CLASS II, VOTE 10.-cont. Subhead J.-Palestine, Contribution to Trans-Jordan Administration (Grant in Aid) 1926, 66,000l. (L.E. 64,350). 18. The account of the Trans-Jordan Administration for 1926 shows receipts and payments as follows: There is an unexpended balance of L.E. 11,165, which is not subject to surrender. This account is certified in the same terms as that of the Trans-Jordan Frontier Force. The account for 1927 covering the grant of 45,000l. has not yet been received. Subhead L.-Aden, 656,173l. 4s. 3d. 19. As explained in the Estimate, the charge to this subhead represents the cost of military and political services at Aden, the responsibility for which was taken over from the Government of India as from 1 April 1927. 250,000l. contributed by India towards these expenses is credited under Subhead M. The above charge comprises repayments to Army and Air Votes of the military and Air Force expenditure (470,0927. and 165,1697. respectively). With the exception of the cost of a small local military force, such expenditure will in future remain a final charge to those Votes, in accordance with the decision by which the separate Vote for Middle Eastern Services was abolished. (See Introductory Memorandum to Civil Estimates for 1928, paras. 7 and 27.) The balance of the charge, 20,912., consists of payments to the Government of India in connexion with political expenditure, and includes a refund of 12,1947. in respect of an assessed division of the expenditure at Aden between British and Indian funds. I have not been furnished with evidence of the correctness of this refund, which is based on a provisional claim made by the India Office on 28 November 1928. In reply to my enquiries, the Colonial Office state that no supporting vouchers or audited statements are at present available, but that the India Office have been asked whether a certified statement can be furnished. I am further informed that formal Treasury sanction will be sought for the basis of allocation between British and Indian funds adopted in the claim, and for the rates of certain non-effective charges therein. (34559) A**2 CLASS II, VOTE 12.-IMPERIAL WAR GRAVES COMMISSION. Subhead C.-Endowment Fund. 20. I have again been furnished with an account of receipts and payments, certified by the honorary auditors, Messrs. Deloitte, Plender, Griffiths & Co., of the Fund which is being formed by the Trustees under the Imperial War Graves Endowment Fund Act, 1926, and a statement relating to that portion of the Fund contributed by the United Kingdom is appended to the Appropriation Account. I am satisfied that the United Kingdom contribution is not in excess of its due proportion. In paragraph 10 of their Second Report, 1928 (H.C.99), the Public Accounts Committee recommended that consideration should be given to the question of affording to Parliament an opportunity of reviewing the expenditure arising from the Endowment Fund after it has been finally constituted. In their Minute of 18 October 1928, the Treasury stated that they proposed to discuss with the Commission and with the Trustees the best method of meeting the wishes of the Committee. CLASS III, VOTE 8.-PUBLIC TRUSTEE. Trust Accounts. 21. A test examination of the Public Trustee's Trust Accounts has been carried out in accordance with the Regulations issued under the Public Trustee's Statutory Rules. The results of the examination, which were satisfactory, have been reported to the Treasury. Subhead C.1.-Losses. 22. As shown in the account on page 120, the principal charge under this subhead is that of 4,6351. 10s. due to misappropriation by a stockbroker of scrip delivered to him in connexion with the sale and reinvestment, on behalf of the Public Trustee, of certain trust funds. In the course of sale and reinvestment" transactions the money must almost inevitably be left in the hands of a broker, and provided it be so left for a reasonable period only, the procedure involves no impropriety, and therefore no liability, on the part of a trustee. In the present case the loss is attributable to or was facilitated by failure on the part of officers in the Department of the Public Trustee to take adequate steps to secure the production of the necessary certificates, the delivery of which was delayed on various pretexts by the defaulting broker. Disciplinary action has been taken as regards the officers concerned, and with a view to minimising the risk of similar losses in the future, arrangements have been instituted which will ensure more rapid detection of any attempts at fraud and will thus protect the Public Trustee from liability. It may be remarked that this is the first case of the kind which has occurred in twenty years on transactions involving a hundred million pounds or more. It is hoped that a substantial part of the loss will eventually be recovered. CLASS III, VOTE 9.-SUPREME COURT OF JUDICATURE, ETC. Subhead Q.-Losses. 23. This subhead records the loss (so far as can be ascertained) arising from a series of frauds connected with the collection of fees in the Principal Probate Registry, which have formed the subject of criminal proceedings and of which particulars have appeared in the press during the past year. Under Statute all Probate Registry fees are taken in stamps. The fees are prepaid in adhesive stamps purchased from the Inland Revenue Department, which are cancelled on acceptance, and after an interval destroyed. Except to a very small extent the clerks of the Principal Probate Registry are not called upon to handle cash in their official duties. This procedure should offer little or no opportunity for fraud, but in the Principal Probate Registry a state of affairs had arisen in which it became possible, and apparently easy, for dishonest persons to obtain possession of used and cancelled stamps, remove the cancellations, and convert the stamps thus manipulated into cash. Six clerks in four different departments of the Registry and four solicitors' clerks were involved in the frauds, which had extended over several years. The Registry clerks who had participated in this illicit traffic were prosecuted and sentenced to terms of imprisonment ranging from eight to fifteen months, and the solicitors' clerks were bound over. The loss to the revenue so far as can be ascertained is estimated to be not less than 1,500l. and this sum has been paid over to the Revenue. On discovery of these frauds an Inter-Departmental Committee (of which a Registrar of the Principal Probate Registry was chairman) was appointed by the President of the Probate, Divorce, and Admiralty Division to examine the arrangements for the issue, receipt, and cancellation, etc., of Judicature and other stamps issued in connexion with the Principal Probate Registry and to report what better safeguards should be introduced for the protection of public moneys. The committee's recommendations, which were approved by the President and are being carried into effect, provide, inter alia, for the substitution of impressed for adhesive stamps wherever practicable, for more effective cancellation of stamps, and for greater care in the custody of cancelled stamps awaiting destruction. The same committee expressed the opinion that some of the frauds would have been detected at a comparatively early stage had more intelligent observation been shown by the officers of the Audit Branch of the Registry in the process of check, and that the frauds would to some extent have been prevented had proper care been exercised by those officers in the custody of the documents. I am informed that the President of the Division has taken disciplinary action against one of these officers. I understand further that a Committee has been appointed recently by the Lord Chancellor to examine the arrangements for the collection of fees by means of adhesive stamps throughout the Law Courts, and in the Land Registry, and to report generally thereon. CLASS V, VOTE 3.-MINISTRY OF HEALTH. Subhead D.2.-Contract for Printing Contributory Pension Forms. 24. On the passing of the Widows' Orphans' and Old Age Contributory Pensions Act, 1925, it became necessary for the Ministry of Health to arrange for the provision of a large number of pension order forms, and that Department, after consultation with the Treasury, entrusted the task of placing the requisite contracts for printing and paper to the Post Office. After the initial requirements had been satisfied by provisional arrangements, the Post Office, in 1927, invited five trade firms to tender for a contract covering six years requirements. Only two tenders were received, the higher one being from a firm, Messrs. Y, which already held contracts. of a similar nature. This firm was approached by the Post Office with the suggestion that they should reduce their prices, and some reductions. were in fact secured, though still leaving a considerable disparity between the two tenders. Nevertheless the contract was placed with the higher tenderer, after Treasury concurrence had been obtained, the Post Office having expressed the view that the advantage of the lower prices quoted by Messrs. X would be largely negatived by the difference in the cost of the respective control establishments necessary. On the facts being brought to my notice I inquired (i) why the arrangements for this contract were not placed in the hands of the Stationery Office, which is the recognized Department for supervising Government printing: (ii) why the Stationery Office was not invited to submit a tender on behalf of the State Printing Establishment at Harrow : (iii) why Messrs. X were not, equally with their rivals, afforded an opportunity of submitting a competitive reduction of their tender price and (iv) in what circumstances so much as 5,600l. was considered necessary for control staff at Messrs. X in view of the fact that 5001. was thought sufficient for additional staff at Messrs. Y. In reply I was informed that (i) it was desired that the requisite pension order forms should be provided under the same conditions as Postal Order forms. printed for Post Office purposes and Old Age Pension forms for the purposes of the Old Age Pensions Acts: (ii) the Stationery Office tender in similar circumstances in 1922 was so much above the lowest tender that it was considered that no useful purpose could be served by referring to that Department on the present occasion when the requirements were much smaller than on the occasion of the 1922 contract: (iii) the tender of Messrs. Y was considered to be more advantageous financially when allowance was made for the cost of control, apart from the reductions secured from that firm: CLASS V, VOTE 3.-contd. (iv) the difference in the cost of control at the two works was due partly to the fact that a supervising staff was already in being in the one case, and partly to the method of production contemplated by Messrs. X necessitating counting the orders singly instead of in batches of 30 as could be done at the works of Messrs. Y. I cannot regard this answer as affording any satisfactory explanation of the omission of the Post Office to give the Stationery Office an opportunity of tendering or at least to consult them. It is common. knowledge that the Harrow Works have made great progress in efficiency and economy of production since 1922, and they have, in fact, been able to undertake the printing of similar matter for the Ministry of Pensions. CLASS V, VOTE 6.-UNEMPLOYMENT GRANTS. 25. This is the last account for this service as a separate Vote. In the succeeding year the sum provided, which has been further reduced to 15,000l., appears as Subhead B of the Vote for Grants in respect of Unemployment Schemes (Class V, Vote 5). CLASS V, VOTE 8.-RELIEF OF UNEMPLOYMENT. 26. The present account is the last for this service as a separate Vote. The loans to Local and Poor Law Authorities for which this Vote has provided were discontinued after the year under review, and the training services which absorbed the remainder of the Vote were provided for in the succeeding year under Subheads M, N, and O of the Vote for the Ministry of Labour (Class V, Vote 9). The receipts which arise from past expenditure out of the Vote for Relief of Unemployment will, after its termination, be accounted for according to their nature by the Ministry of Labour, the Ministry of Health, or the Ministry of Transport. CLASS V, VOTE 10.-OLD AGE PENSIONS. Excess Expenditure over Estimate. 27. The gross expenditure on this account has exceeded the gross estimate by 88,8821. 17s. 4d.; in addition, there is a deficiency of Appropriations in Aid realized of 1,265l. 1s. 3d. The total deficit, therefore, amounts to 90,1471. 18s. 7d., for which an Excess Vote is required. The excess, which represents 0.27 per cent. of the gross estimate, is due partly to an unexpectedly large influx of new pensioners in the last quarter of the year, and partly to the fact that the pension orders cashed on the last two days of the financial year greatly exceeded anticipations. |