In pursuance of section 61 of the Finance Act, 1921, the Department were consulted during the year by the Treasury with reference to the fixing of the new scale of audit stamp duty to be charged on Local Authorities in respect of the audit of their accounts by District Auditors.

Sub-section (1) of that section provides that the scale shall be such as to secure that the duties levied shall be sufficient to meet the cost incurred in respect of the remuneration, including superannuation allowances, and the expenses of the District Auditors.

The Order, which was made by the Treasury, came into force on the 24th December, 1921, and applies generally to the audits of accounts of Local Authorities. Prior to its issue, and in accordance with the provisions of the Finance Act, Associations representing the principal classes of Local Authorities were consulted.

In connection with the Order it was found necessary to revise the form of the statutory financial statement in which the expenditure of the majority of Local Authorities is presented to the Auditors for certification. An Order was accordingly issued by the Minister to come into operation on the same day as the Treasury Order above referred to.

In consequence of the financial provisions of section 44 of the Education Act, 1918, it was deemed necessary to issue a new form of annual statement for reporting the particulars required by the Board of Education. After consultation with that Board and with representatives of Local Authorities, an Order, entitled the Education Accounts (Annual Statements) Order, 1921, was issued for the purpose. The Order repeals the previous Order on the subject which was made by the Local Government Board in 1918.

DISALLOWANCES AND SURCHARGES.

The number of formal disallowances and surcharges reported by the District Auditors during the year ended on the 31st March, 1922, as having been made at the audits of the accounts of Local Authorities was as follows:

The total figures given above for County Councils, Town Councils, other Urban District Councils and "Other Authorities," include the disallowances, etc., made in their accounts under the Education Act, 1902, and in the accounts of governing bodies of schools and joint education committees.

APPEALS AGAINST DISALLOWANCES AND SURCHARGES.

Any person aggrieved by a disallowance or surcharge may appeal to the Minister, who is empowered to confirm or reverse the decision of the Auditor. When confirming a disallowance or surcharge the Minister also has power to give a direction, on equitable grounds, that remission be granted, i.e., that the persons from whom the amount is certified to be due shall be relieved of their liability under the Auditor's certificate.

In nearly 90 per cent. of the cases no appeal is made to the Minister against the Auditor's decision, but the amount disallowed or surcharged is refunded.

Decisions were given during the year as regards 189 appeals against disallowances and surcharges, which were distributed among the several classes of Local Authority as follows:

The Auditor's decision was confirmed in most of these cases, but in 23 cases his decision was reversed or declared null and void. Remission of the disallowance or surcharge was wholly or partly refused in ten cases, and in the others the persons concerned were relieved of their personal liability.

During the year appeals were also received in four cases against the allowance by Auditors of various items of expenditure. The Minister did not find sufficient ground for interfering with the Auditor's decision in any of these cases.

LOCAL AUTHORITIES (EXPENSES) ACT, 1887.

Under the Local Authorities (Expenses) Act, 1887, expenses paid by a Local Authority whose accounts are subject to audit by a District Auditor shall not be disallowed if they have been sanctioned by the Minister.

This Act is of use in avoiding disallowances in respect of expenditure which though open to objection on technical grounds is in itself reasonable or even necessary.

The number of items of expenditure dealt with under the Act during the past year was 4,279. The applications from the different classes of Local Authorities were decided as follows:--

The most numerous classes of case dealt with by way of sanction under the Act were those relating to the expenses of the attendance of representatives of Local Authorities at Conferences not within the Conferences Acts, contributions by Local Authorities towards the expenses of Provincial Industrial Councils, gratuities by Boards of Guardians to Registrars of Births and Deaths, and payments of accounts not paid within the proper time.

III. ADMINISTRATION OF THE POOR LAW, Etc. Administration of the Poor Law.

NUMBERS RELIEVED.

The gradual increase in the number of persons in receipt of relief, which began in the middle of the financial year 1918-19 and was accelerated in the year 1920-21, had, at the beginning of the year under review, notwithstanding the diminished number in receipt of institutional relief, brought the numbers practically to the pre-war level. Indeed the number of persons in receipt of domiciliary relief on the 26th March, 1921, was 449,612, a proportion of one in 84 of the estimated population, a total figure and a proportion which had not been previously exceeded since the coal dispute of March, 1912.

The dispute in the coal-mining industry, which began on the 1st April, and ended on the 1st July, naturally led to a large increase in the numbers relieved. A notable feature of this increase was that in a number of Unions it was not gradual, but sudden, and followed immediately on the beginning of the dispute.

From the end of March to the beginning of July there was a continuous and rapid increase of the total numbers relieved from 653,500, equivalent to one in 58 of the estimated population, to 1,363,121, equivalent to one in 28. The highest comparable number previously recorded was 1,105,234 about the 1st January, 1863, the time of the Cotton Famine. The only other years since 1849 in which over a million persons were in receipt of relief on or about the 1st January, are 1864 and 1868-71 inclusive. The proportion of the population in receipt of relief had not been equalled since 1873.

The conclusion of the dispute was marked by an immediate decline in numbers. But the fall barely exceeded half the increase of the previous three months, and on the 6th August 931,389 persons were in receipt of relief.

The more lasting effects of the dispute, coupled with the great depression in trade, the exhaustion of unemployment benefit, and the usual seasonal causes, checked the fall in numbers by the end of August, and by the 5th November 1,519,823 persons, or 156,702 more than on the 2nd July, were in receipt of relief.

With the commencement of the second special period of payment of unemployment benefit at the beginning of November, another reduction began. In spite of the special provision for the payment. out of unemployment funds of allowances for the maintenance of dependants of persons in receipt of benefit, this reduction was again less than half the previous increase, with the result that on the 10th December 1,362,625 persons, or one in 28 of the population, were in receipt of relief.

From this point the figures again increased. On the 31st December, 1921, 1,366,569 persons were in receipt of relief, and of these, according to the information supplied by the Guardians, 744,836 persons, or say 180,000 families, required relief on account of unemployment. The numbers rose continuously to 1,490,996 on the 18th February, and at the end of the financial year the number of persons in receipt of relief was 1,465,599, including about 1,250,000 in receipt of out-door relief. About 793,000 of these were persons insured under the Unemployment Insurance Acts and their wives and families, and about 65,000 were persons and families ordinarily employed in some regular employment but not so insured.

It is noteworthy that the number of persons in receipt of relief at the end of March, 1922, excluding the two classes mentioned at the end of the preceding paragraph, was 607,000. The total number in receipt of relief at the end of the last financial year before the War was 644,000. There has in the interval been a considerable development under social legislation, as for example the increase in the rate of old age pensions, maternity and child welfare work, school feeding, and the schemes of national health and unemployment insurance.

The course of relief in Wales resembled generally that in the country as a whole, but the increase during the coal dispute was proportionately much more considerable,-from 75,641 to 231,039. By the 3rd September this number had fallen to 104,734, and the rise in November to 149,739 was much less severe than that of the early summer. The number in receipt of relief at the end of the financial year was 140,017.

In London the number relieved was not substantially and directly affected by the coal dispute, but rose slowly from 124,300 at the end of March, 1921, to 156,874 at the end of August, 1921. There was then a rapid increase to 238,200 at the beginning of November, followed by a slight fall and another steady rise, the number at the end of the financial year being 238,300.

The foregoing statistics as to the number of persons in receipt of poor law relief are taken from Quarterly Statements which are published separately. The numbers given in every case exclude lunatics in county and borough asylums, registered hospitals, and licensed houses, persons in receipt of medical relief only, and casuals. The number of persons in these excluded classes varied during the financial year 1921-22 from about 103,000 to about 116,000.

Fuller statistics of the numbers in receipt of relief will be found in the annual return giving the results of the usual census of persons in receipt of relief on the 1st January.

A special return relating to London and certain adjacent Unions shows that 14,500 able-bodied men were being relieved at the beginning of the financial year, 23,000 at the end of July, 60,000 at the beginning of November, 48,000 at the end of December, and 56,000 at the end of the financial year.

The tendency to a general increase in the total numbers relieved has continued into the current financial year.

GENERAL REVIEW OF THE YEAR.

As will have been seen from the preceding section, the administration of the Poor Law during the year under review has imposed upon many Boards of Guardians and their officers an extent of responsibility which is without parallel in recent years. This responsibility has generally speaking been readily accepted and successfully borne, and the devotion of the Poor Law administrators should be explicitly acknowledged. At the same time, it is necessary to point out that in some ways and in some instances the breach with the traditions of the past has been widened, and that in a number of Unions relief has been administered without any "test" and on the almost automatic basis of published scales of outdoor relief. In no other way, it may be said, could the numbers requiring relief on account of the widespread lack of employment have been dealt with. As was stated in last year's Report, the discovery of a constant relation between unemployment, distress, and pauperism has hitherto proved impossible. It might have been expected that the introduction of the methods above mentioned would bring out clearly such a relation in the Unions in which they were employed. The examination of such statistics as are available does not, however, show such a relation, and on the