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and to launch out again when conditions improve. Expansion

can of course be curtailed or postponed but the normal work

of administration must go on. It may even increase during a

slump as the records of Police, Prisons and Magistracies show.

Actual reduction of Expenditure which is to have immediate

effect must generally be at the expense of Public Works

recurrent or extraordinary. Sven this is not always possible.

The Policy which was perforce adopted in 1936 of reducing

maintenance votes has left its legacy in deterioration of

roads and buildings and it would be false economy to try to

starve these services any longer. It is necessary in fact

in order to escape very heavy expenditure in the near future

to do something to make up lost ground. The vote for Public

Works Recurrent has accordingly been increased from $1,486,500

in 1937 to $1,600,200 in 1938 and no attempt has been made to

reduce unduly those items unr Public Works Extra ordinary

which are of a recurrent nature. The sum provided for Public

Works Extraordinary has on the other hand been considerably

reduced. The only major commitment carried forward from 1937

is the Government Store, the construction of which has been

shown clearly to be a measure of economy. There are however

certain other items which have been postponed from year to

year until their urgency can no longer be disputed.

for a beginning in the case of two of the most pressing will

be found included. These are a new Mental Hospital and a new

Ward Block for the Kowloon Hospital. However uncertain the

future may be I feel that Honourable members will agree that

the time has at last come when these works can no longer be

safely postponed.

Provision

Even more urgent if that were possible is a fur ther

extension of waterworks. The position has been very fully

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