HC Deb 18 July 1935 vol 304 cc1365-75

Considered in Committee.

[Captain BOURNE in the Chair.]

"I. Whereas it appears by the Navy Appropriation Account for the year ended the 31st day of March, 1934 that the aggregate expenditure on Navy Services has not exceeded the aggregate sums appropriated for those Services, and that, as shown in the Schedule hereto appended, the net surplus of the Exchequer Grants for Navy Services over the net Expenditure is £126,455 6s. 8d., namely:

£ s. d.
Total Surpluses … … 671,901 15 1
Total Deficits … … 545,446 8 5
Net Surplus … … £126,455 6 8

And whereas the Lords Commissioners of His Majesty's Treasury have temporarily authorised the application of so much of the said total surpluses on certain Grants for Navy Services as is necessary to make good the said total deficits on other Grants for Navy Services."

SCHEDULE.
No. of Vote. Navy Services, 1933, Votes. Deficits. Surpluses.
Excesses of actual over estimated gross Expenditure. Deficiencies of actual as compared with estimated Receipts. Surpluses of estimated over actual gross Expenditure. Surpluses of actual as compared with estimated Receipts.
£ s. d. £ s. d. £s. d. £ s. d.
1 Wages, etc., of Officers, Seamen, Boys, and Royal Marines, and Civilians employed on Fleet Services. — 5,007 3 1 83,519 9 6 —
2 Victualling and Clothing … 80,279 5 8 2,350 7 11 — —
3 Medical Establishments and Services. 5,123 7 8 1,304 17 2 — —
4 Fleet Air Arm … … — — — —
5 Educational Services … — — 3,403 14 1 354 12 8
6 Scientific Services … … — — 14,728 9 4 4,952 14 9
7 Royal Naval Reserves … 17,840 8 2 251 0 9 — —
8 Shipbuilding, Repairs, Maintenance etc.:
Sec. 1. Personnel … 10,955 11 4 5,231 14 10 — —
Sec. 2. Matériel … — — 159,040 5 2 68,493 15 6
Sec. 3. Contract Work 276,112 10 5 — — 6,585 2 4
9 Naval Armaments … … — — 182,651 16 8 74,092 16 0
10 Works, Buildings, and Repairs 4,674 15 10 54,589 12 3 — —
11 Miscellaneous Effective Services. 25,619 7 5 — — 12,897 5 5
12 Admiralty Office … … — — 9,945 18 10 1,039 18 3
13 Non-Effective Services (Naval and Marine), Officers. 53,230 16 10 — — 259 4 0
14 Non-Effective Services (Naval and Marine), Men. — 1,131 5 8 32,409 0 10 —
15 Civil Superannuation, Compensation Allowances, and Gratuities. — 37 7 4 17,527 11 9 —
— Balances irrecoverable and Claims abandoned. 1,706 16 1 — — —
475,542 19 5 69,903 9 0 503,226 6 2 168,675 8 11
Total Deficits £545,446 8 5 Total Surpluses £671,901 15 1
Net Surplus … £126,455 6 8

Motion made, and Question proposed, "That the application of such sums be sanctioned."—[Mr. Cooper.]

11.0 p.m.

Mr. MORGAN JONES

I am sorry that I have to intrude on the time of the Committee for a few minutes, but I wish to call attention to a matter which is of importance to the House as a whole. May I preface what I have to say by observing that I am not now raising this point as a Member of the Opposition, but because of the fact that hon. Members will by now have received a copy of this year's report of the Public Accounts Committee, which draws attention to a matter of some constitutional importance in relation to the Resolution now before us. It will be known to all hon. Members that there is no power whatsoever in respect of Civil Votes whereby it is possible to meet excesses on one Civil Vote from savings on another. It is not strictly so in respect of Service Votes, on which certain transfers may take place from one Vote to another, or, indeed, with Treasury sanction, from one subhead to another and in the case of a service Department that power of transfer is provided annually in the Appropriation Act which we are called upon to discuss next year. I shall not weary the Committee with a recital of the history of this case beyond making this observation, that the safeguards which are embodied every year in the Appropriation Act are safeguards which are designed in order to make quite sure that no Government Department has any power to incur expenditure without obtaining formal Parliamentary sanction for it. That is a general proposition with which all Members of this Committee will be well acquainted.

In accordance with the instructions of this House it falls to the Public Accounts Committee to examine the expenditure of each Department, and I am bound to recall to the memory of hon. Members that last year the Public Accounts Committee, in reviewing the expenditure of the year then before it, that is, 1932–33, felt obliged to call attention to action which was embarked upon by the Admiralty. In view of that action the Public Accounts Committee made a report in very clear and quite unequivocal language. I will recall precisely what we did say: Your Committee accept the assurance that this incident, the incident to which they refer, does not indicate any general relaxation of the vigilance with which the Treasury seek to maintain the approved conditions of transfer between Navy Votes and they do not recommend therefore, that confirmation of the temporary application of savings should be withheld when the relative statement comes up for approval .… As was then stated, no Department having larger funds at its disposal for one Vote than are requisite for the service of the year has any right to spend that surplus on another Vote, even for the purpose of effecting a saving in the succeeding year, except under the conditions laid down in the Appropriation Act. That was a quotation from our report last year. In relation to that, in the ordinary course of things the Treasury had to determine what the effect of this minute would be on that recommendation. I think the Financial Secretary will bear me out when I say that the Treasury accepted the report of the Public Accounts Committee in regard to that matter. If the matter remained there, I should have nothing to say to-night, as a member of the Public Accounts Committee, but this year, again, the Public Accounts Committee have had to call attention to another question of precisely the same kind. I would like to quote from the report of the Committee: Your Committee are satisfied that there are substantial advantages in the change of system. The Committee explained that the Navy arranged that a five quarters' expenditure should fall upon one year's Estimates and that the consequential change in the Vote of the Navy Department incurred the censure—if that is not too strong a term—of the Public Accounts Committee in regard to that action. The Committee say: Your Committee, however, are not convinced that the urgency from this cause developed so suddenly and rapidly that it could not have been met by presentation of a Supplementary Estimate, and they are of the opinion, in which they understand that the Treasury now agree, that this course would have been better and more cautious. I say emphatically that it is not fair to expect that the Public Accounts Committee should repeatedly call the attention of a Government Department to this erroneous course of conduct. We are there, seeking to exercise vigilance over public expenditure, on behalf of the House of Commons. I do not think it can fairly be expected that the Committee such as ours should, year after year, draw attention to this kind of procedure without, in due time, if the necessity arises, bringing it much more formally, and much more forcibly perhaps, to the attention of the House of Commons.

We have this year again indicated that we do not propose to carry the objection to this procedure to the extent of objecting entirely to the expenditure of the money, but I am sure that my colleagues on the Public Accounts Committee will agree with me that we cannot go on repeating our objection to this course of procedure, and I hope that the Government Department concerned will take note of what I have ventured to say. There was no intention to defy the Committee in any sense, and I am willing to confess that the action of which we complain this year was in point of fact a procedure which had a very substantial advantage and which was defensible on other grounds. It was not defensible from the point of view of the Public Accounts Committee, and I hope very much that the necessity may not arise again to call attention to this matter.

11.8 p.m.

The FINANCIAL SECRETARY to the TREASURY (Mr. Duff Cooper)

I am sure that nobody in this Committee will object to the point which the hon. Member for Caerphilly (Mr. Morgan Jones) has raised, or to the way in which he raised it. The price of economy, like the price of liberty, is eternal vigilance, and as Chairman of the Public Accounts Committee the hon. Member has fulfilled his duty to the satisfaction of everybody in the House of Commons and we welcome him as the protector of the national finances and of the Constitution. He has stated quite fairly the facts of the case in which criticism has been levelled at the Treasury. Approval was given to the savings from one Vote being transferred to another form of expenditure, and on most grounds it was entirely right that approval should be given, as the hon. Member has recognised. But it is laid down by the Appropriation Act that this is only to be given in cases where urgency demands that it should be given at once as the expenditure in question cannot wait till the following year in order to obtain Parliamentary sanction. In these two cases, one in 1932–33 and the other in 1933–34, that particular provision was overlooked and the Treasury have frankly admitted the criticism levelled at them by the Public Accounts Committee. The fact that these two cases occurred in two years running does not show in any way that the Treasury have overlooked the first criticism made, because the second failure to recognise this important provision had already been made before the Treasury's attention had been called to the first mistake.

Therefore, the hon. Member will recognise that there has been no suggestion that the Treasury did not intend to fulfil the undertaking they gave, as soon as their attention was called to the first oversight, that such a thing would not occur again. It is doubly unfortunate that it should have occurred a second time, and it would naturally appear to anyone who had not all the facts before him that the Treasury had given an undertaking and then broken it in the following year. That is not the case. We entirely accept the criticism of the Public Accounts Committee. We welcome the vigilance with which they carry out their duties, and we once again reiterate the assurance we have already given that a mistake of this kind shall not occur again.

And whereas the Lords Commissioners of His Majesty's Treasury have temporarily authorised the application of so much of the said total surpluses on certain Grants for Army Services as is necessary to make good the said total deficits on other Grants for Army Services."

SCHEDULE.
No. of Vote. Army Services, 1933, Votes. Deficits. Surpluses.
Execeeses of actual over estimated gross Expenditure. Deficiencies of actual as compared with estimated Receipts. Surpluses of estimated over actual gross Expenditure. Surpluses of actual as compared with estimated Receipts.
£ s. d. £ s. d. £ s. d. £ s. d.
1 Pay, etc., of the Army … — 163,178 10 7 31,193 6 7 —
2 Territorial Army and Reserve Forces. — — 19,141 7 4 301 15 9
3 Medical Services… … — — 15,813 7 11 236 16 1
4 Educational Establishments 16,707 10 0 — — 9,965 5 3
5 Quartering and Movements … — 38,772 12 4 66,097 2 10 —
6 Supplies, Road Transport, and Remounts. — — 194,415 8 5 6,062 3 2
7 Clothing … … … — — 6,201 2 1 8,983 13 2
8 General Stores … … 631 14 8 16,184 4 10 — —
9 Warlike Stores … … — 66,516 17 4 202,357 3 11 —
10 Works, Buildings, and Lands 29,508 19 8 12,675 10 1 — —
11 Miscellaneous Effective Services. — 9,051 18 9 175,721 8 7 —
12 War Office … … … — 1,004 11 10 1,911 6 6 —
13 Half-Pay, Retired Pay, and other Non-effective Charges for Officers. — 21,064 7 7 50,178 4 8 —
14 Pensions and other Non-effective Charges for Warrant Officers, Noncommissioned Officers, Men, and others. — — 28,378 9 9 45,908 12 1
15 Civil Superannuation, Compensation, and Gratuities. 3,340 15 0 9794 1 — —
— Balances irrecoverable and Claims abandoned. 2,219 13 11 — — —
52,408 13 3 329,427 17 5 791,408 8 7 71,458 5 6
Total Deficits £381,836 10 8 Total Surpluse £862,866 14 1
Net Surplus … £481,030 3 5

Resolved, That the application of such sums be sanctioned."—[Mr. Cooper.] III. Whereas it appears by the Air Appropriation Account for the year ended the 31st day of March, 1934, that the aggregate Expenditure on Air Services has not exceeded the aggregate sums appropriated for those Services and that, as shown in the Schedule hereto appended, the net surplus of the Exchequer Grants for Air Services over the net Expenditure is £725,206 3s. 7d., namely:—

£ s. d.
Total Surpluses 735,395 4 2
Total Deficits 10,189 0 7
Net Surplus £725,206 3 7

And whereas the Lords Commissioners of His Majesty's Treasury have temporarily authorised the application of so much of the said total surpluses on certain Grants for Air Services as is necessary to make good the said total deficits on other Grants for Air Services.

SCHEDULE.
No. of Vote. Air Services, 1933, Votes. Deficits. Surpluses.
Excesses of actual over estimated gross Expenditure. Deficiencies of actual as compared with estimated Receipts. Surpluses of estimated over actual gross Expenditure. Surpluses of actual as compared with estimated Receipts.
£ s. d. £ s. d. £ s. d. £ s. d.
1 Pay, etc., of the Royal Air Force. — — 11,463 7 9 78,449 19 2
2 Quartering Stores (except Technical), Supplies, and Transportation. — 5,351 13 4 92,859 12 7 —
3 Technical and Warlike Stores (including Experimental and Research Services). — — 196,675 15 5 53,468 11 2
4 Works, Buildings, and Lands — — 68,377 19 5 151,683 13 7
5 Medical Services … … — — 3,330 11 9 3,186 11 1
6 Technical Training and Educational Services. 4,355 2 5 51 10 11 — —
7 Auxiliary and Reserve Forces — — 182 0 4 27 4 9
8 Civil Aviation … … … — — 25,472 6 11 4,441 9 10
9 Meteorological Services … — 29 1 11 6,008 9 4 —
Miscellaneous Effective Services. — — 25,275 19 1 547 7 8
10 Air Ministry … … … — — 125 5 0 1,392 14 7
11 Half-Pay, Pensions, and other Non-effective Services. — — 11,941 18 6 484 6 3
— Balances irrecoverable and Claims abandoned. 401 12 0 — — —
4,756 14 5 5,432 6 2 441,713 6 1 293,681 18 1
Total Deficits £10,189 0 7 Total Surpluses £735,395 4 2
Net Surplus … £725,206 3 7

Resolved, That the application of such sums be sanctioned."—[Mr. Cooper.]

Resolutions to be reported To-morrow.