HL Deb 25 May 1916 vol 22 cc190-6

LORD BERESFORD had the following Question on the Paper—

To ask His Majesty's Government the total amount of prize money in their hands up to date; how much of it is in the hands of the Prize Court; how much is in the hands of any other officials; if so, what officials; why it has not been paid into the Exchequer; how many enemy ships have been detained in British and Dominion ports since the beginning of the war; whether His Majesty's Government have applied to the Prize Court for their confiscation and condemnation; by virtue of what authority have His Majesty's Government taken possession of some or all of these vessels and employed them in carrying freight; whether it is intended at the end of the war to return them to the enemy; if so, will the enemy also be paid the freight these ships have earned while employed by the British Government.

The noble and gallant Lord said: My Lords, I apologise for intruding on the House twice on one afternoon, but the matter which I wish to bring before your Lordships is very important. It is impossible to overrate what we owe to the British Navy during this war. Without the Fleet we could not have continued the war, and we and our Allies could not have had any hope of success in the war. Therefore anything connected with what the officers and men of the Fleet may consider as justice to themselves should be carefully considered; and I know it will have a very sympathetic hearing in this House. I do not intend to discuss prize bounty, because that has been settled more or less under the new Order in Council of February 29 last and is being paid to officers and men. But I should like to touch on the question of prize money. I believe that up to date there must be considerably over £4,000,000 of prize money which should be paid to the Fleet. That sum entirely escapes the control of Parliament, as it is under the control of the Paymaster-General and is not paid into the Exchequer. I should like to ask my noble friend by what authority that is being carried out. The Government have never given any sound reason why this has been done. They have abolished the old scheme, but have established no new scheme and are not going to do so until the end of the war.

The present position is very unsatisfactory for the officers and men of the Fleet. They are a poor Service; the officers particularly can barely live on their pay. Seeing the extraordinarily arduous work they have been carrying out in the North Sea and elsewhere, I think some effort should be made to let them know the nature of the new scheme to be proposed by the Government. The Government may have a very good scheme. It may be better to have the new plan instead of the old one, but I think we should know what it is. Certainly the interest in the Fleet on this question is very keen. I quite agree with the new idea of the, distribution of prize money, having regard to the new necessities of the case. In the old days it was the smart frigates which made all the prize money; they captured the vessels, particularly the merchant vessels, which returned most of the prize. It would be very unfair in these days if we gave the whole of the large sums of money taken in that way to the cruisers, and forgot the patrols and the destroyers and the small cruisers who have been doing superhuman work in the North Sea ever since the war began. Nobody will appreciate the fairness of that more than the officers and men of the Fleet themselves.

I would like to ask my noble friend who represents the Admiralty a further question. The Order in Council of August 28, 1914, did away entirely with the authority of the Prize Court and delegated the authority to the Prize Claims Committee at the Foreign Office. Why and by what authority was that done? Another question. Queen Victoria's Proclamation of 1900 was in force from August 4 to August 28, 1914. A number of vessels were taken and a good deal of prize money paid in during that period, and I should like to know why that has not been paid. The succeeding Order in Council nullified the payment of those moneys until such a time as the Government should fix after the war. It is only fair that the money gained between August 4 and August 28 should be paid to the officers and men, because there is no authority by which they should not be paid. I make out that there is a sum of £2,819,060 received from the sale of condemned vessels, out of which, according to the White Paper, there were "Proceeds to claimants, £637,047." I should like to know who these claimants were, and why, if money could be paid to claimants, it could not be paid to the Fleet.

The Government refuse to give the prize money to the officers and men of the Fleet at present, but they are going to pay, or have paid, a large sum to a certain Baron Schroeder, a German, because he either mortgaged or owned the cargo of a ship that was taken. That is not very satisfactory to the men of the Fleet, who certainly will ask why certain sums should be paid to this German while they have not received what is their due. Again, the Government Prize Claims Committee decide compensation to be given for claims not recognised by the Prize Law. That appears to me very confusing, and I should like an explanation. Dr. Macnamara, who is always very sympathetic with regard to this matter, said in the other House that the prize money is to be paid after the war on a new system of pooling. Well, the war has lasted nearly two years now, and the Government are unable to produce a system of distribution. There are apparently two sets of Regulations, one relating to armed ships and another to merchant ships. Perhaps that could be explained to us. In addition to the £4,000,000 in the hands of the Paymaster-General, there are about 93 ships retained in our ports. I want to know why they were not brought to the Prize Court for condemnation and confiscation. I believe that if those ships were adjudicated upon by the Prize Court a further £5,000,000 would be added to the money which will eventually fall to the Fleet. Why are these ships not placed in the hands of the Marshal of the Prize Court? That is the law. Why has it not been carried out as before? The Government are running the ships as if they were Government property. They requisitioned them without their being condemned by a Prize Court, and are now using them for freight. I want to know whether these ships are going to be returned to the enemy after the war, and what is going to be done with regard to the freight they have earned.

The attitude of the Government has not been explained. I know they are just as sympathetic as myself to the officers and men of the Fleet, but they should relieve the anxiety that exists as to these matters. The position is not clear in the Orders in Council and White Papers. In one it would appear that the Government are going back to the Proclamation of Queen Victoria of 1900. Is that so? Anyway, since the cancellation of the Proclamation of 1900 the allocation of the money is determined by the sole will and caprice of the Government, as is evinced by the Baron Schroeder instance. I have asked my noble friend a number of questions. It may be that he is not prepared to deal with all of them now. If there are any which he cannot answer at the moment, I shall be pleased to put them down again, perhaps after the Whitsuntide recess, so that a full reply may be given.


My Lords, I am obliged to my noble and gallant friend for his last observation, for, as he knows, this question is a complicated one. The Question on the Paper does not err on the side of brevity, and it has been supplemented by a number of other inquiries. I have done my best to prepare answers to the questions on the Paper, but I hope my noble and gallant friend will not expect me, without notice, to deal with the other complicated and technical matters to which he has referred.

The Question as it appears on the Paper relates, I presume, to what are technically known as droits of the Crown, and does not deal with droits of Admiralty. As many of your Lordships are aware, the broad distinction is that enemy vessels detained as prizes by port authorities are known as droits of Admiralty, and, as such, are claimed by the Exchequer. On the other hand, vessels captured at sea are known as droits of the Crown, and according to ancient practice the prize money was awarded to the, captors. My noble friend has referred to the distribution of prize money and the change which we contemplate making. Instead of, as in the past, making the award of the prize money to the actual captors, the money is to be pooled and distributed among the whole of the Fleet at the close of hostilities. I think that when the circumstances of modern naval warfare are borne in mind this will be considered the fairest course that could be proposed. There are a number of points even in connection with the Question on the Paper which I am not able fully to answer at this moment as they have to be still further considered, and to that extent I hope that your Lordships will not regard my answer as final. But I should like generally to assure my noble and gallant friend and your Lordships that the policy of the Board of Admiralty is to treat the Naval Prize Fund in the manner which will produce the most favourable result to the Navy as a whole. We fully recognise the work which the Fleet has done, and we quite see that their ancient rights should be fully maintained.

I will now answer the various heads of the Question seriatim. The total amount of prize money held by the Paymaster-General under the Supreme Court Prize Deposit Account was on May 10 of this year £4,420,372. In addition to this sum there would be the moneys in the custody of Indian and Colonial Courts and the proceeds of certain vessels condemned in such Courts. A part of these funds is in the charge of the Overseas Prize Disposal Committee, for whom a special account is kept by the Paymaster-General. As various claims have to be met out of the fund the money has not been paid into the Exchequer, but in the meantime the Government have had full use of the money, and the best use that can be made by the Government of the money is made. The number of enemy ships detained in the United Kingdom ports, Oversea British ports, and Egyptian ports, or seized on entering these ports, is rather more than 200. I believe that in all cases these vessels have been or are being dealt with by the various Prize Courts concerned. Under the Prize Courts Rules and by the provisions of The Hague Convention the Government have power to requisition ships which are ill the charge of the Prize Courts, and I believe that every one of them which could be economically and usefully employed has been so employed. Many questions relating to the status of these ships are engaging the consideration of the Government, and I am unable at present to deal fully with this subject; but I do not think that the noble Lord need fear that any money will be paid to the enemy on account of any freight which may have been earned by these vessels while employed by the British Government.

My noble and gallant friend raised a point as to why this money should not be distributed to the Fleet. There are certain technical and practical difficulties in the way of immediate distribution. It would be difficult to ascertain the sum which would be available for distribution, as that would entail the establishment of a Central Fund into which receipts from the Prize Courts throughout the Empire would have to be collected. Another difficulty is that of the realisation of the value of the many vessels which, instead of being handed over to the Prize Court, have been requisitioned by the Crown. For instance, some people claim that the value of a ship is the value on the day on which the ship was seized. From the point of view of the Navy, I should rather have as its value the value at which it might stand now, which, as my noble friend knows, is probably greater than it was when the ship was seized. Therefore from that point of view I think it would be wiser that the value of the ships should not be determined at the present moment. In the final adjustment all the various interests and claims to which the proceeds are subject will receive attention. There is also the question of the number of individuals who may be eventually employed by the Navy.

On the whole the Government think it would be advisable that before any distribution is made we should await the conclusion of hostilities, when we shall be able to ascertain fully what is due to the Navy and the number among whom it would have to be distributed. The change of method which has been suggested, and which I think generally has met with approval, will need legislation to give it effect. A Bill will accordingly be introduced into Parliament, and these matters will no doubt then be raised. In the meantime, as I have said, it is from many points of view advisable not to make this distribution until the conclusion of hostilities. As to the case of a man who is killed, and who, had he lived, would have been entitled to a share of the money to be distributed, I understand that there is no difficulty in providing for its payment to his representative or dependant.


Can my noble friend tell the House what becomes of the interest on this vast sum of money? Will it eventually go to the officers and seamen?


I believe that has not yet been settled. Personally I hold a very strong view upon the matter. If money to which the Navy are entitled earns interest in the meantime, that interest ought to follow the capital. That is my opinion for what it is worth.