CO129-368 - Acting Governor May - 1910 [8-9] — Page 543

for many years and heavy annual expenditure has to be incurred in the redemption of subsidiary coin, while the receipts from liquor duties are not realising expectations. trade is bad, there is little demand for land, and the revenue from opium has diminished and is likely to still further diminish".

The promised opium contribution is not a grant in aid of Revenue but a Compensation grant in view of the loss involved by His Majesty's Government's policy. It does not,therefore,seem reasonable to base it on figures re- presenting strict economies in administration and the post- ponement of pressing services and public works, and on the amount which can possibly be obtained by fresh taxation,

If the question were one of a grant in aid involving the usual supervision by the Treasury of details of revenue and expenditure the refusal of the Treasury to consider the question without the complete figures for which they have asked could be understood, but in the actual circumstances there seems to be no justification for further long delay, especially as a year has now elapsed since proposals for meet- ing the situation were first made.

The pledge of substantial assistance was, given by the me Secretary of State on behalf of His vejesty's Government) as

my collagne s the result of collective deliberation of Hie Majesty's Hixista; it has not been found possible to come to an agreement with the Treasury as to the interpretation of this pledge, or to obtain their views as to the principle of calculation, on which a décision cannot be delayed indefinitely. Jam

Lord Crewe therefore bringing the matter before the

Cabinet

letter re- ewing the tuation in ese terms Jannouncing

Secretary of ate's pro-

sed action was nt to the

easury on the

rd of Sept.

JR.

Yes

م

539

Cabinet; Jask for an interpretation of the pledge

a ne recommend

given by His Majesty's Government; and

that the principle to be adopted is that His Majesty's

Government shall pay one half of the dirept loss of

(1910-12) opium revenue for a period of 3 years after taking into

account the £9000 granted for 1910.

The question whether any further grant will be required

after the expiration of the three years is one which

can reasonably be left for consideration in the future.

C. JRZ

Circulated to Cabinet.

7/10/10

12

į

(21.442). Wt.32,696-3. 6000. 2/10. A&EW.

(26,462). ,, 0038-28. 6000. 6/10

6=764