CO129-393 - Governor Sir May - 1912 [11] — Page 292

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continues to rule high a reduction in local prices must presumably: be only a matter of time is true, but true to so limited an extent as to make any conclusion based upon it largely erroneous. The

main fact to be borne in mind is that the standard of value in the

Colony is the Mexican Dollar and not the English Pound Sterling. To the former standard local products must conform and these,

with house rent, wages, doctors and dentists fees all of which are

fixed in dollars and never vary with exchange though they show a constant upward tendency, comprise by far the greater proportion of the Civil Servant's wants. Sir Matthew Nathan in paragraph 6 of

his Despatch No. 37 of the 8th. of March, 1907, calculated that

"dollar payments make up two-thirds the expenditure of senior and

somewhat more of that of junior officers*. This estimate is I

think accurate for married officers. But the majority of the Civil

Servants on Sterling; Salaries are unmarried. For bachelors a care-

-ful estimate places the proportion of expenditure to satisfy

wants valued according to the local standard at 80% of the

expenditure. The remaining 20% is accounted for by insurance (4%)

passages (5%) both of which directly conform to the English

i

*

standard, and 11% by foreign products purchased from local store- -keepers. The percentage of last class of liabilities would be

higher (it is higher in the case of the Governor who as a rule

imports large quantities of wines and spirits) if imported goods

conformed more closely to the sterling standard. That they do not

so conform is common experience. That they camot conform is ex-

-plained by the general statement that stocks bought at a lower

rate of exchange cannot without loss to the importers be sold at

a higher one. In other words the clearance of stocks cannot be

made to synchronise with the movements of exchange.

10.

I have had a very careful comparison made

between the prices of local products in September, 1911, (with

exchange at 1/94) and in September of this year (exchange at a little over 2/-). In the price of meat, poultry, eggs, fruit,

vegetables, and dairy produce there is no variation while the

same may be said of the price of nearly all classes of fish.

There