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14. The expense of all this is of course very great, and will result in the cost of these "social" items rising from 33 per cent of the total budget in 1972/73 to 45 per cent in 1977/78.
15. In addition to this field, which might be described as the social security of the population, to which I attach the greatest importance, this Government is also heavily involved in two other particular areas of activity. Firstly, the expansion and training of the police force to give greater security against the rising rate of crime, and particularly violent crime, and secondly the improvement of public transport.
16. With regard to crime the key facts are that in the five years from 1968–73, whereas overall crime has increased by 60 per cent, violent crime, i.e. murder, manslaughter, attempted murder, serious assaults and robbery-has increased by 260 per cent (from 2,900 cases to 11,000). The effect on the population has been highly disturbing, and at this time the most common criticism of the Govern- ment is that it will not adopt stern enough measures against culprits including use of the death sentence. The counter measures we have adopted were described at length in my annual despatch for 1973 and I will not repeat them here; they were radical in nature and involved a mobilisation of the population not previously attempted, as well as many basic changes in the procedures and attitude of the police. Though much groundwork has been laid and at last a satisfactory expansion of the police force is being achieved, the basic problem still remains to be cracked.
17. The improvement of public transport involves the construction of an underground railway at a contract price of $5,000 million, which is now under negotiation, and also the construction of a series of massive road through-ways. Here again the cost is very great, as has also been the demand made on scarce administrative manpower.
18. All this has been accompanied by very considerable efforts to improve communications between Government and governed including the establishment of a widespread network of grass-roots neighbourhood organisations called "Mutual Aid Committees ". We have also embarked on determined efforts to improve recreational services for young people. These widespread activities have required considerable administrative back-up and consequent expansion and to some extent re-organisation of the direction and procedures of the Civil Service. In the latter we have been helped by the consultants, Messrs. McKinsey Inc. All in all the implementation of the policies and operations described above and all other aspects of administration would involve expenditure rising from approximately $4,300 million in 1972/73 to $9,000 million in 1977/78.
19. When formulating these policies and operations we had hoped to cover the expenditure at constant tax rates, on an assumption of a 7 per cent annual growth rate of the economy in real terms (the average achieved in recent years). But in view of the uncertainty created in Hong Kong's export markets by all that is involved in the oil crisis, we have thought it prudent to assume a growth rate for 1974/75 of only 4 per cent with consequent implications of diminished revenue. At the same time there have been spectacular rises in costs. In the light of all this we concluded that if our programmes were to be achieved sufficiently fast, and if we were to avoid overstraining our capacity in their first three years both some rephasing was necessary and that additional resources were required. With regard to the latter we have raised the overall level of revenue from taxation of all sorts this year by 2.8 per cent and have put the public on notice that from 1975/76 new money of the order of $650 million a year will have to
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