6.
264
senting Hong Kong's share of the subsidy which will enable all Empire letters to be carried by Air Mail at the ordinary letter
rate. Postage rates have already been raised on account of the fall in exchange and it is not proposed to raise them further in spite of the additional expense involved.
Police Department.
I have already referred to the item "20 Sub Inspectors' which appears under the heading "Chinese Contingent". During 1937 these officers will of course be in training and any reduction in personnel which may result from their employment will not appear until later.
Prisons.
The new prison will be completed early in the year. When it is ready for occupation Victoria Gaol will be closed all but a small portion to be used as a clearing house for prisoners going to and from the Magistracies. Laichikok
prison will also be closed but the Female prison will remain
in use.
Medical Department.
With the opening of the Queen Mary Hospital, the Victoria Hospital and the in-patients department of the
Government Civil Hospital will be closed.
Education Department.
The Trade School and increased provision for physical training represent additional educational facilities resulting from recommendations contained in Mr. Burney's report.
Miscellaneous Services.
Provision has again been made for a grant of $15000 towards the expenses of the Travel Association. I wish to make