Q. 2321.

Q. 2318.

Q 2877.

Public Works Loan Commission of sums not exceeding in the aggregate £20,000,000, and for loans to be made out of these moneys to the Local Authorities for the purposes of Land Settlement.

In the White Paper (Cmd. 132) issued in 1919 in connection with this Bill it was explained that (a) the Local Authorities would be recouped by the Ministry the actual loss incurred by them on their small holding schemes for each of the seven financial years up to 31 March, 1926, and (b) that in 1926 a valuation of the undertakings would be made with a view to ascertaining the final liability of the Ministry, which it was stated might amount, in addition to the annual losses, to as much as 40 per cent. of the capital expenditure i.e. to £8,000,000. The Committee are informed that, of the capital sum of £20,000,000 provided in the Act, the money already spent and the commitments incurred amount to approximately £16,000,000.

The annual losses under these schemes paid by the Ministry. in 1921-22 amounted to £512,990 and the estimates under this head for the two succeeding years show considerable increases on this figure. The heavy losses involved appear to be due largely to the high costs of building and to the high rate of interest at which the money was borrowed.

In addition to the Land Settlement schemes carried out by Local Authorities, there are various Farm Settlements held by the Ministry under the Small Holding Colonies Acts, 1916 and 1918, the accounts of which appear in the volume of Trading Accounts, 1921-22.

BOARD OF AGRICULTURE, SCOTLAND.

18. Land Settlement.-The Committee referred in paragraph 35 of the Third Report of 1922 to the probability that rents receivable for holdings formed under the Land Settlement, Scotland, Acts would not for many years suffice to meet more than at most one-half of the annual loan charges. This was borne out by a return of expenditure and probable loss on schemes so far submitted to and approved by the Treasury, which was handed in by the Board and printed as Appendix 34 to that Report. This return showed an average estimated loss of approximately 50 per cent. on a capitalised initial outlay of £2,186,721 for land, buildings, ingoing expenses, etc.

The total provision for cash expenditure on schemes under the Land Settlement, Scotland, Acts has been reduced from the statutory maximum of £3,500,000 to £3,000,000 and it is estimated by the Board that this latter figure will provide Qns. 2858 & equipped holdings (including houses as far as necessary) for some 4,000 to 5,000 ex-service men, mostly in Highland areas.

2864.

19. We have considered and approved changes proposed to us by the Treasury in regard to certain Statements (B. D. & E.) appended to the Appropriation Account for the Board of

2847.

Agriculture, Scotland, as these changes appear to meet the Qns. 2789 & desire expressed by the Committee in previous years for a simpler and more illuminating form of accounts.

The Treasury have agreed to recast Statement (F), similarly appended, which at present merely exhibits the cash receipts. and expenditure in the particular year on each of the Board's Small Holding Colonies, to show the total capital expenditure

on each estate, together with the result of the working in past Qns. 2829 & years.

2847.

ROYAL IRISH CONSTABULARY.

3332.

20. The irregularities in the accounts of the Auxiliary Division, alluded to in paragraph 36 of the Committee's report of last year, have been further investigated and the accounts have now been finally cleared by writing off some £3,400 as irrecoverable. These Qus. 3305 & losses may fairly be attributed to the fact that the force was raised and organised as a temporary unit at a time of acute disturbance. 21. Auxiliary Division. Fines Fund.-Under the Statutes relating to the regular Royal Irish Constabulary Force fines imposed upon members were credited to the Constabulary Force Fund, Reward Branch, the accounts of which were audited by the Comptroller and Auditor General.

When the Auxiliary and the Veterans' Divisions of the Royal Irish Constabulary were established a system of fines and a fine fund were set up as regards those Divisions, not under statute, but as an administrative arrangement. The fund so created was administered at the discretion of the Chief of the Police, and while the accounts appear to have been subjected to Q. 3361. independent scrutiny, they were not submitted for examination by the Comptroller and Auditor General.

In explanation of this omission it has been represented to the Committee that this fund was a voluntary one with which the Government was not concerned, and there is no kind of suggestion that the money was misapplied. Nevertheless it appears to the Committee that as the Officer Commanding received these monies in his official capacity he should have governed himself by the analogy of the statutory fund and have submitted accounts of his receipts and expenditure for examination by the Comptroller and Auditor General

PRISONS, ENGLAND AND WALES.

22. In June, 1920, the Prison Commissioners rented a piece of land near Wormwood Scrubs Prison and erected certain huts upon it at a capital outlay of 4,500, together with annual charges for rent, rates and repairs of £240, in order to accommodate some fifteen ex-warders who had been dismissed from the Prison Service and had declined to vacate quarters in the prison as they

Q. 2236.

Q. 2734.

C. & A. G.'s
Report.

Para. 47.

could not find accommodation elsewhere. The Commissioners omitted to obtain the previous authority of the Treasury for this arrangement, and indeed failed to report it to the Treasury until 1922 when the matter was brought to notice by the Comptroller and Auditor General. The view of the Treasury then was that at that date they could not give any authority for the action taken by the Prison Commissioners.

As the circumstances were altogether exceptional and unusual the Committee do not wish to suggest at this date that the expenditure should be disallowed, but they trust that this anomalous arrangement under which persons not in the Government Service are housed at reduced rentals at the expense of the State will be terminated as soon as practicable.

BOARD OF EDUCATION.

23. A question has arisen as to the payment in full, without Treasury authority, of a short service gratuity to a teacher who at the time of payment was maintained in a Sanatorium at the public expense. The Committee raise no objection to the charge of the amount involved against the Vote for 1922-23.

PUBLIC EDUCATION, SCOTLAND.

24. The attention of the Committee was drawn to the very generous treatment accorded to a teacher by the award of a retiring. Qns. 2996-8 allowance from the Education (Scotland) Fund. The teacher had been granted an annuity of £200 (part of which is reimbursed indirectly from public funds) by a local authority in England on abolition of his post, and in view of this the Board of Education refused to grant a pension under the School Teachers (Superannuation) Act, 1918. By a renewed engagement of 33 days in a Scottish school, however, the teacher revived the admissibility for pension of 16 years' service in Scotland before his English service, and the Scottish Education Department awarded him an allowance under their scheme. As the annuity granted by the local authority was approximately equal to the pension that could have been awarded to the teacher on his combined service in the two countries, the position is unsatisfactory.

Qns. 35263528.

The Committee learn that the Scottish award is strictly legal, but they consider that at a suitable opportunity steps should be taken to remove the possibility of an anomaly of this kind.

UNIVERSITIES AND COLLEGES, IRELAND.

25. Under section 7 (6) of the Irish Universities Act, 1908 the accounts of the Irish Universities and Colleges in receipt of grants in aid from this Vote must be audited by the Comptroller and Auditor General. The accounting period of these bodies is the academic year, ending 31st July, and the last accounts audited

and certified by the Comptroller and Auditor General were those for the year ended 31st July, 1921. The educational services were transferred to Northern and Southern Ireland on 1st February, 1922, and 1st April, 1922, respectively. As considerable inconvenience would have been caused by the special preparation of accounts for the broken periods from 1st August, 1921, to the respective dates of transfer, it was arranged on the suggestion of the Comptroller and Auditor General that the accounts should be prepared for the whole year ended 31st July, 1922, and and should be rendered to and audited by the Comptroller and Auditor General of the appropriate Irish Government. Committee approve the action taken in this matter.

DIPLOMATIC AND CONSULAR SERVICES.

The

26. Virement. In their Reports of 1921 and 1922 the Public Accounts Committee commented on the extensive exercise of the powers of virement" by the Treasury, i.e. (in the case of Civil Votes) the use of a surplus under one subhead to meet an excess upon another subhead of the same Vote.

In the year now under review, largely owing to economies effected as part of the general policy of His Majesty's Government, excesses on subheads have been comparatively few and in consequence resort to virement has been correspondingly limited. The Committee note however that a large excess has again been Q. 1860. incurred over the Grants for Special Missions and Services, subhead K of the Diplomatic and Consular Services Vote, namely £239,608 or 200 per cent. of the grant. The excess is mainly attributable to arrear claims in respect of expenditure on Missions instituted in previous years to some extent also it is due to an inadequate provision for unforeseen missions and services which arose in the course of the year. Owing to the fact that the expenditure on other subheads of the Vote relating to salaries and office expenses had been considerably over-estimated it was possible to meet this heavy excess over estimate without the necessity of a supplementary estimate.

The Committee have learned with satisfaction that the C. & A. G.'s Treasury have represented to the Foreign Office the importance Para, 51. Report. of securing reliable estimates of expenditure, and they trust that Qns. 1739with the re-establishment of peace conditions these wide diver- 1741. gences of expenditure from estimate will disappear

27. Peace Conference and Supreme Economic Council.-In App. 35. continuation of Appendix 6 to the Report of the Committee of Public Accounts, 1921, a revised summary has been prepared and is appended to this Report showing that the total expenditure incurred in connection with the Peace Conference amounted to £686,464. The Committee are informed that the expenditure in connection with the Supreme Economic Council amounted to £143,363.

App 38.

Q. 1014.

Qns. 10101012.

Q. 1030.

MIDDLE EASTERN SERVICES.

28. Scope of Estimate.-Before 1st April, 1921, there was no separate Vote for Middle Eastern Services. The expenditure necessary for carrying out the policy of His Majesty's Government in this area, which was almost entirely military, was charged against the accounts of the fighting services concerned. Early in 1921 the Middle East Department of the Colonial Office was constituted and a separate estimate was presented for that department covering both Civil and Military charges in Mesopotamia and Palestine as from 1st April, 1921. It was then arranged that the expenditure out of Army and Air Votes in these countries would be repaid to the War Office and the Air Ministry by the Middle East Department, the sums in question being appropriated in aid of Army and Air Votes, and the net total of the Army and Air Estimates was thus reduced by the amount provided for military expenditure in the separate Vote for the Middle East. This arrangement is still in force. The object of this change, as explained to Parliament at the time, was to mark the fact that the Secretary of State for the Colonies had become immediately responsible for policy as regards the Middle East, and it was thought that the institution of a separate Vote would restore to the House of Commons a more effective control over the expenditure by making the Minister actually responsible for the policy himself answerable for the expenditure (see Parliamentary Debates, 15th March, 1921, Vol. 139, Col. 1280-1281, and 14th June, 1921, Vol. 143, Col. 268).

This arrangement, regarded from the point of view of Parliamentary control over policy in its widest sense, has obvious advantages, but from the accounting point of view it involves serious drawbacks. The Accounting Officer of the Vote for Middle Eastern Services, Class V, Vote 3, is nominally responsible for expenditure which, in the year 1921-22, amounted to just over £27,000,000. Of this total £21,682,000 represented a block repayment to the War Office of its expenditure in Mesopotamia and Palestine, and £1,564,000 a similar repayment to the Air Ministry, making a total of £23,246,000 over which the Accounting Officer for the Middle East had no detailed control at all. This, from the accounting point of view is certainly undesirable. Again, viewed as a statistical record of the total expenditure involved by the policy of His Majesty's Government in the Middle East, the expenditure brought to account under the Vote for Middle Eastern Services can only be regarded as a rough approximation owing to the fact that as regards certain items no charge is made against the vote for stores which have been consumed but not replaced.

The Departments concerned are disposed to advocate discontinuance of the Vote in its present form, but as the matter is