§ MR. BOWLESI beg to ask the Chancellor of the Exchequer whether he is aware that, although Section 5 of the Appropriation Act, 1905, only empowered the Treasury to authorise the Board of Admiralty to defray expenditure not provided for out of surpluses effected by the saving of expenditure and not otherwise, and only empowered them to deal with appropriation in aid to the extent of sums not exceeding in all £1,688,687, the Treasury have, nevertheless, contrary to the Act, taken upon themselves to authorise the application to expenditure of £120,938 19s. 7d., which is not a saving of expenditure but an excess of receipts beyond the total sums appropriated in aid of naval expenditure by the Appropriation Act, 1905; whether a precisely similar course under precisely similar circumstances was taken by the Treasury in regard to a sum of £172,392 13s. 4d. on the Army Votes; why the Treasury thus took upon itself to exercise powers beyond those conferred upon it by law, and reported by the officer appointed to examine the public accounts on behalf of this House to be without statutory sanction; whether he will direct these two sums, amounting together to £293,331 12s. 11d., to be surrendered to the Exchequer; and whether he will undertake that in future the Treasury shall set an example to the other departments of strict obedience to the law.
§ MR. ASQUITHBefore I read my Answer to the hon. Member, I beg to assure him that my sole object in asking him to postpone his Question until to-day was in order that I might obtain the fuller information which I have now got, and which, I am afraid, will trespass for some time on the attention of the House. I agree generally with the hon. Member in his interpretation of Section 5 of the Appropriation Act, 1905, and gave orders, as soon as the matter was brought to my personal notice, that an Amendment should be drafted so as to make it quite clear in future that the Treasury's temporary powers shall extend to making up any deficiency upon the receipts appropriated in aid of any Navy (or Army) Vote out of the surplus receipts on account of appropriations in aid on other Navy (or Army) Votes respectively. My decision has been communicated by the Treasury to the Public Accounts Committee, who are considering the Navy and Army Appropriation Accounts on which the Comptroller and Auditor-General raised the question; and their approval will be sought forthwith to the draft Amendment of the Treasury, which has already been agreed to both by the Comptroller and Auditor-General and by the authorities of the House. So far, I have dealt with the steps to be taken for regularising the position for the future. As regards the current year, I may add that in the Treasury Minutes of the 22nd inst., which were laid in dummy on the Table of the House on Friday, the temporary application of anticipated surpluses to meet anticipated deficits on Navy and Army Votes for 1906–7 has accordingly been dealt with exclusively on the basis of using surpluses effected by the saving of expenditure without applying any extra receipts. I now propose to deal with the second part of the Question, in which the hon. Member asks, with reference to the year 1905–6, that sums of £120,938 19s. 7d. in respect of the Navy and of £172,392 13s. 4d. in respect of the Army may be surrendered to the Exchequer. These sums represent the gross excess of actual over estimated receipts on certain Navy and Army Votes respectively, and I will now indicate how, if they had been surrendered eo nomine to the Exchequer, the Exchequer and the old Sinking Fund could not have received one penny more 1501 than the net surplus of £237,758 19s. 2d. on the Navy or of £1,334,136 17s. 10d. on the Army, as shown on the face of the Appropriation Accounts for the respective services. As the hon. Member will see, this result flows from the fact that there was an unexhausted balance of authorised grants from the Exchequer, out of which the deficiences of receipts appropriated in aid of certain Navy and Army Votes could have been made good without making any use of the surpluses of receipts which have arisen on certain other Votes. All that would have happened would have been two payments of extra receipts into the Exchequer and a precisely equal increase of the two payments out of the Exchequer under the head of Exchequer Grants.†This explanation will, I trust, satisfy the hon. Member that the action actually taken by the Treasury, in accordance with an unchallenged practice of many years standing, amounts in substance to precisely the same thing, so far as the Exchequer is concerned, as payment of the excess Navy and Army receipts into the Exchequer and the consequent issue of a correspondingly larger sum out of the Exchequer under the head of authorised Exchequer Grants.
§ MR. BOWLESDoes the right hon. Gentleman deny that his action in authorising the application of these moneys in this way was unlawful?
§ MR. ASQUITHI have said that on the technical point I agree with the hon. Gentleman. But the action taken by the Treasury is one that has been pursued for twelve years under I do not know how many successive Chancellors of the Exchequer. I see one sitting opposite. It was treated so much as a matter of routine that it was never even brought to my notice. But as regards the future, I agree that we must regularise the proceeding if it is to continue.
§ LORD R. CECIL (Marylebone, E)The right hon. Gentleman says his delay in giving the Answer was to enable him to give fuller information. May I ask him whether he was cognisant of a notice of Motion put down by the hon. Member for Barnstaple for the sole
†See also Col. 1457.1502 purpose of preventing a discussion of the matter in the House?
§ MR. ASQUITHI never heard of the Motion until it was put down. I may say, in regard to the suggestion of the noble Lord, that there is no desire to burke discussion. There will be ample opportunity for discussing the matter on the Motion for Adjournment on Wednesday.
§ LORD R. CECILHas the right hon. Gentleman made any appeal to his hon. friend to withdraw the Motion?
§ MR. ASQUITHI shall be glad to do so.
§ MR. BOWLESgave notice that at the end of Questions he would ask leave to move the adjournment of the House in order to call attention to the matter.
§ MR. AUSTEN CHAMBERLAIN (Worcestershire, E)As the right hon. Gentleman says, I am a fellow culprit. I am, therefore, less interested in the past of this matter than in the future. As to what the right hon. Gentleman proposes for the future, do I rightly understand him to say that the change in the law which he proposes will only authorise excess of receipts to be used to supply a deficiency in receipts, and not a deficiency in the Votes arising otherwise?
§ MR. ASQUITHIf the right hon. Gentleman will put down his Question on the Paper I will give him a direct Answer. What I intended to imply was that the practice should continue in the future as in the past, not that there should be any alteration.
§ MR. RAWLINSON (Cambridge University)May I ask the right hon. Gentleman whether the proper way of dealing with the admitted illegality would not be to introduce a Supplementary Estimate?
§ MR. ASQUITHI think not. The matter is before the Public Accounts Committee, and any recommendation they may make will receive the careful consideration of the Government. I think it can be got rid of under the Appropriation Act.
§ *MR. LEIF JONES (Westmoreland, Appleby)Is not illegality much too strong a word to use? Is not the proposal merely to confer explicitly by the Appropriation Act powers which have hitherto been deemed to reside implicitly in the Treasury?
§ MR. ASQUITHThat is so.