ORDER OF REFERENCE.

[Friday, 18th February]-Public Accounts,-Ordered, That the Committee of Public Accounts do consist of Fifteen Members.

Committee accordingly nominated of,-Mr. Walter Baker, Mr. Briggs, Captain Craig, Sir Henry Craik, Mr. Ellis, Mr. Gillett, Mr. William Graham, Sir Robert Hamilton, Colonel Vivian Henderson, Sir John Marriott, Mr. McNeill, Mr. PethickLawrence, Colonel Sir Assheton Pownall, Major Salmon, and Sir Fredric Wise.

Ordered, That the Committee have power to send for persons, papers, and records.

Ordered, That Five be the quorum.-(Colonel Gibbs.)

[Tuesday, 22nd March]:-Public Accounts,-Ordered, That Mr. Cyril Lloyd be added to the Select Committee of Public Accounts. (Colonel Gibbs.)

[Wednesday, 27th April]:- Public Accounts,--Ordered, That Captain Craig be discharged from the Committee of Public Accounts.

Ordered, That Sir Malcolm Macnaghten be added to the Committee. (Colonel Gibbs.)

The cost of preparing for publication the Shorthand Minutes of Evidence taken before the Committee was £218 19s. 5d.

The cost of printing and publishing this Report is estimated by the Stationery Office at £746 9s. Gd.

FIRST REPORT.

THE COMMITTEE OF PUBLIC ACCOUNTS have made progress in the matters to them referred, and have agreed to the following FIRST REPORT:-

Your Committee have to report that during the year ended 31st March, 1926, expenditure in excess of the amount voted by Parliament has been incurred as follows:

STATEMENT OF EXCESSES.

CIVIL SERVICES AND REVENUE DEPARTMENTS, 1925-26.

STATEMENT of Sums required to be Voted in order to make good EXCESSES on certain GRANTS for CIVIL. SERVICES and REVENUE DEPARTMENTS for the Year ended 31st March, 1926.

Ninety-seven Thousand Five Hundred and Forty-nine Pounds Twelve Shillings and Three Pence.

Foreign Office.-The principal Excess arises on Subhead C. (Messengers' Travelling Expenses), and is mainly due to the

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cost of extra journeys to Geneva for the purpose of maintaining communication with British representatives at League of Nations meetings, and to the increased cost of continental fares on the regular weekly journeys.

CLASS VI. VOTE 3.

Old Age Pensions.-The principal Excess Expenditure arises on Subhead A. (Pensions), and is due to an unexpected influx of new pensioners during the March Quarter, 1926.

Revenue Departments.

VOTE 3.

Post Office. The principal Excess arises on Subhead I (Engineering Services), and is mainly due to the exceptionally heavy expenditure incurred on Storm Repairs.

Your Committee see no objection to the sums as set out above being provided by an Excess Vote.

CLASS IV. VOTE 13.

National Library of Scotland.-The account as presented to Your Committee shows a gross expenditure of £1,807 17s. 3d. and ordinary receipts amounting to £1,887 4s. 11d., of which £1,807 17s. 3d. has been appropriated in aid of the Vote, leaving a surplus of £79 7s. 8d. payable to the Exchequer.

Your Committee are informed that the receipts so brought to account include a sum of £500 representing accumulated income which was in the hands of the Scottish National Library Endowment Trustees, and was on 22nd October, 1925, paid over by them to the Librarian to meet the running expenses of the Library. On 26th October, 1925, when the National Library of Scotland Act, 1925, came into force this sum was still intact in the hands of the Librarian and was used to meet in part the outgoings of the Library subsequent to the transfer, the position being that while the income derived from the Endowment Fund was sufficient in a complete year to meet the expenditure of the Library the dividends received during the broken period, 26th October, 1925, to 31st March, 1926, were not sufficient to cover the current outgoings in that period.

The Comptroller and Auditor General, however, has pointed out that this £500, being accumulated income of the Endowment Trust, fell under the terms of Section 4 of the Act to be transferred to the new Board of Trustees as capital, and

could not properly be taken in relief of the Vote of Parliament, and this view has been endorsed by the Law Officers of Scotland.

The position then is that capital amounting to £500 has been applied as income and appropriated in aid of the Vote. If this item is excluded from the account the Vote will show an excess, and in that event an Excess Vote would be required to make good the deficiency of receipts during the broken period 26th October, 1925, to 31st March, 1926.

Your Committee are, however, informed that it is proposed to regularise the position by making provision in the Vote for the National Library of Scotland for 1927 to replace the capital which has, by a not unnatural error, been applied as income. In the peculiar circumstances of the case Your Committee acquiesce in this proposal and do not suggest that an excess Vote should be taken.

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SECOND REPORT.

THE COMMITTEE OF PUBLIC ACCOUNTS have made further progress in the matter to them referred, and have agreed to the following SECOND REPORT:

Qs. 4087-89 and

Para. 4 of

GENERAL.

1. Out-turn of the year.-The Public Accounts Committee of 1926 was able to report a progressive improvement in estimating C. & A. G.'s the supplies required for the public Service. It is satisfactory Report. to find that in the year now under review, viz., 1925-26, the out-turn is even closer to the Estimate than in 1924-25, as is shown by the following table which shows the ratio of surrenders to Supply Grants for the last two years.

The surrender figures in these tables for Civil Services and Revenue Departments do not include the surplus of ordinary receipts, but even with this deduction the results for 1925-26