PUBLIC RECORD OFFICE
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19 PUBLIC RECORD OFFICE, LONDON
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88
10 July 1908.]
CROWN AGENTS' ENQUIRY COMMITTEE:
Mr. E. WALKER,
1846. (Mr. Leathes.) Apart from the fact that more works may have been carried out in the last few years, would you say that the Government was becoming more greedy in the way of doing its own work, or has there been any change in that respect?—I should say it was naturally more anxious to make a success of its own department, to put down the latest plant, and to be up to date, and so extend its operations.
1847. And do everything itself ---And do everything itself.
1848. And exclude private enterprise ?—Yes.
•1849. You would consider that is the settled policy? -1 would say 50.
1850. (Mr. Harris.) You referred just now to the Crown Agents' list. Have you ever made any attempt to be put on the Crown Agents' list ?—No.
1851. What do you know about the list? Can you tell the Committee what your knowledge of the exist- ence of a list may be?, You spoke just now of public tenders, and then you said there was a list can you explain that?-So far as I understand, although I confess I am not perhaps competent to express an
pinion. just as in the ease of the Admiralty w on the Admiralty list, so there are firms the Crown Agents put. as they say, on their list. and when public works have to be done in Colombo or other Crown Colonies, they ask these firms to tender for
them.
are
1852. Is it your own fault you are not on that list; if you are on the Admiralty list, why not be on the other list? Because the Crown Agents come in; we are at liberty to do the work direct with the Ad- miralty out there, but there comes in this factor, that the Colonial Government has to get all its supplies though the Crown Agents. We cannot work through the Crown Agents even if we got a tender here, be canse the work would be done ont at Colombo,
1853. (levirman) Why not 'The work would be done out at Colombo,
1951. Mr. Harris asks if you never applied to the Crown Agents to be put on this list, and you said no; I wish to ask why.-Because I understand it is in- ten (I may be wrong) for home manufacturers,
15. It would be worth while to find out, would it
It would.
1656, 11 41 1 strange thing that you never asked: it may be that your view is correet, but as I understand it your reason is that there is no good your applying to the Crown Agents for work to be done in Colombo because you make the things in Colombo, and that bears you-Yes, we have no manuf veturing stablishment here,
18%. Is that really your view?—That is so 1-8. Have you any intention of new asking to lo put in the Crown Agents list after what has hap Teme today--I think I shall.
Meet Spitze) Of course, you are aware fher your goods have to be inspected? That is the difficulty: I cannot just peullest every point at the moment, but everything has to be inspected here. That je a very important poin which Sir Aller: has raisi, and I included it in the sentence that every- thing has to go through the Crown Agents.
We can-
not do work through the Crown Agents beenuse our work are in Colombo,
poon, (Me, Gilson, ì The Public Works Department in Ceylon have competent people to inspect your mat- rial- ?--Quite competent.
1861. If they are competent to do the work them. selves they must be competent to inspect the work of-- other people?—Yes.
1862, (Chairman.) Is it your view (I again ask the question) that suppose the Government sends home to the Crown Agents here for work to be done and the Crown Agents invite tenders either openly or from the large firms on their list, if you tendered and your tender was in point of fact lower than the others, and the Crown Agents were otherwise satisfied with it under these regulations, it would be impossible for them to accept your tender except you were to do the work on the spot ?—Yes, that is putting it correctly.
1863. Such a case has not ariwn though, becaus you have never tendered ?—The grain sheds is a very apt illustration.
1964. Will you explain the gram sheds case again? --This is the reply we received from the Colonial Office (the correspondence is all here): "As the ten- ders received were found to vary considerably in design, they were referred to the Colonial Government with a view to ascertaining which design was best alapted to the local requirements, but not in order that additional tenders might be obtained in the Colony." We were in the first instance £2,000 below the English firm, and then when it was stated that some of our sections were not quite heavy enough wo met the Government engineer and took his sections. and on that amended specification we were still £1,300 less, yet it had to go through the Crown Agents.
1865, (Mr. Leathes.) Is it not the case that the Government Bent home a specification and that that was issued to firms hen for tenders, and that these tenders were taken hold of by the Crown Agents and found a diffor very much in construction, that they were then sent out to the Colonial Government to seo which would snit best, and that further tenders wero refusei beranse, so to speak. the matter had already been compromised, that the original tenders were in the field and other tenders were excluded. Is not that what happened? I do not know that that was the reason, but we heard that tenders were being called for by the Crown Agents.
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1866. (Chairman.) Hore in England?--Yes, and we asked the Government in Ceylon: Will you allow us to tender?" And the Government there said: "Yes. we will allow you to tender." Then when they got the English tenders at and ours they found this differ- I do not know for what special reasons it was deeded that the contract should be placed in Englant even though it cost the Colony so much more, and when we referred the whole correspondence to this office-I have already read you the answer which we got, which I think bears out my point-"Not in order that aditional tenders might be obtained in th Colony," the meaning being that because we were in the Colony we were barrel from tendering.
1987, (Sir Ralph Mor.) Had you not put in a der in the first instance with the original tender. which you say was £2,000 below the others in this country? No, Wo did not know what specification was put out here. We made a specification of our own there and tendered to that specification, and the estimate was £2,000 below the English price. Then the Gosenment shid, or those representing the Crown Agents said. “Your wetions are not so strong as the English ones." Then we said, “Give us the English specification and we will render to it"; and we did so, with the result that we were still £1,300 below.
The witness withdrew,
Sir M. P. QMMANNEY, GA'M.G., K.C.B., 1.8.0, called atul examined.
1860. (Chairman) You have a very special know- ledge of this matter, have you not?-I should point out to the Commutte at the outset that it is eight years now since I left the Crown Agents' Office, and I understand that in the eight years a good many changes have been made in its organisation and arrangements, 1, of course, an only speak of the
othic as I know it during the 23 years I was myself
a Crown Agent.
Esido, Will you tell us your history as a Crown Agent, when you first went to the Crown Agents" Office, and how you were appointed ?—I was appointed by the late Lord Carnarvon in 1877 as third or junior Crown Agent.
MINUTES OF EVIDENCE,
Sir M. F. OHMANNEY, GAM,G., K.C.B., L.S.O.
1970. You being then in this office?-1 was then Lord Carnarvon's Private Secretary, and an officer of the Royal Engineers, and it was thought that my qualifications as an officer of the Royal Engineers might be useful in a department which has to deal largely with contraet business and with questions of I was Junior Crown Agent the supply of materials. until 1879, when Sir Penrose Julynn, the then Senior Crown Agent, retired, and Sir William Sargeaunt became Senior Crown Agent. He continued in that office until 1898, when he retired, and very shortly afterwards diel. When he died 1 became Senior Crown Agent, and remained Senior Crown Agent mil 1900, when Mr. Chamberlain selected me for the position of Permanent Under-Secretary of State here. 1871. You were Senior Crown Agent for how many years!-Twelve, from 1888 until 1900,
1972. Having had experience of both Offers, on the whole do you think that the Crown Agents' system works well and gives satisfaction both here and in the Colo- mies?--1 may be considered, perhaps, rather a preju- died witness, but I am perfectly satisfied that the Crown Agents' Oflice has done excellent work for the Colies. To say that it gives satisfaction in the Colu- nies is, perhaps, going a little far, because you must always remember that there are very important classes in the Colonies, the banking, financial, and mercantile alasas, who consider that if the Crown Agents did not exist they would derive what they regard as a very legitimate profit from the Government business. Therefore the Crown Agents have always lived in an atmosphere of somewhat unfriendly criticismn so far as the Colonies are concerned, but have no doubt that alifferent view is taken by the Governors and other therals, and 1 should appeal with very great confi- dence to their experience as to the character of the work which the Crown Agents have done.
173. On this point as to how, in point of fact, they are regarded in the Colonies we have had evidence of a very emphatic character, for instance, one witness sand that in one great Crown Colony he did not sup 1 that there was one man among many thousands who approved of the Crown Agents' system, and when pressed on that point he adhered to his view, he having been there for a long time. Others, both of the official and unofficial classes, have agreed that there was a certain discontent with the Crown Agents' Ulice, so much so that one important witness of the eficial class said that the Crown Agents' Office was an office which existed, broadly speaking, to do work for the good of the Colony against the wishes of the Colony as expressed in its Legislature?--Yes; but you nuust remember that the unofficial members of thes Legislatures all belong to the interested classes to which I have just referred, the people who would very naturally like to see pass through their own hands all business transacted by the Crown Agents. No doubt the Crown Agents do stand in the very invidious posi- tion of doing good to people against their will.
1871. It is always unfortunate that any institution trying to do its best should be regarded with disfavour. Can you suggest any way of getting over the difficulty, or does it seem to you that it must inevitably be the case that there should be an institution here the exist- en of which is resented by the whole of the mercan- tile, financial and general community 7-In answer to that question I would say that it wents to me you must consider what the possible alternative is. You would have to go back to the old system which pre- vailed up to some time at the end of the fifties under which the Colonies all appointed their own individual agents, and no doubt the cost of that system was enor mously higher to the Colonies, and I do not believe the work was anything like so well done; at all events it was found to be so unsatisfactory and so intolerable a system that the Agents-General for the Crown Colo- mis, as they were then called, were instituted to put an end to the inconveniences and abuses of the old *ystem. I do not see what is before you except either. adhere to the Crown Agents' system, which I think ma self has thoroughly justified its existence, or to go lak to the system of individual agencies which stands edemned in the light of past experience.
1975. In your judgment have the very numerous changes, the immense changes that have taken place
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10 July 1908.
in the rapidity of communication and so forth, since the days when the old system was tried and con- demmel, made any difference, and if so, what differ- ence in the advisability of resorting to either of the two possible systems -I do not think they would- affect what to my mind was the radical defect of the old system. If you had a number of very small people working for each individual Colony you would have none of the benefits and advantages of co-opera- tion which the Crown Agents have been able to secure. Of course, the Crown Agents de transact an enormous volume of business. They transact that business on absolutely ready-money principles, and with those two trump cards in their hands they ought to be able to do better for the Colonies than any single individunt, and I do not see that that condition is affvered at all by the increased facilities of communication. Orders come and go by telegraph, and so they would equally in both cases. I do not think these alteréd conditions would in any way affect what occurs to my mind to be the radical defect of the individual agency system. I think it would be a great pity to sacrifice the, gquire mous benefits of the magnitude of the business and tho sort of co-operative principles upon which the Crown Agents' business is fransacted. That to my mind is especially true as regards what is perhaps the most important part of the Crown Agents' business, namely, their financial transactions. There you have an Offico which is known in the City as having been practi- cally the father of the Colonial market, and which has placed upon the market in one form or another an enormous mass of securities, which has a reputation in that particular market which I do not hesitate to say used to be even higher than that of the big joine stock hanks, which for many years did not touch Colonial loans at all. If every little West Indian or East Indian Colony had its individual agent, I de not think they would ever have that influence and weight in the money market which the Crown Agents possess, and it would be a very great loss to the Colonies.
1976. We have had a very great deal of evidence as to the discontent which is felt, but I do not know that s far we have had any, speaking from recollection, with regard to the financial transactions of the Crown Agents Office. In your judgment, and following out th idea which is in our minds, I think that it is un- desirabl that so much hostility should exist to an institution doing its best; would it be possible to differentiate the financial from the more ordinary commercial business? Could you retain the central body which you hav⋅ for these large financial transac tions, while the ordering of stares and the carrying out of works enfibd be devoted upon some other De- partment-Yes, I think it would be possible.
1877. Do you think it would be advisable! I do not think it would be advisable to entrust the ordering of stores and materials for the Crown Colonies to any. body except an office which, like the Crown Agents', is under the control of the Secretary of State. It is a very difficult subject to deal with frankly, but in my long experience. I have seen reason to fear that orders placed in the Colonies are placed for reasons not al- together directly connected with the good of the Ser- vice. Of course, we live in a period i am trying to pat this as fairly as I can) in which the drummer or tout is a very active person'; he goes out to the Colo- nies to solicit orders, and I. myself, should like to see the Colonial Service, as it ought to be under the Crown Agents' system, entirely free from being exposed. ts the kind of temptation which people of that soirt do offer.
There is no doubt about it that that kind of thing does happen here, or it happens in the Colonies that those men go round and offer in- ducements to place orders with their firms, I think myself that the Crown Agents' system does tend to maintain the integrity of the Colin Civil Service, and Todo not think that is at all an unimportant ron- Sideration; therefore, although it would be possible to dissociate the financial side of the business from the mercantile and commercial. I think it would be a great pity to do it, and I do not believe myself that anything you will ever do will overcane the jealousy of the Crown Agents which undoubtedly exists in the Colonies for the reasons I have given.
1878, I do not know that the same discontent exists
in Tudia, where a slightly different system prevails.