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PUBLIC RECORD OFFICE

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19 PUBLIC RECORD OFFICE, LONDON

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6 July 1908.

CROWN AGENTS ENQUIRY COMMITTEE:

Sir C. P. Lucas, K.C.M.G., C.B.

office on the Secretary of State; if you do, I think you ought to have somebody from this office sitting upon a Board of Crown Agents. I do not want to diminish the authority of the Crown Agents over their staff, and I think if you have an appeal to the every clerk is appointed by Secretary of State, and the Secretary of State, you do diminish the authority of the Crown Agents.

1633. Do you find that is the case throughout the Civil Service that the power of appeal to the parliamentary chief of the Department affects the authority of the permanent heads of the Department?— You are not merely putting them under the Secretary of State, but you are putting them under the Secretary of State and his permanent advisers. If there was a Secretary of State for the Crown Agents it might be different.

1631. (Sir Albert Spicer.) May I ask whether you are very much where you were in opinion when you wrote a certain part of this Memorandum in 19037- Yes, I think so.

1635. Would you recommend any changes?—Yes; I have suggested some changes just now.

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1636. Beyond what you mentioned here --Which

Memorandum is that?

1637. The despatch of Mr. Chamberlain ?-That does not deal with the details of the Crown Agents' Office, dees it!

163. It does make some suggestions -But not about the clerical staff.

1639. No; I was going, not so much into the clerical staff, but as to the method of dealing with the grumbles and complaints that exist ?-1 feel as strongly 88 ever-indeed, much more-that you should perpetu ally keep the Crown Agents, as far as possible, Agents for the Crown Colony Governments; but I feel per- fectly certain that. if this Committee were to sit in ten years' time, we should still have a compromise going on it always will be a compromise. I think it is a very good thing to take stock from time to tine, but I do not think you will ever get a system there that will not be open to some sort of objection. The Crown Agents' Office will always be open to similar criticisms to the present unless you convert it into an absolute Government Office, or into a more purely commercial office, and I do not think you can or should convert it.

1640. Do you not think it very much depends upon the spirit shown by the Crown Agents themselves 1- Yes. I do, and on the personality of the Crown Agents.

1641. And how far they try to realise that they ar in the main under the Crown Colony Govern ment---I hope I have made it clear that I am most Mrongly opposed to any idea of the independence of I think that is su absolute the Crown Agents. myth.

1612. (Chairman.) (n the question of how the Crown Agents should be paid, you are aware, of course, of the present system under which they are principally It has been raid by commissions for work done,

suggested that they might be paid by direct vote of the Colonial Legislatures, as, for instance, in the case of the joint emigration agencies for several Colonies, or the cost of the staff of the Colonial Audit Branch Do you think that this would be a practicable plan, or would it have any advantages over the present system, which is a peculiar on--?-- No. I am strongly in favour of the present system.

1613. Will you tell the Committee why, in a word? I think it is a fair and a right system. You have a moderate fixed sort of retaining fee, and then you have a payment by work done,

14. But you are aware that a very large reserve fund has grown up by this system 2-- Yes.

1645. Amounting now to £13,000?—Yes. 1616. And some question has arisen as to who has the control of that reserve fund. What is your view as to that? That reserve fand is under the control of the Secretary of State as representing the Crown Colonies.

1647. You have no doubt of that?-I think I have no doubt about it. I mean to say that I have abau-

lutely no shadow or shade of a doubt that the Crown Agents cannot dispose of that fund without the authority of the Secretary of State.

1648. (Mr. Bailey.) It is invested in the name of the Secretary of State, is it not?-1 think the Per- manent Under Secretary.

1619. (Chairman.) With regard to the pensions, 1 understand that hitherto the scale of pensions adopted by the Crown Agents' Oflice has been more liberal than either the Imperial Civil Service or that of either of the Crown Colpùies. Can you suggest any justih- cation for that state of affairs-No, I do not think they should be any better, and I do not think they should be worse.

1650. Nor the pay, so far as it refers to pay?—You mean whether the pay should be worse or better than that of the staff of the Colonial Office?

1651. You say you think the pensions should not be better; but do you think the same thing applies to pay--I do not think the pay should be higher. You do not have the same tests.

1632. Taking a corresponding man, so far as there is a corresponding man, and very often there is, do you think the pay of a person in the Crown Agents' olice should approximate nearly to the pay of a similar person in the Civil Service, either of the Crown Colonies or of this country?—It is a very difli- cult question to answer, because of course you pay higher in these Crown Colonies for climate.

163. Take the Home Service, then; the India Office supplies an exact parallel think it should be very much of a muchness" with them.

1654. The same scale-I should make it a lower scale if you do not have the same test, for that means that you do not get quite the same class of man, I take it.

99955. So long as the present system of appointment without examination continues, it would be fair in your judgment if they were to make the pay slightly less than that of the corresponding rank of the Civil Service? That would be the tendency, but I would rather have the test and raise the pay.

167%. It has been suggested that the work of the Crown Agents' Office is liable to such violent Burtua- tions that it is impossible to reorganise it upon You have tobl us that ordinary Civil Service lines,

you do not wish it to be brought in many respects more into harmony with the Civil Service, but in Sotne respects you do. What do you say about the violent fluctuations --I am told that is so, and cer tainly there have ben great changes; there has ben a large amount of work thrown on them by the South African Colonies, and then a dropping off again. I really have no strong feeling about the ques tion; I have a little sympathy with the fact that the clerks in the Crown Agents' Office have been to some extent recruited from the sons of Colonial governors. people who have done good work for the country. It is a system. I suppose, which cannot last, but I think it is one that there is something to be said for.

1657. (Sir Francis Mowatt.) That, of course, would be inconsistent with competitive examination?--Yes, but not necessarily inconsistent with a test examina- tion, for which people were nominated.

1658. (Mr. Gibson.) That system of the appointment of sons of Governors, and such like people, has been in furce for appointments in the Colonial Service also, has it not, by the Colonial Office? Yes, from time to time. I merely put that in incidentally, and I think it is to the credit of the Crown Agents that there is that strain in their staff.

1659. (f'hairman.) The last question on the paper has reference to the liability of the Crown Agents for any error or mistake in the conduct of their business, but before I ask you to answer that I may say that wo have had very conflicting evidence on this point, and any statement you may make will be very helpful to the Committee 7-I suppose that refers to this Jamaica

case.

1660. No, we have had other cases; of course, the Jamaica case was the subject of some very strong remarks on the part of one of the witnesses. Which way does the liability run?-It is a most difficult

MINUTES OF EVIDENCE.

Sir C. P. LUCAS, K.C.M.G., C.B.

thing; I do not think you can make them liable in the ordinary sense and to the full extent. If you will allow me, this was Mr. Chamberlain's Minute in the course of that case: "The rule 1 desire to lay down as regards the Crown Agents in future is that where a mistake of theirs has caused direct pecuniary loss to any Colony, and where such Colony would have a legal and a substantial claim if the Crown Agents were private merchants, such claim should be dealt with by fair compensation. The justice of the clain and the amount of compensation, if any, will have to be decided by an arbitrator appointed by me if it is disputed."

1661. You understand what was meant at the time, of course; that means that the claim shall be dealt with by fair compensation, but compensation paid out of what fund 7-Out of the Crown Agents' Fund.

1962. Not out of their £10,000 deposit, but out of the general fund, I suppose 7-What is the £10,000?

1663. Their security?—No, out of the general fund. 1664. From what you knew of the intention of the Secretary of State in connection with that matter, you do not think he meant them to pay personally ?—No, I do not think you could do that.

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1665. Is not that rather a curious situation? compensation is to be paid by the Crown Agents, and such compensation is not to come out of their own private pockets or the guarantee they make upon appointment, does it not follow that all the rest of the Colonies are paying out of their revenues for mis- takes made in the case of one Colony by people over whom they have no control, namely, the Crown Agents } -That is so, but, of course, that reserve fund is a fund for the support of the Crown Agents' Oflice. I do not think you could make them personally pay. In the first place, they do not make profits in the same way as an ordinary merchant; they are paid fixed

NERIS.

166, I would not wish it to appear upon the notes that I thought they should pay personally in such a case, and it would be a very hard doctrine, but I point out to you the difficulty that occurs in the other plan, and we have had evidence to show that they ibink it is rather hard upon them?--If I was the Com- mittee 1 would not attenipt to define a rule upon that point. I should have all these cases brought before The Secretary of State for the time and decided upon their merits, and take the line that he may make any order he pleases about it. I should not make a rule about it.

1667. Is it the reserve fund that would usually hare to pay?—Yes.

1668, (Sir Ralph Moor.) Would you not regard the reserve fund as partly contributed to meet such con- tingencies?—I do not think it was meant for that; it was meant to supply the pensions of the Crown Agents. This is a conceivable thing to do; it has just struck me that you might settle what amount of that fund is required for the pensions and so forth of the office, and set aside a part as a common fund of the Crown Colonies to make good mistakes.

1669, (Chairman.) A sort of mutual insurance i— Yes.

1070, (Sir Francis Mowatt.) Would you admit the general rule that where a mistake arises, either from the impropriety or the gross negleet of the agent who makes it, he should be personally responsible out of the $10,000, but where the mistake was a legiti- mate mistake, that might be made by an honest, capable agent, then it should fall upon the general fun which. I suppose, was provided for that among other purposes? - No, I would not do that, but I would do this assuming that you found that a Crown Agent had been guiity of gross personal misconduct, 1 shoubt de something like cutting down his salary fathe

171. In principle, that would be the same thing'→ Yes, but it would be a very different way of doing it.

79

July 1908.

If you make them personally responsible for loss, you must give them an opportunity of personally making gains.

1672. I suppose that they do make gains; they make the gains of their annual salary and remunera tion! I should be very sorry to be held personally liable for all the mistakes 1 have made in this Office.

1673 I am trying to draw a distinction between the mistake which a Civil servant honestly makes and a mistake with a Civil servant makes (of course, I use this without the slightest persunal reference) by way of such matters as mniversation or gross neglect ? →If you come to malversation and gross neglect, it is the duty of the Secretary of State to get rid of the Crown Agents.

1674. But that would not help the person who had lost by the neglect. I say that one is committed to the view that where a Colony is injured (1 will not suggest that such a thing has ever happened) by the gross neglect of a person entrusted with its financial administration, thất person should be held personally responsible, because, if not, I cannot conceive why this £10,000 fund was ever established?-The £10,000 I suppriè, covers the question of the Crown Agents running of with some money, for instance; in that case certainly you should get whatever you can, but I am assuming that you are not referring to that sort of case, but to cases where the business has been bully done.

1675ake the distinction between the two classes of mistakes, and it is a distinction drawn every day in commercial houses. Where an agent doing his Est makes a mistake it would be absurd to hold that he was personally liable; but where he makes the mistake by gross neglect then he should, in my opinion. be personally liable, and I put it to you that that is the rule which should obtam with the Clown Agents, as I believe it obtains in every other department ?—Does it obtain in Government offices?

1076. Certainly. Then I have no objection to that; for instance, if it applied to the case of the head of the Treasury going off with some money being made per- sonally responsible.

1677. (Chairman.) Arising out of that, there was a point I put down to ask you, although I think it hardly necessary in view of what you have said. The view has been expressed that the Crown Agents them- selves hold their office, like the judges, during good behaviour, indeed, they almost have a freehold like a On the other hand, we have had evidence that they, like other servants of the State with a few exceptions, hold during pleasure, and that the Secre- tary of State's power of dismissal is absolute. What is your view I think it is untenable and ridiculous to talk about holding like judges.

rector.

1078. (Mr. Gibson.) In fact, you agree with Mr. Cox entirely ?--Yes.

1679. (Chairman.) That concludes all the questions we have put down. Is there anything you would like to say finally 7-I do not think so.

1080. (Mr. Gibson.) One question about the reserve fund. Inasmuch as it has reached such a large sum now, do you think it would be a reasonable proposal that the income from this fund should be set aside practically for the upkeep of the office, pensions, etc., to the extent that it is available to meet them, and that the contributions of the Colonies should be reduced pro rata to make up the balance-I think the con- tributions have been reduced from time to time.

1681. Yes, but still this reserve fund has increased practically from nothing to £430,000, so that there cannot be much equipoise; except in the last two or three years when this question of increased or new accommodation has come in, the reserve fund has been mounting up by leaps and bounds, and the perisions, ete., have been more than met by the annual contri- butions? You should reduce the charges, if you have got enough, unless you do what I have ventured to suggest-make.some sort of insurance fund.

The witness withdrew.

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CROWN AGENTS' ENQUIRY COMMITTEE: