§ Presented to Parliament by Command of Her Majesty.)
§ The Estimates of 1886–7 showed an anticipated expenditure of £15,150,900 for effective, and £3,076,300 for non-effective services, making a total of £18,233,200. But, in introducing them to the House, the Secretary of State (Mr. Campbell-Bannerman) explained that, unless the Army in Egypt could be reduced during 1886–7 to 8,000 men, it would be necessary to ask for a Supplementary Vote. This Army was in fact maintained for some months at a force considerably above this strength, and accordingly Supplementary Estimates have become necessary. The total amount is £459,000, of which nearly £200,000 is due to the increased demands of the Navy, and the greater part of the remainder to Egypt. The Estimates, which are now submitted to Parliament, show an expenditure of £18,393,900, of which £15,305,700 is for effective, and £3,088,200 for non-effective services. It will thus be seen that, as compared with last year's original Estimates, the amount now required for the service of the Army shows an increase of £160,700. But this does not represent the true state of the case. As the House is aware, the War Office supplies the armaments and warlike stores of the Navy, and the cost is borne by the Army Estimates. For 1887–8 the Army Estimates have to provide for an increase, on account of the armaments of the Navy, of £292,000 on the previous year.
§ Nor is that all. Certain other increases in charge are altogether beyond the control of the Secretary of State, and may be summarized as follows:—
| (1.) | Indian Contribution to Vote 1 (the additional strength of the Indian Army having been nearly provided in the current year) is reduced by | £100,000 |
| (2.) | Leap year causes an additional expense over all the Votes of | 30,000 |
| (3.) | Deferred Pay has increased by | 20,000 |
| (4.) | Retired Pay by | 45,000 |
| (5.) | The Army Reserve—by the increase of numbers—requires in addition | 25,000 |
| £220,000 |
§ These two sums, amounting altogether to no less than £512,000, show that, instead of an increase, the present Estimates show a reduction of expenditure, even without taking into account the Supplementary Votes for 1886–7.
199§ Increases have also been caused by the rise in the establishments, by the new grants to the Volunteer Service, and especially by the demands for armaments and military stores, which will presently be referred to.
§ On the other hand, large savings have been accomplished by the withdrawal of half the British force from Egypt, the effect of which is mainly to be traced in the Vote for Supplies and Transport. The Vote for the Non-Effective Services, with the exception of the large automatic increase in the item of Retired Pay (which will be to some extent checked by the new Royal Warrant), shows on all points a diminution of charge.
§ A small reduction has also been effected in the Vote for Military Education. The general improvement in the education of the country will soon tell upon the special charges necessary for this purpose in the Army, and by greater recourss to civil schools, and the reduction in the establishment of Army schoolmasters. I hope that in future years greater economies can be effected on this head.
§ Some steps have also been taken by my predecessor, after very careful examination, for the reduction of the General Staff, and of certain permanent appointments.
§ Leaving these- details, I may say generally that, without pretending to have been able, within the limited time at my disposal, to scrutinize personally all parts of these Estimates, the Vote for Armaments has undergone a renewed examination; and I have satisfied myself that, looking to all the circumstances of the present time, the Estimate prepared by my predecessor represented only that necessary demand for this service which any Secretary of State would be bound to make.
§ But, as attention has been specially attracted to Military Expenditure, it may be well to pass in review some of the great heads of expenditure, though as time has not enabled the Financial Secretary and his Department, who have given much trouble to the matter, to work out the figures in all cases from the present Estimates, the results will be found to be in some cases founded on the figures of 1886–7.