Introduced in September 1991, the Direct Subsidy Scheme (DSS) was set up in response to the recommendations of the Education Commission in its Report No.3 and approved by the Executive Council. The Government encourages non-government secondary schools which have attained a sufficiently high educational standard to join the DSS by providing subsidies in order to enhance the quality of private school education. Under the scheme, schools are free to decide on their curriculum, fees and entrance requirements. In March 1999, the Executive Council accepted the recommendations of a review of private school policy to allow aided primary schools to join the DSS from the 2000-01 school year onwards. New improvement measures had also been introduced to the existing scheme. We have also taken steps to increase our resources and support to facilitate the development of quality DSS schools. The new measures introduced from the 2001/02 school year are contained in Circular Memorandum No. 210/2001. Details of the scheme are contained in the Explanatory Notes for Primary Schools and Explanatory Notes for Secondary Schools.