CO129-558-3 Levy on Salaries- petition from Chinese Civil Servants 3-1-1936 - 19-12-1936 — Page 251

2.

251

European officers serving in the Colony. Their expenditure may

be divided into three categories :-

A. Home remittances which of course are purely sterling,

B.

According to standing rules these are not expected to

exceed half salary and in the great majority of cases

are probably far less.

Goods imported from Europe or United States of America.

The cost of these in Hong Kong currency varies more or

less directly with the value of the Hong Kong dollar

but the price does not since such elements as dividends

interest and wages of Chinese staff are payable in

dollars.

C. Servants, transport and local produce, the cost of which

rises and falls very little with the fall and rise in

exchange.

Consequently it can confidently be said that a sharp fall in the

sterling value of the Hong Kong dollar provides the sterling

officer with more money than he can equitably be said to need, at

any rate during the earlier months of such fallen value. An

officer who received $10 for each £1 in October does not require

$16 for each £1 in the following March. In fact if he is so paid

for March he will be better off on his "cut" salary than he was

in October on his uncut salary at the expense of the taxpayer.

(It is of course equally true that a sharp rise in the sterling

value of the Hong Kong dollar would leave the officer with less

money than he can equitably be said to need and it is for that

reason that the officer has been given the protection of an upward limit of $1 - 28/-.)

3.

For the reasons just given it is suggested that sterlin salaries for the first quarter of 1936 (less Widows' & Orphans