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Page 15.
(b) Coal & Firewood Section
57.
The procurement and distribution of coal, firewood and charcoal, which was undertaken during the period of the British Military Adminis- .tration, was continued as the responsibility of the Coal and Firewood Section of the Department.
58.
In the case of coal, the Colony's allocation is made by the organisation of the Special Commissioner, South East Asia, in Singapore, and paid for through the Crown Agents but it appears from the accounts of the Supplies, Trade & Industries Department that other purchases, e.g. purchases from India and Hongay, which have been paid for leually, have also been arranged by the Director.
59.
In
During the period of the British Military Administration, coal was obtained from the Supreme Commander for the Allied Powers in Japan and shipments from this source have been continued up to date and the cost has been charged to the Hong Kong Government in the "Two-Way" Account maintained by Government with S.C.A.P.(sec paragraph 29). this connection, it has been observed that liability for the shipments of coal received from S.C.A.P. during the period of the British Military Administration has been preferred against the Hong Kong Government in the statement of account received from S.C.A.P. for the period up to 31st December, 1946 (see paragraph 39 above) and that this liability is included in the ledger account for S.C.A.P. maintained by the Supplics, Trade & Industry Department. While the assumption of this liability would appear to be in accord with the terms of the agreement for the handover from the British Military Administration to Civil Government, referred to in paragraph 19 above, it has been observed from correspondence on the Department's files that the method of settlement with 5.C.A.P. formed the subject of several telegraphic communications with the War Office during the period of the British Military Administration, during which the War Office instructed, inter alia, that settlement should not be effected by barter arrangements and that the price of U.S.$10 a ton was not agreed. My predecessor accordingly enquired whether any arrangements for settlement of this liability were effected by the War Office and I have been informed that the matter has been taken up with the Crown Agnets for the Colonics.
60.
The Distribution of coal is undertaken by the Supplics, Trade and Industries Department and coal yards have been rented for this purpose on Hong Kong Island and at Kowloon. This Office has not been informed as to the method adopted for fixing the selling prices of coal nor on what authority this is done. The matter has not yet been fully investigated but it appears that the selling prices are fixed in order to cover costs plus landing and distribution charges.
61.
A separato Suspense Account is maintained to account for the expenditure and receipts involved in the purchase and distribution of coal. Expenditure on rent and maintainance of the coal yards is also charged against this Suspense account and queries have been raised on payment vouchers so classifica, on the grounds that expenditure of this nature forms part of the cost of the functioning of the Supplies, Trade & Industries Department and is therefore properly chargeable against the expenditure head in the Estimates for the Department under which appropriate provision should be made. Replies to the queries raised
are awaited.
62.
During the period of the British Military Administratton, an agreement was made with Mr. A.E. Phillipps of the North Borneo Trading Co. Ltd., appointing him as Agent of the Administration in North Borneo
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