CONTENTS. Report of the Governor General (Jan. 1, 1916, to Dec. 31, 1916).. Budget statement, fiscal year 1916 compared with fiscal year 1915.. Executive orders and proclamations. Supervision over provincial and municipal governments. REPORT OF THE GOVERNOR GENERAL. JANUARY 1, 1916, TO DECEMBER 31. 1916. MANILA, August 10, 1917. SIR: The year 1916 is significant in Philippine history by reason of the passage by the United States Congress of a new organic act for the islands. Political autonomy was thereby given to the Filipinos together with a promise of future independence as soon as a stable government can be established. The appointive Philippine Commission was moreover replaced by a Senate elected by the Filipino people. The wisdom as well as the justice of this legislation is already demonstrated because not only is the new form of government working most satisfactorily, but the Jones law has greatly cemented the friendship between the American and Filipino people. All doubts and suspicion as to the purpose of the United States in the islands have now been removed in the minds of the inhabitants, and a genuine and widespread feeling of loyalty to the United States was made very apparent upon the entrance of our country into the war. The regular elections for members of the Assembly, since designated the House of Representatives, were held in June and passed off in good order and practically without disturbance. Pursuant to the terms of the new organic act, elections were held for members of the new Philippine Senate on October 3, 1916, and on the 16th of the same month the new Legislature organized. For the first time this body contains a membership completely and entirely Filipino. The appointive members of the new body were selected by the Governor General as closely as possible actually to represent the non-Christian territories formerly under the exclusive jurisdiction of the Philippine Commission and prescribed by the Jones law to be represented by appointment instead of election. Hadji Butu, the former prime minister of the Sultan of Sulu, was selected as a Senator, and Datu Piang, of Cotabato, and Datu Benito, of Lanao, two of the leading Moros in Mindanao, were nominated to the House of Representatives. In the Mountain Province, Juan Cariño, a Benguet Igorrot, and Rafael Bulayungan, one of the leading men among the Ifugaos, were also nominated to the House of Representatives. It seemed wise to the appointing power to allot representation as far as possible to all the different elements in the Philippine Islands in order to give voice to the various bodies of the Filipino people and bring home to them the fact that a popular and autonomous government has been now established. The results seem to have completely justified favorable expectations. The attention of the new Legislature was first of all directed to the reorganization of the departments of the government. Act No. 2666 established the department of the interior, comprising the bureau of non-Christian tribes, the Philippine General Hospital, the boards of pharmaceutical, medical, and dental examiners, the executive bureau, and the Philippine Constabulary; the department of justice, comprising the bureau of justice, public-utility commission, code committee, courts of first instance and inferior courts, Philippine Library and Museum, and bureau of prisons; the department of finance, comprising the bureaus of customs, internal revenue, treasury, and printing; the department of agriculture and natural resources, comprising the bureaus of agriculture, forestry, lands, science, and the weather bureau; the department of commerce and communications, comprising the bureaus of public works, posts, supply, labor, and coast and geodetic survey; and the department of public instruction, which comprises the bureau of education, Philippine health service, and the quarantine service. The department of public instruction is under the direction of the Vice Governor, appointed by the President of the United States, and all the other departments are under the supervision of Filipinos appointed by the Governor General, as follows: Hon. Rafael Palma, secretary of the interior; Hon. Victorino Mapa, secretary of justice; Hon. Alberto Barretto, secretary of finance; Hon. Galicano Apacible, secretary of agriculture and natural resources; and Hon. Dionisio Jakosalem, secretary of commerce and communications. The heads of departments have been constituted into a cabinet, holding weekly meetings with the Governor General and discussing general policies of government as well as the affairs of their own departments. Each department has also an undersecretary, appointed by the Governor General, as follows: Hon. Teodoro M. Kalaw, undersecretary of the interior; Hon. Jose Escaler, undersecretary of justice; Hon. Miguel Unson, undersecretary of finance; Hon. Rafael Corpus, undersecretary of agriculture and natural resources; Hon. Catalino Lavadia, undersecretary of commerce and communications: and Hon. Felix M. Roxas, undersecretary of public instruction. The undersecretary acts in the place of the secretary during the absence of the latter and in general assists him in his general supervision of the bureaus under his control. The Legislature also passed a new salary act devised to meet the anomalous situation caused by the presence in the insular service of officials of two different races-Americans and Filipinos. Wnile the salaries originally fixed during the American occupation were adjusted to the needs of men who frequently abandoned their occupations in the United States and came out for a longer or shorter term of service in the Philippines, these salaries have been generally recog nized as too high for permanent residents in the Philippine Islands, certainly too high in comparison with the insular revenues. From time to time in the last few years certain reductions in the salaries of the officials had already been effected as described in previous reports, and in Act No. 2668 the Philippine Legislature attempted to fix a permanent basis for the future. While establishing a materially lower scale of salaries for the officials of the government the act leaves it largely to the discretion of the cabinet as to when the new |