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7. The total cost of the Police during the period from 1867 to 1881, both years inclusive, has been:—

Pensions, $32,473.00 Superannuation allowances, 16,600.00 Bonus and gratuities, 55,820.00 23,410.00 Return passages, $128,303.00 Establishments, 2,015,445.00 Services exclusive of Establishments including passages from England and India, 538,373.00 $2,682,121.00 or an average of $178,808.00 per ann.

The average annual strength of the Force during that period having been 612, the total cost may be set down therefore at $292 per head annually, including all ranks and races. At this rate the Estimate for 618 of all ranks for 1883 should be only $180,456 instead of $190,478 + 9,000 for pensions. With the view of showing how the increase for 1883 is accounted for, I have had the annexed statement prepared, exhibiting the Estimates for the years 1872, 1878 and 1883. An examination of this statement will show that the estimated cost per head of the salaries of the staff and European part of the Force has been:—

In 1872, $583.00 » 1878, 562.00 1883, 577.00 1885 619.00 of the Indian Contingent it was In 1872, $185.00 1878, 169.00 1883, 169.00 1885 168.00 of Chinese. In 1872.. $101.00 1878, 113.00 1883, 114.00 1885 114.00

Taking the whole force the annual cost per head for salaries only was estimated at:—

In 1872, $232.00 1878, 216.00 1883, 229.00 1885 236.00

Taking into consideration pensions and all expenditure on account of Police shown in the Estimates for 1883, the total Estimates for the three years are:—

1872, $191,361 1878, 188,327 1883, 199,478 1886 220,768

The Police School, Stokers, and Working Expenses of Steam-Launches, and a large increase in the amount of Pensions, will satisfactorily account for the increase in the Estimates for 1883, which does not seem to me unreasonable, considering at the same time the increase in population, and especially in the value of house property.

8. The Captain Superintendent of Police recommends that for the future no pensions should be given until after 15 years' service, except in case of invaliding, when 10 years' service might be considered as giving a claim to consideration of the case. I think that this recommendation should be approved. All members of the Force under the present approved law can obtain a free passage to the place from whence they came after each period of five years service. If they re-enlist for a third period of 5 years, their passage back would therefore still be paid by Government. Under these circumstances 15 years' service does not appear to be too long.

9. The next question is whether a bonus of 3 months' pay should in future continue to be given at the expiration of each period of five years to all classes who do not elect to return home, but who re-enlist. A perusal of the report of a Commission appointed by Sir R. MACDONNELL in 1868, leads me to believe that the object of giving a free passage after five years' service was to encourage Europeans to go on leave, as it was considered that they could not serve continuously and efficiently for 10 years, and that no such provision was considered necessary for Indians or Chinese. However, the provisions of Ordinance 8 of 1869, which was passed after the report of this Commission, sanctions the payment of a bonus after each period of five years' service, whatever the nationality of the Constable, and whether or not he goes to revisit his native country, and the Captain Superintendent does not recommend any alteration.

I am inclined to think that the Ordinance ought to be modified and that it should provide that for future enlistments Europeans should be entitled to a free passage or bonus at any period after five years' service, when they wish either to go home, or to leave the service and remain in Hongkong; but that if they re-enlist without going home their claim should be deferred. In such case the right having been duly earned should be claimable either at the expiration of the further period for which a man enlists or at any intermediate period in event of his health giving way or of his discharge for any cause.

As the law now stands, in case he re-enlists and draws his bonus, and his health breaks down before the next term of five years expires, he has no claim whatever to a return passage and unless he has saved money would be left here destitute,

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