Committee Reports > List of Committees > Dáil > 1945 > Committee of Public Accounts > Interim and Final Report - Appropriation Accounts 1942 - 1943

MIONTUAIRISC NA FINNEACHTA

(Minutes of Evidence)

Déardaoin, 1ú Feabhra, 1945.

Thursday, 1st February, 1945.

The Committee sat at 11 a.m.

DEPUTY DILLON in the chair.

Mr. J. Maher (An tArd-Reachtaire Cuntas agus Ciste), and Mr. C. S. Almond (An Roinn Airgeadais), called and examined.

VOTE 63—ARMY.

Lieutenant-General P. MacMahon called and examined.

926. Chairman.—The Vote we have to consider this morning is the Vote for the Army, and General MacMahon is here to give us any information we may require. On that Vote, there are several notes by the Comptroller and Auditor-General. The first note is paragraph 63, which reads as follows:—

“The estimate presented to Dáil Éireann did not include details showing the distribution of the grant amongst the several heads of expenditure and accordingly the appropriation account, in conformity with the estimate, shows only the total expenditure. The normal sysem of accounting was, however, continued within the Department and particulars of the expenditure under the various subheads of the detailed estimate, as approved by the Department of Finance, have been furnished to me. The sanction of that Department has been sought for the application of savings on certain heads of expenditure to meet excesses under other heads.

The account shows that, including a surplus of appropriations in aid of £112,590 13s. 10d., the total surplus remaining to be surrendered is £618,802 11s. 9d. or 6.9 per cent. of the net estimate.”

Is there anything you care to add to that note, Mr. Maher?

Mr. Maher.—We are not aware yet whether the sanction of the Department of Finance has been obtained.

General MacMahon.—It has been obtained.

927. Chairman.—For every case of virement in connection with the Vote?— Yes.

928. Is 6.9 per cent. over-estimation a usual margin on your Vote—No. It was down to 2.3.

929. Did any special circumstances arise in this year which caused this wide discrepancy between Estimate and expenditure?—It was principally due to the non-delivery of stores ordered.

930. I think I am correct in saying, Mr. Maher, that £618,000 represents approximately 6d. in the £ on income-tax?

Mr. Maher.—I think that is correct, Mr. Chairman; it depends on whether it is surtax or ordinary tax.

931. Chairman.—I trust the General will remember the unfortunate income-tax payers when next making the Estimate, and will not give the Minister for Finance an excuse for putting on an extra 6d.?

General MacMahon.—I am afraid it was outside my control.

Mr. Almond.—The Minister for Finance sometimes takes over-estimation into account when framing his Budget.

General MacMahon.—This year it will be 2 per cent.

932. Chairman.—I am sure Deputies appreciate the peculiar difficulties under which you are working, General MacMahon. My observations are to be taken as being more in a jocular strain than seriously intended. The Comptroller and Auditor-General has the following note in regard to Stores—paragraph 64:

“I referred in previous reports to difficulties which had arisen in accounting for Barrack Service stores under emergency conditions. Stocktaking of some of the more important items of these stores was carried out during the year and certain deficiencies were disclosed. It was calculated that the cost price of the articles deficient amounted to £21,961 10s. 10d., the value of the articles at the time of the loss being assessed at £5,490 7s. 8d., or one-fourth of the cost price, and proposals for the adjustment of the matter by the recovery of a moiety of the latter sum from Army Welfare Funds, have been submitted to the Department of Finance. It is provided by Defence Force Regulations that, where charges are raised in respect of articles lost, the amount to be recovered will be assessed from the best evidence available as to the condition of the articles at the time of the loss, subject to a minimum of one-fourth of the value of the articles when new unless it is established by evidence that the actual value is less. As there was some evidence that the value of certain of the deficient articles, at the time of their loss, was estimated at over 25 per cent. of their cost price I have inquired as to the circumstances in which an overall percentage of 25 was adopted for assessment purposes. I have also asked for information concerning the basis on which the cost price of the deficient articles was determined.

I have been informed that the practicability of taking stock of further selected items of Barrack Service stores will be considered at an early date.

Considerable quantities of scrap or unserviceable stores have accumulated at depôts and the question of their disposal or reconditioning is under consideration.”

In regard to the first paragraph dealing with the loss, Mr. Maher, have you anything you care to add?

Mr. Maher.—The Committee have already had under consideration the need for stocktaking of those stores, and, while it is desirable to have a general stocktaking, I understand that owing to the very large number of items coming under the heading of Barrack Service Stores it was impossible to cover the whole field, and it was accordingly decided to concentrate on some of the more important items, mainly bedding and furniture, about 21 items in all. As stated in the report, deficiencies of those items amounted to £21,961. As regards stocktaking of the other items, the Accounting Officer proposes that a test stocktaking of selected items be made. On the limited stocktaking already made, two points arise: the basis of the cost price of the deficiencies, and the adoption of an over-all percentage of 25 for estimation purposes. The basis of cost of lost or damaged property is governed by rates quoted in vocabularies of Army stores which are issued from time to time. The vocabulary used in the present case was that issued in 1941, though a later one issued in 1943 was in existence when those deficiencies were being dealt with. We inquired whether the cost price did not more properly fall to be calculated by reference to the 1943 rates, which were higher than the 1941 rates, and were informed that the latter rates applied when the deficiencies were discovered, that is in December, 1942. On the question of the over-all percentage of 25, it seemed that, as some of the missing articles were in use for a comparatively short time, the adoption of the minimum percentage in all cases was scarcely warranted. The Accounting Officer informs us that the lower figure was adopted owing to the extra wear and tear of those articles during the emergency.

933. So far as the 1941 vocabulary being used instead of the 1943 vocabulary is concerned, the Accounting Officer’s representations that the losses accrued in 1942 seems to be reasonable, Mr. Maher?—Yes. We have accepted that.

934. Perhaps you would give us your view, General MacMahon, on the propriety of taking an over-all 25 per cent. valuation for much used and little used goods?

General MacMahon.—The primary object was to fix a penalty on the military which would make them realise the importance of looking after barrack service stores. That has been achieved, because a recent inspection of about 30 other barrack service stores revealed practically no deficiency. In the light of further information now available, it may be necessary to raise the figure from 25 to about 50 as the cost of the stores lost, but the penalty on the military will stand at the same figure of £2,745 3s. 10d. Already £2,711 3s. 7d. has been recovered—only £34 0s. 3d. is outstanding.

935. Are we to understand then, in regard to the other 25 per cent. which will accrue as a result of the revaluation, that provision will be made in the Estimates to meet that out of the Exchequer —We have discussed this matter with representatives of the Department of Finance, and they too were dissatisfied with that 25 per cent. We explained that we were arriving at the figure which we would get the military to refund, but in actual fact in some cases we will increase it to about 50 per cent. It will then be a case of a greater write-off; we will have to write-off a bigger amount.

936. To be met out of the Exchequer?— It is already met.

937. Chairman.—What is your view, Mr. Almond, in regard to this matter?

Mr. Almond.—We have had very extensive discussions with the Department of Defence on this matter and it involved a large mass of figures. Briefly, the Department of Finance are now satisfied that the assessment of 25 per cent., as being the value of the articles, was an underestimate of the value at the time they were lost and the percentage has been put up in every case. Our anxiety was to discover what was the actual loss. We cannot very well increase the amount the Department of Defence charged against Welfare Funds because you can only charge an individual soldier or an individual unit for articles lost. So much time has elapsed that it is now impossible to say which individuals or which units were responsible, and this payment out of Welfare Funds is virtually an ex gratia payment by them. There is no means of compelling Welfare Funds to pay anything at all. Although the loss may be greater than that shown by the Comptroller and Auditor General as a result of the increased percentage, there are no grounds upon which we can claim a higher payment.

938. Chairman.—Have you anything to say on that matter, Mr. Maher?

Mr. Maher.—We have not had any opportunity of considering the later developments at all. We have only been aware of the discussions with the Department of Finance now.

Mr. Almond.—We have not completed our discussions with Defence yet. The figures are exceedingly complicated and involve a considerable amount of examination. The net result so far is that we shall have to write off a larger amount.

939. Chairman.—May we take it that this matter will come before us for final review in next year’s accounts?

Mr. Maher.—Yes, Sir; it is under consideration.

940. Chairman.—I observe in the schedule of lost property there appear items of 12,000 pairs, or perhaps 12,000 individual, blankets. Have you the schedule before you? Is that 12,000 individual blankets or 12,000 pairs of blankets?—Individual blankets.

941. And 13,000 slip cases and 15,000 sheets. Can you suggest to the Committee what became of these?—Many of them were worn out and not reported as worn out, and many of them were not written off.

942. Are these all marked with the army mark?—Yes.

943. And if they were being illicitly sold, would it be possible for the army authorities to locate them and bring the persons responsible for dealing in them to book?—It would if we were able to locate them.

944. It does seem strange that 15,000 sheets and 12,000 of one type of blankets and 4,000 of another type, all bearing the army mark, could be concealed within this country and escape all efforts to discover them?—It is a rather big area. We have not been able to trace them.

945. Would the public laundries notify you if army property were being passed to them for treatment?—No, they would not.

946. Do you think that these peculations or deficiencies are sufficiently serious to justify some inquiries on these lines being undertaken?—I do not think we are ever likely to have anything like this occurring again. It occurred at a particularly bad period when officers were inexperienced and when they did not realise that an old blanket or an old sheet handed in was as good, from their point of view, as a new one. Our experience since has been that officers now know their job and that they are doing their job. I do not think it necessary to take action to compel public laundries to notify us if they do receive any of this property for treatment. They do notify us if uniforms are sent to be dyed. It was necessary to make that arrangement with the dyers.

947. Are you sure that the public will appreciate that you were training a young army at this particular period and that many of the younger officers did not appreciate the necessity of abiding strictly by the regulations? Are you satisfied that it is unlikely that deficiencies on this scale will occur again?—I am absolutely satisfied because the Quartermasters are now trained quartermasters.

948. A good deal of the deficiencies were due to inexperience on the part of officers? —I think most of them were due to inexperience on the part of the accounting officers at that period.

949. Chairman.—I take it that in due course, Mr. Maher, you will make any necessary comments in regard to this matter?

Mr. Maher.—Yes.

950. Deputy Cosgrave.—Can you say if many prosecutions took place?—We had to my knowledge five or six, but they were not very successful. In one case the District Justice simply cautioned the individual concerned, and the receiver was fined 5/- or some ridiculous sum like that.

951. Chairman.—You told us on a previous occasion that in the early army days, army property which became unsuitable for continued use was destroyed and sold to the rag merchants rather than sold in its entirety, and that that made it very much easier for the authorities to identify stolen army property. Subsequently, I understand, that arrangement was altered, and the army were directed to sell their old stores as complete articles. In view of this situation, would you consider it desirable to revert to the old practice of destroying army property, thus ensuring that any property with the army mark upon it in the ownership of private individuals would be prima facie evidence of improper possession?—We have had that under consideration, particularly in the case of uniforms. It has been represented to us that it would be unfair to cut up old great coats and old tunics that could be converted easily into suits for small boys. I feel very strongly on this matter, and I have stated that I would not agree to this unless the articles were previously dyed, and we are in touch with dyers at the moment in order to see what it would cost to dye them before we sold them. If we found it was economic to do that, it would get over the difficulty.

952. Mr. Almond, has the Department of Finance any view as to the comparative economy of selling the old stores instead of having them previously destroyed, as opposed to the danger which that practice creates of theft and improper sale of stores which had not been abandoned?

Mr. Almond.—I should like to point out that the observation of the Comptroller and Auditor General relates to a period when conditions were absolutely abnormal and there was no real control of stores. Now the control has been tightened up so perfectly that the risk of pilfering is extremely slight, and I think it is definitely to the advantage of the State that we should dispose of surplus articles of clothing to the best advantage rather than cut them into rags and not get the same return. I think the risk of army stores going astray is very slight in view of all the precautions that are being taken and the improved efficiency of the quartermasters.

953. I think, in view of the times in which we live and the acute shortages of material, that the Committee would agree with that view for the present; but I think it would be desirable to review, with one’s eye on normal times, the practice of disposing of army goods with the army mark on them, thus rendering the detection of improper dealing in army property more difficult.

Mr. Almond.—There is another point to be considered. Where losses occur now, in the majority of cases the loss is recovered either from the soldier or the unit, or the individual officer responsible.

General MacMahon.—That is so, but at the same time I agree with the Chairman’s remarks, that while an exception might be made now when material is in short supply, in normal times these articles should be cut up and sold in such a way that they could not be represented as articles of army wear.

954. That is not a matter on which you have any opinion, Mr. Maher?

Mr. Maher.—It is really more a matter for the army authorities themselves. There is another consideration involved in ensuring that army property is not used for any improper purpose. However, that is a military matter.

955. It is, in one sense, a military matter, but I think it is true to say that General MacMahon has been striving for the past 15 years to reduce the misappropriation of military stores to the minimum degree, and if his task is made more difficult by a regulation permitting general dealing in abandoned army stores, it is a matter in which the Department of Finance and this Committee are intimately concerned, if we can devise methods which will make detection by the Department of Defence of the improper use of military stores more easy. Perhaps Mr. O’Toole will make a note of that matter so that we may consider it when we are preparing our report.

Deputy Pattison.—One would think it should be possible to tighten up the administrative machinery just as anyone running a business might do. I think that at the present time and in the future there is and there will be a need for making available cast-off clothing from army stores, and this is a matter that should be taken into consideration. We all know that large numbers of agricultural labourers and others in the country try to collar the cast-off army great coats. These people are exposed to all kinds of weather, and I would not like to see the practice adopted of destroying these articles. We ought to be able to look after these things and devise some system that will prevent, as far as possible, any pilfering. In Kilkenny we had a case in which a large number of blankets was involved. There was an understanding between a pawnbroker and a man in the army. The army man had a long, clean record, but unfortunately, through some comrades, he seemed to fall away. The case came before the District Justice and a very heavy penalty was imposed. The local military authorities dealt with their own man. I was present in the court at the hearing of the case.

956. Chairman.—Is there anything further on this matter, Mr. Maher?

Mr. Maher.—Nothing, except that I might call attention to the fact that this paragraph refers to only 21 items in barrack stores, whereas the total number runs into hundreds.

General MacMahon.—We have taken stock of 30 items since and found the position satisfactory.

Report of Comptroller and Auditor General:

“Pay.

“65. In paragraph 83 of my report on the appropriation accounts for the financial year 1935-36, I referred to the then existing practice by which members of the Forces were permitted to draw only a part of their pay and to allow the balances to accumulate to their credit, and the Committee of Public Accounts, in its report dated 9th December, 1937, paragraph 20, took exception to this practice, pointing out that it afforded opportunities for misappropriation. The Committee reasserted the principle that claims which are ripe for payment in any financial year should normally be discharged in that year, and the accumulation of credit balances, save in exceptional circumstances, was accordingly prohibited by Defence Force Regulations. The matter has since been reconsidered from the point of view of the desirability of encouraging Durationists and Reservists to provide for their return to civil life. Owing to the distance of their military posts from banks and post offices many serving soldiers have no facilities for saving otherwise than by accumulating credits in their pay accounts, and an amendment to the Regulations permitting such accumulations was promulgated in October, 1942.

An increase of pay of 6d. per day was granted to all privates, volunteers and seamen with effect from the 29th September, 1942. The relevant regulations also provided that, with effect from the same date and until the termination of the emergency, the pay-account of each non-commissioned officer, volunteer and private and of each warrant officer and rating should be credited at the rate of 6d. per day in respect of each day of paid permanent service. The sums so credited are to be regarded as deferred pay and will not become payable until after the emergency.”

957. Chairman.—Have you any observations to make with regard to that matter, Mr. Maher?

Mr. Maher.—As regards the first part, it is purely informative, as the matter was before the Committee on a previous occasion. As regards the last paragraph, I understand a regulation was promulgated in June, 1944, providing for the immediate issue of deferred pay in cases of death or discharge.

General MacMahon.—I should like to explain that to the Committee. Owing to representations made to the Minister, deferred pay is now paid to all men discharged—that is, men who are completely cut off from the army—and to the next-of-kin of deceased soldiers.

958. Chairman.—With regard to the first paragraph, I remember when that matter was before the Committee. Would it have been practicable, instead of reviving the system of allowing credits to accrue in the soldier’s pay account, to direct the pay officer of his unit to pay such moneys into the Post Office Savings Account on behalf of the soldier, rather than to retain them in the hands of the military authorities at the particular post?—The sum of money is not retained by the officer; it is simply not issued. That practice might give rise to irregularities.

959. Quite. Am I to understand then that the new Order made in 1942 did not operate to revert to the old pre-1937 arrangement?—It was a similar arrangement to the pre-1937 arrangement, but the credit balances were never kept by the officers. The pay simply was not issued. A man entitled to 25/- might decide that £1 would be sufficient, and the 5/- would be put to his credit. Only the £1 was issued to him, and only that amount was issued to the pay officer to give to that man.

960. In the pre-1937 arrangement, did not the whole sum issue to the pay officer?—No.

961. Then how did the defalcation arise?—An N.C.O., as happened in this particular case, actually paid the man. In the case I am referring to only £1 was paid to the man and only £1 was indicated in the pay book, but in his return to us he stated he paid 25/-. He put the 5/- in his pocket.

962. Are you satisfied there is no danger of a recurrence of the pre-1937 abuses?—It could happen, as it happened then, but we are watching.

963. On the whole, you think that that risk is worth running for the advantages served?—The Minister was keen on it and he got the concurrence of the Minister for Finance. I mentioned it to the Committee and to the Comptroller and Auditor General and got authority to reintroduce this system.

964. That procedure, on the whole, meets with your approval, Mr. Maher

Mr. Maher.—Yes. I think General MacMahon sent a note to the Committee in May, 1943.

General MacMahon.—That is correct.

965. Deputy Cosgrave.—You could obviate the danger by paying only £1 to the unit in respect of an individual case and by making it obligatory on the soldier to notify in the previous week that he would not take 25/- and was taking only £1?—We tried to get the soldier to indicate that and pointed out that they could save 5/- every week and then it would be very simple, but the soldiers would not agree to that. It all depended on the particular circumstances and they did not make up their minds until the morning they would be paid.

966. Deputy Lydon.—Is the private soldier informed at the end of the year of the amount to his credit?—He is informed of that every month. I would like to make it clear that the pay officer has to surrender any money he has not paid out, on the evening of pay day.

967. Chairman.—With regard to the second part of the paragraph, does it represent an annual charge of £300,000 in respect of deferred pay?—That is correct.

968. Is that sum provided for in the Estimates for each year, or is it intended at the end of the emergency that a covering Estimate will be introduced for the pay accrued due?—We will have to budget for a larger sum or, if necessary, have a Supplementary Estimate.

969. Provision is not made in the annual Estimates for this deferred pay? —No. In the case of discharged men we estimate a certain sum will be required— that is, in respect of men who sever their connection with the Army, or men who die.

970. Is it correct, Mr. Almond, that the Estimates for Army pay do not correctly reflect at present the true charge and that there is a large charge accruing in addition to the annual charge for the Army?

Mr. Almond.—That is true, but that charge has not yet matured and it would not be proper to provide for a charge that has not matured.

971. The procedure of estimating for it annually and putting it into a Suspense Account does not commend itself to the Department of Finance?

Mr. Almond.—There would be no point in that. It simply would mean increasing taxation for a payment that has not matured, or increasing borrowing for a payment that has not matured.

972. I take it the course that is at present being pursued is more in keeping with the policy of the Department than the one I have outlined, Mr. Maher?

Mr. Maher.—Yes, it is in order. The payment is a deferred liability and does not come in course of payment until a future date.

973. I take it that we may assume that it is accruing at the rate of approximately £300,000 per annum?—That is correct.

974. Deputy Pattison.—Is it considered that the reduction in the strength of the Army later on will more than offset this deferred liability?

Chairman.—I suppose we are entitled to entertain any pious hope we like?— That represents the position.

Mr. Almond.—In agreeing to deferred pay, one of the underlying ideas was that it might be easier to find this money after the emergency than during the emergency; instead of giving an actual increase of pay, to defer it to a post-war date when possibly the financial position might be easier.

Report of Comptroller and Auditor-General—Paragraph 66.

“Provisions.

“66. Statements have been furnished to me showing the cost of production of bread at the Curragh Bakery, and of meat at the Dublin and Curragh Abattoirs. The unit costs are as follows:—

The average price of cattle purchased for the Dublin and Curragh areas was £33 5s. 6d. and £31 4s. 9d. per head, respectively, as compared with £29 13s. and £28 10s. 3d. in the previous year, while the average production of beef per head was 722 lbs. and 665 lbs., respectively, as compared with 715 lbs. and 669 lbs.

A revised procedure for the purchase of provisions was introduced, in certain areas, during the year. Under the former practice separate contracts were placed for the several barracks and posts, but depôts have now been established for the supply of non-perishable provisions to the various posts within a convenient area. It is considered that the revised system will operate to simplify the accounting procedure considerably and that more favourable contract prices will be obtained by the delivery of larger quantities of provisions to central points, although any saving under this head will be offset to some extent by the cost of redistribution from the depôts. I have not yet had an opportunity of examining the revised system in operation.”

975. Mr. Maher.—This matter will be referred to in reports of future years but I understand the system is working satisfactorily.

976. Chairman.—Is that your view, General MacMahon?—It is. In addition, it gives the military experience of handling supplies in a way similar to that in which they would have to handle them if an emergency actually developed.

Report of Comptroller and Auditor-General—Paragraph 67.

“Kit Deficiencies.

“67. Defence Force Regulations promulgated prior to the emergency provided that soldiers on discharge might retain all articles of personal clothing and necessaries in their possession except tunics, breeches and caps, and whilst these latter items were required to be returned to store they could be disposed of for the welfare of the Forces and were not retaken on ledger charge. Accordingly, in cases of deficiencies in the kits of men proceeding on discharge, only the value of items of public clothing found deficient was debited in the relevant pay accounts. Defence Force Regulations issued in 1941 provided that Reservists and men enlisted for the duration of the emergency might, on discharge, retain certain items of necessaries and the least serviceable of certain items of personal clothing. As these Regulations appeared to imply that the remaining items of kit should be surrendered I inquired whether the practice by which debits were raised in respect of public clothing only does not fall to be revised in relation to the men concerned, and was informed that a new clothing regulation to meet emergency conditions was recently submitted to the Department of Finance for sanction.”

977. Mr. Maher.—The regulation issued in 1941 was issued with a view to reducing the losses incurred in the case of men who might serve only for short periods. I understand that the contemplated revised clothing regulation will abolish the distinction between regulars and durationists.

978. Chairman.—And that will meet any point that occurred in your mind?— Yes.

General MacMahon.—I should like, with your permission, Sir, to make a statement regarding paragraph 13 of the Report of the Public Accounts Committee for 1942-43. On reading my replies to questions 985, 988 and 989 regarding the instruction issued by the Quartermaster-General under which men proceeding on indefinite leave were permitted to retain part of their kit, I find that I gave the impression to the Committee that in issuing the instruction the Quartermaster-General had acted on his own responsibility without consulting me or my officials. The Quartermaster-General did actually consult my officials before issuing the instruction and I fully concurred in its issue. In replying to the questions, I relied on my notes which did not adequately reflect the minute in the files which passed between the military and civil branches of the Department. I, therefore, take this opportunity of correcting in this respect the statements made by me in reply to the questions concerned.

979. Chairman.—We are much obliged for that information. You have such a vast area to cover in these discussions that it is very difficult for you to remember every detail sprung upon you without notice in our questions. It will appear on the records and will serve to qualify your answers of last year.

Mr. Almond.—I wish to join in that explanation, because I had previously assumed from General MacMahon’s statement that the Quartermaster-General had acted on his own initiative.

980. Chairman.—I am sure the Quartermaster-General and the Committee fully appreciate that it is difficult to meet every inquiry raised at this Committee and particularly those of which neither you nor General MacMahon have had any notice. The amplification by General MacMahon now of his answers meets the situation completely.

General MacMahon.—Thank you very much.

Paragraph 67—(Continued).

“Regulations relating to Second Line Units provide that a member on discharge shall be required to surrender all the articles of clothing and equipment which had been issued to him, and that such articles, if serviceable, shall be taken on ledger charge and reissued. It appeared from examination of the store accounts that certain items were deficient from the clothing and equipment recovered from discharged members of the Maritime Inscription, and I have inquired as to the extent of these deficiences and how it is proposed to deal with them.”

981. Mr. Maher.—The Accounting Officer has informed us that arrangements have been made whereby the local Gárdaí, on being informed by the military authorities that certain articles of kit have not been returned by a discharged member of the Maritime Inscription, will interview the person concerned, instruct him to return the articles and inform him that failure to do so will result in a prosecution. I understand that the revised clothing regulation referred to in the previous subparagraph will provide for the Second Line Units.

General MacMahon.—I am afraid that some losses in regard to Second Line Units are inevitable. We had to write off 281 uniforms costing £330. I am afraid it is inevitable, but we are doing all we can to keep the losses at a minimum.

982. Chairman.—What exactly are the Second Line Units of the Maritime Inscription?—They are very much the same as the old Volunteers. They are men issued with uniforms who bring them home with them. They unfortunately can resign and they can move from one part of the country to another. At one time they were able to leave the country, but we have an arrangement now that before they can leave the country they must have a certificate to the effect that they have handed in all kit issued to them. They are non-permanent soldiers.

983. And I suppose their numbers will not tend to increase from this time forward?—No, definitely not.

Paragraph 68.

“Warlike Stores.

“An advance payment of £9,917 2s. 3d. for stores which were delivered in the year of account has been admitted as a charge against the Vote pending the receipt of certified claims.”

984. Mr. Maher.—A sum of £9,917 was charged to the Vote in respect of stores received for which claims had not been received. This figure was taken as the estimated value of the stores in question, but I understand that the actual value was in the neighbourhood of £40,000.

985. Chairman.—Claims are still outstanding?

General MacMahon.—That is the position. We advanced £9,917 2s. 3d. against goods actually delivered to the value of £40,000.

986. Is there any explanation as to why a claim for these goods has not been made by the authorities?—It is the British War Office which is concerned and they have delayed making the claim. They were asked for it, but I think there is a certain amount of chaos there, too.

987. We may expect the British authorities in due course to make a claim?—They definitely will.

988. However, I suppose they are to be congratulated on the expedition with which they delivered the necessary goods, even if they did not send their bill?— From our point of view, that was the important consideration.

Paragraph 68 (continued).

“The sanction of the Department of Finance was obtained for the purchase of a number of steel helmets for the Army and it appeared that 6,997 helmets in excess of the number sanctioned were delivered. I have asked whether further sanction was received for the excess.”

989. Mr. Maher.—The sanction of the Department of Finance has since been obtained.

990. Chairman.—And I take it that disposes of it?—Yes.

Report of Comptroller and Auditor-General.

Paragraph 68 (continued).

“The Department of Finance also approved of expenditure of £10,800 on the purchase of steel helmets and the reconditioning of obsolete type helmets for issue on repayment to the Local Security Force and to certain air-raid precautions services. It appeared that 15,688 of these helmets were taken on Army charge and I have asked whether they were applied to Army use in addition to those specifically ordered for that purpose; and, if so, whether the Department of Finance sanction was obtained. I have also inquired as to the position regarding the helmets purchased for issue on repayment and also as to certain obsolete type helmets which were unaccounted for on a recent check.”

991. Mr. Maher.—Sanction here has also been obtained and an explanation has been furnished to us by the Accounting Officer satisfactorily dealing with the accounting for the obsolete type of helmet referred to. He has also sent in a statement showing the helmets issued on repayment.

992. Chairman.—And I take it this matter is now satisfactorily disposed of from your point of view?—Yes.

Report of Comptroller and Auditor-General.

Paragraph 69.

“Mechanical Transport.

“Certain motor vehicles which had been seized by the Revenue Commissioners owing to attempted illegal exportation were deposited at a military post pending consideration of the question of their disposal. It would appear that they remained without protection from the weather for a long period and when their disposal became possible they had depreciated considerably in value and were deficient of several parts. The vehicles were taken over for Army purposes at a valuation and I have asked whether they were rendered serviceable and whether responsibility for the deficiencies was fixed.”

993. Mr. Maher.—These vehicles were deposited at Rockhill Military Post by the Revenue Commissioners for safe custody in July, 1941. Four vehicles in all were involved and it is stated that only one of these can be rendered serviceable, but repair work has not been carried out yet. The others will be broken up for scrap or spares. We are informed that, as depreciation and thefts occurred prior to the vehicles passing to Army charge, there was no loss to the Army Vote. There was, however, a loss to the Revenue Department and the loss occurred while the vehicles were in military custody.

994. Chairman.—What are your views on that, General MacMahon?—In this case I cannot quite agree with the Comptroller and Auditor-General. As a matter of fact, I was surprised to see this note in against Vote 63 at all. We accepted no responsibility for these lorries. We explained to the Revenue Commissioners that we had no sheds and no accommodation whatever for them and that we could not accept any responsibility for them. We did not accept any responsibility for them, and I think we only come into it from the time we purchased them from the Revenue Commissioners. Any losses which occurred prior to that are simply the responsibility of the Revenue Commissioners. I admit that five soldiers were convicted of stealing tyres and wheels and sentenced by the civil court, but we had no responsibility for the lorries then.

995. Though I suppose you were responsible for the soldiers?—Yes, but the soldiers were convicted in the civil court. These vehicles were out in the open. The particular barracks had been a private house. It was not an ordinary barracks and there were no walls surrounding the spot in which the Revenue Commissioners left the lorries. There was nothing to protect them.

996. Can you speak, Mr. Almond, for the Department of Finance or the Revenue Commissioners in connection with this matter?

Mr. Almond.—There is no loss arising on the Army Vote as a result of this. The case has not been officially reported to us, but we have had an opportunity of discussing it informally with the Department of Defence, and we came to the conclusion that the Army Vote was not concerned, even to the extent of a penny, but there was definitely a loss incurred by the Revenue Commissioners.

997. Can you explain, Mr. Maher, why this was appended to the Army Vote instead of the Revenue Vote?

Mr. Maher.—Well, we thought that since it was taken over by the Army it was more appropriate to put it under that heading.

General MacMahon.—In the beginning we thought it better to take the lorries over, but I think that neither ourselves or the Revenue Commissioners were to blame. The fact was that neither they nor ourselves could sell them. They were simply planked there, much as if somebody were to plank a private car outside your house, and nobody knew what to do about it.

998. Chairman.—Perhaps I might ask you, Mr. O’Toole, to get in touch with Mr. Cleary in connection with this matter and ask him to be kind enough to furnish us with a note about it.

Mr. O’Toole.—Certainly, Mr. Chairman.

Mr. Maher.—It is really a question of a loss that has occurred between the two Departments, without either being directly responsible.

General MacMahon.—If we could have purchased them we could have had them properly cared for, and the Revenue Commissioners were not able to do anything in connection with them for over a year.

Chairman.—Then, with all respect to Mr. Cleary and General MacMahon, perhaps I might suggest that it would be well to have the two stools brought here before we fall between them, so that we may have more enlightenment on this matter, and I take it that the Committee will agree that Mr. O’Toole should address a letter to Mr. Cleary in connection with it. Now, the next paragraph is No. 70— Marine Coast Watching service:—

“In May, 1942, damage was caused to a State ship whilst rendering assistance to a vessel in distress and the law officers advised that the Minister for Defence was entitled to claim salvage on behalf of the State under Section 9 of the Defence Forces (Temporary Provisions) Act, 1941. The damage attributable to the salvage operations was repaired at a cost of £45 16s. and a fee of £21 was paid for a valuation of the salvaged vessel, the owners of which were advised in September, 1942, that it was proposed to present a salvage claim. In reply to my inquiries as to whether such claim had been presented I was informed that the necessary data for the formulation of a claim for salvage and expenses were in course of preparation.”

999. Have you anything to add to that, Mr. Maher?

Mr. Maher.—Yes. This matter is under consideration and will probably be referred to in a further report. For that reason I suggest to the Committee that the matter might be deferred to a later date.

General MacMahon.—I might say, as a matter of fact, that if this matter were to get pubilicity at the moment, it might prejudice our claim to a certain extent. We hope that the matter will be brought to a conclusion shortly.

1000. Chairman.—Will this claim be an inter-governmental claim or a claim against an individual shipowner?

General MacMahon.—Against an individual shipowner.

1001. In that event, have the law officers advised whether the claim should come before an international court or a court of this country?—The courts of this country, but we hope that it may not be necessary to bring it before the courts. We hope to be able to settle this case without proceeding to court.

1002. Do I understand that the law officers will take all advice so as to ensure that every recourse is taken to assert any rights to which our Government would be entitled under our own legal system or any other legal system? I take it that that will be done?—Yes, that will be done.

1003. In view of what General MacMahon has said—that further publicity might prejudice the claim—I take it that we need not go further into the matter at the moment and that Mr. Maher will deal with it on a future occasion.

Mr. Maher.—Yes, Mr. Chairman.

1004. Chairman.—The next paragraph is No. 71—Purchase of Stretchers for Local Defence Force:—

“Tenders for the supply of 4,160 stretchers were invited in August, 1941, and quotations of 34/4 each and 25/- each were received, the latter price being subject to a war clause which is referred to below. The canvas to be supplied conformed to the required specification only in the case of the higher quotation, but it was clear that this contractor could not give immediate delivery as he was unable to secure materials to fulfil a previous contract for stretchers for the Army. As a matter of urgency and to meet minimum requirements, an order for 2,000 stretchers was issued in September, 1941, to the contractor who quoted 25/-, but no further order was issued until June, 1942, when, as a result of further invitations to tender, an order for 2,000 stretchers at 32/6 each, subject to a war clause, was placed with the same contractor, the stretchers to be similar in all respects to those previously quoted at 25/-. It appears to have been recognised in October, 1941, that the contractor whose price covered the provision of standard canvas could not make delivery, as alternative purchase arrangements were made at that date for the Army supplies which had been ordered from him. I have accordingly inquired whether consideration was given to the possibility of securing an extension of the contract at 25/- to cover the outstanding requirements.”

Have you anything to add to that, Mr. Maher?

Mr. Maher.—Yes, Mr. Chairman. The Accounting Officer has since informed us that both these firms were in difficulties in connection with the supply of raw material for the stretchers. In the case of one of them an export licence had been granted by the British Board of Trade, but the licence was subsequently cancelled, and in the case of the other firm the Department had actually to intervene to enable the firm to obtain certain materials. The Department did not, therefore, consider it advisable to seek an extension of the contract given at 25/- to cover outstanding requirements.

1005. Chairman.—I take it, Mr. Almond, that in all the circumstances, the Department of Finance was satisfied that the right thing was done?

Mr. Almond.—Yes, Mr. Chairman, we were quite satisfied. There is one point mentioned by the Comptroller and Auditor-General to which I should like to refer, and that is where he says that he has inquired as to whether consideration was given to the possibility of securing an extension of the contract at 25/- to cover the outstanding requirements. It would seem, at a first glance, that, on a rising market, that would be desirable, but it is an inviolable principle of contracts procedure that when one contract is exhausted, and when you require further quantities of the particular article concerned, you must get out a fresh tender, the idea being that the price may have gone down, instead of up, by that time. Accordingly, it seems to me that if the Department of Defence had acted as the Comptroller and Auditor-General suggested, they might have been liable to attack for that reason.

1006. Well, Mr. Almond, would I be correct in assuming that the practice in the Department of Finance is not so rigid as to insist on the observance of peacetime custom at such a time as this, and that it might be assumed that prices might have gone down during a period similar to that in which the Department of Defence was operating in this case, since, manifestly, prices were soaring at that time?

Mr. Almond.—We have had evidence of recent cases where prices went down instead of going up.

Mr. Maher.—We merely ask whether consideration was given to the possibility.

General MacMahon.—Perhaps I might be permitted to say that, apart from that question, we were aware that the firm concerned could not give us immediate delivery and that it would be futile to expect him to do so, apart from the procedure in regard to Government contracts.

1007. Chairman.—The remainder of paragraph 71 is as follows:—

“The quotation of 25/- on which the original order was based was subject to a clause which provided that in the event of an increase or decrease during the progress of the work of more than 2½ per cent. in the market price of the materials as compared with those ruling at the date of the tender, resulting in an increase or decrease of the cost of the work to the contractor, such increase or decrease as should amount to more than 2½ per cent. should be paid to the contractor or allowed by him as the case might be. A claim for payment of £172 19s. 1d. was submitted by the contractor under this clause and admitted after inspection of the firm’s books. I am communicating with the Accounting Officer on certain matters arising out of this claim.”

Have you anything to add to that statement, Mr. Maher?

1008. Mr. Maher.—Yes, Mr. Chairman. In interpreting the war clause we took the view that the first 2½ per cent. of any increase in the costs of the materials as a whole used in the contract should be borne by the contractor. The Department interpreted the materials clause in the tender as referring to the prices of individual items of materials and on that basis the payment of £172 19s. 1d. referred to in the paragraph was paid to the contractor, but the Attorney-General, whose opinion was sought, has advised the Department that the first 2½ per cent. of the increased cost of materials as a whole should be borne by the contractor. I am informed that the contractor has refunded the over-payment, amounting to £15 17s. 9d.

1009. Chairman.—I take it, therefore, that the matter is satisfactorily arranged, so far as that contract is concerned?

General MacMahon.—Yes, Mr. Chairman.

1010. And I suppose we may take it that that interpretation will rule in connection with all similar arrangements in the future?—Definitely, yes, Sir.

1011. Chairman.—The next paragraph in the Report is No. 72—Hospitalisation.

“Provision was made in the Estimate for the purchase of supplies and equipment for military hospitals and of reserve medical supplies for civilian hospitals. In addition, expenditure amounting to £4,047 16s. 3d. was incurred on emergency hospitalisation equipment and has been charged to a suspense account pending a decision as to the final incidence of charge. As it is understood that the general hospitalisation policy contemplates that the services provided from Army funds shall be available equally for such military and civilian casualties as might arise in an emergency, I have inquired whether, in the circumstances, arrangements have been made for contributions by local authorities or other bodies towards the expenditure incurred.”

Have you anything to add to that, Mr. Maher?

Mr. Maher.—Yes, Mr. Chairman. A good deal of this expenditure relates to the purchase of emergency equipment, for example, boilers, cookers, stretchers, blankets, etc., for civilian hospitals. No decision has yet been reached as to the incidence of charge for these items and the cost has been charged to a suspense account.

General MacMahon.—Perhaps I might say, that, since then, the Government have decided that the expense will be borne by State funds, and we think that that means the Army Vote.

Mr. Almond.—In view of the Government decisions, this expenditure, I understand, will become a charge against the Army Vote.

Mr. Maher.—We were not aware of the decision to which General MacMahon has referred.

1012. Chairman.—Perhaps, General MacMahon would give the Committee an outline of the position in regard to this matter?

General MacMahon.—I am afraid, Mr. Chairman, that I am not actually in a position at the moment to give the particulars.

1013. Well, General, I suppose we may take it for granted that at some stage steps will be taken in this connection and that the Comptroller and Auditor-General will be notified?

General MacMahon.—Yes, Sir; he will be notified immediately.

1014. Chairman.—The next paragraph in the report of the Comptroller and Auditor-General is No. 73—Construction Corps:—

“Arrangements were completed, with the sanction of the Department of Finance, for the employment of personnel of the Construction Corps on a development scheme undertaken by the Irish Tourist Board at a seaside resort. The scheme provides for payment by the Board to the Army Vote of the sum of £17,274 3s. 3d., being the agreed value of the labour content of the work, this sum to cover the provision of overhead equipment and plant and to be subject to adjustment in the event of any alterations in the plans for the work. As it would appear that the value of the labour content was calculated by reference to wages rates ruling in 1942, I have asked whether consideration was given to the question of providing for financial adjustment by reference to any increase in these rates which might result from the operation of the Emergency Powers Orders regulating wages from time to time.”

Have you anything to add to that, Mr. Maher?

Mr. Maher.—Yes, we have since been informed that there was no time limit within which this work was to be completed and that, therefore, the question of increasing the wages of labourers does not arise, and I understand that the Department of Finance concurred in that view.

General MacMahon.—That is correct.

1015. Chairman.—How does the fact that there was no time limit in regard to the completion of this work affect the question of whether the Irish Tourist Board should be made liable for some part of the increased cost resulting from the calculation of the labour content in connection with this development scheme?

General MacMahon.—Well, if an ordinary contractor had undertaken this scheme he might have completed it before there was any increase in wages. We were not in a position to promise that, and, as we did it when it suited ourselves, we felt that it would be unfair to ask the Tourist Board to pay the increase, whatever it might be.

1016. Chairman.—Yes, I can quite see that, and I take it, Mr. Almond, that the Department of Finance assents to that point of view?

Mr. Almond.—Yes, Mr. Chairman, and we have already conveyed our agreement on that matter.

1017. Chairman.—Paragraph 74 of the Comptroller and Auditor-General’s report reads:—

“Occupation of Privately Owned Premises.

“Privately owned premises are, in general, occupied subject to the condition that the Department will be responsible for any damage arising out of military occupation. The sanction of the Department of Finance was obtained for payments of compensation amounting to £390 15s. 8d. for damage at certain premises which had been evacuated, subject to recovery from the troops concerned of sums totalling £167 15s. 4d. in respect of avoidable damage. A revised method of assessment of the amounts recoverable from troops was subsequently adopted by the military authorities and it would appear that, in the cases under notice, the total amount so recoverable was reduced to £41 12s. In reply to an inquiry as to whether the sanction of the Department of Finance had been obtained for the increased charge to public funds resulting from the reduced assessments, I was informed that the reductions made by the military authorities had not been accepted by the Department of Defence.”

General MacMahon.—In connection with this damage, it is only avoidable damage that can be recovered. Most of these were private houses and were altogether unsuitable as barracks. Soldiers’ boots damage floors and stairs and in a way that ordinary boots would not. Soldiers’ rifles in barracks are put into proper rifle racks and have not to be left against walls, where they damage paper and the building. Equipment that soldiers want in connection with the blocking of roads if left against walls will do a certain amount of damage. That is unavoidable and I think it would be unfair to charge it against the soldiers. In this case we charged a sum against a unit but, having investigated the matter, we felt that we were charging something against that unit which it would not be fair to charge it with.

1018. Can you say if the Department of Finance dissented from that view?

Mr. Almond.—It was not reported to us.

1018a. Am I to understand that in so far as this note goes the report made has not been accepted by the Department?

General MacMahon.—Not quite. There has been a compromise. We will have to go to the Department of Finance in connection with all these cases eventually.

Mr. Almond.—We did actually sanction payment of compensation in this case on the understanding that £167 15s. 4d. would be recoverable from the troops concerned. If that amount is reduced it will be necessary for the Department of Defence to go to the Department of Finance again for sanction.

1019. Chairman.—The note proceeds:

“Portion of certain premises was occupied in October, 1940, the remaining part of the premises being reserved to the owner. It appeared that the electric lighting plant broke down in November, 1940, and a tractor was hired locally, at a hireage rate of 5/-per hour, to drive the dynamo until repairs to the plant had been executed, fuel and oil being supplied from Army stocks. As noted in the account, expenditure amounting to £40 9s. 6d. was incurred on abortive attempts to repair the plant, of which sum £10 was recoverable from a military officer. A replacement engine which was purchased for £97 10s. also broke down after two weeks’ service and the tractor was employed from November, 1940, to June, 1942, when a new engine was installed, the total amount paid for hireage being £412 10s. I have inquired whether the service of the tractor could not have been secured on a more economic basis than by hourly hireage. I have also asked for information concerning the arrangements made with the owner for the provision of electric lighting and the maintenance of the plant.”

Mr. Maher.—The Department of Defence undertook to keep the plant in good condition without being aware of the state it was in when taken over. The defective engine was replaced by a new one. No arrangements were made with the owner regarding the provision of light although the owner continued to occupy portion of the premises and derived benefit from such provision. The charge of £412 10s. for nine months’ hirage cannot be regarded as economic seeing that an engine with presumably a life of several years was subsequently obtained for £135. It is possible, however, that a suitable engine could not be secured earlier and it is stated that no better hirage rate than 5/- an hour could be got.

1020. How do you justify the payment of £412 10s. for the hirage of the engine? —We could not get an engine at a less rate than 5/- a hour, which included payment of the man who operated it. I think the charge was not an unreasonable one.

1021. Was there any tractor engine in possession of the Army authorities that could have been obtained?—No. We actually brought in another engine and it broke down. There was great difficulty in getting engines at that time.

1022. What do you imagine would be the total cost of a tractor if it were employed to do this work?—At that period you might pay £1,000 for a tractor. Normally, of course, we would buy a tractor at a particular price. If we looked for a tractor then we could not get one. There is also in this case the cost of the man operating the machine.

Mr. Almond.—The Department of Finance gave sanction to this charge, because we were informed at the time that the number of hours working per day varied from three to seven, according to the period of the year, and that local inquiries revealed that the rate charged for the hire of tractors for agricultural purposes was 30/- a day. It was understood that the owner of the tractor could have earned that amount owing to intensive agricultural activities in the area. In view of that explanation the Department of Finance sanctioned the hirage charge.

1023. Are we to assume that this tractor was withdrawn from agricultural activities in order to provide light at this particular premises throughout the whole period?—Yes.

1024. Deputy Cosgrave.—What was the charge per day for the hire of the man?— That is included in the amount. I suppose it would be about 30/- a week.

Chairman.—In any case that was not a matter for the authorities. They dealt with the contractor and he could hire a man on any terms he liked.

1025. Deputy Pattison.—Could the Committee get the all-in cost, seeing that we understand that fuel was supplied by the military authorities?—I could find out the cost of running a tractor for an hour.

1026. Chairman.—When it was explained to the Department of Finance that a tractor owner could earn 30/- a day at his normal avocation, did you direct attention to the fact that if he could earn 30/-he was supplied with oil for operating the machine in this case by the Army authorities? They were supplying petrol and paying 5/- an hour in addition. Did that occur to you at the time? When recommending this rate you advised the Department of Finance that local inquiries showed that this man could earn 30/- daily for the use of his tractor for threshing or ploughing. Let us assume that that was correct. Would that information not imply that the man was supplying oil and petrol while threshing or ploughing, and that you would have to deduct the cost of petrol and oil from 30/- to arrive at the net cost of operating? Assuming that when hiring the machine to the Army he got 5/- an hour he got oil and petrol for nothing?—Some days it would be working for seven or eight hours and on other days for three hours.

1027. Even getting the oil for nothing was he required to keep the tractor on the premises all the time?—The tractor was there all the time.

1028. Was it present to the Department of Finance when approving of 5/- an hour that in this case the man was getting oil and petrol for nothing, whereas in the normal way of agricultural work he would have to supply oil?

Mr. Almond.—Even if it was, I am afraid the circumstances were such that we would have to stretch a point. There was no option in this case. I do not think that even if there was a discrepancy between the normal charge and what we were paying it would have affected our attitude seeing that the premises had to be lighted.

General MacMahon.—The only alternative would be to send a tractor from the Curragh, which could not be replaced as it was required there.

1029. Chairman.—Paragraph 74 con-continues:—

“Damage was caused to premises in military occupation as a result of a fire which occurred in October, 1941, and the resulting Court of Inquiry found that there was no evidence as to the cause of the fire. The premises were fully covered by insurance effected by the owner and it appeared from correspondence which took place prior to the fire between the insurance company and the agents for the owner that the company was aware of the military occupation and was holding the insurance in force against ordinary fire risk. It was estimated that damage to the extent of £3,112 5s. 6d. had been caused to the premises and contents, of which sum £1,217 related to structural damage, and a claim was presented to the Department by the insurance company. I am in communication with the Accounting Officer on certain matters arising out of this claim.”

Mr. Maher.—I think that the consideration of this case by the Committee might be deferred until a decision has been reached.

1030. I believe I am correct in saying that this case is sub judice and that the rights of the State might be prejudiced by a discussion of its merits at this stage. I suggest, therefore, that the Committee should approve of the suggestion to defer consideration of the matter.

Agreed.

1031. Chairman.—The note continues:

“Expenditure amounting to £157 4s. 10d. was incurred on the acquisition and adaptation of certain premises for occupation by members of the Forces in connection with a scheme for the transport of turf. The scheme was abandoned and the premises were not in fact occupied and I have asked whether the sanction of the Department of Finance was obtained for the charge to the Vote.”

Mr. Maher.—The sanction of the Department of Finance was obtained for acceptance of the agreed conditions of letting of the three premises in question. When it transpired that nugatory expenditure had been incurred, the matter was reported to the Department of Finance and I understand that it is at present the subject of correspondence.

General MacMahon.—The Department of Finance have now sanctioned the expenditure and it is being charged against the Army Vote.

1032. Chairman.—The matter has been disposed of to the satisfaction of the Department of Finance?

Mr. Almond.—Yes.

1033. Paragraph 75 of the Report of the Comptroller and Auditor-General relates to the Local Defence Force and is as follows—

“A yearly Grant in Aid of £1 is payable to unit funds for each person who is serving in the force and who is certified by the area officer to be an active member. In the course of my examination of the claims submitted in respect of certain battalions for the period to 31st January, 1943, I observed that the required certificates had been furnished, and grants paid, in respect of persons who either had resigned or been discharged prior to that date, or who had not attended for several months previously. In reply to my inquiries I was informed that difficulties had been experienced in securing proper records of personnel and that discrepancies arose between company and battalion headquarters records. I was also informed that the more exacting inspections now being carried out would ensure that proper records would be available and that non-effectives would be eliminated. The charge in respect of the persons referred to has been removed to a suspense account pending recovery of the amounts paid. Having regard to the position disclosed by a limited test examination I have suggested the desirability of having investigations carried out with a veiw to establishing the validity of the claims submitted by Local Defence Force units generally for the year 1942-43.”

Mr. Maher.—We have recently been informed that further test examinations have been carried out in the Dublin area, as a result of which a sum of £94 10s. was recovered in respect of incorrect claims from men resigned or discharged and £288 10s. in respect of members who could not be regarded as active. In test examinations which were carried out in the Western Command, amounts totalling about £450 have been noted for recovery.

1034. Were those sums recovered from the funds of the battalion or unit or from individuals?

General MacMahon.—From the funds of the unit, because it was the funds of the unit that benefited by those false claims.

1035. You are satisfied that any moneys obtained from the Department on foot of those defective claims went to the funds of the unit and were in no sense misappropriated by individuals?—I am absolutely certain of that.

1036. Are you, Mr. Almond, satisfied that the position is now under control?

Mr. Almond.—Yes, subject to a full audit of the various districts being carried out, which, I assume, will be done.

1037. In all the circumstances, it was frightfully difficult to assess with precision the active membership of the Local Defence Force in this period?

General MacMahon.—It was practically impossible at that period. The records were bad. The company records did not always agree with the battalion records. We were supplied with the battalion records and it was on those we paid. I think that the position is now all right, because, in most cases, military officers are in charge.

1037a. The money was mainly used for the benefit of the unit, whether the unit was as large as it was represented to be or not?—It was used entirely for the unit.

1038. Chairman.—The next portion of paragraph 75 states:—

“With the sanction of the Department of Finance, payments amounting to £2,037 15s. 5d. were made to unit funds in recoupment of expenditure on leggings purchased locally and I have asked for certain information on the matter.”

Mr. Maher.—The Department of Finance sanction for the purchase of uniforms and leggings for the Local Defence Force was subject to the condition that the leggings would not be issued to members who were already in possession of leggings of standard pattern whether purchased at their own expense or from district funds. It was subsequently referred to the Department of Finance that 8,684 pairs of leggings had been provided from district funds at a cost of £2,037 15s. 5d., and sanction was sought for recoupment as it was felt that districts which were enterprising enough to make such provision should not be under a disability. Sanction was obtained and the various districts recouped accordingly. In reply to our inquiries we were informed that vouchers were not furnished for the purchases made by the districts but that the charges were vouched on audit by the commands, and that instructions had been issued to have the leggings taken on ledger charge.

1039. Are you satisfied with the position as it now stands?—Yes, up to that point.

1040. Chairman.—The next portion of the paragraph states:—

“As stated in paragraph 68 of my last report, the issue of serge uniforms to members of the Force was sanctioned subject to the recall of existing denim uniforms and their disposal as far as possible for Army purposes. Considerable discrepancies were disclosed between the number of serge uniforms issued and the number of denim uniforms surrendered and the matter is still the subject of investigation.”

Mr. Maher.—I understand that authority is being sought to write off that unexplained balance in respect of uniforms.

1041. I take it that the vast bulk of those denim uniforms was lost?

General MacMahon.—Yes. We have asked the Department of Finance to write off 62,279 blouses, 62,947 trousers and 66,937 caps. The numbers actually issued of each was 99,608. More than 50 per cent. have been unaccounted for but one has to remember the circumstances. The material in those denim uniforms was bad. In spite of instructions, they were worn at work and got worn out. Men moved from one part of the country to another and did not notify their change of address. Others emigrated and said nothing about the matter.

1042. If you set off the amount of pneumonia contracted as a result of parading in those uniforms, I venutre to say the balance is in favour of the State rather than in favour of the unfortunates who wore them when we wanted them to do so?—I think we got good value.

1043. I think so, too. The next portion of the paragraph states:

“Following a reorganisation of the Force, which was confirmed by regulations promulgated in May, 1943, comprehensive accounting instructions were issued providing for the custody and control of stores on charge to Local Defence Force units and for periodic stocktaking. The effect of these instructions will come under observation in the course of audit of the accounts for the year 1943-44.”

We can postpone consideration of the details until those observations come before us. Perhaps it would be right for me to say at this stage that the Committee desires to extend every kind of consideration to the army authorities in connection with certain discrepancies in their accounts on this occasion because it appreciates the immense difficulties under which the army was operating in the period with which we are dealing. I mention that so that our somewhat cursory procedure may not be regarded as a precedent in later years when more detailed supervision may be legitimately expected.

General MacMahon.—I understand that.

1044. Chairman.—Paragraph 76 of the Report deals with a grant to the Irish Red Cross Society and states:—

“Payment of a grant of £440 13s. 0d. was made to the Irish Red Cross Society, being a proportion of the transatlantic freight charges on certain surgical and medical supplies sent by the American Red Cross Society. The supplies remain the property of the American Society and may be used in this country only in certain circumstances; in the event of their not being used in the present emergency, the manner of their disposal will be arranged between the two Societies. Payment of the grant was subject to the condition that the Exchequer will be recouped should the supplies be sent outside the State or disposed of by sale. Further similar payments will be charged to the Vote for the year 1943-44.”

Mr. Maher.—The charge to the Vote represents 75 per cent. of the freight charges on the first consignment. Further consignments have since arrived, and the payments in respect of them will be charged to the Votes for subsequent years.

General MacMahon.—That is correct.

1045. Chairman.—Whatever about the value we got for the denim uniforms, we got very good value for the amount expended in this case. Paragraph 77 of the Report deals with fuel and light accounts, and is as follows:—

“I referred in paragraph 93 of my report on the Appropriation Accounts for the financial year 1937-38 to difficulties which had arisen in accounting for stocks of peat fuel and in reconciling quantities held in stores with ledger balances. Stocktaking was carried out in 1942, the quantities of turf held at the various posts being ascertained by reference to scales which have been adopted for the calculation of weight by measurement, and, as noted in the account, the sanction of the Department of Finance was obtained for writing off charge a total of 5,756 tons of waste turf which had accumulated. This quantity represented approximately 7.16 per cent. of the total deliveries during the year, but it was noted that at certain posts the percentage of waste exceeded 50, whilst at other posts no waste arose, all the stocks being regarded as suitable for fuel. I have inquired whether the Accounting Officer is satisfied that deliveries of turf were used to the best advantage. I have also asked as to the basis on which the quantities of accumulated turf mould were determined.”

1046. General MacMahon.—In that year, we were using turf won by the army. It was the first venture of the kind in which the army had engaged. They had no experience of the work and they cut some turf from the top portion of the bog. The weather, too, was bad, and the turf was not well saved. Great losses occurred that year, but in subsequent years the losses were not very great.

1047. I suppose the man who said he had no losses was an optimist and that the man who said he had 50 per cent. loss was a pessimist?—The man who had no losses deprived the soldiers of the amount of turf to which they were entitled.

1048. Have you considered the practicability of using turf-mould as fuel in stoves for heating rooms and halls?—That is done in some places but, in many cases, the men object to it. They say that it does not heat the rooms. A great deal depends on the unit. Some units have used a certain amount of mould and got quite good fires from it. Others are inclined to grumble and complain of cold. Some mould is being used in that way.

1049. I sympathise with the losses mentioned here because I think that turf does waste appreciably into mould but I have found that turf-mould used in ordinary stoves effectively heats a room?—We find it very good for heating the baths at the Curragh.

1050. Chairman.—What is Deputy Breslin’s opinion on this matter?

Deputy Breslin.—I have been thinking of the turf-mould I see at the railway stations in Donegal. I see tons and tons of turf-mould lying at all the stations and I am sure that if it were of any use it would be picked up. I inquired at my local station and I was told that it would not be worth lorrying for the purpose of heating.

Chairman.—I think that that is true, but if you have large deposits of turf-mould on the premises and a large number of stoves, you can use it effectively in enclosed stoves. In an open stove it would be extremely dangerous, because it gives rise to considerable sparking.

Deputy Breslin.—That is correct.

1051. Chairman.—The next portion of this paragraph is as follows:—

“Payment of £37 17s. 6d. was made in settlement of a claim in respect of the cutting of turf on certain property during the 1941 season. It appeared that only 20 tons of the turf so cut had been removed and that the balance remained on the bog and had deteriorated considerably. A further payment of £33 15s. 0d. was made in May, 1943, in respect of the same property for the 1942 season. I have asked for certain information on this matter.”

Mr. Maher.—In 1941 about 120 tons of turf were cut on this property, but as it was cut late it was unfit for removal when troops were available, and it was left on the bog where it deteriorated considerably. £37 17s. 6d. was paid for the cutting rights. The turf was inspected in June, 1942, and was refooted and left to dry. Twenty tons were removed and taken on charge, the balance being left on the bog, as the troops were withdrawn for Brigade training. When training was completed it was found that the turf was again unfit for removal. In May, 1943, payment of £33 15s. 0d. was made to the owner in respect of turf stated to have been cut in 1942. No turf was in fact cut that year, and I understand that the amount paid is to be recovered.

1052. How did that payment of £33 15s. 0d. arise?

General MacMahon.—The officer, in actual fact, misunderstood the position. When he saw the turf there, he thought it was the same number of perches again, and he certified that the turf was cut. He was proceeded against, but I should say that what he did he did in good faith. He was merely required to refund that sum of £33 15s. 0d. It was really an error on his part.

1053. I take it that the Department of Finance have no observations to make on that?

Mr. Almond.—No.

1054. Chairman.—We can now take paragraph 78 in the Report of the Comptroller and Auditor General:

“Suspense Account.

“With the sanction of the Department of Finance, expenditure in connection with the steps taken towards the maintenance of water supplies in the event of the destruction of bridges carrying mains has been charged to a suspense account pending a decision as to the final incidence of charge, the amount expended to the 31st March, 1943, being £2,245 15s. 5d. Materials for the purpose of effecting repairs to water mains were delivered to the local authorities concerned and I am informed that arrangements for the control of these stores are under consideration.”

Have you any note on this, Mr. Maher?

Mr. Maher.—I have nothing further to say on this paragraph.

General MacMahon.—The Department of Finance has now decided that the Army Vote is to bear the full cost, and that the materials with the local authorities will remain army property. In the event of it not being required, the local authorities will get an opportunity of purchasing it. If they do not purchase it, it will be withdrawn to army stores and disposed of.

1055. Chairman.—We can now take paragraph 79 in the Report of the Comptroller and Auditor General:

“Losses.

“Losses written off during the year were as follows:—

The corresponding figures of losses in the previous year were £754 13s. 11d. and £28,850 14s. 10d.

Full particulars of the losses have been furnished to me, and the sanction of the Department of Finance has been obtained for the write-off in each case.

Accrued deferred pay (see paragraph 65) amounting to £58 15s. 7d. was set off against debtor balances on non-effective soldiers’ accounts before arriving at the amount to be written off under that heading.”

Have you any note on this, Mr. Maher?

Mr. Maher.—No. As regards the last sub-paragraph, the amended regulations have already been discussed by the Committee. Provision has been made for the payment of deferred pay on death or discharge.

Chairman.—That disposes of the notes in the Report, and if there is no other question we can turn to the Vote itself. The members of the Committee will remember that under an arrangement made at the beginning of the emergency no subheads are given in this Vote, the detailed consideration being left to the Defence Conference. If there is any question which the members of the Committee wish to ask the Accounting Officer in regard to general army matters, they can do so now.

1056. Deputy Loughman.—With regard to the sale of army stores—used boots, for instance—is there any publication of the price which the army accepts when people tender for them?

General MacMahon.—We simply advertise them, but we do not publish the price that we accept.

1057. The reason that I ask the question is that I was asked about it by a person who tendered. He put in a tender, at what he considered a high figure, for army stores, and he was not satisfied that the price he quoted could be beaten. That creates an impression among people of that type that there might be some influence used to accept the tender of a person who might, perhaps, have tendered at a lower price. There is no possibility of that?—Not the slightest.

1058. Chairman.—I take it that if any specific case comes to Deputy Loughman’s attention and that he brings them under the notice of the Accounting Officer, you will be glad to go into the details with him?—I certainly will.

1059. Deputy Cosgrave.—A number of cases has come to my notice where soldiers who enlisted were subsequently discharged, suffering from tuberculosis, and that when they made application for disability pensions, or for medical or hospital expenses which they had to meet outside, they were informed that the disability from which they suffered was not attributable to service in the army. I would like to know from the Accounting Officer if there are many cases of that kind. Quite a number have been brought to my notice. At the moment I have two or three of practically the same type before me. There is this sort of case. A couple of days after a man joins the army he gets a wetting, say, on the barrack square and develops a cold. He interviews the doctor and he is put on sick leave for a short time. Afterwards he may be sent to St. Mobhi’s hospital, and is finally discharged. These people are labouring under very considerable grievances in respect of their treatment. Technically, I do not say it is possible to prove conclusively that they did actually contract the disease in the army, but even if they did not, they were suffering, in a minor way, from army conditions. Their service in the army may have accentuated their trouble?—Before such a man is discharged he is encouraged by the M.O. to apply for an application form for a disability pension. After that application for a form is filled in it is referred, when certain details have been obtained, to the Army Pensions Board, which is a statutory body. It examines the application, and eventually the applicant comes before the Board. The Board’s decision is final. The Minister has no control over it. If the Board says that the disability is not due to service, the Minister cannot do anything about it.

1060. Deputy Pattison.—I know myself that this matter has had serious reactions on recruiting in my part of the country.

Chairman.—Excuse me, Deputy. If the Accounting Officer says that so far as he is concerned, in respect of an ex-soldier, his function ceases once he provides the soldier with the application, and that, thereafter, the matter passes to the Army Pensions Board, which is a statutory body over which he has no authority, we cannot press him as to what the Board does.

General MacMahon.—The 1943 Act deals merely with disability due to service. Aggravation is not dealt with under that Act. It is under another Act. If a man’s disease is aggravated or increased he gets nothing under the 1943 Act. The disease or disability must be actually due to service.

1061. Deputy Cosgrave.—That is a serious drawback?—That is the position.

1062. Are you satisfied with the examination which the Army M.O.’s give, both when a man joins the army and when he reports sick? I have personal knowledge of a case in which, on a soldier joining the army he was passed fit, but three weeks later he applied for discharge on medical grounds due to some injury to his back. Of course, this particular individual was malingering. He had been previously in the army and got his discharge. Then he came back again. Nevertheless, it must have been quite obvious from looking at him on the first occasion on which he was examined that he had some disability as he was discovered to have three weeks later?—When we are dealing with personal clothing and refer to the fact that a big number of men were discharged, we draw the attention of the medical authorities to the fact that these men were passed in fit two or three weeks earlier. When we ask for an explanation they state that there are certain disabilities that only manifest themselves at a particular time; that they may have been latent, and that it is only intensive training that will bring them out, and because of that the medical officers cannot detect them.

1063. Chairman.—I suppose it would be true to say that if every potential recruit were put into clink for three days it might be possible to detect a disability, but that it is utterly impossible to apply an exhaustive kind of test that would reveal any suppressed weakness which might manifest itself under the exceptional stress of military training?—That is the position.

VOTE 64—ARMY PENSIONS.

Lieutenant-General P. MacMahon further examined.

1064. Chairman.—There is no note by the Comptroller and Auditor General on this Vote. On Subhead I.—Surgical and Medical Appliances—is it within the discretion of the Board, or of the Minister, to grant an injured soldier a surgical appliance of which he stands in need?— The Board must recommend it, and if it does, then he gets it. Automatically, we go to the Department of Finance for sanction where the Board recommends it.

1065. May we assume the practice is in the event of a soldier losing a limb, that ordinarily he would be provided with an artificial limb on the occasion of his discharge?—That is always done.

1066. I take it that the hospital treatment envisaged under Subhead K. would be the sort of case where you send a soldier to an outside sanatorium or something of that sort?—This is really a repayment from the Pensions Vote to the army for pensioners who are usually in St. Bricin’s Hospital.

1067. Would these be men who had been discharged and who were sent back to St. Bricin’s Hospital after they have ceased to be soldiers?—Yes, they are called up by the Board for examination, and the Board may recommend treatment.

1068. And then I take it they go into St. Bricin’s as quasi-civilians for whom the Board are responsible?—They go in as civilians. That applies also in the case of old I.R.A. men who come under the 1932 Act. They are civilians under examination in the hospital, and are very often there under treatment.

The Committee adjourned.