§ Mr. Grimondasked the Civil Lord of the Admiralty (1) what measures are being taken to check extravagance in expenditure such as those revealed in the Tenth Report from the Estimates Committee of this session;
(2) why he authorised the expenditure of £46,000 on an admiral's house in Aden; and what action he is taking to control expenditure of this nature in future.
§ Mr. HayI assume that both of the right hon. Member's Questions refer to remarks in the Tenth Report of the Estimates Committee (Sub-Committee D) Session 1962–63 Military Expenditure Overseas on Fort Tarshyne at Aden.
This house is not just a house for a Rear-Admiral. It is the residence of a Flag Officer who is, in effect, the naval commander-in-chief for a large and strategically important area, with considerable responsibilities for entertainment and representation. The Committee do not appear to regard the house as unnecessarily large: rather do they criticise it for the opposite reason, at any rate in respect of the dining room. Equally, it would appear from paragraphs 107 to 111 of their report that they would support the decision that the house should be fully air conditioned.
The final costs of the house (excluding furniture) as now established, are as follows:
£ Building 16,100 Air conditioning 4,700 Wiring, refrigerator, cooking equipment etc. 3,700 Air Ministry agency charges 5,630 Servants' quarters, air conditioning plant room, garage, screen and retaining walls, terraces, site works and bringing up services 7,530 Total £37,660 The first estimate after sketch designs had been prepared was £28,600, to which had to be added expected agency charges of £5,400, making a total (excluding fur- 220W niture) of £34,000. This estimate was approved by the Treasury. As work proceeded, revised estimates were prepared. The first two reported increases. The next two reported decreases. Each estimate was scrutinised to establish that costs were reasonable. The final cost as shown in the above table, excluding furniture, was £37,660.This exceeded the estimate approved after sketch designs were available by just over 10 per cent. (£3,660).In the circumstances of urgency and extreme pressure on the building industry in Aden I do not regard this excess as indicative of more than the uncertainty generally inherent in estimates.
The furniture, which cost £6,600, was more expensive than it would have been had a house of conventional design been built, but the extra cost, which was about £2,600, was only about half of the savings on foundations for the house, a fact which the Committee appear to have accepted. The decision to adopt a design making use of an existing foundation was itself a deliberate measure of financial control.
In the light of the foregoing, I can find no evidence that the history of the design and construction of this house indicates extravagance or lack of financial control. Since 1st April, 1963,financial responsibility for works and building required by the Royal Navy has passed to the Ministry of Public Building and Works.