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I now enclose copy of the report of the Commitice. The figures and definite expression of opinion promised in the 7th paragraph of the report have not been received for the reason, as I understand, that as Sir M. NATHAN was opposed to the scheme of compulsory insurance, the contributors who favoured such scheme did not consider it worth while further to pursue the subject.

5. Upon receipt of Your Lordship's despatch under acknowledgment, it was with its enclosures printed and circulated among all the contributors to the Fund. A meeting of representatives from each Department and of the Directors of the Fund, was subsequently held and was presided over by the Treasurer who is Chairman of the Directors.

Mr. A. M. THOMSON who is an advocate of the transfer of the Fund to the Government, explained the purport of Your Lordship's despatch, and the question was fully discussed. But the great majority of the contributors and all of the Directors, except the Chairman, were opposed to the transfer of the Fund.

6. I now enclose copy of a memorandum in which the present Directors of the Fund with the exception of the Chairman (Mr. C. McI. MESSER, Acting Treasurer) have set out the views of the contributors on the question of the taking over of the Fund by the Govern

ment.

The figures therein quoted as to rates of interest prevailing in the Colony are correct.

7. I understand that the majority of the Directors and contributors are considering a scheme of compulsory insurance which would remove the unpopularity of the present Fund for the reason that each contributor would know that he, his heirs or assigns would even- tually get some benefit in return for his contribut us; while all or very nearly all the Direct- ors and contributors feel that the Hongkong Fund has had such a specially favourable start and is accumulating so rapidly that they may confidently look forward to the possibility of an increase in pensions even on the Ceylon rates if the Fund is kept separate and fresh valuations are made from time to time.

8. In these circumstances I would recommend that the proposal to transfer the Fund to the Government be dropped, and that if necessary the actuary be consulted as to whether the tables attached to the Ordinance can with safety be adopted. If the report is favourable I would ask Your Lordship to sanction their inclusion in the Ordinance.

I take this opportunity of acknowledging the receipt of your despatch No. 25 of the 5th of February.

The Right Honourable

The EARL OF ELGIN, K.G.,

I have, &c..

F. H. MAY.

His Majesty's Principal Secretary of State for the Colonies.

S

Sie..

HONGKONG, 18th November. 1905,

Sin, The Committee appointed by His Excellency the Governor to put forward the views of the Civil Service on the subject of the Widows and Orphans Pension Fund have the honour to report that after consulting all contributors to the Fund they find :--

7. That the Service is unanimously opposed to the proposal that the Fund should

be transferred to the Government.

. That a majority of contributors are in favour of a compulsory insurance scheme

in place of the present Pensions Scheme.

¡¡¡. That a minority prefer that the existing scheme should continute, but are of the opinion that the pensions are insufficient in view of the large amount of the total annual contributions. They further suggest that the daughters of deceased officers should be supported from the Fund until marriage instead of until the age of twenty-one years only.