HC Deb 02 March 1865 vol 177 cc1010-22
MR. SEELY

, in calling the attention of the House to the apparently excessive cost of fitting out, refitting, and repairing certain of Her Majesty's Ships, and to other items in the Dockyard Accounts that appear to require explanation, said, the object he had in view in bringing this question before the House, was that it appeared to him, from a Return he held in his hand headed "Navy Ships," printed in July, 1864, that the cost of repairing certain vessels, the names of which he had fur- nished to his hon. Friend to enable him to investigate the matter, had clearly exceeded the sum for which they might have been bought, if new. If his hon. Friend could not contradict that statement, he clearly owed to the House and to the country an explanation of the circumstance. The name of the first vessel to which he would draw their attention was the Falcon of 17 guns, 751 tons burden, and 100-horse power. The cost of building that ship, if it had been bought by contract, would not have been more than £24 per ton; but, in order that he might be quite within the mark, he took the cost of the new vessels—complete with masts, rigging, &c.—to be £28 per ton, and the price of the engines he took at £55 per horse power—rather more than the Government would be willing to pay for them. Calculating upon that scale, he found that the Falcon would cost when new £26,528, being £21,028 for the vessel, and £5,500 for her engines; whereas she cost in repairs in 1863–4 £26,642, being £23,000 for the vessel complete, and £3,642 for her engines. The Lyra of 17 guns, 488 tons, and 60-horse power, which might have been bought new at the same rate as the Falcon, for £16,964, cost for repairs in 1863–4, £17,653; the hull, rigging, &c, costing £15,000 for repairs, when it might have been bought new, at the same rate as the Falcon, for £13,664. The Wasp, of 13 guns, 974 tons, and 100-horse power, which would have cost new £32,772, cost for repairs in 1863–4, £32,002; and in 1860–1, £8,483; and credits returned being in 1862–3, £15; and in 1861–2, £1,451; making a net total of repairs, &c, to the Wasp, from 1860 to 1864, of £38,919. The next vessel he would call their attention to was the Sharpshooter, of 6 guns, 503 tons, and 102-horse power, which might have been bought new, at the same rate, for £19,694, and cost in repairs in 1863–4, £18,249. There was a statement with regard to this vessel that he could hardly understand, for it was stated that in that year her engines, which, if new, would have cost £5,610, had actually cost £9,249 for repairs. The Salamander, of 6 guns, 818 tons, and 220-horse power, would have cost new, at the same rate, £34,004; cost for repairs in 1863–4 £26,078, and in 1862–3, £10,950—mating a total in two years of £33,628. [Sir JOHN PAKINGTON inquired the age of the vessels referred to by the hon. Member.] He only knew that the Wasp was built in 1850, and believed that the Falcon was built in 1854, but the hon. Member for Pontefract (Mr. Childers) would doubtless give them information upon that subject. The Bulldog, of 6 guns, 1,124 tons, and 500-horse power, which would have cost when new £58,972, cost for repairs in 1863–4, £33,700; in 1861–2, £2,092; and in 1860–1 £10,518; returns to be credited being in 1862–3, £2,317; making a net total spent in repairs, &c, upon the Bulldog, from 1860 to 1864, of £43,993. In calculating the repairs many items had been omitted. For example, the wages of the artificers were charged, but not their pensions, though it was well known that their wages were less owing to their receipt of pensions. For this reason some allowance should be made for pensions, especially as in this year's Estimates there was no lees than £84,556 proposed to be voted for pensions to artificers. In the Navy Estimates there would also be found sums for the wages of foremen and others in dockyards, and these amounts were not included in the cost of shipbuilding and repairing; and therefore when they estimated the cost from these accounts, it should be borne in mind that they did not get the whole cost, but only a part. He had brought forward these points in order to press upon the Admiralty the necessity of giving true and faithful statements of what things did cost. Some days ago he told his hon. Friend the Returns to which he should allude, and the drift of the observations he should make, in order that any reply might be made of which the subject was susceptible, his only object in all this being to elicit the truth. The next subject to which he wished to direct attention, was the Return issued last Session for 1862–3, purporting to show the cost of converting timber in Her Majesty's dockyards. The Return was headed "Dockyards and Steam Factories," and it was printed on the 1st of July, 1864. In this Return it was stated that the excess cost of produce over rate-book value was only about 4½ per cent, and considering that the whole amount was a million and a half, they did not think there was much to find fault with. Instead, however, of the conversions of timber being executed at 4½ per cent only above the rate-book, he found they were something like 15 per cent above it. The following abstract showed the cost and rate-book value of the timber conversions:—

Cost of actual timber conversions. Rate-book value of actual conversions. Cost more than rate-book value. Per centage cost above rate-book value per cent.
Deptford £27,426 £27,146 £380 1¼ to l½
Woolwich 35,655 31,685 2,970 8½
Chatham 41,920 36,399 5,521 13
Sheerness 17,381 15,992 1,389 8
Portsmouth 69,619 61,220 8,399 13
Devonport 34,488 28,761 5,727 22
Pembroke 41,492 30,752 10,740 35
Total £266,981 £231,855 £35,126 15¼

This was a difference altogether of £35,126 in excess of the rate-hook; but if all the conversions of timber in the different dockyards in 1862–3 had been made at the lowest yard rates the country would have saved on English oak conversions £9,360; Italian and other oaks, £4,594; teak, £21,543; mahogany, £3,362; substitutes for oak, £3,200; English elm, £5,078; Canada elm, £542; firs, £4,781; and mast timber, £3,036, or a total saving of £55,496. His hon. Friend (Mr. Childers) might say that the reason for this difference between different yards was that they had not the same appliances and machinery at one yard as another. But why had they not? In five years the Admiralty had obtained for new works, improvements, and machinery £2,782,910, and why was not a portion of this large sum spent in providing machinery which would have saved upwards of £55,000 in one year in the single item of timber conversions? The next point to which he wished to call attention was, he confessed, a rather difficult subject to deal with. There was an account published, headed "Navy Ships," and that account showed, or purported to show, the expenses incurred on Her Majesty's ships in building, repairing, and converting, in the years 1860 and 1861. It stated that under Votes 8, 9, and 10, there was a sum of £4,276,382 voted for these purposes, and that in that year there was under fifteen heads £4,017,780 spent in building and repairing Her Majesty's ships, and at the foot of the account was appended this note— It may be proper to remark that timber, copper, and other materials, purchased in one year, may not be expended for many years, and therefore the aggregate expenses incurred under the above fifteen heads may, in any one year, greatly exceed or fall short of the aggregate amount of money voted under Votes 8, 9, 10; in other words, these two sums ought not to balance, unless the value of materials in store at the commencement and at the end of the year happened to be the same, and this can never be ascertained without the costly and laborious process of taking stock. From these accounts the natural inference was that, as £4,276,382 was voted and £4,017,780 expended, a sum of £258,602 had been added to stock. But it so happened that the sums voted did not correspond with the sums received by the Admiralty. The sum received was £4,424,243, and the sum expended was actually £4,017,780; so that there ought to have been, according to their own principle, £406,463 added to stock in that one year. He had examined the accounts for the next three years, and he found that, according to the same principle of calculation, there ought to have been added to stock in the first year £802,321, in the following year £672,222, and in the third year £381,274. Consequently, in the four years there ought to have been added to stock no less than £2,262,281. He might further mention that from the year 1848 to the year 1858 there was added to stock, according to the account of the Admiralty, no less than £1,500,000. The noble Lord (Lord Clarence Paget), in a statement he once made said, he believed that £500,000 had been added to stock in those ten years, but the Admiralty put forward a different statement and said the amount was a million and a half. He, therefore, came to this conclusion, that from 1848 to 1864 there was no less than £3,762,281 added to stock, according to their own accounts and according to their own principles, as put forward in the note which he had read. They naturally asked where this stock was. He believed his hon. Friend would say that the stock in hand was something about five millions. But could anyone accustomed to business suppose that in 1848 there was anything like so small an amount of stock as a million and a quarter; and if there was more in that year, what had they to show for these figures? Perhaps his hon. Friend (Mr. Childers) would be able to show that he (Mr. Seely) was in error; but if not he hoped his hon. Friend would try to carry out what was recommended to-night, and by the noble Lord the Secretary to the Admiralty before the Commission, for he thought the House would agree that this state of things was most unsatisfactory, and ought to be very speedily put an end to. Complaints had been made with respect to Admiralty mismanagement year after year, and last Session the hon. Member for Rochdale called the attention of the House to the subject; but of all the advocates of reform in the Admiralty none had spoken more clearly and distinctly than the noble Lord the Secretary to the Admiralty as to the necessity of amendment in these matters. The noble Lord showed by the evidence he gave before the Royal Commission that no one had a clearer conception than himself of what was needed in this matter. The noble Lord stated before the Commission that the present state of accounts was most unsatisfactory; that it was exceedingly desirable that the House should be informed what money was received and how it was expended; that in order that this might be done there should be a valuation of stock at the commencement of the year; that the value of all stores obtained during the year should be added to that; and that there should be deducted all the stores used in building and repairing ships during the year. Such was the opinion of the noble Lord in 1860, but now, in 1865, what progress had been made to that desirable result? There was yet no clear creditor and debtor account, showing the balance, and, to use a nautical phrase, they were "all still at sea." He had no doubt that his noble Friend would say that the question was a difficult one; but if he had acted on his convictions and given orders to any professional accountant the way in which the money was expended would have been explained. But the noble Lord needed not to have gone to any professional accountant, for his own accountant at the Admiralty, Sir Richard Bromley, might have prepared the account. Any one perusing the evidence of Sir Richard Bromley would see that he had a clear conception of what was wanted, that he was almost worried to death by contradictory orders from the Lords of the Admiralty. Sir Richard Bromley said he had been working twelve or fourteen hours a day, until at length his health gave way. That first one person and then another found fault with what he was doing, and that it was this which took so much out of a man and stopped progress. He also said that the public auditors under the present system were unable to watch the public expenditure. There could be no doubt that the root of the evil was in the system. There were too many masters and governors. The Lords of the Admiralty were continually being changed. Sir Richard Bromley said there had been ninety-seven Lords and Secretaries of the Admiralty since 1829. Imagine any private concern changing its management at the rate of nearly three a year. Any private firm, even if it were as rich as the firms of Rothschild and Baring, would, were it conducted on the same principle, soon find its way into the Gazette. He was, of course, aware that the Lords of the Admiralty could not get into a state of bankruptcy, because if they wasted one million of money they had only to go to their colleague, the Chancellor of the Exchequer, and ask for another million. He only regretted they were not obliged to put down in two columns what was absolutely necessary and what was spent unnecessarily. It was the duty of the Members of that House, as the representatives of the people, to watch this expenditure. He believed the root of the evil was the system of government by a "Board." It was the opinion of the Commission and of men most competent to form a judgment on the subject, that the present state of things should not be allowed to go on. By inference he had a right to assume that Sir Richard Bromley was of that opinion, because in his evidence he said there was no individual responsibility; and he certainly might range on his side Sir Baldwin Walker, who had distinctly stated before the Commission that the Government by a Board was a bad mode of government, and was rendered worse in consequence of frequent changes. He did not deny that the present system might produce improved accounts, or that the accounts given now were not better than they were a few years ago. He should not have been able four years ago to have pointed out these discrepancies. But though a Board might, by means of better accounts, be able to show that things cost more than they ought, yet from its very nature it would not be able to give them things at a fair cost. Not one of the Lords of the Admiralty—he said it with all deference—knew what a thing ought to cost; and the same remark applied to the superintendents at our different dockyards, of whom also he wished to speak with all possible respect, for they had shown themselves anxious to afford every information to Members of that House and the public at large. In their place, as commanders of vessels, the superintendents were excellent officers. All he wished to impress upon the House was that there was such a thing as fitness. Why, the Chancellor of the Exchequer himself, with all his vast abilities, if put at the head of one of these manufacturing establishments would be completely out of place. What was wanted was fitness in the various offices; but as long as they went on looking simply for political patronage, without selecting the men best qualified to discharge the duties intrusted to them, they must continue to have these conversions of timber executed at a much higher rate than was necessary, their ships repaired at an excessive cost, and accounts as defective as those he had referred to, continue to be laid before the House.

MR. CHILDERS

said, that before he followed his hon. Friend through the very interesting and in many respects very useful statement he had just made to the House, he wished to answer the remarks which had been made by previous speakers on the subject of naval chaplains. And at the outset he felt bound entirely to disclaim certain episcopal functions which the hon. and gallant Member for. Wakefield (Sir John Hay) had attributed to him. He had nothing to do with either the appointment or the discipline of the chaplains afloat, and his duties in connection with them were confined to cognizance of, and suggestions relating to, their educational functions. As he understood the suggestion of the hon. Baronet and those who supported him, it was that in the present state of naval affairs there should be at head-quarters a clergyman in the position of Chaplain General, with whom the chaplains of the navy should be in special relations. It was said that such a Chaplain General would be able to select clergymen for the position of chaplains; and, still more, that he would be able to select them for particular ships, knowing those who would be best suited for one class of ships and those who would be best suited for another. Moreover, it was said that, from that Chaplain General naval chaplains were to look for counsel and instruction as to the way in which they should carry out their duties on board ship. Now, he thought the House should pause before it advocated the creation of a new office of that kind. What was the position of the chaplain of a ship? He took it that, in the first instance, he was intended to be the friend and adviser of every one on board. To him all in the vessel looked for counsel. His special relation to the captain was of the greatest value; as by their common action much good would be gained in all matters in which the religious and educational interests of the seamen were involved. But he believed he should have with him the opinion of a great many of the naval chaplains—for he knew that many of their body did not concur in the proposal to appoint a Chaplain General—that if the chaplain, instead of being in that independent position as the friend and adviser of all on board, were made a mere subordinate in a chaplain's department, and tied down by rules prescribed for him by a Chaplain General, a great deal of his usefulness would be lost. Both his hon. Friends who had spoken on the subject had pointed out the great advantages which the chaplain could confer on the officers and crew of a ship, and they had given special cases in which his advice and friendship had been of the greatest possible benefit. Experience, therefore, showed how valuable an influence a naval chaplain derived from his present position, and how useful he was able to be with respect to the religious and educational advancement of the seamen, without at all changing his proper relations with the Admiralty. The appointment of a Chaplain General he believed was unnecessary, and there were reasons patent to all which, bearing in mind the freedom of opinion in the Church of England, made it inexpedient that all the naval chaplains should be selected by, and subordinate to, one clergyman in the position of a Chaplain General. In matters of education the Admiralty had already the advantage of the advice of the Director of Education in regulating the educational functions of the chaplains. He hoped, therefore, that the House would hesitate to sanction a proposition which would be attended with very serious danger and inconvenience. He now came to the question raised by the hon. Member for Lincoln (Mr. Seely), and he admitted that that hon. Gentleman had given his noble Friend (Lord Clarence Paget) and himself a general idea of the matter to which he intended to draw the attention of the House, although he was not prepared in all respects to criticize the figures he had stated. The hon. Member in the first place took the Return laid on the table at the end of last Session, giving an account of the expenses incurred for ships building, repairing, and converting in the financial year 1863–4; and, speaking of certain expenditure incurred for particular ships, he asked the House whether it was not a mistake to spend so much money on their repair in that year, in addition to what had been spent in previous years. Now, not having been aware that the hon. Gentleman would refer to the previous expenditure on these ships, he was not in a position to answer him off-hand as to that expenditure. But the hon. Member had stated, with respect to the account for 1863–4, that the general expenditure of the Admiralty in building the hull of ships of the same class would be £28 a ton, and he gave certain instances in which apparently a sum as great, or greater, than that had been expended during that year. But let him call attention to the Return itself, and compare what the hon. Member had said was the tonnage expenditure on the repairs of the hulls of these ships with the real tonnage expenditure on building similar ships, as shown by these accounts? If his hon. Friend referred to a subsequent page of the Return he would see that the average tonnage cost in building ships of the class quoted was about £28 for the hull only. The hon. Gentleman took the case of the Falcon, and said the expenditure upon it was out of all proportion to what it ought to have been on a ship of that kind. Now, according to the Return, the expenditure in 1863–4 upon the hull of the Falcon, in round numbers, was £14,000; but in addition to that, there was a certain proportion of the incidental expenses charged on the whole ship. Taking a fair proportion of those charges, he found the total expenditure upon the hull to be something between £15,000 and £16,000. The hon. Gentleman did not seem to be aware that the Return which he quoted included, not only expenditure on the hull, but other items—such as rigging, masts, engineers' stores, and repairs of machinery. Under the head of the Falcon, rigging and stores cost between £5,000 and £6,000, so that the repairs of the hull only came to £21 or £22 per ton, instead of £28 or £29 per ton. That was the extreme case adduced. The case of the Bulldog had also been mentioned. That was a vessel of 1,124 tons, and the expenditure on her hull was stated at £13,600. Allowing £2,000 for the proportion of incidental expenses, the total would be only £15,600, which was very far from being the amount stated by the hon. Gentleman. The Salamander had been quoted. The expense on her hull was about £8,500, in addition to her proportion for incidental expenditure. The Salamander was 813 tons, which gave only £11 per ton; while the expenditure for rigging and stores was no less than £4,000, besides expenditure on her machinery. These were a few of the cases—six or seven had been quoted, and it would be easy to show with regard to the others that his hon. Friend had included in the expense of repairing the hulls of these ships what did not at all belong to hull repairs. But his hon. Friend asked why we in 1863 spent so large a sum in repairing ships of that class. They were wanted, and existing ships of that class must either be repaired or new ships of the same class must be built. If new ships were built, it would have been necessary to wait nine or twelve months over the time requisite for repairing the existing ships; and therefore, in the view of the Board of Admiralty, it was more economical to repair those ships at an average of £10 or £12 per ton than to build others of the same class at an expense of £28 or £30 per ton. His hon. Friend appeared also to forget that at the time referred to the whole available expenditure of the Admiralty was applied to building large iron ships, and it was considered unwise to diminish these exertions, and apply the means at their disposal to increasing the force of small wooden ships. His hon. Friend referred to another point. He stated that the comparison as regarded timber in the dockyard accounts showed extraordinary variations, and he especially referred to the high rate at which the conversions at Pembroke came out. He had not had the opportunity of seeing beforehand the figures quoted by his hon. Friend, but although he made some mystery about them, they were apparently easily deduced from what appeared on the face of the Returns. It was very difficult, in the conversion of timber, to arrive at uniformity of rate in different shipbuilding yards. The rate-book gave in respect to timber conversion one uniform rate; but there were certain elements of variation, which could not, under any system, be obviated, and which tended to produce discrepancies. It was the duty of the Department to grapple with these discrepancies as much as possible, and he hoped that in future they would do so in a far greater degree than they had done before. It could not be contended that we should have only one yard, because of the difficulty of adjusting rates. Some dockyards were in neighbourhoods where timber was cheap and coal and iron dear; others where coal and iron were cheap and timber dear. To argue that excess in one particular operation being expensive was conclusive against a dockyard, in other respects economically managed, would be absurd. But what were the actual facts as to timber? It is necessary to consider in the first place what kind of work is done at the particular yard, and consequeutly what denomination of timber would be wanted. Thus, the contract price of English oak used at De-vonport was £8 19s.; at Portsmouth, £7 12s.; and at Sheerness,£6 15s. Again, it was necessary to compare the percentage of returns into store, and of offal. As all labour charges fell on the conversion, the larger the returns might be, the greater apparently would be the price of the manufactured article. With respect, however, to the rate-book, there had been handed down certain rules with respect to the different classes of conversion of timber, some of which were very arbitrary, and it had been determined to wipe them away and constitute with respect to timber of the same class uniform rates per cubic foot, instead of having variations amounting, in some cases, to 40 or 50 per cent. There were, again, certain charges, such as those for the stacking of timber strictly belonging to the yard, which would not in future fall upon the conversion, but equally upon all the outlay of the yard, that being evidently the right principle. The effect of the changes would be to put the manufacturing accounts for the conversion of timber on a more satisfactory footing. But it was not intended to have different rate-books for the various establishments, He now passed from that exceedingly dull subject to a comparatively simple one. His hon. Friend had compared the finance accounts of certain years with the expense accounts; and especially Votes 8, 9 and 10, showing the amount of labour and materials supplied to ships building, repairing, or receiving stores during the year, and had pointed out that the two sums did not balance. Of course they did not; but if the causes of the difference were considered, it would be found that the reconciliation was not so difficult as his hon. Friend had supposed. In one respect he was not in a position to answer his hon. Friend. He was not aware that he was going to refer back to 1848, otherwise he might have been prepared to allude to the accounts of the last sixteen years; but as to the expenditure of the last two or three years the facts were clear. The finance account showed a considerable excess over the expense account; that was to say, they had purchased during those years vastly more stores than they had applied to the building and repairing of ships. It was, however, impossible to balance the two accounts exactly. Until the present year there had never been a valuation of stock, and it had been impossible to say that in 1860 the value of the stock was so much, that in 1861 it was so much, and that the difference between the two was the difference between the finance and the expense accounts. He had, however, looked into the difference between the quantities of stock in those periods, and found that in respect of some articles, not including iron, there was an excess at the later date of between eleven and twelve hundred thousand pounds, no small proportion of the supposed discrepancy of his hon. Friend. It was also necessary to eliminate more carefully the item of coal of which £1,500,000 had been supplied to the fleet; and there were also the stores sent abroad, for which allowance should be made. His hon. Friend had inquired why they could not produce an account with respect to stock similar to that which any business man would produce. His hon. Friend did not seem to be aware that that was one of the points in which a change had been made this year. It was decided from the beginning of last year a stock account should be taken, and should be continued in future years, thus affording the means of producing a proper balance-sheet from year to year; and when the House came to consider the Estimates he would explain in what way the dockyard accounts would in future be kept, so that they would not only have an account of the expenditure on each ship, but be able to show at the end of the year a strictly commercial balance-sheet. The House would then be enabled to understand the business done in the dockyards as well as if it were done by a private company or firm, and might put their finger on any particular item and elicit information, which would not only be a great advantage to the House, but conduce to the economical management of the dockyards.