15 June, 1926.]

5846. I should like to press one point. Would Sir Walter kindly explain this: Supposing there had not been any surplus money unexpended on another Vote, how would you have obtained the money for doing these 13 new items?— But the £88,000 was spent; as a matter of fact, we spent slightly over £92,000 on these items. There was money available on the Vote; as a matter of fact, the Vote was largely under-spent.

5847. What about the other items; there were 13 new items started?-Yes.

5848. The reason you got permission to start them, as I understand from the Treasury, was because you had a saving under another head. Supposing that saving had not existed, how would you have started the 13 new items?-I do not know about the other six, they are minor items, and I have not them in my mind; but as to these seven we are speaking of, provision is made for them in the Estimates under item 59. That is where the money for them was obtained.

5849. Without any details?—Yes, without details.

5850. Where did you get the money for item 104, Bicester, for the construction of the station?-We spent about £5,000 on that. It was just beginning at the end of the year, and that came out of this £88,000.

Sir Fredric Wise.

5851. There was no grant ?-I am endeavouring to submit that there was a grant. Whether it is in a form that is wholly acceptable to the House and to this Committee is a matter on which perhaps you will ask Mr. Fass rather than me, because it is a Treasury point rather; but from our point of view, we should certainly demur rather strongly to a suggestion that we had been in any sort of way misleading the House over the works programme of this year.

Colonel Assheton Pownall.

5852. No. 59 you think covers anything which comes in for which you have 56645

[Continued

an extra cost which was unexpected during the year, is that the idea?-No, not the extra cost.

5853. Unexpected in the sense of not having been mentioned anywhere?-No, not unexpected; this is money voted by the House.

5854. I gather you spent very much more than the £88,000 ?-We spent £92,000 on those seven items. I understood what there was some criticism of was the large liabilities involved. That, of course, is another point, but as I say, the Air Ministry, and the Minister in the House, were making it perfectly clear that this Scheme of expansion involved a very considerable building programme which would lie heavily on future years.

Chairman.

5855. I trust I made it clear from the Chair, if not I intended to do so, when 1 called attention to the £399,000 and the other two figures, that they are Estimates for works and not actually what you had spent; what I had in my mind was the very large liabilities which had not been before the House? That I appreciate.

Chairman.] I think we are all quite clear on that; that cannot be disputed.

Major Salmon.

5856. What I should like to understand clearly in the future is, that if we have to have accommodation for additional units some idea should be given to the House, or to the Estimates Committee, of what the eventual liability is going to be?-(Mr. Fass.) I was going to say this, perhaps the witness and I are suffering from an excess of virtue in this case. It would have been quite possible for the Air Ministry to have incurred their expenditure upon these new aerodromes under the head of the £88,000, but the question came to Treasury whether We should exercise the power of virement to enable new works to be started, and it seemed right to let the House of Commons know by means of this Appropriation Account, what the commitments were, and the only way in which we could do that was by having new items and putting them in at the end of the Appropriation Account. That has drawn on us the criticism of the Committee. As

the

04

15 June, 1926.]

[Continued.

a matter of fact it was merely machinery, I think I am right, for showing the House of Commons that these were new items which were not, and could not have been, specifically given at the time the Estimates were prepared. The Treasury knew about them a long, long time ago; they knew that there was this expansion scheme coming along with the House's approval, and they knew that although the £88,000 was shown for it in this year, it would be necessary to provide larger additional accommodation. In the case of Heyford, or Sutton, the Air Ministry wrote to us giving details of the 7th October, 1924, but they told us about the principle in November, 1923, in the previous financial year. There is no question the Treasury knew all about it; the only question was how we should show the House of Commons what we were doing in the matter of virement, and what responsibilities had been incurred in the year 1924-25. (Sir Walter Nicholson.) If I may be allowed to intervene too, the whole of these figures were submitted to the Treasury and voted by the House in March, 1925-the whole of the commit

ments.

Chairman.

5857. Of course, that is later in the year? That is ex post facto, after the work had been begun.

Sir Fredric Wise.

5858. And the liability already incurred? (Mr. Fass.) Only the liability for the land, which was not a very substantial liability.

5859. You are satisfied these are all necessary?—Yes; they follow from the Government's decision, and that is as far as the Treasury can go.

Colonel Assheton Pownall.

5860. With regard to Nos. 84 and 85, on page 56, there are no figures given there for the total amount of work; that is in Iraq; is it all completed ?-(Sir Walter Nicholson.) That I believe to be completed. Perhaps you will allow me to refer to the current Estimates. I find there are three items in the current Estimates relating to Hinaidi, which amount to about £15,000.

Chairman.

I think it would be better to postpone the criticism of individual items.

Colonel Assheton Pownall.

5861. Could Sir Walter give us any idea at all of the total estimate of the work. What are the total commitments that I understand you have undertaken ? -The total commitments as of to-day?

5862. No, presumably as on the date of these Accounts? It is a question of adding up these figures; I have not done so. I will ask for it to be done.

5863. And also I should like to know whether these amounts will be fairly evenly spread, or whether they are going to come in big lumps from the point of view of succeeding years?-Are you speaking of the Works Programme for the expansion over the next 10 years?

5864. Whether in the next few years the big items with regard to Works and Buildings will be coming in lumps, or whether we can take it that the taxpayer will pay evenly for it?-Our effort all through has been to even things out, and I think probably it will work out not unevenly; but I cannot disguise from the Committee the fact that the decision of the Government last Christmas to suspend the expansion, to delay its completion, with an immediate saving so far as possible in the current year, and I believe the next year, has had a somewhat disturbing effect on a programme that was worked out from the point of view of evening things over a period of years. I should not like to say exactly how it will work out, but I think it will be reasonable curve of fairly a expenditure.

of close

on

are

5865. Is this amount £1,000,000 on page 58 the total under the Works and Buildings heading, or there other figures in other parts of the Account? I do not quite follow.

on

5866. There is a total of close £1,000,000 on page 58 for the item of Works and Buildings; I want to know whether there are other sums under slightly different headings with regard to Works and Buildings, or whether this is the total for the year under review ?— The 989,000 is not the whole expenditure under Vote 4. This is the expenditure on major works items.

5867. What is the total of what I call the big items in connection with Works, Buildings and Lands?-Lands is sub-head F. on page 22. You will find that was about £160,000.

15 June, 1926.]

Colonel Assheton Pownall.

5869. I want to get some idea of the figures for land and building, for what we might call new works consequent upon the expansion of the Air Force; I want to get some inclusive figure with regard to that? It is very difficult indeed to analyse exactly what expenditure is due to expansion and what is due to the administration of the existing Air Force. The expansion scheme involves not only the creation of new aerodromes and the selection of new sites for them, and the erection of buildings to accommodate them and their equipment, but it also inevitably involves a considerable amount of shifting about of new squadrons raised under the expansion scheme to existing stations, which may have to be enlarged, or they may displace existing squadrons or existing units of one sort or another, who move; and it is rather a theoretical calculation to find out what is due to expansion and what is not.

was

5870. The last items, I gather, are of a non-recurring nature; and I rather trying to find out what were recurring items, that is, ordinary items of administration, and what were non-recurring items owing to the expansion of the forces. I was trying to get out items, such as land and buildings, which are of a non-recurring nature? It is a matter of difficulty to produce such figures. I could attempt an analysis of the year of account from that point of view, but, if I may say so, I think this year of account is so early in the expansion that any figures of that kind that would emerge from it are not of any real value or interest.

5871. My next question was going to be whether you could give comparable figures for last year and the current financial year, and compare them with the figures for 1924-25. I wanted to see how our curve was steepening with regard to expenditure owing to the expansion of the force? Of course it is rising inevitably. (Mr. Fass.) There is a decrease in this

year.

5872. That is for the reasons that were mentioned ?-(Sir Walter Nicholson.) A

[Continued.

decrease of the expansion items, not the total. (Mr. Fass.) No; that is the point; there is a decrease unquestionably, but whether it is on the expansion only I cannot say. The maintenance item is going up, but I think on capital items there is a decrease this year, but I cannot say from memory.

5873. Could you give us comparable figures for last year and this year, comparing with this £989,000 on page 58?(Sir Walter Nicholson.) I could give you that figure for the current year. It is Vote 4 (B), £1,790,000. That is to be discounted by a proportion, at any rate, of the super-cut, or deductions for overspending, which is £150,000. That is applied to the Vote as a whole, but it is primarily for that sub-head B.

5874. Approximately £1,700,000, in round figures? Or rather less.

5875. It is getting on towards twice what it was in 1924-25?-Not twice the Estimate; it is getting on for twice the actual expenditure,-if we spend it.

5876. I gather you have not got last year's figures ?-I have got the Estimate figure, I have not got the actual for last year. As a matter of fact, it was overspent.

5877. What was it?-I cannot carry it exactly in my mind, but it was overspent. As a matter of fact, we spent approximately £175,000 more than the Estimate, which had been super-cut by £200,000; that is to say we under-spent our original Estimate by about £25,000.

5878. Have you got the figure of the original Estimate? Yes, certainly; £1,806,000 on this sub-head B.

5879. Roughly, the same as for this year? Yes.

Chairman.

5880. There was a request for a figure showing the addition of that column. Can we get that now; if not we can have it later. You mean the total of the seven items?

Colonel Assheton Pownall.

5881. No.-Do you want the whole 105 items?

5882. Yes.-£5,991,000. Much of that had already been incurred, of course.

5883. £6,000,000 as nearly as may be?— Yes.

15 June, 1926.]

[Continued.

Major Salmon.

5884. Is that the total liability that we shall have, or is that the amount of money which has been spent up to date?-Both; it is the total.

5885. I want to be quite clear, at any rate on this point: you know the facts and I do not know them. What I have in my mind is this: before the Ministry recommend any expenditure, even to the Treasury, presumably you, as the Chief Officer, know what the ultimate liability is likely to be?—Yes.

5886. Therefore there it would not be difficult for you to tell us what the ultimate liability will be for the 13 new services referred to here?-The figures are before you; it is a question of The seven items are £1,064,000 on the 31st March, 1925. (Mr. Watson.) it is roughly £1,100,000.

addition.

5887. What I am particularly anxious to know is this: we know what our current expenditure is, but what is our accruing liability; that is to say, we have entered into certain works and we have to foot the bill at a certain date. What is our liability in connection with work in hand, in addition, of course, to the current amounts; do I understand in round figures it is £6,000,000 ?-Not outstanding.

5888. What is outstanding, roughly?— I imagine about half of it, but of course to get that requires an analysis. (Mr. Fass.) The current Estimate shows the total liability in respect of every item on the Estimate. The amounts are not actually added up in the Estimates of the year, but they can very easily be added up, and we can give you the figure of the outstanding liabilities on schemes which have received Parliamentary approval.

Chairman.] That figure might be put in, I think.

Major Salmon.

5889. It would be rather interesting? -(Sir Walter Nicholson.) As at what date: the last day of the year of account, or now?

Chairman.] Are you prepared to take it up to the last day of the year of account?

Major Salmon.

5890. I want the figure of what the outstanding liability is from the date we deal with in these accounts; we deal with these accounts up to March, 1925; therefore it would have to start in the year 1926? You want what was the outstanding liabilities on major works on the 1st April, 1925?

5891. Yes, the outstanding liabilities? -On major works, that is to say on subhead B of Vote 4, all over the world?

5892. Yes. Not expansion, but all over the world?

5893. Yes, all over the world. I will have that figure produced.

Sir Robert Hamilton.

5894. What I want to know is: how far the House of Commons was made aware that over £250,000 was going to be spent on work on each of these stations at North Weald, Bicester and Sutton's Farm?-It was not brought specifically before the House until they voted it in March, 1925; but it was brought before the House in March, 1924, by the paragraph which I have read from the Secretary of State's statement on the Estimates.

5895. In what shape was the House made aware that it was voting money for stations that would cost this amount of money?-It was not made aware of that specific amount. It voted £88,000 under item 59 for accommodation for additional units, with a blank for the total amount of work.

5896. How far was the House aware, in any shape or form, that they were committing themselves to £750,000 expenditure on these three stations?-I think the hon. Member was out of the room when I read the passage that dealt with it in general terms. It may have been referred to more specifically in the debate, but I have not Hansard with me.

Chairman.

5897. Have you anything to add to this discussion, Sir Malcolm? (Sir Malcolm Ramsay.) No, I think not, sir.

5898. Have the Treasury anything to add? (Mr. Fass.) No; except, perhaps, I might as well tell Sir Robert that the actual Treasury virement takes place

Chairman.

5900. On the last occasion we stopped, I think, at the end of paragraph 3 of Sir Malcolm Ramsay's Report, on page iv. I think probably no member has any additional point on that paragraph; if not, we will pass to paragraph 4, which deals with Vote 8, Civil Aviation?-(Sir Walter Nicholson.) Before you pass to that paragraph, I do not know if you would wish me to give а figure that I promised to bring to-day, which was asked for last time: that was the outstanding liabilities on the 1st April, 1925, for major works under sub-head B. of Vote 4. That was £3,788,000, that is to say, 3 millions. In calling that a liability, I should explain that I am giving a figure in the sense in which I understood it to be desired by the Committee: that is to

say, the outstanding amounts up to which the Air Ministry had an authority, in principle, to spend; it does not, of course, represent actual contractual liabilities, which would be very much smaller than that.

Sir Fredric Wise.

5901. Then what is the amount of £5,991,000; I thought that was a commitment? That is money spent plus the future commitments.

5902. And the other is only the commitments?-The commitments are 34

million.

Major Salmon.

5903. Was Parliament made aware of the 3 millions potential liability?— There may be some corrections which