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forward in support of the first Bill, and these Bills themselves were unsupported by a letter of advice.

Arrangements have now been made to secure that in future Q. 6459. inquiries will be made if vouchers have not been received within a fortnight after the date on which any Bill is accepted. Further, for the future only Superintending Consular Officers will be empowered to draw Bills. These steps should safeguard the position, but Your Committee would invite the Admiralty to consider whether, as an additional precaution, there could not be attached to the Bill of Exchange itself the requisition of the Naval officer on which the Superintending Consul acts in drawing the Bill.

24. Losses; disciplinary action. Agreement between Treasury Q. 7220. and Service Departments.-With reference to Paragraph 52 of the Second Report of the Public Accounts Committee, 1926, Your Committee are informed that arrangements have been arrived at between the Treasury and the Service Departments which will ensure that the Treasury, when invited to sanction the write-off of losses resulting from frauds, &c., involving negligence on the part of Commissioned officers, is fully informed of the disciplinary action taken by the Executive authorities of the Force concerned.

7294-8.

25. Cost Accounts.-The cost accounts appended to the Appro- Qs. 7257 and priation Account are for the most part composite accounts aggregating the results of a number of separate establishments, and afford no means of comparing the working of different units in each class. The Accounting Officer has undertaken to supply Your Committee in future with the detailed accounts covering the separate establishments in such classes as they may indicate, e.g., Bakeries or Laundries.

Further, Your Committee are informed that steps will be taken Q. 6057. to secure that the cost accounts of similar establishments in the Army and the Air Force (e.g., Bakeries and Laundries) will be prepared on uniform lines.

AIR.

26. Purchase of a Hydrogen-Kerosene Engine.-The expendi- Qs. 5788ture under Subhead A of Vote 3 (Technical and Warlike Stores) 5873, Appendix 49, and includes a payment of £10,500 for the purchase of an experi- Para. 6 of mental type of airship engine. In past years expenditure on C. & A. G.'s engine research and development has been uniformly charged Report. to this subhead whether the results were likely to benefit aeroplanes or airships, it being as a general rule impossible in the experimental stages to determine whether a particular engine will be suitable for one purpose rather than the other. The particular engine now in question, which is designed to use waste hydrogen as fuel, is, however, one which could only be utilised in an airship, and the Comptroller and Auditor General has sug

Q. 5796.

gested that, in these circumstances, the expenditure should have been charged to the separate Subhead O, where provision is made for airship development. Your Committee, while recognising that there may be difficulties in ear-marking experimental work in the earlier stages specifically to airship development, feel that where an item such as the present one can be so ear-marked, the expenditure should be charged under Subhead O.

Your Committee have examined the circumstances in which this particular engine was purchased. It is a British design which was developed in its initial stages on behalf of the Company who hold the contract for constructing Airship R.100, and the Company had at one time hoped that it might be developed for use in that particular airship. In January, 1926, they approached the Air Ministry, stating that they had spent approximately £28,500, including £3,500 for overhead charges on the development of the engine, but had been compelled to stop work for financial reasons, and they asked whether the Ministry would continue the development, repaying the expenditure the firm had already incurred. This proposal was examined by the technical experts attached to the Ministry, and on their recommendation and after an examination of the accounts of the Company, the Air Council agreed to purchase the engine together with all patent and design rights owned by the Company for a sum of £10,500, which was paid on 31st March, 1926. It was contemplated at the time that further expenditure would be necessary to modify the engine with a view to eliminating certain failures which had already occurred before it could be put through further tests. Your Committee, however, are informed that no work has been done on the engine since its purchase, though certain modifications of design have been worked out. It is hoped to carry out actual tests in the course of the present financial year.

Your Committee are unable to express an opinion on the technical question of the value of an engine of this kind, but view this transaction with considerable misgivings, and they do not understand why, once the engine was purchased, its development was not pushed on at a greater rate. They trust to hear as the result of the trials to be held that the State has got value for this. expenditure.

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MR. WILLIAM GRAHAM IN THE CHAIR.

A Statement of Excesses on the Grants for the Foreign Office (Civil Services Appropriation Accounts, Class II, Vote 5), Old Age Pensions (Civil Services Appropriation Accounts, Class VI, Vote 3), and the Post Office (Revenue Departments Appropriation Accounts, Vote 3) was considered.

The Civil Services Appropriation Accounts, 1925-26, were considered. Sir MALCOLM RAMSAY, K.C.B., Mr. F. PHILLIPS, Mr. A. E. WATSON, C.B.E., Sir F G. A. BUTLER, K.C.M.G., C.B., Mr. E. C. CUNNINGHAM, C.B., and Sir HENRY BUNBURY, K.C.B., were examined.

The Committee deliberated.

DRAFT FIRST REPORT, proposed by the CHAIRMAN, brought up, read the first and second times, and agreed to.

Ordered, to Report.

The Revenue Departments Appropriation Accounts, 1925-26, were considered.

The Civil Services Appropriation Accounts, 1925-26, were considered. Sir MALCOLM RAMSAY, K.C.B., Mr. F. PHILLIPS, Mr. A. E. WATSON, C.B.E., and Mr. E. C. CUNNINGHAM, C.B., were examined

[Adjourned to Tuesday next.

Tuesday, 8th March, 1927.

Mr. Briggs,
Mr. Ellis.

Mr. Gillett.

Sir Robert Hamilton.

MEMBERS PRESENT:

Colonel Vivian Henderson.

Sir John Marriott.

Mr. Pethick-Lawrence.

Major Salmon.

Sir Fredric Wise.

In the unavoidable absence of Mr. WILLIAM GRAHAM, Sir FREDRIC WISE was called to the Chair.

The Revenue Departments Appropriation Accounts, 1925-26, were further considered.

Sir MALCOLM RAMSAY, K.C.B., Mr. F. PHILLIPS, Mr. A. E. WATSON, C.B.E., Sir R. V. NIND HOPKINS, K.C.B., and Sir HENRY BUnbury, k.c.b., were examined.

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MR. WILLIAM GRAHAM IN THE CHAIR.

The Post Office Commercial Accounts, 1925-26, were considered. Sir MALCOLM RAMSAY, K.C.B., Mr. F. PHILLIPS, Mr. A. E. WATSON, C.B.E., and Sir HENRY BUNBURY, K.C.B., were examined.

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MR. WILLIAM GRAHAM IN THE CHAIR.

The Committee deliberated.

The Civil Services Appropriation Accounts, 1925-26, were further con sidered.

Sir MALCOLM RAMSAY, K.C.B., Mr. F. PHILLIPS, Mr. A. E. WATSON, C.B.E., Mr. H. A. FERGUSON-DAVIE, C.B., Mr. J. LUXFORD, Sir LIONEL EARLE, K.C.B., K.C.V.O., C.M.G., and Mr. J. A. W. BUCHANAN, C.B.E., were examined.

[Adjourned to Thursday next.

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MR. WILLIAM GRAHAM IN THE CHAIR.

The Civil Services Appropriation Accounts, 1925-26, were further considered.

Sir MALCOLM RAMSAY, K.C.B., Mr. C. L. STOCKS, Mr. A. E. WATSON, C.B.E., Sir LIONEL EARLE, K.C.B., K.C.V.O., C.M.G., and Mr. J. A. W. BUCHANAN, C.B.E., were examined.

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MR. WILLIAM GRAHAM IN THE CHAIR.

The Civil Services Appropriation Accounts, 1925-26, were further considered.

The China Indemnity Fund Account, 1925-26, was considered.

Sir MALCOLM RAMSAY, K.C.B., Mr. F. PHILLIPS, Mr. A. E. WATSON, C.B.E., and Sir F. G. A. BUTLER, K.C.M.G., C.B., were examined.

[Adjourned to Thursday next.

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MR. WILLIAM GRAHAM IN THE CHAIR.

The Civil Services Appropriation Accounts, 1925-26, were further considered.

The Supreme Court of Judicature Account and the Supreme Court Prize, etc., Deposit Account, 1925-26, were considered.

Sir MALCOLM RAMSAY, K.C.B., Mr. F. PHILLIPS, Mr. A. E. WATSON, C.B.E., Mr. O. R. A. SIMPKIN, C.B., C.B.E., Sir CLAUD SCHUSTER, K.C.B., C.V.O., K.C., Mr. ROLAND WILKINS, C.B., and Captain T. P. NORRIS were examined.

[Adjourned to Tuesday next.

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