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6. ANNUITIES CREATED IN COMMUTATION OF COMPENSATION ALLOWANCES, &C.

Amount of

Pension
Amount payable for ten years to the National Debt Com-

Commuted.
missioners for the repayment of the sums advanced by

£ 8. d. them in commutation of compensation allowances, &c.

100 0 0

91 30

Probable variation during the Year

49,313 12 3
+1,686 7 9

35,286 4 9 + 1,713 15 3

Total Non-EFFECTIVE CHARGES

£.

51,000

37,000

H.-APPROPRIATIONS IN AID :

Production for Army

/Vote 9 of Army Estimates -
Other Repayments (Army) -

1,200,000

50,000

£. 1,325,000

60,000

Production for Navy

Vote 9 of Navy Estimates
Other Naval Repayments

1,300,000

50,000

1,375,000

70,000

Production for Indian Government

150,000

300,000

Production for Colonies

100,000

30,000

Production for Replacement Orders

50,000

- (a)

Sale of old Stores, Refuse, &c.

80,000

75,000

Miscellaneous Receipts

40,000

34,000

Sale of Land, Buildings and Machinery

2,000

60,000

To be transferred from the Ordnance Factories Supplies Suspense

Account

100,000

58,000

£.

3,122,000

3,387,000

(a) £100,000 included under production for Army (Vote 9) in 1906–07.

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MEMORANDUM

OF THE

SECRETARY OF STATE

RELATING TO THE

ARMY ESTIMATES FOR 1907-1908.

Presented to Parliament by Command of His Majesty.

LONDON:
PRINTED FOR HIS MAJESTY'S STATIONERY OFFICE,
BY HARRISON AND SONS, ST. MARTIN'S LANE,

PRINTERS IN ORDINARY TO HIS MAJESTY.

And to be purchased, either directly or through any Bookseller, from
WYMAN AND SONS, LTD., FETTER LANE, E.C.; and
32, ABINGDON STREET, WESTMINSTER, S.W.; or

OLIVER AND BOYD, EDINBURGH ; or
2. PONSONBY, 116, GRAFTON STREET, DUBLIN

1907.

MEMORANDUM OF THE SECRETARY OF STATE RELATING TO THE ARMY ESTIMATES FOR 1907-08.

TOTAL ESTIMATES. The sum which Parliament is asked to vote for Army Services in 1907-08 compares with the total of the Estimates for 1906-07 as follows:

f 1906-07

29,796,000 1907-08

27,760,000

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This decrease, however, does not represent the total of the savings that have been effected, as it has again been necessary to find money to meet the automatic growth of certain charges, viz. :

£
Amount by which the Estimates of 1906-07 were

reduced, owing to the depletion of the Regular
Infantry in that year

90,000
Increased cost of Army Reserve

141,000
Increased charge for stores and clothing, due to the

reduction of the surplus stocks available from
the South African War

187,000
Increased cost of the Militia (including Reserve) 35,000
Increase of the Vote for works, owing to closing of
loan expenditure

42,000
Increased charge for service of loans

41,000 Increased charge for pensions

38,000

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The reductions effected thus amount in total to some 2,600,0001.

This figure includes a decrease of 699,0001, in the amount provided for the Re-armament of the Horse and Field Artillery with quick-firing guns. The progress of expenditure on ihis scheme has been more rapid than was originally anticipated ; and the sum of 488,0001. to be voted in 1907-08 will complete the equipment of the Artillery with these guns. The total cost will have been 3,116,0001.

The total reduction in the Estimates would have been still larger but for the fact that a reduction of establishments does not at once produce a saving equal to the whole cost of the officers and men reduced. They cannot be summarily struck off the books, but must be allowed to finish their engagements; nor can all share of promotion be denied to them. The reduction of actual strength must be effected by taking fewer cadets and fewer recruits; but here again the stoppage cannot be made abruptly. Everything practicable has been done during the year 1906–07 to bring the actual strength of the Army to the level of its new establishment, but provision has to be made in the Estimates of 1907–08 for considerable numbers of supernumeraries. Recruiting as a whole continues to be good, and one result of this has been that the depletion of Line Infantry battalions at home, due to the efflux of three years' men to the Reserve, is rapidly disappearing

LOAN EXPENDITURE. Besides the reduction of the Estimates, the restriction of expenditure of borrowed money calls for notice. In the ten years from 1896-97 to 1905-06, the total amount spent under Army Loans was 15,754,0001., an average of 1,575,0001. a year. It was decided early in 1906 not to exhaust our borrowing powe under existing Acts, but to wind up the Military Works Loan as soon as certain indispensable services had been finished. The expenditure in 1906-07 will amount to some 650,0001. and in 1907-08 probably to a similar sum.

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