The policy of the executive bureau has been to give the fullest possible recognition of the autonomous nature of the provincial and municipal governments.

In the provincial and municipal service almost complete Filipinization has taken place, excepting in a few special government Provinces and in the Department of Mindanao and Sulu. During the year a number of acts were passed by the Legislature making elective certain provincial and municipal officials heretofore appointed.

During the year there was no removal of provincial officials for misconduct in office. Seventy-seven municipal officials, including justices of the peace, were found guilty upon administrative proceedings of whom 39 were removed from office, 7 were required to resign, 31 suspended and later reinstated with reprimand or warning, or otherwise disciplined. The chief offenses for which those officials were disciplined were neglect of duty, violation of law or executive orders, and also for abuse of official position.

BUREAU OF CIVIL SERVICE.

This bureau reports the civil service of the government in excellent condition, and it is satisfactory to note that high standards of civilservice administration have been uniformly maintained here during the year. The civil-service examinations included 11,309 persons, an increase of 1,712 over the preceding year, which was largely due to a memorandum order of the Governor General of July 9, 1915, directing temporary employees of the government to take the examinations to enter the regular service; 1,540 more Filipinos took the examination than in 1915.

Under authority given by act of Congress a Filipino for the first time was admitted to the examination for entrance to the Naval Academy in the United States, the candidate being selected by a civil-service examination in the islands which showed a most excellent degree of scholarship on the part of young men in the Provinces. There were 1,612 new appointments to the service, nearly double those of the year before, which was largely due to the admission of those heretofore temporarily employed as just noted, and because of the admission to leave privileges of messengers and municipal treasurers by Act No. 2626. Of the appointees from examinations only 2 per cent were Americans during 1916, as compared with 5 per cent in 1915, and 6 per cent in 1914, respectively. As noted in previous reports, there has taken place a progressive increase from 48 to 98 per cent from 1902 to 1916 in the proportion of Filipinos appointed as a result of examinations held in the islands. One hundred and thirty-one Americans were brought from the United States during 1916, of whom 76 were teachers and 27 constabulary officers. Aside from three reinstatements, no clerical employees were brought from the United States during the year.

Due to executive restriction, the number of promotions in the service was only 2,401, as compared with 3,138 in the year before. The director of civil service makes some very interesting observations and recommendations in connection with promotion restrictions in his report for the current year, which has been printed and is available for distribution.

The undersigned, in his last annual message to the Legislature, dwelt at some length upon the necessity of fixing the salaries to fit the office instead of the persons in order to avoid inequalities in the service and to do away with the preoccupation of government employees in the securing of salary increases and the consequent pressure, political and otherwise, upon government officials to attain that end. While it is recognized that the promotion restrictions formulated in 1916 by the undersigned were a little severe, it is believed that the net result was greatly to the benefit of the government, both in keeping down expenses and in steadying the excessive demand for salary promotions. Although the problem has not yet been solved with entire satisfaction, it is believed that at the next session of the Legislature action will be taken upon the report of the standardization committee which will definitely lay to rest this ever-present and agitating question.

Reference was made in my last annual report to the passage of Act No. 2589 of February 4, 1915, known as the retirement act. Under the provisions of this act, retirement with a gratuity ranging from 60 per cent of a year's salary to a full year's salary is granted to those who are entitled to the benefits of the act and who voluntarily apply therefor. The scale of payments made is graduated according to the length of the service of the officer or employee making application, and starts with a minimum of six years' continuous service in the government. The granting of the retirement is in the hands of the Governor General, and, in taking action, he is guided by the necessities of the service as well as by the personal desires of those making application. With 50 exceptions, all the 1,064 Americans who were eligible applied before the date on which applications ceased to be permissible, namely, the 1st of July, 1915. During the year 1916, 298 Americans retired with gratuities of P1,053,357 and 61 Filipinos retired with gratuities of P66,022. The policy was adopted not to retire Filipinos unless for disability or old age, and, generally speaking, in recognition of this policy most of the Filipinos in the service did not make application for retirement. Six hundred and thirty more applications are in the hands of the Governor General from Americans who have applied for retirement, and the date of retirement is left in abeyance. The Postal Savings Bank has adopted a plan of purchasing the retirement gratuities from retiring officials at a slight discount, and authority to the one retiring to commute his gratuity in a lump sum has been considered by the Governor General, with most careful scrutiny in each case to ascertain whether the individual applying has sufficient means to insure his being able to take care of himself and his family during the period between retiring from this service and finding a new occupation. In a number of cases commutation of the gratuity was refused in order to protect the individual from possible financial embarrassment. By the terms of the retirement act provision is made for reduction of the salaries of the positions vacated by retirement, so that the net result in the end will be not to increase the cost to the government by reason of the payment of these gratuities. There are 500 Americans in the service not eligible for retirement under the terms of Act No. 2589 who will have rendered from three to seven years of service at the end of 1917. The director of civil serv

ice recommends that the act be extended to cover them, and in this the undersigned heartily concurs. Retiring officials and employees have in many cases been transferred to the United States civil service through the kind offices of the Chief of the Bureau of Insular Affairs, and it is probable that such transfer can be effected in almost every case where the individual is willing to accept considerably lower entrance salary for similar work in the United States service.

The civil-service roster is made as of the 1st of July of each year, and in the year ending July 1, 1916, there was a reduction in the number of Americans in the service of 205, while there was an increase of 844 in the number of Filipinos, a net increase in the number of regular and permanent personnel of 639, but at the same time with a decrease of P139;000 in the amount paid in salaries. The number of Americans in the service had further decreased on January 1, 1917, on which date there were 1,475. Of this number, 501 were professors or teachers, 218 were clerical employees, 190 constabulary officers, 166 technical and scientific employees, 121 patrolmen, prison guards, etc., and 62 chiefs and assistant chiefs of bureaus, etc. The number of Americans separated from the service during the year was 507, or 29 per cent of those in the service; only 22, however, or approximately 1 per cent were separated involuntarily. Of these, 9 died, 8 were removed, and only 5 left the service due to reduction in force or abolition of the position.

As noted above, a successful effort was made during the year to end the practice by which temporary appointments were used extravagantly or for political purposes. During the year ending July 1, 1916, the number of temporary employees decreased from 573 to 355, and on January 1, 1917, to 337.

As is recommended by the director of civil service in his report, more restrictions should be placed by the Legislature upon the granting of accrued leave or the payment in kind for that purpose. While originally established for the benefit of American employees in recognition of the necessity of their visiting the homeland at stated periods, the same arguments do not apply to permanent residents of tle Philippine Islands, who are now in such overwhelming majority in the service. It is quite possible that if Filipinos would use their accrued leave for visits in the United States or travel in foreign lands the expense to the Government, which for accrued leave of all persons in the service amounts to approximately P1,000,000 a year, would be justified, but very few of the Filipino employees make that use of their accrued leave.

Special attention is invited to the statements of the director of civil service that promotions and appointments to office in the Philippine service during the year have been free from political considerations and have been based upon merit and in recognition of the service rendered the government.

PUBLIC UTILITY COMMISSION.

The old board of three members is practically abolished by the appropriation act for 1917, which vested all the powers and duties of the former board in one commissioner, as of January 1, 1917. Commissioner Stephen Bonsal resigned from the service in July, 1916, and Commissioner C. A. De Witt left the Philippines in March

of 1916 on business in connection with the purchase by the government of the Manila Railroad Co., in which he is still engaged since the termination of his position with the board on January 1, 1917. Collector of Customs Bernard Herstein, who was appointed public utility commissioner in Mr. Bonsal's place, left the Philippines in December and has since been occupied in the United States in work upon a proposed revision of the Philippine customs tariff and of the currency and coinage laws of the islands.

The courts in the Philippines overruled during 1916 many of the decisions of the board of public utility commissioners, and thus materially limited the exercise of its powers.

PHILIPPINE HEALTH SERVICE.

With the exception of cholera, no epidemic disease presented any serious problem to the health service during 1916. Cholera, however, was present throughout the year, and 12,847 cases were reported with 7,986 deaths; of these cases, 1,214 were in Manila with 513 deaths. At the end of the year Manila was practically free and only scattered cases remained in the Provinces. The comparatively low ratio of deaths in Manila is due to the activity of a thoroughly organized health service here. The early discovery of cases and prompt removal to San Lazaro Hospital, with immediate treatment, is often attended by prompt recovery. The director of health in his report dwells very interestingly upon the fact that the cholera of 1916 was a "carrier epidemic." It is now an established fact that many persons in apparently good health are cholera carriers, and they become affected by the disease only when the system is, for one cause or another-frequently bad weather conditions-very much weakened. In December a large sale of spoiled shrimps in the Manila markets brought about an epidemic developing in persons who were unsuspected cholera carriers. Considerable headway, however, was made in the Provinces in cultivating the confidence of the people in the handling by the health service of cholera. For instance, in the town of Hagonoy the establishment of a temporary hospital in the school building brought about the prompt control of what would otherwise have been a most serious cholera epidemic. Following this example emergency hospitals sprung up in many places and patients began to present themselves voluntarily. Considerable difficulty is experienced in regulating the ancient religious customs by which it was sought in earlier days to avert the cholera and which served then, as they still do in a lesser degree, to spread the very disease they were designed to prevent.

The sanitary commissions of the health service have completed health surveys of 10 towns, and the results have been most beneficial in the installation of sewage and waste disposal and in the betterment of water supply, as well as in the improved care of infants. It is most gratifying to note that during the year 57 woman's clubs were formed in various localities to devote themselves to improved instruction in the care of infants. The high rate of infant mortality has always been the most pressing health problem in the Philippines and has served to keep the population down to a point where there are actually not enough people to cultivate the rich lands in the islands.

Encouragement was also given by the health service to the planting of vegetable gardens to vary diets and to eradicate the disease of beriberi as well as other affections of the intestinal tract.

Another interesting development of the health service is the treatment of the insane at San Lazaro Hospital; it was found that most of the cases confined there were due to repeated autointoxication of the intestines, and about 60 per cent of those admitted were discharged as cured after proper intestinal treatment.

We can report that the 4,300 lepers in the leper colony at Culion are living under more cheerful and more progressive surroundings from year to year.

The health service states that revaccination against smallpox has now become desirable because the effects of the general vaccination of 11 years ago are beginning to wear out.

There is a most noticeable and ever-increasing demand for hospitals throughout the Provinces, and so far as it is able to do so the insular government is aiding in this work; but plans have been evolved for the construction by the Provinces themselves of their own provincial hospitals.

The antimosquito work in Manila has greatly reduced mortality from malaria as compared with the previous period in which quinine, used as a prophylactic, was the chief source of dependence. The mortality from malaria was only 56 in the year 1916, which is almost surprising in a city of more than 260,000 inhabitants, situated as it is in the midst of marshy plains.

The Provinces of the Islands are gradually being organized into sanitary divisions, 15 such districts being already in operation. During the year 107 more municipalities established an organized health service, and there were 118 new dispensaries added for the free treatment of the poor.

PHILIPPINE GENERAL HOSPITAL.

On August 30, 1916, a strike of the pupil nurses in the hospital to the number of about 150 took place. These young men and women. expressed dissatisfaction with the management of the hospital and formulated certain charges against the director, Dr. Musgrave, and the chief nurse and superintendent of the nurses' training school, Miss McCloskey. These charges were carefully investigated by the director of civil service, who completely exonerated the hospital management of the charges preferred. Subsequently, on October 23, Miss McCloskey resigned from the service and, two days later, Dr. Musgrave also resigned entirely of his own volition, stating that he considered he no longer had control of the situation. The assistant director, Dr. Fernando Calderon, was promoted to the position of director, and Miss Anastasia Giron was made chief nurse and superintendent. Considerable difficulty was experienced for some time in handling the number of patients who presented themselves, and, indeed, for a few weeks the hospital was unable to take care of the normal number of patients. The shortage of nurses was made up, however, by new pupils from the Provinces and by admitting to the service again those of the pupil nurses who had been dismissed as a result of the strike who were conclusively shown by the investigation to have had no leading part in the occurrence, and