2. We understand that the period since the Armistice has been a time of great difficulty for the Mint. Machinery required thorough overhauling. Colonial demands for coin had accumulated and the "fine content" of British silver coinage has been changed, involving much experiment and recoinage. sequently, the incidental expenses of manufacture have shown a very great increase. Whereas in 1913/14 they amounted to £6,910, in the current year they are estimated at £125,000 and in the forthcoming year at £95,000.

3. The following table shows the increase in the numbers of staff since 1914.

Owing to changed conditions, however, comparison with 1913/14 would be fallacious.

The staff are engaged on operations which are essential in the changed position of silver, and we recognise that the profit which results to the Exchequer from these operations must involve increase in the expenditure of the Mint until recoinage is complete.

4. We have visited the Royal Mint and have examined the methods by which the daily progress of the work is kept under review.

66

The premises are antiquated, and consequently it is difficult to obtain the maximum of efficiency. Much of the work is piece-work," and as such is capable of statistical measurement. We have found that the present daily and weekly "operating returns are sufficiently comprehensive to enable the Superintendent to maintain an even flow of work in each shop and to gauge the daily output.

We have no reason to think that the output is not up to the full capacity of the numbers of staff employed, but we are of opinion that a closer check on the efficiency of the seven individual shops would be secured if a "return" (either weekly or four-weekly) were compiled for each shop, showing the "output in units and "man hours paid for."

For the purpose of reviewing the work of the establishment as a whole, we recommend that the total output, as represented

by good coin, should be converted into common units by applying conversion factors to the number of coins of each denomination, regard being had to the fact that in the case of a portion of the output the whole of the operations are not carried out in the Royal Mint, as a quantity of bars of metal and "blanks" are obtained from outside works. This would enable the output of good coin during the four-weekly periods to be compared with the man-hours in the same form as that suggested for individual shops, and in addition the total wages paid out and cost of wages per units should be given.

The conversion factors to be applied to the numbers of coins of the various denominations should be on the basis of the cost of labour. This would necessitate a careful costing analysis for one or more periods, but, when once obtained, the amount of clerical labour involved in compiling the return would be very small.

Of the Estimate for 1921/22, salaries, wages and allowances amount to £2,444, and travelling and incidental expenses to £80. If to this were added the cost of Allied Services, which are charged to other Votes in respect of accommodation, fuel and light, rates, stationery, printing and postage, the total cost for the current year is £3,909.

The Board consists of a Chairman and two members. Of these, the Chairman and one member are unpaid, and the other member receives a fee of 5 guineas per meeting, up to a maximum of £525 per annum. The Secretary is an official of the Ministry of Health, and receives a special allowance of £200 per annum in respect of his duties with the Board. In addition, there are three clerks, two typists and two messengers.

2. Origin and Functions of the Board.

The Board was set up in February 1917 " to deal, by way of conciliation and arbitration, with questions arising with regard to claims for increased remuneration made by classes of employees in Government Departments other than classes of employees who are engaged wholly or mainly by way of manual labour of a kind common to Government and other employment." At present the Board is not empowered to entertain applications for permanent increases of salary from classes of officers with salaries

of £500 or over, or placed on scales of salary rising to £500 and over.

It is open to either party to a dispute to go to the Board independently of the consent of the other, i.e., arbitration is compulsory if either party desires it. It was set up at a time when war conditions had dislocated the Civil Service, and when there was no established machinery of conciliation and arbitration, but it has now passed from the position of being a war-time expedient and has come to be regarded as a permanent body.

Whatever justification there may have been in time of war for setting up such a body, whose awards are final and who can thus uthorise expenditure without the authority of the Chancellor of the Exchequer, we are very strongly of opinion that the main justification for the existence of the Board has disappeared with the institution of the Whitley Councils in the Civil Service. It has now become the established practice in the Civil Service to consider on these Whitley Councils questions of remuneration, so far as they relate to posts carrying salaries not exceeding £500 per annum, and, in these circumstances, we are of opinion that the need for a standing Arbitration Board no longer exists.

CONCLUSION.

We therefore suggest that the Board and, with it, compulsory arbitration, should be abolished. If this suggestion is adopted, the saving in 1922/23 will be £1,886, and there will be consequential savings on other Votes in respect of overhead charges.

53,775

1922/23 Provisional Net Estimate

The Provisional Estimate for 1922/23 has since been reduced to £51,211-a saving of £2,564.

The following table gives the comparative numbers of staff employed :

The Scottish Office occupies a special position among Departments. Its direct administration work is comparatively small and its functions are largely concerned with the supervision and co-ordination with the Central Government of the Departments in Edinburgh. This liaison work covers a very wide field of business and is of a kind which requires an unusually large proportion of higher posts.

Since 1913/14 a great variety of new duties have devolved upon the Office, especially those arising from the passing of the Police (Scotland) Act, 1919; Representation of the People Acts, 1918 and 1921; the Temperance (Scotland) Act; the Licensing Act and the Land Settlement (Scotland) Act, 1919.

We do not see any prospect of reducing the staff.

There is one item, however, in this Estimate to which we call attention, viz., the provision which is asked for the maintenance of a "Drifter" Service, mainly serving various small ports in Skye and on the west coast of Rossshire.

This service was instituted during the war at a time when the usual steamer services were cut down, and it is now administered by the Scottish Office at an annual cost of between £1,000 and £2,000 per annum.

In view of the fact that other steamer services are now available, we think that this "Drifter" Service, subsidised by the Exchequer, should be withdrawn, the Estimate being reduced accordingly by £1,500.

CONCLUSION.

In view of the suggested discontinuance of the "Drifter " Service, we are of opinion that this Estimate should be reduced from £53,775 to £52,275, a saving of £1,500, to which must be added the saving of £2,564, the amount by which the Scottish Office have reduced their Provisional Estimate of July last. The total reduction would therefore be £4,064.

1. It must be pointed out that the Audited Expenditure for the year 1913/14 quoted above refers only to the money provided by Parliament for the salaries and expenses of the National Health

Insurance Commission (Scotland); the Local Government Board for Scotland, and the Highlands and Islands (Medical Services) Board, and for services administered by those Departments. The Estimates for 1921/22 and 1922/23 refer, of course, to the Scottish Board of Health, which was established on the 1st July, 1919, with the powers formerly assigned to the Local Government Board for Scotland and to the Scottish Insurance Commission. Shortly afterwards, it also took over the powers and duties of the Highlands and Islands (Medical Services) Board and certain powers of the Scottish Education Department and the Privy Council.

In general, the policy and practice of the Scottish Board of Health follow those of the English Ministry of Health, on which we have already made recommendations in our First Interim Report.

2. The following table gives a comparative analysis of the main heads of the Audited Expenditure for 1913/14 and the Estimate for 1921/22, the Provisional Estimate for 1922/23:-

The numbers of staff employed show the following comparison :

August 1, 1914.
473

August 1, 1921.
602

April 1, 1922.

580

3. Revised Estimate.

The Scottish Board of Health have now revised their Provisional Estimate of last July in the light of the recommendations which we have made on the Ministry of Health Estimates in Part II, Chapter 2, of our First Interim Report. It is not necessary, therefore, for us to analyse and criticise in detail the figures of the Provisional Estimate, but we proceed instead to show how the reductions which are now proposed in the revised Estimate compare with the Estimates for 1921/22 and with the Provisional