CO129-606-2 Treasury control over Hong Kong finances 22-1-1948 - 9-12-1948 — Page 45

the reference to "changes in salary structure"

267

in paragraph 2(i)(a) of telegram No. 611 has

been omitted because Colonial Regulation No.6

includes a prohibition of any such changes

without the Secretary of State's approval. The

last phrase of paragraph 4 of the draft

however ensures that these two important

points are not lost sight of.

3. In the matter of writes-off etc., we

are proposing to follow arrangements recently

agreed for Africa.

4. It was agreed, I think, in our

preliminary discussions that the simplest

thing was to try out our new arrangements

during the current financial year and then

review the matter. I have included dates

accordingly. A circular despatch about

financial devolution (a copy of which I attach

for easy reference) has recently gone out

to non-African Governments and our proposed

despatch must clearly take this into account.

It has seemed best to do this by relating

consideration of the circular despatch to

the review of Hong Kong arrangements proposed

for the end of the current financial year.

5. Our understanding of the Secretary

of State's relations with the Treasury (as

distinct from the Hong Kong Government's

relations with the Secretary of State) is that

there would be prior consultation with the

Treasury

45

cons 1 (22)