NAVY AND ARMY EXPENDITURE, 1907–8. (Hansard, 3 August 1909)

§ Sir FREDERICK BANBURY

I asked some questions in connection with this Vote when it came up in Committee, and I do not think the Financial Secretary to the Admiralty gave me a satisfactory answer, and it is for that reason that I should like to ask, before the House proceeds to sanction the appropriation of such a very large sum of money, a few questions. The proper way to provide this money would be to add this surplus and deficit together, and, if that were done, you get the large amount of £1,600,000. Here we are dealing with the Government of economists, who have frequently told us that they set their faces against this indirect Budgetting. Right hon. Gentlemen and hon. Gentlemen opposite made eloquent speeches when in Opposition on this point. It is a very serious thing that we should be asked to sanction the expenditure of such a very large sum of money, which only arises from inaccurate and foolish Budgetting. There is a particular Vote here for works, buildings, and repairs at home and abroad for £304,827 2s. 5d. That amount is surplus, and I should like to have particulars of that enormous sum, because before we 1822 sanction the appropriation of this surplus or deficit we should have some reasonable explanation. "Works, buildings, and repairs at home and abroad" is a very simple item. It is not like a shipbuilding programme in which an increase may be necessitated by the shipbuilding programme of Germany. It is a matter that must have been very well known to the Financial Secretary when he sanctioned this expenditure. I think it is important we should be told how it is that the Government have managed to have a surplus in regard to this item. I would certainly like to have some explanation on this point. I wish to know whether the allocation of these large sums is due in any way to the fact that the Admiralty have been wasting their stores; or, rather, that they have used them and not provided new stores? The Financial Secretary to the Admiralty, who is an expert, gave me an answer, but he avoided this point. Has there been any deliberate plan by which these surpluses were arrived at in order to make up for the fact that at last the Government were obliged to provide for the large decrease in the stores which ought never to have been allowed to happen?

§ Dr. MACNAMARA

I thought I had fully explained the operation of this Resolution to the hon. Baronet the other day. The Army and Navy authorities have temporary Treasury sanction to these proposals providing the gross amount is not exceeded. As the hon. Baronet has pointed out, we have seven Votes overspent and ten underspent, and he says this is due to incorrect and foolish Budgetting. This happened in 1907–8, when I was not responsible, but I must protect those who are responsible from a charge of the sort which has been made. The Estimate was prepared in October, 1906, for these Services, the first penny was spent on the 1st of April, 1907, and the last penny was spent 18 months after the Estimate was made. In Budgetting for £32,000,000, when there is a variation of £1,600,000, I do not think it can be alleged that it is a bad Budget. With regard to stores under Vote 9, the amount underspent on Naval armaments is partly due to the partial suspension of the supply of cordite. Serious defects arose in regard to the cordite supplied, and we were bound to stop the supply. We were also experimenting with a new design of projectile, and there 1823 was unavoidable delay in supplying the order. We exceeded our Estimate on the Victualling Vote, and also on the second part of Vote 8, which is for material. There is, therefore, no question arising there. It is a fact we took out the value of stores drawn for stock without payment to the extent of £1,294,802. The hon. Baronet says that that means you are really starving your stores in order to cut down your Estimate. I explained earlier to-day on the other Vote that in 1904, at the end of the period of office of the late Government, a policy was produced, with which I very much agree, of closing foreign stations, of scrapping about 130 unnecessary ships, and of reducing the level of reserves of stores. That was a very excellent scheme, because perishable stores, if they are kept in large quantities, deteriorate. The effect of those three things was that a large amount of stores came in which would be no longer used for the purposes for which they were acquired, and we were bound to exhaust them. I am sure that the hon. Baronet would not wish to throw them away. We utilised them, and that is why £1,294,802 was drawn from stock without replacement by cash payments in 1907–8. The hon. Baronet says we underspent £304,870 2s. 5d. on works. He says, very properly, that it is not like the shipbuilding programme. It is a permanent business, and that you really ought not, even in an Estimate of 2¾ millions, to underspend to the extent of £.300,000. If he will look at page 76 and onwards of the Appropriation Account he will find detailed explanations. The whole matter has been before the Comptroller and Auditor-General and the Public Accounts Committee.

		£	s.	d.
Total surpluses	…	888,815	18	5
Total deficits	…	720,472	5	6
Net surplus	…	£168,343	12	11

		£	s.	d.
Total surpluses	…	687,278	13	9
Total deficits	…	68,820	13	10
Net surplus	…	£618,457	19	11