of the Kwun Tong and Tsuen Wan schemes was authorized. This is, of course, no long-term solution of the housing problem of the so-called middle income group.
54. Cash budgets are prepared monthly, covering the estimated capital and recurrent expenditure over the ensuing six months, which gives the Finance Select Committee a clear picture of the current financial position, and allows it to determine the most beneficial utiliza- tion of the Authority's funds. Monthly statements of income and expenditure, and quarterly balance sheets, are also prepared for the Authority.
55. The policy of the Authority has been directed, in accordance with the provisions of the Housing Ordinance, to securing that in any period of three successive years its revenue shall be sufficient to meet all outgoings, other than those chargeable to capital expenditure account, and this aim has so far been achieved without difficulty.
56. During the period under review, capital expenditure of $21,785,150.66 was incurred, and the sum of $19,078,740.27 was drawn from the Loan Fund. At 31st March, 1961, the Authority's indebtedness to the Government stood at $75,668,157.29, and there was a balance of $80,331,842.71 on the loan of $156 millions. Interest paid during the year, on the amounts outstanding in September 1960, and March 1961, totalled $2,678,740.27.
ACCOUNTS
57. The Authority's accounts are kept in commercial form, under the general direction of the Accountant General, and audited by the Authority's own auditors, Messrs. Peat, Marwick, Mitchell & Co. This firm also kindly acts as honorary financial advisers to the Authority. The Balance Sheet of the Authority as at 31st March, 1961, is attached as Appendix III.
RENT AND RATES
58. Rents on all estates are calculated on a similar basis. They are fixed by first calculating the direct annual expenditure and charges on each estate, and then assessing a standard rental, which gives a basic rent per flat, adjusted in detail according to relative quality, position, and size. Income arising from shops, of which there will be some in nearly all estates, is not included, but is regarded as a useful margin against unforeseen contingencies.
59. Rents are collected monthly, door-to-door, using the duplicate posting system, by Housing Assistants, who at the same time also deal
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