16 March 1922]

expensive site it would be impossible to imagine than that at Leeds.

Chairman.] I think it is quite in order to ask who selected the site, because that is not a question of Cabinet policy but of administration.

Mr. Forrest.

456. If we are in order, I would like to ask with regard to item 10 at the top of page 58 what influenced the Department to select this site?-I cannot answer that question; with the mass of these things all over the country it is quite impossible for me two years after the event to carry in my mind the actual details of these particular matters.

Chairman.

457. We quite understand that.-I am quite willing to let the Committee know the full details on the point they have raised, but is is beyond human power to remember the details in every case.

Sir Henry Craik.

I

458. Our experience (I am speaking of Glasgow and Edinburgh, for instance, and my friend speaks of Leeds) is uniform, that the sites in these places have been chosen with extraordinary recklessness in places which are the most expensive and not always the most convenient. That has uniformly been the case. know, Sir Lionel, that you cannot answer for the particular cases, but can you tell me what sort of system you have for guarding against this sort of thing?Yes, I can at once. On any important site we send officers from London, higher officers than our local district officers; we invariably consult the Inland Revenue Valuation Department as regards the valuation of a site or the price of a site before purchase, and in nine cases out of ten their price and the price of our surveyors agree. There have been a few variations, I admit, but on the whole the figures are approximately the same, taking our surveyors' valuation and the valuation of the Inland Revenue Department; that is to say, as to the value of the site from the point of view of purchase. We never purchase a site without consulting the Inland Revenue Department.

Chairman.] I do not think that is quite the point.

[Continued

Sir Henry Craik.

459. What I want to find out is why is it that so frequently (and I speak from my own knowledge of the northern capital) you have chosen, not the business part or where shops are, and so on, but a very valuable residential area?-Are you talking as regards employment exchanges or as regards post offices?

460. As regards Government offices all over; you have taken the most expensive sites. As regards post offices and telephone exchanges, we are entirely limited in our areas by the post office itself; it entirely depends on their special needs and limitations.

461. It is not the post office we are speaking of, but the other places.-Our attitude, according to the Labour Ministry, has been that in the past we have invariably erected or purchased or hired offices for these employment exchanges in areas which are totally unworthy of the purpose for which they were intended. The Honourable Member just now rather hinted that we provided accommodation which was really a scandal on account of its being rat-infested and so on. We are very liable to be forced into certain districts; we combat it to the utmost of our power, but we are forced by the Minister of Labour into more expensive districts than otherwise we should have gone into of our own accord that is true, because he maintains that the employment exchanges ought not to be put into a back street.

462. But is it necessary to have an employment exchange in the principal residential western area of Edinburgh?-1 do not lay down the law in these matters: the policy is largely directed by another Government Department, and I have to try to do the best I can to carry out their wishes.

463. I can assure you that it would be a great thing if you could investigate this, because they exist in some of the best residential areas of Glasgow and Edinburgh; it is a common experience.

Mr. Myers.] I think the labour exchanges ought to be kept in back streets; long queues of unemployed men are very undesirable in residential areas!

Chairman.

464. May we take this matter up again when the Ministry of Labour is before the Committee, because the answer we have is that the Ministry of Labour

16 March 1922]

forces the Office of Works to choose sites which are more expensive than the Office of Works would choose if they were left to themselves?-The whole tendency of recent years has been to improve the situation in the various towns as regards these employment exchanges.

465. The Clerk of the Committee will make a note that I want to ask the Ministry of Labour about that question when they come before us. Will you, Sir Lionel, look into this question in particular and let us have a note on the policy of choosing sites?-Yes.*

Mr. Stewart.

466. We are turning over these pages at a very great rate, Mr. Chairman, but I suppose the Comptroller and Auditor General goes through them carefully?— (Sir Malcolm Ramsay.) Yes, Sir.

Chairman.] Of course it is hoped that the Committee have gone through them before we meet here as far as they have time. It is impossible for each one of us to go through every item, of course.

Mr. Myers.

467. On page 69 there is an item: "Station Road, Chepstow: Acquisition. of site and erection of hutments, estimated cost £4,632." I want to know for which Department that was provided?That one is for an employment exchange.

Mr. Stewart.

468. On the same page, below that item, at Grimsby, there is: "Purchase of the Victoria Wesleyan Chapel ": that was used for some other purpose, I suppose? -That is for an employment exchange,

too.

Mr. Myers.

469. On page 70 there are two items, one of £9,000 and one of £7,000, Nottingham and Newport (Monmouth): Were those for the same purpose?-Yes.

470. Item 1, on the top of page 72, is a sum of £240,000 allocated for the provision of sanatorium accommodation, and of that, roughly, £200,000 was unexpended What was the reason for that?

Chairman.

[Continued

of £95,000 was revoted in the following year, the year just now ending, to go on with the work. Can you tell us why that work was delayed, Sir Lionel ?-I cannot speak offhand as to those details, but I will let the Committee have a note later.*

472. If you please?

Mr. Myers.

473. Are we to understand from the footnote that the £95,000 was taken to replace the £240,000?—Oh, no.

474. The £95,000 is a portion of it?It is a re-vote.

Chairman.] Did the £95,000 represent all you thought you would be able to spend on this particular work in the year now ending?

Mr. Myers.

475. The fact is that only £40,000 out of the £240,000 has been expended and there is a re-vote of £95,000: What is the relationship between the £200,000 and the £95,000?-It means a drop of about £105,000 on the original £240,000.

Chairman.

476. What is that drop due to? Is it work which will have to be done in the coming year or will it be done more cheaply? It is due to the reason given in the footnote, that the extent of the accommodation to be provided was cur

tailed.

477. That is the reason?-That is the explanation.

Mr. Myers.

478. What is this in the second footnote : "This proposal has been postponed indefinitely "? What does that refer to?-The scheme was abandoned by the Department for whom we were acting. (Sir Malcolm Ramsay.) That footnote refers to F 11 (i): 66 National Health Insurance Department: purchase of site and erection of building (provisional), £20,000."

479. I am not satisfied with this explanation; I believe that the whole of this expenditure of £240,000 and more is necessary in making provision for sanatorium treatment, and I am not satisfied with the explanation as to why the money has not been expended. Whether this is the place to get satisfaction or not I do

16 March 1922]

Chairman.

480. I think myself that when the Ministry of Health comes is the time to ask about it-is that not so, Sir Lionelas to why they have curtailed the accommodation ?-(Sir Lionel Earle.) I can let the Committee know the facts from our side.

481. If you will, please, and then, Mr. Myers, you will have an opportunity of raising again when the Ministry of Health are here the question as to why they have curtailed their building operations.

PUBLIC BUILDINGS, Chairman.

482. Turning to page 77, this question of estimating the number of visitors and so on seems to be a difficulty; the comparatively small amount of £5,000 was estimated to cover the whole lot of the admission fees, and on one item only they came to more than £10,000.-Yes, and of course we have raised these very much in the next Estimates, but it is a very doubtful quantity; for instance, last year we were very much hit owing to places being closed through the coal strike, and no one could foresee that. It is dangerous to over-estimate these Appropriations in Aid, but I frankly admit that this has far exceeded our expectations.

484. With regard to Sub-Head H on page 76: "Woolwich Arsenal Housing Scheme," there is an over-expenditure of £7,500, which is stated by the note to be due mainly to increases in local rates, £5,700, and to the increased cost of upkeep, £1,400. How long have those houses been erected, and how does it come that £1,400 extra is needed for upkeep? Are they new houses?-They are houses built about 1915, during the war, and the increase in the upkeep is due to the rise in wages and materials. There are 1,200 houses.

485. I thought they were perhaps falling down.-No, they are very permanent.

GREAT BRITAIN.

Chairman.] As a matter of fact, the amount necessary for the upkeep of cottage property is quite double what it

was.

Mr. Myers.

486. There should not be much need for upkeep of houses which are only four or five years old.-What about painting and the roofs ?

Chairman.

487. What does the upkeep include?Painting, tiles, roofs, and palings.

488. The upkeep begins at once, as I know from experience. At the bottom of page 78 there is a note that the net deficiency on eight stores amounted to £3,929. Are we to take it that that was due to a bona fide error, that it arose out of the confusion of the war?-Yes, mostly errors of accounting.

489. It is not suggested that there was any misappropriation ?—No.

Mr. Marshall Stevens.

490. At the top of page 79 there is an item of £1,011,000, the estimated expenditure being £580,000. How much of that is due to the item "Freight, handling and incidental charges "?— £228,733 is the figure given there for the freight, handling and incidental charges.

491. What was the estimated expenditure for that?-It was considerably less than that, but I cannot give you the exact figure now.

492. My point is that it ought not to be considerably less.

Chairman.

493. The handling is wages largely, I suppose?-If you will remember, this question was very fully discussed last year. The position, I admit, has been

16 March 1922]

[Continued

The

unsatisfactory for various reasons. fluctuation in wages has been enormous in this particular work, but I am glad to be able to report to the Committee that we have taken steps to prevent anything of this sort as regards exceeding the estimate on the furniture sub-head (it occurs on all the Votes practically) in the future now that things have become more normal. The reasons for the fluctuation are (1) the great increase in the cost of wages, railway rates, cartage, &c. (the first-named could hardly have been foreseen, and insufficient allowance was made in respect of the remaining heads of charge; (2) an alteration in the system under which work formerly carried out by contract was carried out by a staff in the direct employ of the Department, and the effect of that was to charge this particular year with the full year's working ending March, 1921, while heavy charges belonging to the previous year for work done by contract, representing the' Christmas and Ladyday quarters for that year, also fell into this particular year, because the contractors had not presented their bills.

That

accounts for that, and the third reason is the heavy charges connected with the working of the Department's stores due to the exceptional conditions of the year, which could not very well have been anticipated. The wages of various people, like porters, joiners, upholsterers and polishers, blind fitters and carpet-laying people varied enormously, the porters' variation being from 1s. 8d. to 2s. 1d. an hour.

Mr. Marshall Stevens.

494. There is a certain amount of the work of the Department which is usually done by railway companies. How are

those charged to the various Departments? Is the same charge made that railway companies would make for the work? This is for coal?

495. No, freight, handling and incidental charges?-(Mr. Buchanan.) The item" Freight, handling and incidental charges" in connection with stores covers the cost of all charges incidental to the working of the store-system apart from the purchases.

496. It must include the usual charge for railway wagons?-(Sir Lionel Earle.) Yes, we have a certain number of wagons we use for carrying coal. Our contracts are for pit prices and we use our own wagons for the transport. The price

which is charged to Departments for stores, including coal, is arranged so as to cover the whole cost of the purchase plus those incidental charges, in fact everything.

497. My point is whether the Government are paying more really by doing this work themselves than if they allowed the railway companies to do it.

Chairman.

498. Can you answer that general question: Do you think the Government are paying more by doing this work themselves than if they allowed the railway companies to do it?-Not as regards the freight, but I think very likely-and we are going into the question now-the direct labour system has not been an economic success. We had a conference with the First Commissioner yesterday on the whole subject and what we are proposing to do is to have contracts made for the various kinds of work, the laying of linoleum and that sort of thing, and compare prices with what we know we are paying for doing the work ourselves, and if it is cheaper, there is no doubt that the present First Commissioner will abolish direct labour in this Department where hitherto for a year or two it has existed.

Sir Henry Craik.

499. What about these extensions which are mentioned on page 87? Are you still extending these offices at Burton Court, for instance?-Those are all remanets of expenditure from the previous year.

500. I thought you were pulling down some of them: will not the materials sell? We are pulling down wherever we

can.

501. Are you getting anything for that? The Disposal Board got rid of the buildings in the Parks; we hand them over to them to get rid of and they form contracts, and take the proceeds.

Mr. George Barker.

502. With regard to item No. 8 on page 89, I see there is £190,000 unexpended there for the provision of hospital accommodation by the Ministry of Pensions. Is this curtailment really justified? (Sir Malcolm Ramsay.) The estimate was submitted on the assumption that a cash payment would be made to

16 March 1922]

the Office of Works for certain premises but it was not in fact paid. It is a book saving.

Mr. Myers.

503. And it will be paid?-No, it was contemplated that the Office of Works would have to pay to the War Office for certain premises taken over, but it was decided to discontinue payments between one Department and another.

Mr. George Barker.

504. That does not affect the provision of hospital accommodation for the pensioners? Not at all.

Mr. Stewart.

505. On page 92 there is an excess of about £74,000 on certain urgent unforseen works. Are these all specified on the following sheets?-(Sir Lionel Earle.) Yes.

Chairman.

506. Beginning on page 93, there are pages of a similar character of entries running down to page 112 consisting of lists of the provision of accommodation for the Ministry of Pensions and so on. If no Member has any question to ask upon these we will go on to page 113, where we come to the next Vote, 10a ?(Sir Malcolm Ramsay.) You have not taken the report on page vii, but perhaps you are reserving that.

507. On page vi, in the report of the Comptroller and Auditor General we have "Services begun in anticipation of Votes of Parliament." Can you tell me where the money was got from to start these services? It was not voted by Parliament, and I understand it was not paid for by the people for whom the work was to be done. Out of what funds were these operations financed?-(Sir Lionel Earle.) They were financed out of the balances.

508. You mean out of the general funds?--No, the balances of each Vote. 509. There was no Vote for these works, I understand-is not that so? These are services not voted by Parliament?-(Mr. Niemeyer.) Perhaps I might explain that. The Office of Works have, of course, balances on all their Vote Accounts.

510. What are called their general balances? Yes, and they used that money to finance those particular works.

511. Which were works not voted by Parliament? That is so, and one of them

[Continued

in particular was, in our view, outside the ambit of any existing Vote at that time there was a Vote for it subsequently.

512. What authority does your Department claim for using this money in that way, Sir Lionel ?-(Sir Lionel Earle.) It is a practice which has existed from time immemorial. It was the result of the war, when we were called upon by every conceivable Department to assist them in various ways on a recoverable basis, but the thing extended to an abnormal extent. We are doing everything in our power to reduce it to a minimum, but I cannot see how we are going to get rid of it altogether. The satisfactory way, in my opinion, from a Parliamentary point of view, would be to have money on our actual Votes to cover these services that we render for other Departments. To take a quite simple matter, we provide coal to official houses on a recoverable basis, for instance, the Prime Minister buys his coal through our Department. Then the grace-and-favour people in the Royal Palaces and the members of the Royal Family who live in their semi-official houses are supplied in the same way; for instance, take a member of the Royal Family. If he requires a new bath I put it in for him and he pays me back. That money has to be financed out of our balances, and although, as regards big schemes, we are financed by imprest, it seems to me very difficult to ask a Minister to send me a cheque for £20 before delivering to him fifteen tons of coal, or to ask the royal personage to pay me £70 before I begin installing his bath. These are some of the problems we have got to face. I do not see how we are to get rid of the demand from the graceand-favour residents, because in St. James's Palace, for instance, where there are all kinds of houses, we do not consider that it is desirable for the graceand-favour people to allow their own contractors to get into that place and pull that old building about. We have to supervise the work and recover the money from them. It is the same at Hampton Court; a very large number of grace-andfavour people live in that place.

513. You notice the suggestion made by the Treasury is that moneys appropriated by Parliament for a specific Vote must not be diverted. All the balances you have, I take it, have been voted by Parliament for specific purposes? They have.