CO129-583-15 Tung Wah Hospitals- financial arrangements 15-5-1940 - 19-6-1940 — Page 8

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on page 25 of the printed estimates for 1940-41.

This has received the approval of the Finance Committee

of the Legislative Council in Finance Message No. 4 of

1940-41, estimates. 1940/41, Item No.18. The total Government

subvention in respect of 1939 therefore amounted to

$400,000 of which $121,000 was originally provided

in the printed estimates for 1939.

4. As stated in paragraph 6 of my despatch

referred to in paragraph 1 above it is proposed that

in future years the estimates drawn up by the Tung

Wah authorities should be examined and an agreement

reached as to the amount of the Government grant to

be made in the light of the hospitals' expenditure and

revenue. It was explained, however, that this procedure could not be followed in respect of the

hospitals' financial year commencing on 1st January, 1940, and that a provisional figure of $350,000 had accordingly been included in the Colony's estimates for 1940-41. The hospitals' estimates for 1940 have now been prepared and submitted by the Medical Committee, and a copy is enclosed for your information.

The

total income (exclusive of any Government grant) is estimated at $354,780 and the expenditure is estimated at $953,989. The estimated excess of expenditure over income is therefore $599,209. As mentioned above provision for a subvention of $350,000 is made in the Government estimates for 1940-41 (fifteen months), so

that an additional subvention of $319,209 ($599,209 less

$280,000) will be required in respect of the twelve months

of the hospitals' financial year 1940. There is reason to hope that the control exercised by the Medical Committee over

expenditure will be much improved this year and that the

estimate of expenditure given above will not be exceeded.

The Finance Committee of the Legislative Council has informall;

approved the hospitals' estimates and I agree that if proper

financial control is ensured Government should meet the

liability. I should be glad therefore to have your covering

authority to approach the Legislature formally for the

necessary Supplementary Vote.

5. It is also considered desirable that the financial

year of the hospitals should in future coincide with that of

the Government. As the current Government estimates are in

respect of the fifteen months January, 1940, to March, 1941,

it is proposed that the hospitals should carry on for the

first three months of 1941 on the basis of their current

estimates and that thereafter their financial year should

coincide with that of the Government. The hospitals'

estimates for 1941-42 should be prepared at the same time as

those of Government departments and the total subvention

should be included in the printed Government estimates under

the Medical Department. I have the honour to request your

Lordship's approval of this procedure which will mean that

the additional subvention to be met by a Supplementary Vote

will, on the basis of $319,209 for 12 months, be increased

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to $399,011 in respect of the 15 months January,

1940, to March, 1941.

I have the honour to be,

My Lord,

Your Lordship's most obedient, humble servant,

1. Clas. horthesto

Governor.

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