the war the rather catastrophic discovery was made that they had no houses to live in, and we have been building houses for them ever since.

4880. For how long will that expenditure go on?-I should hardly like to say. 4881. Have you the Estimate for this year, 1926-27?-Yes. You would like to know what the new Buildings Estimate is for this year?

4882. If you have it? The Estimate for 1926-27 for new buildings is £47,000. 4883. Do you build the houses yourselves, or do the Office of Works build them? We build them ourselves.

4884. So you carry on a building trade? -We do. We have built several hundreds of houses in the last few years, and I may also add that the building of the houses, and the making of the fittings, the doors, windows, ironwork, and so forth, is very good employment for our prisoners.

4885. Your prisoners build them?Yes. Whenever the houses are near enough to the prison to make it possible the prisoners build them. Of course, in some cases, they are at such a distance that we cannot take a party of prisoners through the streets and we have to use free labour, but we use prisoners wherever we can.

rooms

4888. Practically seven rooms?—On the ground floor there is a parlour, kitchenliving room and scullery, three downstairs and three bedrooms upstairs; it is practically a six-roomed house, I think you may say. In places where we have been able to make use of prison labour to the utmost extent, and very often we can employ materials of our own, for example, if you take down an interior wall in a prison you use the bricks to build your houses, we have built our houses as cheaply as about £167, and they are equally good.

Mr. Briggs.

4889. Are the items under sub-head W, Appropriations-in-Aid, on page 282, also included in the items under sub-head G on page 281?-Yes, that is so.

[Continued.

4890. Then, that being so, look at the explanation of W which appears further down on page 282. Apparently between the estimate and the result there was a difference, roughly, of about 50 per cent.; and it says, I notice, in the note to G, on page 281, that that is accounted for by the number of prisoners. If I remember rightly, just now you told us the number of prisoners was down about 20 per cent. ?-I do not think I committed myself to the figure of 20 per cent.

4891. I thought that figure was given. Could you then tell me what was the average number of prisoners that was anticipated and what was the actual number of prisoners in fact?-In the year under your review?

4892. In the year in question ?-In the year 1924-25 I think, if I charge my memory, we estimated for about 12,000 prisoners. (Sir Malcolm Ramsay.) The figures are given on page 280.

4893. That is what I thought?-(Mr. Waller.) 12,500.

4894. What was the actual number?The actual daily number averaged 10,750.

4895. Then it is really about a 15 per cent. fall in the number of prisoners, but the amount of goods accumulated or sold, or whatever the dealing is, is 50 per cent., so really it is a little difficult to understand?-May I suggest that possibly we are combining two points in one? We took a large sum of money under sub-head G as money which we might perhaps be able to spend on raw material for the manufactures and tools, plant, etc. We actually spent a great deal less, as you say, and that was partly owing to the fact that there were fewer prisoners than we expected, and it was partly owing to the fact that we were unable to develop the prison industries as we should have liked, and we were unable to get as many orders for goods of the best quality from other Departments as we would have wished; and further, of course, we have not yet attained the organisation which it is one of the objects of the Committee which has lately reported to set up. It is quite true that there is a large gap between what we hoped to spend and what we did spend. I must add to that that at that time this arrangement of sub-head G was very new to us; it was instituted in 1922, and it was very difficult for us at first

to estimate how much money to take under it. We are able to estimate our probable expenditure under sub-head G a good deal more closely at the present time.

4896. You do grant, therefore, that the reduction of 12 per cent. in the number of prisoners below what was anticipated should have shown a corresponding reduction of 12 or 14 per cent. in these estimates both in respect of ingoings and outgoings, whereas, in fact, the figure was about 50 per cent?-I would sooner put it in this way if I might: At the time under review we were really in a very great difficult as to how to make a correct estimate of the amount that we ought to ask for; we really did not quite know then what to ask for.

4897. I am not questioning your difficulties; I am only judging the results. The results, I take it, are such as I suggest? Yes. Had we had perfect organisation, it would have been different.

a

4898. I am looking at the explanation, and the explanation given under G, on page 281, is: "This is regulated by the number of prisoners." I suggest that there was a reduction of 14 per cent. in the number of prisoners, whereas in the trading result on both sides, both buying and selling, the difference is 50 per cent. ?-Quite so.

4899. The reason being, you say, that really you had great difficulty in calculating what it would be ?-That is the chief difficulty.

4900. It was really a mistake in judgment? Yes, that is the true explanation; we did not know how much money to ask for.

4901. What is the meaning of sub-head C on page 280, "International Prison Commission "?-In that year there was a small sum taken for the entertainment and incidental expenses of members of the Internation Commission, who visited this country in July, 1924. They were in this country in order to make preparations for the International Prisons Congress which was held in August, 1925.

4902. That was for their entertainment?-There was I think a certain small amount of entertainment for them, and there was also I think some for travelling and printing expenses. Included in that amount is the cost of a visit abroad on the part of the late Chairman and Secretary of the Prisons Commission.

[Continued.

Sir Robert Hamilton.

4903. Going back to the question raised by Major Salmon, can you give us the figure of the pre-war prison population? -In 1913-14 the total prison population of all classes was 20,795.

4904. That was very nearly double the present population?-Not far off.

4905. I think you said that the prison population was now dropping slowly?— Slowly.

4906. Can you say approximately what the percentage is?-After the war, of course, there was an immediate temporary rise up to just about 13,000, the highest pont touched, which was, I think, touched in 1921; since then it has fallen, gradually but steadily, until at the present moment it stands at 10,500, I think.

4907. Is the cost of the Department falling also?-The cost of the Department is also falling.

4908. Behind the fall in the prison population, I suppose?-But not at so great rate, because modern methods of treatment are, and I think must be, more expensive.

4909. As you say, the proportion is 1 to 4 or 5 instead of 1 to 5, which used to be the old rule?-There were old rules which put the number higher than that. For instance, the old rule was that in a local prison (I am speaking now of a good many years ago) you would have one officer to 10, and in convict prisons, one to six, but that is going back a good long time; that, of course, was in the days of mass treatment, whereas now you have, as far as possible, individual treat

ment.

4910. The cost of the Department is falling as the prison population falls ?The cost of the Department is actually falling.

Mr. Pethick-Lawrence.

4911. Going back to these figures of the prison population and the output, the note to sub-head G on page 281 as I read it says that it is regulated (a) by the number of prisoners and (b) by the demand for prison-made goods. I put it to you that it has been partly due to the fact that the demand for the goods has not been as great as was anticipated, and that was why you were not able to spend as much as you expected?-That also was

a factor. We have been trying very hard to develop our industries in the last few years, and the Treasury have helped us very materially by making our needs known to other Government Departments and asking them to give us consideration; this is now producing an effect, and we hope an increasing effect.

4912. These figures, then, will have gone up in the year. You probably know the figures for the following year; is there an increase ?-Yes, we are doing better now; we are doing gradually better.

4913. As far as I can see the percentages are not quite what Mr. Briggs suggested, unless I have misunderstood his point. The appropriations are 32 per cent. below what they were estimated to be; the expenditure is 38 per cent. and the prison population has fallen 14 per cent. I think those are the correct figures.

Mr. Briggs.] You are very likely right; I never trouble to be too accurate.

Mr. Pethick-Lawrence.

4914. The difference is a good deal less than was suggested. The question I want to ask is this: with regard to the fall in prison population, which is, of course, wholly a good thing, am I not right in thinking it is mainly a fall in the population of local prisons?-It is, of course, mainly that; that is the chief factor, because they form much the largest part of the prison population, but proportionately the fall in the number of persons sent to penal servitude is as remarkable. Of course, that is a smaller body in any case, but their fall is equa! in proportion.

4915. That is not in accordance with my recollection, but if that is so I will accept your figures?-I will gladly look up the figures if you want them verified; but that is my impression.

The

4916. If that is so, it would negative the point I was going to make. point I was going to ask you is this, so far as the output of work is concerned, am I not right in thinking that the output of work fetching a price is mainly from the convict population?—No, not now; that may have been the case at one time, but it is not the case now; some of our best industries in the local prisons, and there is also this, it is not

are

[Continued.

the case now that the most valuable output comes from the convict prisons. A good many of our best-equipped shops are situated in the local prisons and the Borstal Institutions, and it is further the case that the local prisons and Borstal Institutions are working a longer day than the convict prisons for certain staff reasons.

4917. Perhaps my original point was not what I should have put. I am thinking really of the difference between long terms and short terms. Am I right in thinking that it is mainly the short-term sentences that have fallen, or does that apply equally to the long-term sentences? -It is mainly the short-term sentences in which there is the great reduction.

4918. The reduction you mention is a greater reduction proportionately in the short-term sentences, is it not?-Yes.

4919. Do you get valuable work out of the short-term prisoners or more out of the long-term prisoners ?-Mainly out of the long-term prisoners.

4920. So that, as a matter of fact, the reduction in prisoners whose work is likely to be valuable, is presumabl smaller in proportion than these figures here would lead us to infer?-Yes, that is a correct inference, I think.

Major Salmon.

1921. Arising on that very interesting point, is that the same experience that has been found abroad, say, in Columbo or the East, in your experience?—I have not had experience of Columbo or the East. One of my colleagues has recently come back from the East, and I think I am right in saying that their sentences there are longer as a rule than ours.

4922. I was very much struck with the extraordinarily up-to-date methods they have in the prisons out there, and the great good they do in training men who are sent to prison for only a short time, but who do very good work afterwards?— I quite agree that in a number of Eastern countries, not necessarily all of them British, a great deal of work is very well done. I believe very good work is done, for instance, in the Phillipine Islands, due to the fact, I think, that they have a vast amount of rather easily learned handicrafts, which are not easily accessible to us; they make all kinds of

Chairman.

4926. Paragraph 22, on page xi of the Comptroller and Auditor General's report, refers to the installation of a costing system at the Mint.

Do you wish to add anything, Sir Malcolm?(Sir Malcolm Ramsay.) That only states that I have not yet seen the cost accounts, as they were not put into actual operation until after the end of the year under review. I understand they have been completely established since the 1st April, 1925.

4927. Could you tell the Committee anything regarding this system and its possible value? (Colonel Johnson.) It is simply the introduction of ordinary business methods into what is, after all, an ordinary business concern.

4928. That is what we discussed last year, I think ?—Yes.

Mr. Briggs.

4929. Do we understand from this paragraph that the cost accounting is now in operation, as promised last year? -As from the 1st April, 1925.

4930. I should have asked, first of all, how it came about that Sir Malcolm

Ramsay was wrongly informed so that he had to put in this paragraph ?—(Sir Malcolm Ramsay.) I think I was correctly informed. I state in the paragraph that they were inaugurated upon the 31st March, 1925.

4931. You say, "I mentioned in my report last year that Accounts on a costing basis were inaugurated," and you have since been informed that the system has not been inaugurated?(Mr. Watson.) As a matter of fact, there was a trial run during that year. (Sir Malcolm Ramsay.) It was not in full operation.

4932. You do not think that is wrong information?-It was inaugurated; they got to work gradually. It was completely in work from the end of that year.

4933. And it is now in operation?Yes. Complete Accounts have been kept since the 1st April, 1925.

Major Salmon.

4934. Have you found since April that you have been enabled, by the information these figures have given you, to effect any economy?—(Colonel Johnson.) It is not so much for the sake of economy, though that is very valuable.

[Continued.

18 May, 1926.]

4935. It is more efficiency?—Yes, efficiency; we get a check on the out-turn in the various rooms, and we are able to see why production in one week on a giver thing was not so good as the production in another week, and I inquire into it. The Costing Accounts are more valuable as forming a basis for quotations to our customers outside the Imperial Treasury. We shall now know from the costings of previous work of the kind what it will cost to do any new piece of work, and in

getting contracts, particularly with foreign countries and the Colonies, it is very important to be able to quote in competition.

4936. Now you are in a position to quote closely and yet be sure you will not make a loss?-Yes; the cost accounts have helped us enormously.

4937. As a matter of fact, do you think that by having the information which this system gives you, and so making internal economies, you will automatically show a better result, even in connection with the work which you do for the Home Government?-Yes, clearly, because we know what we are doing.

Mr. Pethick-Lawrence.

4938. As a matter of fact, do you actually coin a good deal for foreign Governments?--Yes, a great deal, especially in the last three years, including this year, and also for the Crown Colonies and Currency Boards.

Major Salmon.

4939. I see on page 211, in the year under review you had a surplus of £48,000; is that the largest surplus you have had in any one year in recent times? -That, of course, is not the true surplus; the real surplus is that plus the miscellaneous receipts. This was merely a surrender on an over-estimate.

4940. Did you surrender £401,000 then? -We did not surrender it; we paid in a large sum of money.

4941. You realised much more than you anticipated?-We did.

4942. In other words, you had a bigger turnover than you anticipated?—We did. 4943. Is that the position? That is right. That was because the Estimate was based on only a smaller amount of

foreign business, but that year, for the first time, we got a large number of orders from the Soviet Government in Russia, from the Poles and the Letts, and also from Egypt.

4944. The point I should like to be clear upon is this: having got those orders and increased your turnover, are you able to produce the coinage for the Home Government at a lower figure?Certainly.

4945. It is costing the Home Government less money to produce its coinage? -Not only do we make a profit on the foreign contracts, but so far as the permanent staff is concerned, which must always be there, their time is occupied on the foreign coinage instead of their doing nothing, so we save on the overhead charges.

4946. Therefore the net result is that you are, in effect, producing coin for the Home Government at a lower figure than if you had not the foreign trade?Exactly.

4947. Because you would have to have the headquarters staff just the same in any event? Clearly.

Sir Fredric Wise.

4948. Did you estimate for a profit of about 10 per cent. ?-We always get what profit we can. I do not think I should like to reveal what my profits are, but naturally they vary. I always get the most I can.

4949. You have to bargain?-Certainly. 4950. Could you explain sub-head K a little more fully: "Bullion for medals and seals"?-That simply is certain medals and seals that are demanded by Government Departments, and the bullion has to be bought for them. Of course they are paid for by the Government Departments concerned. That is bullio purchased for those purposes as distinct from coinage purposes.

4951. Your wages are a good deal up? -Yes; that is due to the increase in the temporary staff which we had to take on in order to do these foreign coinages. Of course that is very much more than covered by the miscellaneous receipts, which show the profits obtained to be £176,000.

Sir Robert Hamilton.

4952. This does not exactly arise out of these Accounts, but it would be of