Page 279 - Records of Bahrain (6)_Neat

Budgetary affairs 267

n.O. No.C/989. POLITICAL AGENCY
BAHRAIN.
The 1st of October,1947.

9
£*-(• j'/c
I
please refer to the correspondence resting
with your demi-official letter N0.1662-S dated the
18th September, 1947.
2. I enclose a copy of a letter from Smith reporting
increases in the pay of Bahrain Government servants and
of those on the Civil List, which have already been
brought into effect. The increases in the allowances
of those on the' Civil List require your approval, and
I feel that they should not have been brought into
effect in anticipation of it.
3. The increase in the wages of labour employed by
the Bahrain Government (I understand it is -/12/- a day
for working days only) und the increase in Dearness
Allowance from 25# to 50# for persons drawing less than
Rs.300/-p.m. are, in my view, Justified. An increase in
the wages paid to labourers was inevitable; and the
Bahrain Government were having difficulty in recruiting
and retaining any but the least employable clerks on
their previous scales of pay.
4. The increases in the higher paid posts and in
the allowances of those on the Civil List are also
justified by the general increase in the wages of ser­
vants and in the cost of living generally that will
result from the Arabian American Oil Company's action
in increasing wages.
5. The additional purchasing power released by the
Bahrain Government (and other employers will have to
follow them) will increase the demand for goods already
in short supply; and, with the increase in the cost of
food, will aggravate the present inflation in Bahrain.
It constitutes, therefore, an argument against undue
relaxation of internal price controls; but the release
of now purchasing power itself has been dictated by the
action of the Arabian American Oil Company over which the
Bahrain Government have no control.
6. I should bo grateful if I could be informed whether
you approve of the increases in salaries and allowances
already conceded by the Bahrain Government.

Av..

The Hon'ble Lt-Col. A.C. Galloway,
C.I.E., O.B.li.,
Political Resident in the Persian Gulf,
Bahrain.
NS.