programs. Additional knowledge and demonstration of good child welfare practices will also be made possible through the increases requested for the child welfare research program.

REIMBURSEMENT FOR MILITARY SERVICE CREDITS

9. Reimbursement for military service credits, $78,600,000. This is a new item in the 1963 budget and will serve to help keep the OASDI trust funds on an actuarially sound basis. This appropriation will reimburse these funds for the cost of benefit payments paid as a result of military service credits granted for OASDI purposes prior to the period when contributions related to service credits began to be made in 1957. The estimate represents the first of seven annual installments to cover interest, benefit payments, and administrative costs related to these service credits.

FEDERAL CONSTRUCTION AND CONSTRUCTION GRANTS

10. Direct Federal construction and construction grants, $5,471,000. The net increase in this category is the result of several significant increases and decreases. The construction program for 1963 provides $27 million in direct construction activities of the Public Health Service including $4 million for two water pollution control laboratories, $10.3 million for construction of a cancer research facility at Bethesda, $3.2 million for equipping the extension of the Communicable Disease Center in Atlanta, $2.1 million for construction at the NIH animal farm and laboratory, and $4.9 million for master utilities extension at NIH.

Other direct construction includes $5.5 million for construction at Howard University, and $8.1 million for repairs and improvements and construction of a new patient treatment facility at Saint Elizabeths Hospital.

An increase of $10 million is provided for grants for construction of waste treatment facilities and a further increase of $20 million is made in the program of grants for construction of research facilities.

The increases are offset to a large extent by a reduction of $43.4 million in the program of grants for construction of hospitals and a reduction of $5 million due to not requesting continuation in 1963 of the special authorization in 1962 for grants for construction of cancer research facilities.

OTHER INCREASES

11. All other increases, $13,313,000.

A significant item included in this total is an increase of $6,012,000 for civil defense activities to increase the stockpile of emergency medical supplies; to provide for replacement of overage or outdated supplies in the existing stockpile; and to administer a program to provide, to the greatest extent possible, adequate health services to the civilian population in the event of a national emergency.

An increase of $3.5 million is provided for the Social Security Administration to intiate a program of grants to stimulate the training of public welfare personnel.

An increase of $2,054,000 is requested to strengthen the program for prevention of juvenile delinquency and youth crime under the new legislative authority provided by the last session of Congress.

An increase of $1,064,000 is proposed to strengthen the direction and coordination of the rapidly expanding programs of the Department. These funds will be used to increase the staff in the Office of the Secretary, Office of the Social Security Commissioner, and Office of the Surgeon General. The executive and management staffs in these offices have not been increased at a rate adequate to keep pace with rapid growth in size, complexity, and scope of the programs for which they are responsible.

The remainder of the increase in this category is made up of a variety of relatively small individual amounts designed to improve and strengthen the ongoing programs of the Department.

NEW LEGISLATIVE PROPOSALS

ASSISTANCE TO PUBLIC ELEMENTARY AND SECONDARY SCHOOLS

This legislation would authorize $600, $700, and $800 million respectively, for 3 years in grants to States (to be allotted on a public school attendance basis) to assist them in paying more adequate teachers' salaries and in hiring needed additional teachers in public. elementary and secondary schools, and to assist them in constructing urgently needed public school facilities.

While States could use their allotments for teachers' salaries and school construction in any proportion, each State would have to submit and have approved a State application which sets forth criteria and procedures for intrastate distribution and use of Federal funds, which assures that priority (in the case of school construction funds) and preference (in the case of teacher salary funds) would be given to school districts which have the greatest need for increases in teachers' salaries, additional teachers, or additional school facilities, as the case may be, and which are least able financially to provide them without assistance.

The proposal would also amend Public Laws 815 and 874, 81st Congress, in order to reduce Federal payments, particularly those related to children whose parents work, but do not live, on Federal property. The object of these reductions would be to reflect more accurately the degree of Federal impact on the affected communities.

HIGHER EDUCATION CONSTRUCTION AND SCHOLARSHIPS

This would authorize $300 million annually for 5 years in direct loans for construction of academic facilities. It also amends the National Defense Education Act to provide for 4-year scholarships to undergraduate students selected on the basis of need and ability by State scholarship commissions, together with cost allowances to institutions.

EDUCATIONAL QUALITY IMPROVEMENT ACT

This proposed legislation would include authorization for: (a) establishment of advanced study institutes at existing colleges and universities for elementary and secondary school teachers in subjectmatter areas for which there is widespread need for improved quality of instruction; (b) scholarship grants for elementary and secondary school teachers for 1 year of graduate study; (c) grants to colleges

and universities to strengthen teacher education programs; and (d) grants to States to improve the quality of instruction.

REDUCTION IN ADULT ILLITERACY

This proposal is designed to rectify a serious deficiency in the educational achievement of the 8 million adult Americans who are classified as functional illiterates, with a view to making them less likely to become dependent and better able to meet their adult responsibilities. It would authorize grants to public or nonprofit institutions of higher learning to assist in the development of methods and materials for instruction in this area and to assist in providing specialized training for teachers of adults with low educational attainment.

HEALTH PROFESSIONS EDUCATION ASSISTANCE ACT

This act would authorize a 10-year program of (a) grants for construction of medical, dental, osteopathic, and public health teaching facilities; (b) project grants to plan for needed facilities and improved education programs; and (c) scholarship aid to students in such schools, with "cost of education" allowances to the schools.

Also, the health research facility construction program, which was extended for 1 year last year, would be continued for 3 additional years at the new $50 million a year authorization level.

HEALTH INSURANCE FOR THE AGED

This is a renewal of our proposal of last year to provide, through the social security system, a program of insurance against the often catastrophic expenses of extended illness or hospitalization for individuals aged 65 and over.

Under this program, persons would be able to accumulate insurance credit during their working years toward the time of retirement when incomes will decline and medical expenses are likely to rise.

The program would be financed by an increase in social security contributions of employees and employers and would provide for hospitalization, nursing home care, outpatient diagnostic services, and visits for home health services. It would be the greatest boon to our senior citizens since the enactment of the Social Security Act in 1935.

PUBLIC WELFARE SERVICES, REHABILITATION, TRAINING, AND PREVENTION OF DEPENDENCY

I have frequently expressed my conviction that our welfare programs need to be modernized and reoriented to emphasize the elimination of some of the important causes of dependency. New or expanded legislative authority is required to accomplish some of the changes that appear necessary. I have found, however, that much could be done under existing authority and I have already initiated administrative action to improve the management of these programs. These changes were designed to accomplish two major objectives: to eliminate whatever abuses have crept into the programs and to develop more constructive approaches to get people off assistance and back into self-sustaining roles.

REQUIREMENTS FOR STATES

We are requiring each State to strengthen its public welfare organization in order that it may effectively move to detect and report cases of fraud, to locate deserting parents, and to provide more emphasis on services with particular attention to the family as a unit. At the same time we are taking steps to safeguard the dependent children of deserting parents, of unmarried parents, and those who are in unsuitable homes. We are also encouraging the States to develop programs for training adequate staff to combat the alarming shortage of properly trained professional and technical social welfare personnel.

CHANGE OF BUREAU TITLE

In our own organization we have demonstrated our emphasis on preserving the family by changing the name of the former Bureau of Public Assistance to the Bureau of Family Services and have established a new position of Assistant Commissioner who will give full time to coordinating the programs of the Bureau of Family Services and the Children's Bureau and to stimulating public and private welfare organizations to emphasize strengthening of family life.

IMPROVEMENTS IN ADMINISTRATION

To make possible further improvements in the administration of the public assistance programs, new legislation is being proposed. These proposals are designed to move us further along the road toward our long-range goal of reducing the number of public welfare recipients by emphasizing several constructive means of reducing or preventing dependency. This is a job which cannot be accomplished by the Federal Government alone; States, communities, and voluntary organizations must all play a part. The Federal Government can assist in this process, however. Our proposals would permit, for example: (a) More liberal matching of State expenditures for constructive services to recipients designed to reduce dependency; (b) provision of incentives to welfare recipients to help themselves by authorizing Federal participation in community work-training programs and allowing recipients to build up financial reserves against future needs; (c) aiding to keep families together and improve family conditions by allowing payments to two adults caring for children under the ADC program and by increasing the maximum authorization for child welfare services.

GRANTS FOR SERVICES TO CHILDREN

Grants and contracts for research relating to maternal and child health and crippled children's services: This proposal would authorize making grants, contracts, or jointly financed cooperative arrangements for research which shows promise of substantial contribution to the advancement of maternal and child health services or crippled children's services. Funds would be made available to institutions of higher learning and to public or nonprofit organizations engaged in research or in maternal, child health, or crippled children's programs.

FUNDS FOR ASSISTANCE AND RESETTLEMENT OF CUBAN REFUGEES

This proposal authorizes the Department of Health, Education, and Welfare to aid destitute Cuban refugees similar to the program now being carried out under the President's emergency powers. Funds would be available for resettlement, financial assistance, surplus food, medical services, and the foster care of unaccompanied Cuban children entering the United States. In addition, funds would be provided to the public schools of Dade County, Fla., whose facilities have been overtaxed by the addition of approximately 11,000 Cuban refugee children.

VOCATIONAL REHABILITATION FOR PEACETIME EX-SERVICEMEN

This legislation would provide rehabilitation services for peacetime ex-servicemen as a Federal responsibility through use of the FederalState vocational rehabilitation program.

NATIONAL INSTITUTE OF CHILD HEALTH AND HUMAN DEVELOPMENT

This legislation would provide greater research focus in the area of intellectual and physical development of children. It would also bear on problems of the elderly and on the process of maturation generally. It would convert the Division of General Medical Sciences to a new national institute.

POLIO AND OTHER VACCINATION ASSISTANCE

This proposal provides for a 3-year authorization of grants to States for purchase of vaccines-Sabin or Salk vaccines or multiple vaccines against polio and other diseases and for administration, promotion, surveillance, and laboratory services, directed toward the successful vaccination of all children of preschool age. It would also authorize Federal promotion and technical assistance activities to stimulate immunization of all age groups.

AIR POLLUTION CONTROL

The proposed legislation would strengthen the Air Pollution Control Act. It would authorize federally initiated studies of community air pollution problems of more than local significance, authorize project grants for air pollution control programs, provide for regional research centers and make provision for public conferences on special community or interstate air pollution problems. It would also remove the present limitations on appropriations and make these authorities permanent.

FOOD, DRUG, AND COSMETIC ACT AMENDMENTS

This proposal includes amendments to the Food, Drug, and Cosmetic Act to improve its effectiveness in protecting the public against unsafe and worthless products and misleading labeling, and thus assist in our efforts to strengthen consumer protection programs.

The more important provisions would include strengthening the factory inspection authority of the Food and Drug Administration, requiring that new drugs and therapeutic devices be proved effective