CO129-606-1 Treasury control over Hong Kong finances 28-9-1944 - 23-12-1947 — Page 31

CIRCULAR

CONFIDENTIAL

sir,

31

1

Downing Strest,

28th September, 1944.

With reference to Mr. J. I. Thomas' circular despatch

of 22nd May, 1936, and related correspondence, and my oonfidential arnumbered circular telegram of 20th September, I have the honour to inform you that I have had under consideration, in consultation with the Lords Commissioners of His Majesty's Treasury, the possibility of modifying further the procedure followed in connection with the accounts of Colonies, etc., whose finances fall under the control of the Treasury.

2

Revised Instructions regarding the procedure have now been approved and embodied in a new pamphlet, Miscellaneous 450B, six copies of which are enclosed. The revised procedure should be applied to the accounts of the Colonies, etc., concerned for the year 1944 (or 1944/45) onwarûs, The new procedure is intended to afford some relief to the large increase in the volume of finonce vork arising from the war, and it should be regarded therefore as a war-time expedient only. The earlier instructions contained in the correspondence under reference should still be followed, subject to the modifications ect out below, or necessitated by the terms of lilscellaneous 460B.

3. The chief modification of the procedure is shown in paragraph 2 (11) of Miscellaneous 460, from which it will be observed that Colonial Governmente subject to Treasury control may now incur excess exponâiture under sny Kyod up to ten per cent of the figure in the approved Estimates without the prior approval of His Majesty's Treasury, whether or not the expenditure involves the opening of a new sub-head or is of a quodrvent or non-recurrent nature. The sub-paragraph provides, however, that where abnormally heavy additional expenditure 1s forescens the result of a sudden and unpredictable onergalloy, the matter should to specially reported to me with a vier to obtaining prior Trensuzy sanction Ser the necessary provision, without regard to the now ten per cent margin reserved for nowməl excesses0. If the circumstances do not peruit prior Troesery approval being obtained, covering Banation should be sought as soon as practicable; this should bo necessary, however, only in very exceptional circumstances.

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4: It vill of course be appreciated that it is not latended that the puproval of a ton per cent sorgin for novel suresi exponiture should be regarded as effording an oportunity for general increase in expenditure of 10 on all Hoods, and I botat that the neculcity for economy in public expenditure 11 continue to be borne in mind.

In Gråer that the new system may work sitecilvoly, you should satisfy yourself that Departments adhere, stulatly to the teras of Colonial Regulations 196 ve 269 and that in all. recpoobs they cusps etch a spacer of Antoral finstelat

4. 3.

The Gov monk o

congfol