CO129-533-13 Salaries- conversion rate of sterling 30-1-1931 - 21-1-1932 — Page 344

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to approve. The Secretary of State has cabled his approval and has added the proviso that in view of the uncertainty of the dollar change it should be made clear that the Government will review the question from time to time, and it will be noticed that this point is embodied in the resolution."

Governor Thanked.

Serious Position.

The financial position, unless the dollar rises appreciably, is very serious indeed. ex-

It is calculated that the sterling_commitments, in the approved Budget for this year, amount to £677,773. This, for the purposes of the Budget, was con- verted at the rate of 1/4 to the dollar. If the dollar

wel 2 to average 1/- for the current year, a sum of $3,388.861 would have to be added to the expenditure figure.

Hon. Mr. Gordon Mackie: The unofficial members of this Council are greatly indebted to Your Excel- lency for bringing about the modi- fication of the resolution passed on June 19 last. They appreciate the very fair attitude you have adopt- ed in connection with this matter. Provided the modification is adher- ed to, I do not anticipate there .will be any further public contro-

versy on the subject.

The basis on which salaries are to be paid under the new arrange- ment compares very with the exchange compensation favourably granted by most of the commercial houses here. Possibly some of the members of the Civil Service may feel that they have a grievance as they will be in a somewhat worse position than they would have been had the original resolution remain- ed in force. I feel certain, how- ever, they will accept the decision of the Colonial Office in the right spirit, for all must realise that sacrifices are absolutely essential during the present world wide de-

pression.

GOVERNOR'S SPEECH.

H.E. the Governor: I thank the Honourable Member for his words of appreciation. I feel that the step had to be taken, but I regret very much that circumstances have rendered it necessary. I am sure that it will be appreciated that the proposal entails a measure of disappointment to many members of the Government service, and that there will be cases in which some hardship will be caused. hardly be denied, however, that the payment of salaries at the current rate of exchange, with the dollar as low as it is to-day, would have placed them in a more favourable position than was anticipated, or could reasonably be expected by them.

It can

There is also no doubt that, if it had been foreseen that the dollar would go as low as it has done, the Salaries Commission would have modified very consider ably their recommendations. I sin- cerely trust, therefore, that Gov- ernment servants will accept the position in a true spirit of loyalty, and will realise that the financial position has rendered this step ab- solutely imperative.

This, with the deficit actually shown in the approved Budget, which amounted to $2,299,096, would, in spite of increased taxa- tion, make a total deficiency of $5,687,957-a sum perilously near our present surplus. With the dollar at 11d. the deficit would fur- ther be increased by approximately 14 millions. By the adoption of the half rate of payment proposed by the resolution this afternoon, it will be possible to reduce the deficit of $5,687,957 by over a million. I cannot give the exact figure, as it officers on leave, who will of course depends partly on the number of

draw their actual sterling salaries in England.

"A Chronic Optimist."

position has been reached in spite I would add that this serious

of Estimates and the postponement of a ruthless pruning of the many desirable works. Investiga- tion is being made as to whether further economies or postponements can be made. I am a chronic dollar may make some recovery, but optimist, and still trust that the there are many who take an op- posite view.

I should like to say that, as Honourable Members are aware, the report of the Currency Com-

mission was sent home some months

ago, and is being considered by the experts. I trust that we may have some information from them before long.

The question, however, is extra- ordinarily difficult, and it must be remembered that Hong Kong is only a small part of a large fabric which is seriously affected by the price of silver, and that, so far as we can see, it would be impos- sible for Hong Kong to attempt to take action independently of the rest of the fabric. Meanwhile we can only be patient and hope for improved conditions the world in general.

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