Chairman.

5612. We had reached paragraph 33 on the last occasion; will you make us a statement on this, Sir Malcolm ?-(Sir Malcolm Ramsay.) The Committee last year and the year before paid some attention to what are known as the manufacturing accounts, which are appended to the Vote for Prisons, and show the operations conducted by prison labour. The Treasury had proposed last year to simplify the statement which is appended to the Account, and the Committee were not altogether satisfied. Perhaps I can illustrate the point best in this way if the Committee would turn to page 298, which relates to Scotland, it will see the sort of statement they used to append to the English Vote as regards both the Manufacturing and the Farm Accounts. If you will turn back to page 282 you will notice that the form appended for England is considerably shorter, and, really, as regards the manufactures, only gives a statement of the value of stocks and materials. Last year the Treasury informed the Committee that they thought these manufacturing operations were not very suitable for expression in any form of Trading Account, and for that reason they had simplified the statements; but the Committee were not altogether happy about it, and I think the Treasury representatives undertook to consider the matter further, and see whether they could produce some kind of statement which would be rather more informing than that which now appears.

5613. We will turn to the account on page 279. Really, what Sir Malcolm's statement amounts to is that Items C, D and F really understate the amount spent on these services by the amount represented by prison labour.—I have not quite got to that point; I was on the general form.

5614. The general form is to try and get that shown, is not it?-That may be part of it.

5615. Have you anything to say on the general question, Mr. Fass ?-(Mr. Fass.)

What happened on that was that a Comittee was appointed by the Prison Commissioners, and on that Committee a Treasury officer was appointed to sit. It has already put in one Report, but the Committee recommend that they should have expert advice on the whole question of prison manufactures, which would include the form of account and what could be shown upon it. I am afraid the work of the Committee is not yet complete. It has now had the question of control referred to it also. Before next year's account we will submit, if we may, a form of statement for approval by the Committee as a result of the recommendations contained in the Report.

5616. The object will be to credit the sub-head for the labour of the prisoners in some way and to debit the other?— I would not like to say that yet. We found that the Trading Account was not very suitable, because of the valuation of the labour; but there ought to be some statement to show what is actually happening as the result of the transactions in the prisons. I do not know that that would necessarily affect the amount of the grant, and the Appropriations-in-Aid. I think it would not; there would be exactly the same amount altogether to be voted by Parliament.

5617. It is only for greater accuracy between one sub-head and another?-Yes.

Colonel Assheton Pownall.

5618. Under W, Appropriations-in-Aid, there is a shortage of close on £100,000 in regard to the proceeds of prison labour-(Mr. Waller.) There is an explanatory note for that, if you would kindly refer to it; that note says, "See under G for explanation of deficiency." It is, in effect, that under G a considerable sum of money is taken for the purchase of materials, and, to put the matter as shortly as I can, if there is no prospect, owing to the number of prisoners or otherwise, of using those materials in the proper way, the money is not spent.

5620. Is not that a very large underspending in G?-Yes, I should say that it was. It is bound up with the whole question of the form of sub-head G, as to which we have had a great many discussions with the Treasury. The Treasury prefer the present arrangement, but I do think myself that it is difficult. I know that this Committee wish us to estimate as closely as possible, but I do think it is difficult to estimate closely under sub-head G.

5621. What was the point you discussed with the Treasury; apparently the Treasury is in some way responsible for this underspending?-(Mr. Fass.) I do not think they are.

implied that

he

5622. Mr. Waller would prefer a different form of sub-head G because in its present form it is very difficult to get anything like an accurate estimate; he suggested you resisted it?(Mr. Waller.) I think perhaps I am wrong in saying that the precise form of subhead G makes any difference. It is a rather intricate question, but the form of sub-head G has been changed in the last three years. I think I am more correct in saying that now it gives the sums on both sides, where previously we only showed the margin. (Mr. Watson.) In previous years the cost of manufactures was borne from the manufactures account, to which a sum had originally been placed. The sales to the Vote, so to speak, were made out of that Fund, and only the net amount charged on the Vote; the Treasury were responsible for altering the form of the Vote so as to show the gross expenditure.

5623. I should have thought the gross expenditure was easier to estimate than the net. Would not that be so? For instance, you say that the amount required is regulated by the number of prisoners for whom employment has to be found; is that an unexpected number during the year?-(Mr. Waller.) Yes; you cannot estimate with strictness; you have to leave a margin always.

5624. These are nearly always long sentence prisoners, are not they?-No, the majority are short sentence prisoners.

[Continued.

There is a seasonal rise and fall in the number, and it is also subject to quite unexpected fluctuations which do occur. I am afraid you could not reach very close accuracy in estimating the amount you would want to spend in estimates which are made up when these are.

Chairman.

5625. You say it is seasonal; what is the season for prisoners?-Curiously enough, it is high in the summer and low in winter; which I believe is connected with the policy of the workhouses and perhaps of unemployment grants.

5626. Are they more comfortable in the prisons in the summer?-I think the position is they do not get the same consideration in the summer. We do get this rise; it is taking place now, very slowly, I am glad to say. There is a curious fall near Christmas, which takes more time to recover from; perhaps that is because the authorities are more generous at Christmas time.

Mr. Leif Jones.

5627. Have you considered the subdivision of duties amongst the Commissioners? I gathered from an answer you gave me last time you were here that all the Commissioners did all the duties, so to speak. Have you considered that one might be more particularly devoted to the financial and manufacturing side?What I said last time was that we were four Commissioners; that the Chairman had certain special duties of general administration, and, amongst others, of course, the duty of being responsible for the Vote; the medical Commissioner has his own special duties in connection with medical administration. There are only two others, and as regular visitation cf all our establishments is a cardinal point of our policy, we find the best plan is for the other two to divide the establishments between them, with a view to regular and systematic visitation. The subject has often been discussed, but that is the best arrangement we can arrive at. If there is any Commissioner specially charged with finance, it is myself, as Accounting Officer.

Sir George McCrae.

5628. Under "Notes" on page 281, it says, "The value of certain stores, approximately £86, lost on railway, etc.,

for which no recovery has taken place, has been written off as irrecoverable." What kind of stores were those?-Mail bags.

5629. It is not a large amount, but it represents a certain amount of slackness, does not it, that such a thing should be? I think it does; it is one of those curious things you have occur from time to time which give rise to a great deal of correspondence; there is a thick file about this £86, in which everybody concerned denied having lost the bags, and everybody concerned said they had counted them; but finding, in the end, that it was not possible to bring it home to anybody, it had to be written off.

5630. Were the mail bags sent to you? -I think they were in transit between the prison and the Post Office. (Mr. Fass.) They were on the railway. The

[Continued.

Prison Commissioners said they had given the Cheshire Lines Committee 4,996 bags; when they came to be delivered, they were 88 short; the railway company said they only received 4,908; the Prison Commissioners said there were the full number sent, but it appeared that the Prison Commissioners had not counted the bags when they handed them to the railway company, but they had really taken an old counting of some years before, therefore they could not prove against the Cheshire Lines Committee that there had been that number on the line, and so we had to write off the loss. (Mr. Waller.) There was also this point, that the officer who despatched the bags, who vouched that the consignment was correct, turned out in the end only to have counted the bundles, and not the number of bags in the bundles.

Chairman.

5633. We had better begin with the Report of the Comptroller and Auditor General, which commences at page 86 of the Appropriation Account. Before we deal with it, I should like to ask the Comptroller and Auditor General if he could arrange, another year, to let us have this Report printed in front, as we generally have his Report; because I think the public are much more likely to digest the Account with intelligence if they have the notes to go on before-hand, if they hit upon them on opening the book?-(Sir Malcolm Ramsay.) Where the Report comes is entirely a matter for the Committee; your suggestion may mean a little delay in printing, and a certain amount of waste pages, because the report has to be settled last; and if it comes at the front it will have to have Roman numerals It is a matter entirely for the Committee, and I am only too anxious to meet your wishes. The only Report that at present comes at the front of the Account is the Civil one; all the others come at the end; and where you have a small Account I suggest, with deference, that it is more convenient to have it at the end.

Chairman.] I do not know what the Committee feel about this?

Mr. Black.] If it were at the beginning, people would see it, whereas, when it is at the end, very probably the public never get to it at all.

Chairman.] They get involved in the labyrinth of figures and do not get through to the Report.

Mr. Leif Jones.] I am afraid that the point of view of the public is very unimportant, because the number of the public which looks at these Accounts at all is small, and those who do look at the Accounts will be the intelligent public who look for what they want.

Chairman.

5634. Perhaps Sir Malcolm will kindly look into it, and see what can be done. Of course, we do not want to be involved in heavy expense in connection with it? -It is entirely what the Committee wish; it only involves a few waste pages. I suppose you would like the same with regard to the Army and Navy and the big Accounts? With regard to the small ones, where there are only a few lines of Report, I hope you will not mind if it comes at the end; which is really the logical position for it. Confession pre

cedes absolution.

5635. Paragraph 1 reports the position of Vote A, and I do not think there is anything that arises on that. Paragraphs 2 and 3 seem to go together. There is a very large over-estimate here, Sir Walter; and, indeed, it is worse than it seems from the figures, because apparently you had a considerable windfall. You were able to, meet unforeseen services without a Supplementary Grant?

27 May, 1924.]

-(Sir Walter Nicholson.) Yes. I must frankly confess that there is an appreciable amount of over-estimating and under-spending, which are not necessarily identically the same things, in this figure; at the same time, I think it is proper to point out that a very heavy element of the under-spending takes the form of excess Appropriations-in-Aid, and of those Appropriations-in-Aid, there are two which are very heavy items, one in respect of excess claims on India for an unexpected scale of issue of stores consequent on a change of policy on the part of the Indian Government, and another sheer windfall in the form of a repayment by France in respect of war issues. Further, I think it is fair to say that some of the additional expenditure which was met out of savings, in particular that £191,000 mentioned as purchases in respect of an expansion scheme which was not settled at the beginning of the year, really should be off-set by the fact that the expansion scheme involved, inevitably, a review of current commitments; and consequently involved a slowing up of the expenditure provided for in the Estimates. That, I think the Committee will recognise, is an inevitable sequence; consequently, if you make allowance for those things, the surplus is less : but there is no question that there is a very considerable surplus that remains, and I do not attempt to defend it. All I can say is that we are devoting very serious attention to the point at the Air Ministry, and are hoping that the figures will more nearly agree in the present year, and in future years, though not, I am afraid, in last year; but taking it broadly, of course, the Committee must have been aware, from other figures that are before them, that in all the public services in that year, owing to the efforts of economy and the various influences that affected all Accounts alike, there was a very heavy under-spending everywhere in the Public Accounts.

5636. But this Committee is very much interested in that matter; in urging the Departments to estimate closely?-Certainly; I do not attempt to say that, because it was general therefore it was defensible in our case. What I mean is that there were general influences operating that did operate on other Departments as well as ourselves.

5637. On that point, that it is very general, can you give us the percentages,

[Continued.

Sir Malcolm? I think this is a record for the year?—(Sir Malcolm Ramsay.) The percentages which I gave the Committee the other day showed that the biggest saving was in the case of the Army, where the saving was 19.8 of the Estimate.

5638. But this is 23 per cent.?-This 23 per cent. is arrived at by rather a different method; that is the saving on the services for which provision was made; that leaves out of account the unexpected expenditure of £424,000 and £191,000. On what they estimated for they had a saving of 23 per cent. In the figures I gave the Committee the other day, the actual saving was, after taking into account these unexpected items, 17.5 per cent.

Mr. Leif Jones.

5639. I suppose the actual number of people in the service was about 10 per cent. less than you estimated for, and that would account for some part of it?(Sir Walter Nicholson.) Yes, it was less than we estimated for; but we do not estimate on the basis of Vote A, if you are going on the Vote A figures. Vote A is the maximum; it is not the average.

5640. You do not estimate on that?We do not estimate on Vote A. If you add up the figures on Vote 1, which is our pay Vote, they are based on the average, and they do not add up to the same as Vote A. Vote A is the absolute maximum which we must not exceed at any period of the year.

5641. What was the average on which you did base your Estimate?-I could not say off-hand; it was in excess of the actual average.

5642. It was over 28,000, was not it?Yes, it would be, I think, round about 30,000, whereas our Vote A number was over 31,000.

Mr. Black.

5643. When you allege that there has been a general overspending in other Departments, it was not through an arrangement with any other Departments that you over-estimated, was it?-By no

means.

5644. I do not see how there is any justification for your being in excess, simply because others happen to be in excess? I do not allege it as a justifiention at all; I merely mentioned that there were influences, I think, rather particularly operating during this year, which