Chairman.

1. There has been circulated to Members of the Committee the statement of Excesses in connection, in particular, with Class I and Class VI; dealing with Diplomatic and Consular Buildings and also the Ministry of Pensions. I think in regard to the first, there are three paragraphs in your Report, Sir Malcolm. We will take first, paragraph 2?-(Sir Malcolm Ramsay): That merely reports the facts; there is a little more in paragraph 7.

2. That is on page vi. This refers to the deficit of £4,000 odd which has arisen on this Vote, and also, I think, there is a rather longer reference in paragraph 54?—That is in reference to the Ministry of Pensions.

3. Is there anything you would like to add to your statement, with regard to the Diplomatic and Consular Buildings, on page ii, Sir Lionel ? (Sir Lionel.

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Earle): I do not think so, except that this is the first time it has ever happened to me in my official career, and I am bound to say it has been due to a genuine attempt of the Department to prevent those under spendings which the Committee for the last two or three years has, in my opinion, so very properly attacked. We ran it perhaps rather too fine in estimating, and the great difficulty in this particular Vote is that in China, Japan, and the far distant places, we do not get the accounts in accurately until after the close of the year. Towards the end of the financial year we saw that the Vote was extremely close, and, after informal consultation with the Treasury, it was decided that we should take the risk rather than go for a Supplementary. amount is not very large, as you will see, and it was chiefly due to two circumstances; one was the heavy expenditure at Vienna, due partly to a very bad

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winter, partly to a fire, and partly to the very dangerous condition of the electric light wiring. The Austrian architect there, without secretariat authority, embarked on expenditure amounting to £4,000 above what he was authorised to do. He has been very suitably dealt with, and informed that if anything of the sort occurs again it will mean instant dismissal. The second circumstance is the accelerating of the furnishing of the Budapest Legation, and also the visit of the Prince of Wales to Buenos Aires, where the new Legation House which Parliament had agreed to had to be furnished considerably earlier than we contemplated on account of the visit of the Prince. When the Estimates were prepared we did not know that His Royal Highness was to go there. Had it not been for those circumstances there would have been no excess Vote.

4. A lot of the trouble quite clearly turns on the difficulty of keeping in close touch with places so far apart.We do have telegraphic communication every month, but it is very difficult to get accurate information with regard to the exact state of affairs from these officers in far distant places. We are trying to tighten up the system now to prevent anything of the sort occurring in the future, and this excess vote is the result, as I say, of the very much closer estimating to prevent these terrific underspendings.

[Continued.

Sir Fredric Wise.

5. Was the £4,258 entirely for Vienna? Yes, entirely.

6. That means a lot of kronen at the current rate of exchange?—Yes; of course, the krone was not anything like so bad then as it has been; but the house was in a deplorable condition; the cornice fell down into the street; there had been a bad winter and the roof collapsed in part; then there was a fire, which involved expenditure of only £600 I admit, but it did the place no good; and the wiring was in an appalling state. It is a largish house although it is only a Legation, but it was Embassy, and we cannot help that; it is a biggish place.

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7. This completes the maintenance and repairs, does it?-For that year; but we generally take about £400 a year for it. 8. A small amount?-Yes.

Chairman.

9. Have you anything to add to the Committee on this Excess Vote, Sir Malcolm? (Sir Malcolm Ramsay.) No, I do not think I need detain you upon this.

Chairman.

10. That is the only one account for which you are responsible, Sir Lionel ?(Sir Lionel Earle.) That is so.

Chairman.] Thank you very much.

which a larger sum fell on the old year than had previously been the case.

12. Would you like to make any general statement to the Committee, Sir George? (Sir Malcolm Ramsay.) I might just point out that the excess is really, as a percentage of the Vote, quite negligible. (Sir George Chrystal.) That is so. It is what one might call a part of the general underestimate which took place in that year, and for which, as you may remember, Sir, we had to have a Supplementary Estimate. The effect of it, I think, was