In a bowl, combine sugar, flour and cinnamon. Add peaches and toss to coat. Transfer to a greased 8-in. square baking pan. In a mixing bowl, cream butter and sugar. Beat in egg. Combine flour, baking powder and salt; add to the creamed mixture alternately with milk. Drop by spoonfuls onto peaches; spread evenly. Bake at 350 degrees F for 40-45 minutes or until a toothpick inserted near the center comes out clean. Serve warm.