HC Deb 06 August 1940 vol 363 c10
19. Mr. Thurtle

asked the Secretary of State for War whether he is now in a position to announce the result of the court of inquiry held some months ago regarding alleged irregularities in connection with Government contracts?

Mr. Eden

Yes, Sir, but as the answer is long, I will, with my hon. Friend's permission, circulate it in the OFFICIAL REPORT.

Mr. Thurtle

Has any disciplinary action been taken or not?

Mr. Eden

I should be grateful if the hon. Member would read the reply. I am rather anxious not to try to epitomise it.

Following is the answer:

A court of inquiry was constituted last February to inquire into the circumstances surrounding the introduction in 1939 of Mr. Charles Kingsley Scott to a certain firm of Government contractors and/or their representatives, and, in particular, into the action of any military officer concerned and into matters incidental thereto. The Court, after hearing evidence on seven days, submitted a report to the Army Council. The following military officers, Colonel J. H. Howell-Jones, C.I.E., D.S.O., a Chief Progress Officer at the War Office and subsequently at the Ministry of Supply until 30th October, 1939, Lieut.-Colonel S. T. Hayley, D.S.O., O.B.E., liaison officer for the Director of Ordnance Stores at the War Office in connection with the equipping of T.A. units and with the raising of T.A., R.A.O.C. units, and Major D. C. MacGillivray, Progress Officer for the Midland Area under Colonel Howell-Jones, were present on all occasions when the Court heard evidence or argument, and Lieutenant R. F. Rowland, R.A.O.C., was similarly present, except on the first day. The Army Council came to the following conclusions in regard to the conduct of these officers in respect of the introduction of Mr. C. K. Scott to the firm referred to in the terms of reference. (1) Lieutenant-Colonel Hayley made the acquaintance in June, 1939, of Mr. Scott, who has served a sentence of imprisonment for fraudulent conversion and was not a person who should ever have been introduced by an officer for the purpose of assisting in any financial transaction. Within a couple of months, Lieutenant-Colonel Hayley became a close friend of Mr. Scott, and about the beginning of September, as a result of an inquiry by Mr. Scott, he put him into touch with Colonel Howell-Jones with a view to Mr. Scott finding, on a profit-making basis, finance to enable the firm referred to above to carry out certain store contracts for the Ministry of Supply. At that time Lieutenant-Colonel Hayley did not know that Mr. Scott had been in prison. He refused an offer made by Mr. Scott of a share in the profits anticipated from the proposed financial transaction, but he accepted from Mr. Scott the offer of a business introduction with a view to employment after the termination of his military service. Although the Council were satisfied that the recommendation of Mr. Scott to Colonel Howell-Jones was not given by Lieutenant-Colonel Hayley for any corrupt purpose, it was clear that, while Lieutenant-Colonel Hayley was unwilling to make a direct profit, he was not averse from gaining an indirect advantage if that should accrue after leaving the service and from a reputable source. The choice of friends must be a matter of personal taste, but the Army Council considered that, when Lieutenant-Colonel Hayley realised, as he must then have done, that his friendship and introduction were being made use of for private gain, it was most unwise of him to continue the easy-going relationship into which he had got. At a later date, Lieutenant-Colonel Hayley stated on Mr. Scott's form of application for enrolment into the Army Officers Emergency Reserve that he considered Mr. Scott was suitable for a temporary commission. The Court found that by the time Lieutenant-Colonel Hayley signed the form he had learnt that Mr. Scott had been in prison, and the Council accepted that finding. They considered that for Lieutenant-Colonel Hayley to have signed the application while keeping silent as to his knowledge of Mr. Scott's criminal past showed a complete lack of appreciation of his responsibilities and duties as an officer. In view of the above considerations, the Army Council decided to terminate this officer's employment in the Army. Lieut.-Colonel Hayley submitted a petition to the King in accordance with the provisions of Section 42 of the Army Act, but, after careful consideration by the Army Council, I found myself unable to advise His Majesty to issue any special instructions in regard thereto. (2) Colonel Howell-Jones, through his subordinate, Major MacGillivray, effected Mr. Scott's introduction to the firm referred to above. He failed to make any inquiries at all as to the character, standing or resources of the person he thus sponsored. on the grounds that the bona fides of a prospective financier or financial representative was a matter for the firm and not for him. The Council dissented from this view. They considered that the conduct of Colonel Howell-Jones was open to criticism on this point, namely, that at a time of unexampled stress he failed to realise that the mere fact of an introduction coming from him and made formally and officially by his subordinate lent to Mr. Scott a weight and authority which otherwise he could never have obtained; they were of opinion that it was his duty either to have made some inquiries about Mr. Scott before effecting the introduction [...] to have made it clear that he had not done so. Colonel Howell-Jones was working under very great difficulties and, in the Council's view, was actuated throughout only by an urgent desire to promote the flow of equipment for the Army. In the circumstances, the Council decided that it was not necessary to do more than to warn Colonel Howell-Jones as to his future conduct. (3) Major MacGillivray introduced Mr. Scott to the firm referred to formally and officially and did not vouch for him personally. In so doing, Major MacGillivray was merely carrying out his orders and the. Council considered that no blame attached to him. (4) The name of Lieutenant Rowland was mentioned in connection with some of the financial negotiations between Mr. Scott and certain associates with the firm in question. Lieutenant Rowland was a civilian at the time and was not granted a commission until December, 2939. In the circumstances, the Council came to the conclusion that there was nothing in his conduct which reflected on his military reputation.