The first step taken by Lord Mayo and Sir John Strachey was to reduce the overgrown grant for Public Works by about 800,000 pounds,--a measure suggested and carried out with unsparing faithfulness by Colonel, now Lieut.-General, Richard Strachey, then Secretary to the Government of India in the Public Works Department. Other Departments, equally important and equally clamorous, had augmented their expenditure at a rapid rate. In fact, the ten years which had elapsed since the dominions of the Company passed to the Crown had seen the administration rendered more efficient in many ways; and the cost of the improvements, however admirable they were in themselves, had in the aggregate become too great for the revenues to bear. In addition to the reduction of 800,000 pounds for Public Works, Lord Mayo found himself compelled to curtail temporarily by 350,000 pounds the grants to the spending Departments which had received so rapid a development during the decade since India passed to the Crown. The whole saving amounted to 1,150,000 pounds during the current year 1869-70. It became apparent, however, that reductions alone would not suffice to produce equilibrium. Lord Mayo had therefore to decide whether he would permit the Budget arrangements of the year to stand, with the knowledge that they would result in deficit, or resort to the unusual, and in India almost unprecedented, {145} expedient of additional taxation in the middle of the year. He decided, after careful inquiry, that the circumstances demanded the latter course. Had the threatened deficit been preceded by a period of prosperity and financial accuracy, he would not have deemed so severe a policy needful. But the public expenditure had, during three consecutive years, largely exceeded the revenue, and Lord Mayo found that solvency could only be secured, in the first place, by immediate and most stringent measures; in the second place, by a permanent improvement in the finances to the extent of three millions sterling a year. I mean, of course, the aggregate improvement derived from the twofold sources of reduced expenditure and increased taxation. For these and other cogent reasons, Lord Mayo determined to make it clear by measures of unmistakable vigour that his Government was resolved to place the finances upon a permanently sound basis. He raised the income tax from 1 to 2-1/2 per cent. during the second half of the financial year, and enhanced the salt duty in Madras and Bombay. The former measure was estimated to add 320,000 pounds and the latter 180,000 pounds to the revenue of the year; total, 500,000 pounds. By means of this half-million of increased taxation, and the 1,150,000 pounds of reduced expenditure, Lord Mayo hoped to cover the estimated deficit of the current year, namely, 1,650,000 pounds. He thus explained his views to the Secretary of State.