decided to adopt the usual method of special enquiry, and he appointed what he described as "one of the strongest committees ever set up. . . a combination of military, military administrative, financial and accounting experts."

This committee was called the Lawrence Committee, because General Sir Herbert Lawrence, late Chief of Staff to the British Expeditionary Force and chairman of Glyn Mills, was its chairman. It comprised four serving soldiers; two accountants of eminence (Sir Gilbert Garnsey, partner of Price, Waterhouse and Company, and Mr. Webster Jenkinson); Sir Charles Harris, Assistant Secretary and Accounting Officer for the Army; and Mr. Niemeyer, of the Treasury. It was rightly called a strong committee. It examined the entire problem, and it had before it the new system after four years' actual operation.

It reported unanimously that a proper system of accounting is necessary to the efficiency of the army, and that such a system had been wanting in the past; that the new methods should be carried to their logical conclusion; that a complete change in the system of administration should be carried out from the War Office downwards and administrative responsibility and accounting should be decentralised as far as individual establishments and regimental units are concerned; and that the Royal Army Pay Corps and the Corps of Military Accountants should be amalgamated. In view of what has subsequently transpired it should be noticed that these specific recommendations are signed by every member of the Committee.

After the interregnum of the Labour Government, Sir Laming Worthington-Evans came back to the War Office and found this report awaiting him. In the meantime the demands for retrenchment had become more and more insistent. The old order were also becoming concerned for the security of their tenure. Somebody had to be sacrificed on the altar of economy, and the final decision naturally rested with the Army Council. Sir Charles Harris had gone into retirement, and he was the one person in high places who had the knowledge and strength of purpose to defend the new methods. When, therefore, the choice lay between reducing horse transport, which was only earning 40 per cent. of its cost; or reducing the higher staff grades of regulation-mongers, who were battening upon and keeping alive the old system of accounting by votes; or cutting off the

modern, proper and purposeful accounts, the decision arrived at is not surprising. Five years' work, the value of which is endorsed by some enlightened persons within the public service, and by such authorities as Lord Haldane, Lord Olivier and Sir Herbert Lawrence, outside the public service, is to be set at nought. And the Secretary of State has set his seal to this decision.

The reasons given to the public for this change of front are a deplorable example of special pleading amounting virtually to misrepresentation. Sir Laming said in the House of Commons last July that the decision was in accordance with the "majority' recommendations of the Committee. The majority report has been already recited; the only reservation was one by Sir Charles Harris himself, who objected to entrust entitlement and pay account work to the unit accountant, and for mobilisation reasons wished to continue such work at fixed pay centres. This limited reservation is distorted into a minority report, and is used as an argument to reject all the major recommendations.

It is now opportune to examine the grounds on which the Secretary of State and the Army Council seek to justify their decision. They are two-fold, one economy and the other that in all essential respects the new organic accounts are to be retained. In respect to the first, nobody will deny for one moment the crying need for saving in every department of State expenditure. But all saving must be looked at in the light of value received. In the present case the amount to be saved is at the outside £150,000, or one-third per cent. of the entire cost of the Army. Against this alleged saving has to be set the sacrifice of a process for the development of the mind and character. There is nothing more difficult than to demonstrate the positive value of abstract mental qualities and to measure their effect on performance in practical affairs. Yet everybody who has worked among and managed men knows the value of initiative and self-reliance, and the limitations of the mere routine qualities of fidelity and implicit obedience to rules and orders. It is the former qualities that in the realm of private enterprise are eagerly sought for, and well paid. The War Office refuses to pay £150,000 for a process which offers the best medium for their growth and development.

But even the alleged saving is illusory. The Lawrence Committee recommended the amalgamation of the Pay Corps and the Corps of Military Accounts. The water-tight separation of

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these two corps whose duties are closely allied is costly in establishment charges and entails unnecessary reference and correspondence. Commercial firms do not adopt this rigid separation between cashiers and accountants. That it has never been otherwise is the only reason why it should always be so in the public service. The fusion of these two corps would mean gradual but growing reduction in the cost of personnel. The two standing separately now cost £630,000; combined and re-organized they might easily be reduced to £500,000. On the other side of the scale must also be placed the savings-hard to prove or estimatethat must follow from having every unit commander professionally interested in getting the best value for money spent, and not merely trying to keep within the regulations. The telegram saving already referred to is a case in point. That such examples cannot be multiplied is because, although possessing the machinery for decentralisation and control by account, those in authority would not use it, but have kept in force all the rigid rules of diet and allowances, and the regulations supporting them. It would at least be good policy to test this machinery, which has been built up with much labour and experience, and not scrap it untried as is now proposed.

The second line of defence is less easy to argue before lay readers. It is this. In the case of combatant units it is argued that accounts framed to show the cost of each unit separately serve no purpose because the officer commanding has no control over the greater part of the services involved, such as pay, clothing, medical costs, stores, cleaning materials and the like. The argument rests in the main on a complete misapprehension. Pay rates and certain classes of clothing are fixed and, until revised, constitute in a sense a contractual obligation between the State and the soldier. Obviously they are outside the control of each administrator, but this does not apply to other items. In respect of food the obligation is to provide a generous maintenance diet. The soldier has no right to regard the prescribed ration as his personal property. In the war, when rations were being improperly sold to the civil population, an order was issued to say that "the ration did not become the property of the soldier until it was properly consumed." This is the legal aspect of the matter. A fixed scale must necessarily be a maximum scale, and a maximum inevitably tends to become the measure of actual

consumption if there is no means to record any reduced consumption in a manner that will reflect credit on the officer in immediate control. Soldiers require widely varying quantities of food according to their age, the weather, their racial peculiarities and, above all, their attractions outside barracks. A guardsman with friends and relations in London will eat far less in barracks than a soldier on Salisbury Plain. These wide causes of variation offer immense scope for frugal or extravagant management, the result of which should be shown not in quantities but in the common denominator of money. This needs a proper organic account such as we have already outlined. The objections to a fixed scale apply with equal force to barrack stores, public clothing, cleaning materials and many other articles used. Wise management will effect savings, and managers will prove themselves wise if they have an inducement to do so, and the means to prove their case. It is, therefore, not true to say that no practical purpose is served by a proper and separate account for each combatant unit.

There finally remains the argument that inasmuch as those activities which are productive in purpose, such as motor repair units, bakeries, generating stations and the like, are still to have their separate accounts, the essential features of the new system are being retained. But this involves two considerations, namely, what are the units which are to be still under account, and what is the nature of the account itself. With regard to the first question, it has been decided to discontinue accounts both of schools of instruction and of hospitals. These, especially hospitals, are institutions where there is ample scope for good or bad administration, and where control by account would be of special value. The unit of daily cost per occupied bed or per patient is a suitable one by which to test the efficiency and the management of a hospital, and if it were to be relied upon many of the existing meticulous regulations might disappear.

The decisive objection, however, to the proposal is on the grounds of accounting and technique. These retained accounts are to exist quite independently of any connected accounting system; they are to begin nowhere and end nowhere, and to exist, so to speak, in vacuo. They will not be accounts in any authorised sense; they will be computations of cost based on estimates. The cost of purchased stores and pay can be obtained

and will be taken at true values, but rent, stores and services supplied by other departments within or without the army will be taken at estimated values. It will be, therefore, possible for such accounts to vary widely according to the discretion of the compiling officer and the instructions under which he works. The results will be arbitrary, not real, and for this reason they will not command confidence. To do this work, which is largely in the nature of a pretence, trained accountants costing about £100,000 are to be retained. Judged as value for money, this expenditure is largely wasted, but it serves a useful tactical purpose it serves as a plausible pretext to persuade those who do not understand the technique of accounting that the public service is not adverse to modern ideas. In reality it shows that the public official is an expert in the art of camouflage.

This is being written as the season of Christmas is approaching, and the perplexing problem of Christmas presents has to be faced. My son wants a wireless outfit. I can either buy it myself, or I can say: "Here is £; you do the best you can with the money." Does anybody doubt which course is likely to evoke the greater interest, the greater instruction and the greater thought, care, and even pleasure? It is the same with methods of public control: the greater independence allowed, the greater the development of thought, initiative, resource, and of all the more progressive human qualities. It is not because of possible economies in the sphere of administration that modern accountancy is besought and invoked. Economy is a minor benefit: it is the human psychological benefits it produces which are its justification. For these reasons the new methods have gained the almost universal support of men of intellect and vision such as Lord Haldane, Lord Olivier, Sir Herbert Lawrence, Sir Herbert Samuel, Sir Charles Harris, and many others. Opposition has come almost entirely from within the ranks of the public services where it has been none the less powerful because unheard. I boldly assert that such opposition is based on ignorance; that it has regard mainly to the preservation of vested interests; that it is not for the public good; and that it should not be allowed to prevail.

J. KEANE