HONG KONG LEGISLATIVE COUNCIL.
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They have received a summary by telegraph but, not unnaturally, they are not prepared to advance the money until they have ex- amined all the proposed expenditure in detail.
Such an examination will of course also be made by the Select Committee to which these Estimates will be referred but in the meantime perhaps I should touch briefly on some of the principal items of expenditure.
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The first point which calls for comment is the tremendous increase in Personal Emoluments as compared with 1941. In that year Personal Emoluments were estimated at 174 million dollars though this figure was probably in actual fact increased by the issue of Special Warrants. To-day Personal Emoluments estimated at $22,154,706 to which figure must be added the sum of $17,000,000 which is the estimated cost of the various cost of living allowances. Thus it will be seen that the cost of the al- lowances now being paid almost equals the total cost of Personal Emoluments in 1941.
The bulk of this $17,000,000 is expended on rehabilitation and 1941 cost of living allowance to some 16,000 employees in the lower salary grades. The new cost of living allowance which was introduced on the 1st May which is payable to Europeans and non- Europeans alike is only estimated to absorb $3,600,000 of that figure. This is because the new allowance was only payable to officers in receipt of a salary of $210 a month or over. Below that figure rehabilitation and 1941 cost of living allowance already represented more than 50% and in most cases a great deal more than 50% of basic salary.
The total for Personal Emoluments this year is not by any means a normal figure. There are additional temporary departments which it is hoped will soon disappear. There is a great deal of duplication owing to the engagement of officers on short term con- tracts to fill vacancies until the substantive holders return. It has also been necessary to fill posts substantively while the present holders are still on leave pending retirement. Moreover, a good dea of the sudden rise in Personal Emoluments is due to increments as officers are now much higher up the incremental scale than they were in 1941. Normally retirements at the top and new entries at the bottom offset this annual increase, but the fact that new appointments have been made before actual retirement has taken place has thrown this compensating machinery out of gear. The Government is however fully alive to the necessity for reducing expenditure on Personal Emoluments to a normal figure at the earliest possible date and to the desirability of employing as many locally recruited officers as possible,
Other charges are estimated at $68,108,524 and special expen- diture at $76,888,247 though as I explained earlier it has not been
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