PUBLIC RECORD OFFICE
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19 PUBLIC RECORD OFFICE, LONDON
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15 June 1998.J
CROWN AGENTS ENQUIRY COMMITTEE:
Mr. H. B. Cox, C.B.
did not allow the ordinary legal proceedings to take plave, but he said: "1, who am the supreme coll- troller of both of you, will investigate this matter in a fair and judicial way, and I will give my judgment as to what ought to be done between these two parties to_the_dispute,” And as a matter of fact he did order, in one particular case, of Jamaica, where stores which the Crown Agents had supplied were alleged to be such as had not been ordered, the Crown Agents to make a payment out of the reserve fund to the Jamaica Government. Otherwise, but for the over- riding authority and control of the Secretary of State. legal proceedings might have been, and probably would have been, taken by the Jamaica Government against the Crown Agents, but the case, instead of Wing brought into the Courts, was carried to what I may call forum domesticum, that is to say, the Sere tary of State, as supervisor and controller of both parties, decide what was right and proper to be done under, the circumstances, and enforced his decision.
31. The senior Crown Agent, it is interesting to reflect, protested before this Committee very strongly against the action of the Secretary of State on that occasion. I am at a loss to understand upon what ground.
352. (Sir Ralph Mou.) I think the objection was taken on principle. Sir Ernesi Blake admitted that a certain "number of their inspectors were on their staff in the Permanent Establishment authorised by the Secretary of State, and ̧"for thise inspectors." he said. "we dcept responsibility, but there are other inspectors, and the majority of them outside our stuff, whom we employ from time to time; when wo employ them we employ them as Agents for the Colonies on behalf of the Colonies, we selvet the best men We can get, but we will not hoki ourselves, and cannot hold ourselves, responsible for their inspec tion" and it was upen those grounds that he said the finding in the Jamaica case was iniquitous?--It is the tendency of all of us when we get a decision against us which we du not like to describe it in some such terms,
353. On principle they accept responsibility for the inspectors and engineers on their staff, but with regard to the inspectors, engineers and other experts who are not on their staff, and whom they have employed, they contend that they employ them on behalf of the Colonial Government acting as their agents, that they get the best men they can, and that they will not accept responsibility for their action; what is your view upon that point?-It seems to me that it is all very well to protest, but the Crown Agents are unler the control of the Secretary of State, and they must accept his decision.
354. And his decision is distinctly that they are responsible for all the engineers and inspectors that they employ --If the Secretary of State chooses to say that he will hold them responsible in such matters. I do not see how they can help themselves.
355. (Mr. Harris.) Taking the Jamaica case, suppos. ing the Secretary of State had allowed the atfair to go to an action-supposing the Secretary of State harl said: “Very well," the Colonial Government may sue you for £600 or thereabouts." I think there is no doubt that the Court would have said: "You went beyond your contract," and they would have given the decision against the Crown Agent. but who would have had to pay the £600?-- The Secretary of Stato in that case would have directed] the Crown Agents to pay it.
358. Personally ? To pay it out of their Reservė Fund. I presume, which was a fund created among other things to provide for contingencies of that
natuur.
357. In fact it is partly an insurance fund against general business losses ?—Yes, and also is the fund, so to speak, of capital which every man in business has to possess in order to carry on his operations. The difference between the Crown Agents and private firms in that respect is that they are, so to speak (I do not like to use the expression) hamperesi, at all events they are controlled, by the fart that someone else has the power to supervise and direct what shall be done with that capital.
358, (Chairman.) The Committed suggested, or at least a member of the Committee suggested, betura you came in, that we should be glad to hear your view as a legal expert as to what change, if any, would be destrable in the status and tenure of the whole office, and I think we should, the point broadly being that from your evidence we see that, legally speaking, the Crown Agents are in a more dependent position than they themselves appear to hold. In that case, how far would it be woe to go
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the way uf recommendation?—That is more a practical ques tion than a legal question, but so far as I can see the present system has worked extremely well; when it is un terstond I think it can be seen to be a reasonabl working system. After all it has lasted now for a great taty years, and no particular harm has arisen out of it.
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150, (Sir Francis Moratt.) You are confining your observations now to the question of responsibility and not referring to the question of administration ?—I was dealing with both questions really, as far as I know. My experience with regard to the actual administration of the Crown Agents' Office and the aling of the Crown Agents with the Calomnes has been less than that of other Assistant Under- Secretaries. At one time I had a certain number of Crown Colonies under my supervision as Under- Seentary. That, of course, has censed under the new resorganisation, but at that time the impression. I frnish was that the business of the Crown Agents was on the whole extremely carefully and extremely well done, and that the complaints male against them arse partly out of misunderstandings and partly out of the desire of the Colony not to be fettered in the choice of their own Agents, but that when you allowed for that general feeling there was very little indeed that could be said against the Crown "Agents' Office. Speaking from a legal point of view, I think if the position I have indicates) is taken to be correct and is understood by the Crown Agents there would be very little difficulty in future. I'may point out that these views of the Crown Agents, which I am told they lobt, have never blossomed out into practice. As far as 1 am aware they have never attempted to divide the Reserve Fund among themselves, and I do not se, very well how they could have set about it. They have always applied, so far as I know, when they had to give a pension, and those pensions-it was laid down by the Secretary of State at ilie start, were to le pensions given under ordinary Civil Service rules, 35), (Chairman.) They are, in point of fact, very much in harmony with the Civil Service, in your
view?—Yes.
361. They are very nearly a branch of the Civil Service-Yes, they are an outlying outpost, so to speak, of the Civil Service.
362. Except with regard to first appointments7--—--- They are in the service of the Colonies. They are servants of the Crown Colonies, controlled partly by the Crown Colonies and partly by the Secretary of
State.
3624. An almost entirely with regard to their staff by the Secretary of State! Yes, and not only with regard to their staff but really with regard to all their matters, because, although they are Agents for the Crown Colonies and act for the Crown Colonies, complying with requisitions made by the Crown Colonies and doing the business the Crown Colonies request them to do, there is always the fact at the back of it that both the Crown Colonies and the Crown Agents themselves are controlled by the Secre tary of State, s that there is, so to speak, a Court of Appeal from the Crown Agents or from the Crown Colonies to the Secretary of State. Really the work the Crown Agents do is not work done for the Secretary of State in any sense but work lone for the Crown Colonies,
363. (Sir Francis Moratt.) Do you mean that they have satisfactorily solved this difficulty of serving two masters? So far as practice goes I think they have, Jut really braise of these two master on can when I like predominate. Whether and the erreum- stances that is a case of two masters is another thing.
MINUTES OF EVIDENCE.
Mr. II. B. Cox, ('.B.
364. (Sir Mert Spicer.) Supposing an official in the Colonial Office has the offer of a vacancy in some department of the Crown Agents Office which is a distinetly better position than he holds in the Colonial Office, if he arrepts that, do you consider that he has the right to have his pension up to date or rather the service which he has rendered for that pension. still his credit, or would you say that l'has to give up that entirely and make a new arrangement with the Crown Agents?—I should think he certainly ought to have; it depends upon the construction of the Superannuation Nets, but I think he ought to have that service to his erolit. In my view, and. subjort, of course, to the construction of extremely iutriente Arts, I should imagine that his service under the Crown Agents would be service under the Crown. 35. Even although it is a much better position and he throws the old one up to take the new, you do not look upon that as practically entering upon new em ployment under now principles ?--No,
3G. It is a continuation of the Civil Service then? --It is a continuation of service under the Crown,
367, (kairmen.) If there is any doubt about the matter you think it ought to be removed ?--I think it would be extremely deširahle,
3. To make it in that respect at least a branchi of the Civil Service, which in effect it is in practice?— To ensure there being no doubt that the service under The Crown Agents is" service under the Crown for the purpose of pension,
369, (86 Prmzais Moralls With reference to that are you nequainted with a troublesome little for called the Superannuation. Yet of 1927- I have went it.
370, That attempted to deal with the diffeusty, but really broke down over it? – Yes, that is a way Acts of Parliament have, I am afraid, not only with pen- sions but with other antters.
71. The Act attempted to get out of the difficulty by saying "The Treasury may within one month after the passing of this Art frame rules for the pur pose." and they provvedel to frame rules?—If the Act had said: "The Treasury may from time to time
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372. That would have been a better thing ?—Because it is perfectly obvious that cases must always arise of that kind which cannot be foreseen at the time when the Act is passed or within a month afterwards,
373. (Sir Allert Spicer.) I think I understood you to say that any reorganisation of the Crown Agents Offle has to be Fonsidered and approved by the Secretary of State '---Without doubt.
374. (Ma, Gibson.) With regard to the salaries of the staff generally, you said just now they were practically on Civil Service ines and that the pensions were under the control of the Secretary of State and largely awarded under Civil Service "conditions and rules?-- Yes, it was laid down a long time ago that the pensions would be fixed by the Secretary of State on Civil Ser vice principles. As a matter of fact the pensions which the Secretary of State has allowed to members of the Crown Agents' staff who have retired have been more liberal than thos bused on the Civil Service prin. ciples.
375, Is it not the case that, whereas the pensions. have in some ens when slightly more liberal the Crown Agents have a very much larger discretion as regards salaries than the ordinary Civil Service heads? There is a minimum and a maximum salary practically, and within these minima and maxima the Crown Agents are at liberty to put up a man at their own discretion without any scale of increment ?-Undoubtedly, that is to say in the general control of their office they can go as they please within certain defined limits.
376. A man may be getting, sny, £500 a year at the age of 55 or 56, and the Crown Agents could at once put him at the maximum of £500 at their disere- tion ?--Yes.
377. (Sir Albert Spicer.). With regard to the reserve fund, was that reserve fund arranged for by the Secre tary of State on his own responsibility or after consul- tation with the various Colonies?-My recollection is
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[15 June 1908,
that it was done by the Secretary of State on his own responsibility.
378. Because, of course, it is a ́sort of a Common funel ? – The Secretary of State fixed the charges which the Crown Agents might make for the services they ren- dered to the Colonies on such a scale as wonbI "allow of the accumulation of a reserve fund to meet contin- gencies, among other contingencies being pensions and gratuities,
379. He did not give them the option of having a reserve fund, so to speak, for each Colony?—No, it was a general reserve fund.
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380. So that a loss on one Colony is charged to the funds of the whole of the Colonies ?--Yes.
391, (Chairman.) Do you anticipate any legal diffi- culty from this very anomalous arrangement, the creation of a mixed reserve fund, because it so hap- peus that one Colony may want a bit of railway, which might lead to the complète depletion of such a reserve fund, and if these people are really in the position of civil servants it is certainly anomalous that their pen- sions should depend on such a variable foul?—I think that is certainly a risk which anyone who enters the service of the Crown Agents has to face, and His Majesty's Government have clearly laid down that they will me themselves be responsible either for the salary or pension of the Crown Agent's themselves, or those in the service of the Crown Agents, and that they must look only to the reserve find for their salaries and pensions.
352. Again I put it. is it not rather anomalous?— because we have complete control over these people we appoint them and do not allow them to appoint others without our consent; we fix the sums they may charge, and then we say. “We are not responsible; you must get your salaries and pensions out of your reserve fund, and if there is not sufficient money there you can go and starve": Is not that it?-You must recollect that the Crown Agents have in practice a guarantee against the depletion of that reserve fund which no private firm in the world possesses; and that is that their clients cannot leave them; they can never cease to do business unless the Secretary of State per-, mits or directs the Colonies for which they net tổ employ them no more, and while 1 quite agree and shoubi like to say all I can as to the ability with which the Crown Agents have carries on their business. anl the efficiency with which' their office is worked, which I have always had the greatest admiration for, yet I say this, that the erslit of building up an ener» mous réserve fund is less in the case of a banker, a barrister, a doctor or anybody else whose clients or cus- tommers cannot leave him than it would be in the case of people whose clients or customers had the power to go to whomsoever they pleased,
383. I put the case to you in the strongest way I ecull in favour of the Crown Agents to extract a reply, but is it in your view a reasonable and satisfactory arrangement ?-1 do not think it is an entirely satis factory arrangement. Of course it must be recollected that no Civil servant has any absolute right to pen- sion. I do not say on the ground that the Crown cau dismiss him without pension, but because he cannot claim his salary or pension unless it is vuted by Par- liament. It would be in the power of the Chancellor of the Exchequer if he liked not to put my salary or the Vote from which I draw my salary on the Esti- mates at all, and if that were done I should have nɔ remely against the Chancellor of the Exchequer or Parliament or anybody else.
381. (Sir Francis Moraft.) There are fortunate per- sous whose pensions are charged on the Consolidated Fund-Yo; the pensions of the judges for instance are charged on the Consolidatest Fund. That is a provision which the Constitution has introduced for the sake of guarantewing the absolute independency of the julges, who are placed in English history in a_position" which no other officer of the Crown is placed in.
35. Can you suggest any advantage which is pos-
d by the present organisation with regard to appointment, salary, or pension by the Crown Agents Office over the corresponding regulations and condi- tions of the Civil Service?—None, except the fact which I can point to, that the Secretary of State
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