CO129-558-3 Levy on Salaries- petition from Chinese Civil Servants 3-1-1936 - 19-12-1936 — Page 240

3.

238

5.

Looking to the future I do not share the extreme

pessimism that I sometimes hear expressed.

The Colony's trade

and the Government revenue have shown remarkable resilience in

the past and I prefer to hope that history will repeat itself,

but in view of world conditions the process may be slow and

extreme caution is indicated. The Colony is indeed at a stage

of transition. The rapid fluctuations of exchange which have

played havoc with Budget estimates in past years have for the

moment been brought to an end and if the dollar exchange can

now be kept stable it will be possible to frame estimates of

income and expenditure with less uncertainty than in the past.

At the same time, it is hoped that stability of exchange will

lead to an increase in trade and revenue. But I anticipate

that it would take twelve months at least to reach a state of

equilibrium even if we could be rid of disturbing political

and economic factors which are quite outside our control; and

the transitional period is therefore necessarily one of

protracted and anxious adjustment and in my opinion dictates the drastic step of a temporary levy on salaries.

6.

On the general question of Government salaries I have

formed the impression that while the salaries granted in 1930

as the result of the Salaries Commission were not excessive in

comparison with those paid in some other Colonies and by

mercantile firms in Hong Kong, they were, generally speaking,

generous enough to allow officers of ordinary prudence and

foresight to make savings for the future and to permit of a levy in time of serious financial difficulty particularly so

in the case of sterling salaries when a sudden fall in exchange gives the sterling paid officer an abnormal rise in his dollar

equivalent.

7。

The petitioners lay considerable stress on the

increase in the surplus balances of the Colony during the year

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