§ The Estimates last year were £52,000,000. This year they are £45,000,000. The total number of British troops to be voted this year is 152,592 against 154,536 last year, a reduction of 2,000 men. Thus a very large monetary saving has been made at the expense of a very small reduction of man power. The 2,000 men by which the Army is reduced represent entirely administrative economies. They do not affect what might be called the fighting strength of the Army. It has been maintained concurrently with this substantial saving in cost. The £7,000,000 saving is effected under two heads. In the first place, the terminal charges resulting from the War, which last year were £3,500,000, are this year only just over £1,000,000. Ultimately, this head of expenditure will disappear. The more important of these charges are due to the reinstatement of property and the provision 2614 for various war claims, compensation, and so on. Among the terminal war charges that are now almost disappearing, I may mention the issue of medals, for which the charges are now quite small. In the Estimates this year the provision is only £3,400. I am glad to be able to assure the House that the War Office has now distributed over 13,000,000 medals, and we anticpate that there remain only about 300,000 still to be distributed. Every endeavour has been made to distribute these, but difficulties have been found in locating addresses, although steps have been taken, with the co-operation of the newspapers editors throughout the country and a cinematograph company, whose efforts I desire gratefully to acknowledge, to advertise the proper method by which the men can obtain their medals.
§ The second cause of the reduction in the Estimates is the reduction of 4½ million pounds on the current charges of the Army. This is partly due to the reduction of 2,000 men in the administrative services, to which I have already referred, and partly to other items to which I shall refer later. It would not be out of place here to compare the value we are getting for military expenditure to-day with that obtained before the War. In 1914 the Regular British troops numbered 174,000, and the total of the Army Estimates was £28,800,000. The figures for this year are, respectively, 152,000 and £43,900,000. There are two factors which raise the cost of the Army to-day. The first is the price of all stores and supplies, which are nearly twice what they were in 1914, and, secondly, the fact that the rate of pay in the Army to-day is more than twice what it was in 1914. The relations between the size of the Army and its cost compares not unfavourably with the size and cost of the Army before the War.
§ We have had difficulties in recruiting, but there are signs that that it improving, and the feared shortage of candidates for commissions has been inquired into by a Committee set up by the right hon. Gentleman the Member for Colchester (Sir L. Worthington-Evans), and presided over by Lord Haldane. I need not go into the cause of the necessity for the reduction of the five cavalry regiments and the 22 infantry battalions disbanded by the last Government. That was a necessary contribution of the Army 2615 to the financial security of the nation. We, as a Government, realise that this condition cannot be divorced from the question of military security, and vice versa. Here I would remind the House of the general principles which govern the size of the Army and justify its existence. In the first place, it is necessary to find garrisons for our stations abroad. In the second place, it is necessary to have at hand an expeditionary force which can be sent at short notice wherever it may be required. If the disappearance of the German menace has naturally reacted upon the size of the Army, it must not be forgotten that we have possessions at great distances: these cannot be left defenceless. These considerations make the Army really a nonparty question. That is why I have found no difficulty in putting forward the Estimates which are now before the House, and which have been prepared in accordance with the announcement made to Parliament by my predecessor last June, to the effect that while administrative economies would be continued, no policy of further reduction in the fighting arms was in contemplation. While, naturally, any reductions would only be made by myself with the utmost reluctance, it is, of course, impossible for me to foresee the future or to tie the hands of future Governments. Governments must be left free to reconsider the state of the Army in the event of any serious and important change in the international situation. I hope, before I sit down, to indicate to the House certain lines on which administrative economies are possible in the Army.