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24 March, 1927.] Sir CLAUD SCHUSTER, K.C.B., C.V.O., K.C.

and it has been put a stop to in the manner described by Sir Malcolm in his Report.

Mr. Briggs.

1305. Are we to understand, Sir Claud, that up to the time of this alteration there has been a distribution of a sum of £2,500 per annum between these five officers ?-(Sir Claud Schuster.) Oh, no. That was distributed as compensation to these men for losing a vested interest.

1306. I see it says that it is estimated the fees will produce a revenue of £2,300 per annum?-Yes, that is the revenue which I hope we shall get in the future.

1307. That is not the revenue you have been getting which these five officers have been dividing between them?-Perhaps I had better begin a little further back. This business goes back about a hundred years. For a very great many years it probably did not produce a very large revenue. We do not know. Some time about 20 years ago I should think, the then President of the Probate, Divorce, and Admiralty Division, became alarmed at the amount which the clerks were getting for this service which they were putting into their own pockets. I do not mean they were doing that improperly; they were no doubt quite entitled to put it into their own pockets. The President then required them to hand over to him what he considered to be the amount of excess beyond the amount they might fairly take, and he put all they gave him into an account at Child's Bank, and out of that account he paid various things which he thought proper to be paid. For example, he made payments to people who he thought were working overtime when they need not-and things of that sorttreating the money as a sort of trust fund, although of course it

was a

trust, over which he had absolute dominion. For example, out of it he made a very heavy subscription on one occasion to the funds of the London Hospital. The present President, when his attention was called to the matter, partly I suppose in consequence of the Tomlin Committee, and partly in the course of the administration of his Division, began to stop it by requiring that a larger sum be paid into the account and a smaller sum be paid to the clerks, and so there came to be an accumulation in Child's Bank. That sum of money is now being used for buying

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out the vested interests of these people, and henceforth the whole of the revenue, such as it is, will become in effect a profit to the Exchequer.

1308. Can us you tell the amount divisible in the last year, the year 1924? -Do you mean the amount produced?

1309. I want to get at the amount that these officers got in the last year. 1924 was apparently the last year. At the moment I cannot quite grasp what the fund was worth? There were five clerks interested. In form, the person who got it all was a person called the Record Keeper. He did not in fact get it all. The arrangement between him and the President was that when the amount did not produce to him £500 a year, he was to be entitled to come to the President and ask him to reconsider the arrangement. The other four clerks got amounts which varied between £100 and £200. That left a considerable surplus, which went to the President in every year. Do not let me lead you to think the President put it into his pocket. Of course he did not.

1310. Take your figures. You have roughly given me the figure of £500 as a minimum for the Record Keeper and £200 approximately for the others. That meant a basis of about £1,500 divisible between these five men, which is £300 a year apiece?-Yes.

1311. What were the salaries of those five officers?-One had £650, and the others would probably be all third-class clerks on a salary of £100 rising by increments to £200, plus a bonus since the

war.

1312. Therefore the amount they got in this way was a very considerable addition to their salary?-Very considerable, no doubt.

Major Salmon.

1313. It is estimated that these fees will produce a revenue of £2,300 per annum, at a cost, including compensation and other allowances, of £1,450 per annum?-The agreement that was made for the termination of this arrangement was an agreement made between the Treasury and the President. What I

ought to have put before you is the exact terms of the agreement, perhaps. May I just read you the terms, it will probably save time in the long run. document says that the existing arrangement is a private undertaking and shall be finally terminated at a certain date.

The

24 March, 1927.] Sir CLAUD SCHUSTER, K.C.B., C.V.O., K.C.

man

The interest of the Record Keeper and his four assistants shall be recognised and disposed of in the following terms. Out of the capital monies in the hands of the President there shall be paid to the first man (not the Record Keeper) a lump sum of £500, the second £335, to the third man £250, and to the fourth man £50. After payment of these sums and of any expenses incurred in winding up, the balance shall be paid to the Record Keeper. There shall also be paid to the Record Keeper in addition to his salary an annual allowance approximately equivalent to the difference between £475 and the value of the capital sum payable to him as mentioned in sub-clause (b). It is rather a difficult calculation to state except by referring to the actual words of the agreement.

1314. Does it mean that at the time when the officer in question retires the new officer who succeeds him will not receive this money?-That is what I understand. This is a terminable thing. If he comes to an end, so does this.

1315. Therefore the amount the Exchequer will receive will be whatever the amount of the annuity to the individual is? Yes, so far as that annuity is concerned; but there will still remain payments to these other clerks, because they will still be doing something which is considered to be a little in excess of their real work. £50 is not a very large sum; it will not do any great harm. I think it is intended to continue the £50 allowance, but you must not take that as certain. (Mr. Watson.) It is £25.

1316. That means it will go with the office, beyong the first man who gets it? -Yes.

1317. There will always be an additional emolument to the individual who has this position in this office?-Not the big sum I have referred to.

1318. The sums other than the big sum? Yes.

1319. Does it mean that the Revenue will receive after these allowances have been made £1,450 a year more income than they do at the present time?—(Mr. Phillips.) No. I think over £1,000 of that is real expenses in running the business, and could not be avoided in any circumstances. (Sir Malcolm Ramsay.) About £300 a year is stationery, and that will go on.

1320. But the difference will be all surplus to the Revenue ?-(Sir Claud Schuster.) It will be, not surplus to the Revenue, but to the account.

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Sir Assheton Pownall.

1323. I am not quite clear about the two words "including compensation," because I understood from what you said that the measure of compensation had been paid out of the " Charity Fund "?

(Sir Claud Schuster.) The Record Keeper will go on receiving an annual allowance so long as he remains in office.

1324. He has not benefited by the payment from the "Charity Fund "?-He has, but in addition to that he is going to get an annual sum so long as he remains in office, and the clerks are going to receive for all time £25 more each.

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1325. I presume this does not affect the pension rights at all? Oh, This is an extra thing altogether. least, I suppose so. But that is not a thing for me. (Mr. Phillips.) It does not carry either Civil Service bonus or reckon for pension. (Sir Claud Schuster.) The first, or possibly the second time that this arrangement came to the knowledge of the Treasury was when about 50 years ago the then clerk demanded to be pensioned upon profits he was making in respect of this work, and that very nearly produced a stoppage of the whole thing at the time. He was pretty well entrenched, because he went on receiving it in in.. creasing amounts right up to the time of his retirement; but he did not get his pension.

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we have now Chairman]. I think sufficiently dealt with the Report of Sir Malcolm on this account, and we will now turn to the account itself.

Mr. Ellis.

1326. A good deal has been said about Judges' Marshals just lately. It would be as well if you could tell us the work they really do. It is not all disclosed,

24 March, 1927.]

Sir CLAUD SCHUSTER, K.C.B., C.V.O., K.C.

and it is only fair to the public that they should know they are of some value. -The Judge's Marshal to all intents and purposes is the private secretary to the Judge. He is responsible for looking after the Judge. He runs the household and he swears the Grand Jury. I should think in most cases he reads the depositions, and if the Judge

wants a machine to talk into he fulfils that function. It is a very lonely performance for a Judge on a single circuit to be away from London for a great many weeks. He is cut off very largely from the Bar who are practising before him, and he has nobody to talk to. And it is a great advantage to him to have somebody with whom, I should not be so disrespectful as to say he could discuss, but to whom he could talk about the cases he is trying and going to try, even if he does not require any answer from the instrument into which he talks. I have been a Marshal on many occasions, and I thought I was a very useful servant to the State at the time. do not know whether anybody else did. 1327. I remember being one myself. Would it be fair to say that in many cases he acts as a useful intermediary between the Judge and people outside? -The Judge must have some intermediary in so many cases, and that function cannot be performed by the clerk. I think some few Judges do not in fact take Marshals. I do not want to claim for the Marshal that he is of equal importance with the Judge, but I think the Judge's comfort would be materially lessened if he had not a Marshal.

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1328. In the circumstances does he earn his salary? Oh, yes, I think so. If I was going to save money over circuit arrangements, I should not begin by cutting down the Marshals. There are a good many things I should do before that.

Sir Robert Hamilton.

1329. Are the circuit expenses increasing ?-No.

1330. But you do indicate two directions in which the expenses might be reduced? I am quite clear in my own mind about the measures by which expenses could be reduced, but they do not commend themselves to Parliament. To reduce expenses would mean substantial and substantive alterations in the law.

1331. How do the circuit expenses shown in this account, amounting to

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£22,000, compare with pre-war expenses? -I do not think they can be substantially higher, because, although we pay bonuses we do not pay them in full, I think, to any circuit official.

1332. Would bonuses come into this item of circuit expenses?-Any bonuses there may be. The expenses will be slightly increased, of course, because railway tickets cost more.

1333. Could you say how much they have increased now over what they were before the war?-(Mr. Phillips.) Before the war, in 1913-14, they were £19,600. (Sir Claud Schuster.) They must vary from year to year, of course, because the lengths of the circuits vary.

Colonel Henderson.

1334. Are the travelling expenses shown under subhead G the travelling expenses of the Judges, or do those travelling expenses come under subhead C? The expenses under subhead G are expenses of the Lord Chancellor's own officers, and members and witnesses of Departmental Committees. Those will all be in connection with the Lord Chancellor's Department: The Master in Lunacy and his clerks; the Visitors in Lunacy, who really account for probably nearly half the whole amount; the Official Referees and their clerks; the District Registrars at Manchester and Liverpool District Probate Registries. That will be an increasing charge, because that means District Probate Registrars that have more than one Registry, and that will be an increasing class. There will be fewer Registries, and therefore they will have to travel more. Then there is the Official Solicitor to the Supreme Court. The rest I cannot classify. There is the Probate, Divorce and Admiralty Division, and other departments of the Supreme Court, a sum of about £300. I do not know what that actually goes on.

1335. Where are the travelling allowances of the Judges shown?-In subhead C.

1336. Those travelling allowances do not include any allowance for accommodation, do they?—No.

1337. That is paid to the Sheriff ?-So far as it is paid by the Exchequer at all.

1338. There is a very big payment made by the Exchequer to the Sheriff?But the main expense of housing the Judge falls on the County.

24 March, 1927.] Sir CLAUD SCHUSTER, K.C.B., C.V.O., K.C.

1339. Then why is there a payment made to the Sheriff ?-That is outside my accounts altogether.

1340. Is not that dealt with by you?No, I have nothing to do with that at all. I should be very glad to have to do with it, but I have not.

1341. I wanted to know whether they in any way overlap. I am not happy about that. But if you cannot answer the question, it is no use asking it?—I am afraid I cannot answer the question. I wish I could.

Major Salmon.

1342. Under subhead A dealing with salaries, wages and allowances, is any regard had to pensions, or what will pensions come under?-They do not come in this account at all.

1343. Could the Treasury explain this? Am I correct in saying that in most public accounts that come before us the superannuation is shown in the account of the particular Department?-(Mr. Phillips.) In the Estimates, but not in the Appropriation Accounts. (Sir Claud Schuster.) The superannuation in the year ending March, 1926, was estimated at £83,000, but that does not include the Judges. Lower down in the Estimates you get pensions and compensation.

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1344. What does this subhead salaries, wages and allowances include? Does it include the Judges' salaries?— No.

1345. What salaries does it include?My own, and all the clerks and other people serving in the different courts, and in the Lord Chancellor's Department. If you have the Estimates for 1925-26, Class III, Vote 3, you will find the whole lot set out in detail.

1346. Do you from time to time go into the question with each of these departments to see what savings can be made? -Yes; we never cease doing that, practically speaking. We had a very large and long inquiry into all these departments, which began just before the end of the war, and it has to all intents and purposes only just ceased, as a result of which we made reductions which, considering the total amount involved were enormous. In some cases they amounted to about 50 per cent.

1347. Is that reduction reflected in the accounts?-Not in these accounts. It has all worked itself out. But if you look at the Estimates for 1913 and compare

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them with this Estimate, leaving out the bonus, you would find a very large difference indeed.

1348. This is considerably less?—The bonus being omitted, it is enormously less. The total figures are not large, as probably you think of figures, but from our point of view the figures are enormously less.

1349. Does that mean that people are receiving less, or that there is less personnel? There is less personnel. Salaries are not reduced.

1350. Do you anticipate that by reorganisation you will be able to make further reductions?-Not in these offices. I do not say that these offices are understaffed, but there is no room for reduction of staff.

1351. You think you have reached the irreducible minimum ?-In these offices we have without any question reached the irreducible minimum.

1352. When you say these offices, do you mean the offices under this vote of the Supreme Court of Judicature?—Yes, with a single exception, and that is that we have not finished the work as regards the district probate registries. There is no question that there is an opportunity for reduction there.

1353. When do you hope to be in a position to give effect to some of the recommendations and effect savings?—If Parliament would pass a Bill this year on the subject we could then hope to be in a position to do something. Some of the reductions are being effected now, people die; but others could only be touched if you passed a Bill this year enabling us to do so.

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1355. It is a small figure, but large in percentage. Is that the point?--Yes, that is the point. There are other cases in which economies can certainly be effected, but they could only be effected by change in policy.

1356. Without affecting efficiency?That is a matter of opinion. I say they depend on policy, and not on office efficiency. If Parliament were to choose to alter the legal system in some respects we could undoubtedly effect economies, but whether it ought to do so is a matter for Parliament.

24 March, 1927.]

Sir CLAUD SCHUSTER, K.C.B., C.V.O., K.C.

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1357. Presumably you would not put it forward unless you thought there was a prima facie case for it? Well, we have put up some economies which Parliament has not thought well of.

Sir Fredric Wise.

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1360. I only want the figures?—I mean the appropriations are no use at all for any comparison of cost, because all the money that is taken in judicature fee stamps, which is an enormous proportion of the whole of the money taken altogether, is not appropriated in aid on our Vote. I could tell you what the money earned is, but I almost demur to giving what the appropriations are because they bear no relation at all to the money earned. They are pure accident.

1361. The figure you have given me would work out on your account to about £200,000?-The Pensions Appeal Tribunals for 1925-26 amounted to £61,000, while for 1924-25 it was just on £100,000. That is a very substantial item.

1362. I am just taking these figures here in the account, viz., £536,000. And you have given me the figure of £332,000 for 1913-14 ? (Sir Malcolm Ramsay.) Might I interrupt to say that Sir Claude gave you the net total expenditure for 1913-14.

1363. I asked especially for the gross figure? (Sir Claud Schuster.) I beg your pardon. The gross figure in 1913-14 was £374,000. But of course there are two things which come into the account since then; one is the bonuses, and the other is the pensions appeal tribunals. I think if you come to reckon that out, you will see there is a very substantial reduction.

Chairman.

1364. The figure of £374,000 which you gave as the gross figure for 1913-14 is comparable with the figure of £536,838 in this account?-They are not really comparable.

Sir Fredric Wise.

1365. So far as the taxpayer is concerned? We have been given a duty to perform which in my duty has nothing whatever to do with the Supreme Court of Judicature, and we have to perform it and to take it upon our Vote. That has nothing at all to do with the administration of justice. We take in the money, and pay out the money, and that is all we have to do with it. It does involve us in a little extra to deal with the money, but that is the only connection. We have no control over it. That is the first thing. In the second place, from the taxpayer's point of view, the fees have been very considerably raised so that this is a selfsupporting service. It always was in theory a self-supporting service, but now it is in fact.

Major Salmon.

1366. What is self-supporting ?—The business of dispensing justice in the Supreme Court. There is no charge on the taxpayer at all.

Sir Fredric Wise.

1367. There is no charge on the taxpayer on this account?-None whatever. (Sir Malcolm Ramsay.) The fees taken in the courts are taken by means of stamps, and they are paid over separately to the Exchequer, and do not pass through this account. So that against the gross and the net expenditure shown here the Committee has to take into account something like £600,000, which is paid in stamps into a separate account altogether.

1368. Which account does that come under? The Finance Accounts, as part of the revenue of the year.

Mr. Ellis.

1369. Then we have been discussing this all this time under a misapprehension? (Sir Claud Schuster.) I tried to

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