CO129-489 - Governor Sir Stubbs & Sir Clementi - 1925 [8-12] — Page 331

case of Hongkong, more especially as I have had

occasion in the past to draw attention to the

fact that the inclusion of expenditure credite

in the accounts of Hongkong has had the effect

of concealing considerable amounts of unauthorised

expenditure in the account (vide paragraph 5 of·

my report to the Secretary of State on the

Hongkong Account for the year 1922).

3. I have no additional comments to offer

with regard to the first three points in my

Reference Sheet (which are referred to in para-

graphs 2 to 4 of the Governor's despatch) but,

in connection with the fourth point (recovery

of Postal transit charges) which is dealt with

at length in the concluding paragraphs of the

despatch, I would refer to the correspondence

which was enclosed in the C.0. letter to the

Comptroller and Auditor General, No.11667/1910

of the 29th of April, 1910 (copy enclosed) and

to Section 3 of Hongkong Ordinance No.1 of 1901,

from which it appears to be very doubtful whether

the treatment of such recoveries as expenditure

credite instead of including them in the "gros8

receipts" of the Postal Department is in accord-

ance with the existing authorities governing the

calculation of the Military Contribution.

I am not aware to what extent, if any,

the general question of expenditure credits in

Hongkong is influenced by the existence of the

assessment on revenue for Military Contribution,

but, in my view, if it is considered to be

desirable that certain items of revenue should

be exempted from such assessment, the correct

procedure to be followed is that which has

already

56391 18

already been adopted in the case of the sale

of returned P.W.D. Stores (enclosure 3 in

Reference Sheet No.3/1923).

Mr.

Engens

12.7.26

Will you please draft for conson on

above minute and pass draft through Sir 2.

Stephensen.

The allusion to the defunct M11. Cont. Com:-

mittee can be ignored,

At once

A.E.Collins

29.1.26

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