PUBLIC RECORD OFFICE
Reference :-
C.O.885
19 PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE COPYRIGHT PHOTOGRAPH-NOT TO BE REPRODUCED PHOTOGRAPHIC-
58
29 June 1908.]
CROWN AGENTS' ENQUIRY COMMITTEE:
Sir E. BLAKE, K.O.M.G.
1100. Mr. Harris.) There appears to be nothing in that business which would make the ordinary service staff unsuitable for dealing with it. is there -Except that I think that it is very necessary that you should I touch with these sort of people.
1200. To make sure that you get the very best terms? Could you not do that through the agency of men re- ruited in another way ?—No. For instance, the India Ofire. I believe, fend their money through the Bank of England and through Mullens Marshall and Co., who charge a commission for doing that.
1201. And you lend yours without getting any com- mässion charged against you?—Yes, we do that work curselves.
1202. (Sir Albert Spicer.) I take it the bank lends the money; you do not get any more?-1 think we do. You are trenching on rather delicate ground. You see I must think of the banks, as well.
1203, I know, but I know all about this work.-OI course, the bank does not do it for love; it makes Something out of it.
1201. (Mr. Harris.) Has your city office any func tions with regard to that kind of work —No, they are simply a transfer oflice.
?
1205. (Mr. Bailey.) Registering transfers-It's. We use it for various other little things, but they have nothing recognised except transfer work.
1206, (Sir Albert Spicer.) You know that last autumn money was at 7 per cent.; what was the Interest you were getting for loans at that time?-It was varying week by week.
1207. Dut you letad for a fortnight or a mouth?— No. There again I am trenching on a delicate matter. Wa leave it to the bank and they account to us week by week. They keep a return of the actual daily rates at which they lend, and they have shown it to
inle.
1208. What rates were you getting when the Bank rate was 7 per cent?--We were getting sometimes 7 per cent. I'am not sure whether we got more, but we Containly got per cent, on some occasions, and we
6 per eent, continually. We mate a splendid I had a lot of money. I thing out of it last auturan. was perfectly comfortable all through that crisis, and I made a lot of money for the Colonies.
1209, (Sir Ralph Muor.). Does the Londen and West inster practically mak the bans on your behalf ?-- We lend them the money and they lend it out.
1210, D you lend it at a definite rate to them? - No They have to account for it to us work by work. For instance, money, fris been desperately cheap recently, and I have been getting only 1 per cent. I expect that this next week 1 shail do a little better than that, b eaus money is rather tighter.
1211. (Chairman.) Do you deal only with the London and Westminster?-Unless our figures are very big, and then, as I said. I have had relations with the Joint Stock and with the Union.
1212. But broadly speaking? Broadly speaking. our resources fluctuate immensely; sometimes we have a considerable amount, but a few weeks ago we were
in the position of actually borrowing money.
128. How did chant 4 the beat! Simply becaus tor Colonial Office would wet make up their minds,
1211. On what subject: It was that they would not
e as authority to raise a loan.
1255 Fou what · For Sombern Nigeria. It was a question whether the Treasury should lend the money. atol 1 had -- write a very strong letter pointing out tivat unless they would take up their minds I Should dese all je wers of alancing-
1216. (M). Harris.) Under your system, then, do ym practically never have to contemplate any
sa
n your balances Loss? I do not know what you
W do not speculate.
PONIL
1217. What I mean is this; it was a question that came up in connection with the India Olles system. When you are lending money you might sometimes make a bad debt, but under your system have you mactically assured yourself against it? Yes, unless vare of the laggest banks in Englan● came to the ground there is no risk of loas.
1218. And partly also to bring up what lies in the background, could you tell the Committee your view of the reserve fund which you have?—It is on that reserve fund that our pensions are all based, and it is very important that it should be adequate.
1219. (Chairman.) What does it stand at now?—At a little over £100,000, but we have a very serious liability. Our present building, which I may say has cost us between £30,000 and 260,000, is only lease- hold, and when that runs out, if the Government, as is extremely probable, pull down the whole of these buildings and put up a big block of Government Offices, the Crown Agents of that day will have to build themselves an office. They might have to spend anything. We are now almost full up, and I do not think we could take in 20 more clerks.
1990, (Mr. Bailey.) How many years have you left of your lease-There
are about 18 years to run, and we may have to spend an untold amount, or rather the Crown Agents of the day may have. Then there is no question that if we had more space we coubt do a great many things for the Colonies that we cannot do now. We ought to have 4 store; we ought to have a laboratory, and lots of things if we could only afford space for them.
1221. (Chairman.) Do you consider you would be ntitled to spend the whole of that sum on objects of that kind? Not the whole of it, because we want it for our pensions; but we must lay up sufficient to be able to invet that liability 18 years hence.
1222. To whom does it belong in your view—1t blogs to the ollice; it is in trust.
1223. (Sir Albert Spicer.) You have not had a lease restemption fund?-We have not started n yet, be caitse we have our office fund, but if any objection were raised to the office fun being more than was neces sary, then I should say: “Now is the time for us to begin a new fund for the lease redemption."
1221, (Mt. Harts.) That was the point 1 Coming to Can you see any linat to the accumula- We tom of the reserve fund ?--I cannot at present. shall not accumulate so rapidly.
was
122, And in future you think the accretions will not be so large?-They will not be large; our accre tions are almost entirely from loan work.
1226. (Mr. Bailey.) These accretions are money carol by fees and contributions by the Crown Colonies They are the excess of our income over our expenditure,
1927. (Chairman) Your view is plainly that the reserve fund belongs to the office?—It belongs to the
⚫fice.
19. And the office belongs to the Crown Agents 7-- Yes, and the Crown Agents hold it in trust for the good of the office,
1229. The view Wäs once expressed by one of the Crown Agomis, I no told, that there was nothing but natural bonesty of mankind to prevent the Crown Agents from dividing it amongst themselves! I do
o know what. Crown Agent sal that.
1930. We have been informal that that was the view once held of course, it is not yours?—I think that is scandal. We hold it in trust.
1231. What is your trust within what limits are you contined, do you think, as to the disposal of this money think we should work the concurrence of the Secretary of State for any appropriation of it.
1232. Do you flunk you are bound to? - I think we are distinctly.
1233. Of course
as true that the Secretary of State creates the fund by permitting you to charge a curtain rate?--Yes, that was done of course, otherwise the office would have been hopelessly insolvent.
1231. And in the last resort the Secretary of State is quite supreme; he could ruin the office the morrow? Not with regard to the trust fund. He could ent away any fresh business.
1985. He could make your income rease altogether! He could make our income erase altogether, but he catnet touch the trust fund.
1236. You think not ?—No.
1237, And that blongs to whom?-To the office.
MINUTES OF EVIDENCE.
Bir E. BLAKE, K.O.M.G.
1238, Of course, he might put it in this way when people have so much power as that he might Suggest to you that it would be well that the trust finds should be employed in a particular direction and say that if it were not done he would cut off supplies? Yes, he could threaten to cut off supplies unquestionably.
1939, So that in a way he has control over the trust fund? No, I think not; I draw a distinction there. It is vital to us, and you will never get me to admit that the Secretary of State has any power to appro- priate or misappropriate the trust fund. That al Intely belongs to the Crown Agents' Office, it is for the good of the office.
1240. But the Secretary of State, having complete power over your income, has of course in the last resort power over your capital, has he not ?-I think
net.
1241, (Sir Ralph Mowr.) If he controls the source, surely he can control the results?—He can prevent its growing, of course,
1242. (Chairman.) He allowed it to grow?—He allowed it to grow, but now it has passed into the innils of trustões.
1213, (Mr. Bailey.) Surely it is a matter of history that this is partly made up of contributions at some time or another from the various Crown Colonies ?--If at depended on the contributions alone the fund would starve. If you look at the Parliamentary paper you would see that the great bulk of our business does not pay us; the big business pays for the lifthe busi- The vast bulk of our business would be a gain to us to get rid of. We are simply a great benevolent institution run in the interests of the Colonies.
1241. (Chairman.) I see that Lord Ripon in 1994 laid down this principle that "the surplus re
the ceipts of your office have been devoted ta
reserve fund provision of
created for the purpose of guaranteeing the maintenance of your establishment in the event of any sudden de egase of income, and of providing for retiring pen sions and gratuities. Thai fund has already reached some £300,000, which is admittedly more than suffi- cient for those purposes, and the Ĉolonies have from the first been informed that the charges for transaction of business will be reduced in that event."--The staff was very small then compared to what it is now.
1215. It has therefore become necessary to prevent the further increase of that fund, and if this cannot safely be effected by a still further reduction of charges, the alternative in favour of which there is mueli to I said would be to carry each year a rateable pro- jertion of the surplus to the credit of the several Colonies for which you transact business," Supposing that view of the Secretary of State holds, it would probably be the case that the large portion of your reserve fund which you have at present would be the property not of your office but of the Transvaal- There is a considérable sum we have earned from the Transvaal, and we have done very great services for the Transvaal.
1216. On this basis the Secretary of State might say---?—You must pardon me for saying a word there; I think I know the man who wrote that, and anything more preposterous than that idea I cannot iuingine. I think you are wasting time really, sir, to trouble yourselves about the man who wrote that.
1217. Certainly we will pardon you any language you please, but it is rather unusual to say that a Secretary of State's considered expression of opinion is preposterous?--I think I know the man who wrote
that.
1248, I dare say the Secretary of State signed it. niel I do not think in this office it is wise to speak of it in that fashion.--It came signed by the Under- Secretary. It would not come to us signed by the Secretary of State.
1249. I think we must assume that it is the Seero- tary of State's opinion. The decision there says that we have from time to time reduced our charges, andd unquestionably if they were in excess of what we wanted we should reduce them again. If, for instance, Toull find time. I have been contemplating suggest- ing a little alteration of our charges; that is to say.
→ 21
69
[29 June 1908.
at present we could afford to reduce very materially the rate at which we pay off loans if we are given a little more for paying interest. The old arrangement for paying interest was all very right in those days; it wasper cent. on the interest. Well, in those days loans were at 6 or 5 per cent., and then they went down to 3, and it makes all the difference in the world. The Bank of England is much more sensible; they have so much on the capital of the loan and the interest has nothing whatever to do with it. That is an alteration I am contemplating suggesting.
1250. Then you are not in favour of this proposal to carry a portion of the earnings to the eridit of the Colonies-To say the least, I think it would be an intensely complicated thing, and it would be a very contentious thing. You would have all the Colonies squabbling as to what should be their share.
1251. It would be very popular with the Colonies, - - It would also be very popular to abolish the Crown Agents.
1252. With whom?-With the Colonies.
1253. Do you think so?--No doubt; there is nothing they would like better than to be able to distribute their business as they liked.
1254. Mr. Harding points out to me that the idea was that it should be a pro rata return?—Yes, but I do not think it is a practical proposal.
1257. It is highly undesirable in the abstract that large a reserve fünd beyond the requirements of the office should be built up? But I do not think it is beyond the requireßtents if you will take the fact that we have now a staff of somewhere about 200, and there might actually be four Crown Agents on pension at the same time. Sir Montagu Ommanney has gone on pension, and I shall go very shortly; Major Cameron and Mr. Mercer are getting on, and it might be that there would be four Crown Agents and a very large staff upon it, and then, as I say, boming in the future is this very heavy charge when the Crown Agents have to rehouse themselves. We shall not have another Transvaal case, at least, probably not.
1250. We devoutly hope not. I have not made my meaning clear to you. What I asked you if you thought was undesirable was that this very large fund should grow up, which might be very greatly increased, when all the time it is strictly under the control of the Secretary of State responsible to Parliament. You see the Secretary of State creates this fund by per- mitting certain percentages to be charged?--You
1257. He is therefore the public official responsible for the creation of those balances which at any moment might become absurdly too big?-It could always bo
checked.
1258. By what method?---By, for instance. reducing our rales.
1259. Supping very little business ensues and you have a sudden depletion of your reserve fund? Then, of course, they would have to increase the rates again. 1260. Would it not be almost simpler (4 keep on coming back to it) to carry ench year a rateable pro- portion to the Colonies? No, I think not; I think it would be absolutely destructive to all good work. Men are but human, and I certainly should have the strongest possible objection to earn money, and then give it away again. My keenness is that I am earning for the office, and my great anxiety is to make the office a success; and if you are going to say: "All you have done is now to go away to the Colonies," you rb us of our keenness.
1261. Is not that exactly what hundreds and thou- sands of Civil Servants are doing they are earning money for somebody else? But you must remember that this oflice has grown from nothing, and individual Crown Agents have built it up, and we say that at pre- sent it is not in a position fu which it can afford to give away. The time may conne when the Crown Agents can say: "We havé got enough in the reserve fund, and we can now reduce our charges.”
1262. What your contention almost comes to is that loyalty to your office is a more patent spur to effort than loyalty to the Stai- ? Surely that is not true's I do not think I owe anything to the State; I think the State gets its full value it of me, but I do feel
I 2