CO885-(18-19) — Page 693

PUBLIC RECORD OFFICE

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CROWN AGENTS' ENQUIRY COMMITTEE:

Mr. J. D. Rɛgs. C.V.O., C.LE., M.P.

That opens up a very wide'fieki, but first I would ask you-do yon consider, as far as your knowledge of the City gos, that the Crown Agents give satisfaction in their position as intermediaries?-Giving my own opinion. I cannot myself think that it is desirable that there shall be another Colonial office between the Colonial Ofice and the City. Practically what hap pens is that, as contracts are made with the Crown Agents, they become almost the Colonial Office as far as the business done with the City is concerned. They stand between the contracting parties and the Soere- tary of State. Now, for instance, taking a cultract with which 1 _am_ acquainted, our original contract was made with the Crown Agents on behalf of the Foreign Office, and for that Colonial Office was sub- stituted when that office took over Nyasaland from the Foreign Office, A supplementary contract becomes necessary, and then that is made by the Crown Agents on behalf of the Government of Nyasaland. In both enses the authority with which we have to deal is the Crown Agents, and in connection with every point in our contract everything has to be done to the satis faction of the Crown Agents—to the satisfaction of the engineer appointed by the Crown Agents—and, as 1 presume they are regarded as experts in respect of their business, practically it seems to me that under existing arrangements those who enter into contracts are almost shut off from the Colonial Office, at any rate it places them in the position of appearing to be appealing against the Crown Agents or to be taking exception to what they do if they come directly to the Colonial Office, which is what instinet would prompt me, at any rate, to do in any such case. Probably the same consideration might weigh with others in the same position, but I have a little difficulty in enlarg- ing upon this bcause I feel some delicacy in criti- rising the Crown Agents at the moment owing to my own position as the chairman of a company which has an extremely large contract with these gentlemen,

497. Perhaps you could tell us how that stands ?—I will: naturally it is my duty, and I should like to do so, but how de I stand as regards my evidence? It seems to me that it plages me in a somewhat in- vidious position with regard to the other party to the contract. This illustrates extremely well. I think, the position that I take up as regaris the existence of the Crown Agents in their present capacity.

498. Could you elaborate that? You are in a diffi calty, you tell us, because you desire to criticise, as a Member of Parliament, the organisation of the Crown Agents you think it might be improved, or that it is not required at all, as the case may be, but at any rate you find a difficulty. because you are at this moment chairman of a company which has a contract with the Crown Agents; which company is it?-The British Central Africa Company.

400 Which is building this important railway?—It is a very expensive railway, if not very long.

500. (Sir Francis Mowatt.) You are distinguishing your criticisms, I understand. between the department and the persons?-I am rather asking how I stand myself. If I state exactly what I think and criticise the other parties to the contract of which I-represent one side, are my criticismus at their disposal, and will it conduce to friendly relations between myself and the Crown Agents in the further prosecution of the enter priso I am bound to say that whenever I have approached the Colonial Office directly nothing could exceed the courtesy, attention, and consideration I have always received: but I do at the same time feel that when the Colonial Office have got between us and them a body of experts served by another body of experts, engineers and so forth, we certainly are cut off to a great extent from the Secretary of State, and T think that in the City the feeling is rather prevalent (which I have very strongly myself) that the Secretary of State from his position leis a lofty impartiality he and the Under-Secretary of State and their agents in this office have a position which cannot altach to the Crown Agents.

801. (Mr. Harris.) May one put it to you that after nl the Secretary of State minst have some expert advisers at some point -I quite agree, but mus: there be between those experts and himself a body who, for - instance in respect of a particular arf are not experts? Take, for instance the engineer, we have to

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satisfy the engineer, and nobody would object to that. That engineer is an expert, but he is under the Crown Agents, and not immediately under the Colonial Vilice. I might come to you, for instance (we will re- gard this as hypothetical, if I may ask it), and say :" I consider that the requirements of the engineer appoin ted by the Crown Agent are eXCESSIVO, SO EXPessive as to double, perhaps treble, the cost of our contract, a must serious inatter." But you would say to us: “Well, we will give instructions that a proper regard for tho exceeding great difficulties under which the contract is curried out is to be accorded to" myself, let me say, the hypothetical person; but then we are left, after all, with the Crown Agents us the other parties to the contract and the engineer is their servant appointed by them, dismissible by them and entirely their servant, and the actual position of the Crown Agents themselves is that they are not Civil servants,

501a. So that what you suggest is this, that you do not so much object to an expert control under the Secretary of State, but you do object to its being rather listaut from the basê-tón independena of the base; is that it ?-Quite

502. (Sir Francis Mowatt.) Might you put it this way: You do not object to an expert adviser under the Secretary of State, but you do not want an expert adviser over the Secretary of State-That is so.

503. Would you carry that question a little further › You recognise that the Secretary of State in any devi- sion on a professional matter must have professional advice-Oh, yes.

504. Then your view would be met by your represen- tations coming directly to the Serretary of State on a matter of contract, and the Secretary of State in turn referring that for the opinion of his expert adviser Gefore he answers you 1-Quite so.

505. That is the usual course thronghout the Civil Service-That would be the usual course in the India Office next door, for instance,

506. That is your idea of the solution of the quest tion ?—Yes.

507. You do not object to the Secretary of State con. sulting his professional advisers before deciding, but you would rather that the application went to the Colonial Office and was referred by the Colonial Offiess to the Crown Agents or their professional adviser for a report instead of your going direct to the Crown Agents' professional adviser, who would go to the Sec- retary of State if he thought fit-But your question. Sir, assumes the existence of the Crown Agents.

508. I am afraid, without assuming the existence of the Crown Agents, this Committee does not exactly know what it is sitting round this table for?-It assumes their continued existence, then; it takes it for granted, because, as I would venture to put it. anybody who had a contract with the Colonial Offer would certainly expect that the Secretary of State should have expert advisers in all respects, but the contractors would prefer to come to Que Secretary of State.

609. To come to the Colonial Office?-To come to the Colonial Office, and that the Secretary of State should refer it to an expert adviser through the Crown Agent, hut why is the link of the Crown Agent required

510. Very well. we will strike that out?-If you strike it out, the question, as you put it, exactly eincides with my opinion.

511. You do not object to the Secretary of Stat having professional advice before he decides; whether that professional adviser is the Crown Agent or an outside enginer or other person is a part of Colomat Office aluinistration and constitution, but I gathered that your objection was that the Crown Agents were. in fact, to much indep ndent of the decision of the Secretary of State?

512. (Chairman.) I might put it in this way to you. From something you let drop in the course of a previous reply your view is that if the arrangement were the same as obtains at the India Office that would seem to you to be a better arrangement? That would eliminate any little Colonial Office outside the large Colonial Office.

MINUTES OF EVIDENCE.

Mr. J. D. Rees, C.V.O., C.I.E., M.P.

513. That is your point?-And it would cut out the non-civil servant, half independent and half sub- ordinate to the Colonial Ollice, element which exists in the Crown Agents.

514. We understand. Sir Francis just before you came in that if you thought it advisable to tell us just how your relations with the Crown Agents have grown up- the story, as you know it, of your company, it might be very useful

It was suggested to me by

You may not want to make any charges, but just to say how you have founl difliculties, and then, of course, the Crown Agents would point out to us in reply that greater difficulties would occur if another method were adopted. At least, that would probably be their answer, so that in order to hear both sides if we could hear what has happened to you and "how difficulties have arisen in connection with your com pany it would be desirable?—I am extremely anxious not to make any charge against them; that is exactly my wish. Briefly, it is this: one makes a contruct my company, for instance, makes a contragt to con- struct a railway under circumstances of unparalleled difficulty, not like the Uganda Railway or the Gold Coast Railway in which you are on the sea from which you get your material, and as you make your line you carry it forward mile by mile, and your baso is the sea, just what you want to bring your material, and you go oli.

515. This is the railway in Nyasaland you are referring 103- 1 am speaking of other railways now; they have been accustomed to do that. We contracted with them to build a railway to be made under en- tirely different conditions 250 miles from the sea up an affluent of a great tropical river which is navigable enly four months in the year I doubt if three gentle- met who have never been in this Protectorate, who have a personal knowledge of it, and have sent out an engineer to exact a wooden compliance-a drastic com- pliance with certain sections of a contract, are alto- gether able to appreciate the exceeding great diffi culties under which an enterprise like that is con- ducted; and, as they have been accustomed for in- stance in their own construction to run to something from £10,000 a mile upwards. 1 do not know that they would have that kien sympathy with the posi tion of commercial men who want to make a railway at a profit. We have to make the railway at such a price that subsequently we can make it pay.

The Polestial agents are accustomed to making railways under spelt conditions that they are superior entirely to that consideration; they have not to consider what will make it pay.

516, (Sie Francis Mowatt.) Are these contracts com- petitive? Are the tenders put out to certain com- panies to compete for them?--As regards the contract for construction of the line?

517. Yes.--No, the contract in the case I speak of was originally concluded before the Protectorate in question was under the Colonial Office; the arrange tent was made with the Foreign Office, and the original contract was made with my company by the Crown Agents on behalf of the Foreign Office.

518. (Sir Ralph Moor.) It was originally a conces- ston to build a railway? Yes. I would point out to you how very serious this question is. Of course, a condition of the concession is that a certain large ex- tent of land is to become the property of the railway when the line is completed to the satisfaction of the engineer of the Crown Agents. Supposing these gentle- men in good faith, upon their experience as con- structors with unlimited funds (and such people are apt to take rather a high line about things; they do not seem to consider the exceeding great difficulties in obtaining labour and in getting cement for instance and other material), exact a standard which is unneces sarily high, and suppose they do not allow sufficiently for the diffienities of the situation and the local require. ments, then when the time comes for their engineer to satisfy them that the line is up to standard, sup- pusing they err in their appreciation of the case and will not give a certificate that it is up to standard. the constructors of this line are bereft of the land grants and they cannot get them until they satisfy these engineer representatives of the Crown Agenta. It seems to me that in a case like that the Crown Agents might go on prescribing further capital ex-

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penditure and further capital expenditure until the total expenditure approached the absolutely appalling limats which it has reached in lines which they have themselves constructed.

519, (('kairman.) Which they have constructed ?— Which they have constructed themselves. Here they are merely parties to the contract, and we are con- structing it, but they themselves have constructed departmentally in other Cu8B in Africa, and although, as I say, they have had the sea as their base, which is just everything in building a railway, to be able to put your material on the ground and carry it forward in your construction trains as you go along, if their lines reach this tremendous figure under those circumstances, are they quite in a position to decide what is a sufficient compliance with the standard mentioned in a contract that is made under far greater difficulties and has necessarily to be carried out at less expense?

520, (Sir Francis Mowatt.) You adinit a right of appeal to the Colonial Office if the criticism of the Crown Agents Engineer is in your opinion unneces- sarily strict?--I do not think it is provided for in the contract, but it would exist. I presume, because the contract is made by the Crown Agents on behalf of the Colonial Office. There is a right of arbitration. of course: there is an arbitration section, but that is rather late in the day.

521. (Mr. Harris.) It is the case, is it not, that the Crown Agents always said there ought to be a defi- nite specification attached to that contract, and they have complained that because there was no definite specification they were in great difficulties as to where to meet you and where not to meet you; to be quite fair to them, is not that so?-I know there is no specification; what their feelings on that matter have been I do not know, but they drafted the original con-

tract.

522. You at that time were not one of the contrac- tors -No, I was not.

523. So that you do not know, of your own know- ledge, that they did press for a specification and t was not given?--I think they raised that point, and I do not think they were favourable to the contract in any respect so far as I know. They were not under- stood to regard it with favour; I rather gathered the impression which you yourself have stated now, but I never heard anything conclusive on this particular point, because, as you say, I was not there at the tinie. 524. Of course, you admit that if you have not a specification for work it leaves a good deal to the imagination - Yes, but it says, "up to the standard of the Mafeking-Buluwayo Railway as at 192," and I think for a pioneer line in Central Africa that is pretty precise, it is near enough; in fact, it is quite as near as you can go. How could you have specifica tions for masonry for instance in a case where there is no mason, and masonry cannot be done (there is not a stonemason in the country), and where you cannot get cement? I do not know exactly what our cement lias cost, but I think it is something like three times its value. We have tried no cement but also lutely the best that can be made, because none other will stand the chmate; it has to be sent out in casks and a lot of it spoils on the way. The River Zambesi is open all the year round, but directly you reach the Shire, which you have to go up about 70 or 80 miles before you begin, there is no water for many months in the year, and the cement has to lie on the banks out in the open for months before it can go on. The same thing applies to all the material. I do not think you could have a close specification.

525, (Nir Francis Mowatt.) Is the question between yourselves and the Crown Agents this: that in point of fact you have worked up to the specification, and that they desire to interpret or construe, not the swcification, but the nearest advance you have got

comparison with this other railroad-t strictly? I cannot say, because we have not reach si that point, and there is no specification, and I a not bringing any charge or complaint against them: I

the thing rather hypothetically,

to 1

but I may say, and I think I ought to say, that we do think that the engineer generally has extracted too much from us, and that the idea has rather been that

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