11,000 that from the New Water Distribution
Works; making together $61,000; so that from these sources alone there would be sufficient to pay interest and 1 per cent. sinking fund ou a Loan of $1,220,000 at 4 per cent.
All things considered therefore though I am by no means sure that some of the increases of salaries do not require re-consideration. I am completely satisfied that with a very moderate loan for public works and in the absence of circum- stances impossible to foresee, there is every reason to believe that the Ordinary Revenue from its present sources will be sufficient to cover the salaries, as increased by the vote last October, as well as the increased Military Contribution.
As regards the future, though there may be expected some loss in the next sale of the Opium Farin as compared with the large sum obtained for it under exceptional circumstances in 1889 (being some $216,000 per annum higher than previously), there is good reason for anticipating advances in other directions; (1) If at this time of exceptional depression (from which the facts above referred to seem to indicate the beginning of improvement), the assessel taxes should prove to have fallen off as estimated only 24 per cent., I venture to think in view of the increasing general trade that there is good reason for believing that this loss will be very quickly com- pensated by return to a normal condition, even if there should not be, as I con- fidently anticipate, a further upward progress in prosperity. (2) The revenue from profit in subsidiary coinage, so far from shewing any signs of diminution tends steadily to increase. Owing to the exceptional demand for these coins, not- withstanding the institution of the Canton Mint I have been compelled to raise from $1,000,000 to $1,300,000 the annual requisition upon the Crown Agents; and if the Mint should be able to supply us with the amount, I anticipate that the revenue from this source for this year will be at least $90,000. (3) Rent from Land must continue to increase in anonnt as further Land is sold, and will even make a considerable advance this year. Indeed the permanent revenue from this source will mount very rapidly, if, as I most sincerely hope the policy should be maintained of permitting the commuta- tion for increased rent of a considerable portion of the premiums. There will always be a strong temptation to abandon such a policy at a time like the present, when the current account is running low; but I am confident that it is the only sound policy, and that, if steadily maintained, it will in the course of not many years render it possible to considerably diminish the weight of taxation. And while refer- ring to this matter of taxation, I think it well on the eve of my departure to correct an impression which I may have given in a recent speech, as to the possibility that any substantial increase of taxation would, by driving trade away, cause this Colony to meet the same fate as the West Indian Island of St. Thomas.
From further enquiry into this question (which I may mention only suggested itself to me on the spur of the moment), I have been led to believe that any appre- hension on this score may be entirely dismissed. Withont troubling you with all mention the may the reasons which have induced this more favourable view 1 principal one as being that the large size of the steamers which are ordinarily required to bring goods from Europe and America, would render it impossible for them to conduct coasting work on any large scale at a profit, and that cousequently a distributing centre, such as Hongkong and for which no other port would afford anything like equal facilities, is an absolute necessity. And I am further told and believe that the present tonnage dues might be very considerably increased, and might be made something much more nearly approaching the average of other ports, and yet all, or nearly all, the vessels which now come here would still have to come here, inasmuch as their not coming here would cause them a loss considerably greater than the increased tax. Whether this view is completely but I believe there is at all events sufficient truth in it to correct, I cannot say; suggest the consideration whether additional revenue might not be raised, or whether with the revenue remaining at the same amount the incidence of tax-
4
No comments yet.
Private notes are available after approval.