THE CANTEEN FUNDS

Auckland Star, Volume LIV, Issue 213, 8 September 1923, Page 12

THE CANTEEN FUNDS

TEN MILLIONS DISAPPEAR. RAISED FROM THE SOLDIERS. WHERE SOME OF IT WENT. (From Our Own Correspondent.) LONDON', August 2. The Canteen Board, a non-civilian body I wholly under War Oftice control, had 1 the welfare of the various expeditionary , j forces in its hands during the war. It | obtained millions qj money from the ■ men on service, but from the beginning it was laid down that the work of the board should not be a money-making one. The board was wound up in April, lfllfl, and there were even after heavy I writing down of various stores to half their cost, a pro-fit of ten millions Btill ; in hand. It was understood that these j millions were to be returned, to the I pockets whence they were derived —and that source was in many case= tne X.Z.E.F.—that is, the men on service. Within 21 months there remained only : seven and a-half millions. I The scandal was naked. A select j committee was appointed to inquire into the way in which the Army and Navy I Canteen Board took ov e r and managed J the profits of the expeditionary force j canteens. That report shows appalling j chicanery. j While* the report docs not suggest , that the E.F.C. could have been wound j up without incurring loss, or that improper use of profits has been made, it does criticise, and at length, some disgraceful transactions brought to light | by its inquiry. :no proper supervision". After hearing the evidence of several ' disposal officials, the committee declares that "it is a. remarkable circumstance : ' that most of the goods sold at low i prices were sold to ex-officials of the board:' and it adds the opinion that j the- "board of management failed to , exercise proDer care and supervision in this matter." , The report deals with the circumstances in which these sales were made and with regard to Major \ an den Bergh 'and Major Boyd, who were officials; directing the disposal, the committee "re-ret to state that they do not think ! any reliance can be placed upon their j evidence." or that a Mr. Blake, who puri chased goods from the board. • "We are of opinion." it is stated that Major Boyd and Major Van den Bergh , I failed to exercise ordinary care in die-1 posin°- of the property of the board. It was at the end of 1918 that the disposal of surplus stocks was first considered. ' •'lt is not a little surprising, comment the committee, "that bo far as can ue i judged by the records of their proceedings, the" board of management never once gavo their consideration to the general problem, and were never supplied with comprehensive information as to the amount of stocks to be disposed of, the methods employed, or, until January, • 1920, with any detailed results of sales." Major Van den Bergh, the report states, was the officer directly responsible for supervising the disposal of the surplus stocks. Instructions were given to him, though not in writing, by Sir Francis Towle. that in private treaty sales, competitive bids were to be obtained, and no sale by private treaty was to be made at a price less than that obtained under similar conditions at auction. • PRIVATE TREATY SALES. "It seems clear to us,"' the committee state, "that not only was the general I policy of these instructions departed I from, but also that, so far as a considerable- volume of private treaty sales between July and October, 1919, are concerned, competitive bids were not obtained, and no proper comparison of prices realised at auction was made before arranging sales by private treaty." With regard to Sir Francis Towle, who at the special request of tiie Army Council continued to ffivo part of his time in the control of the board, the committoe states:— ".Sir Francis Towle cannot be altogether absolved from blame for having failed to see that his subordinates were not carrying out their duties concerning disposal of stocks by private treaty satisfactorily. "It must be remembered that Sir Francis Towle was a part-time worker, and it is, therefore, possible that under pressure of other business he allowed himself to be satisfied with much of the information as it was placed before him." Major Van den Bergh also 'became a part-time worker from June, 1919, "and, ,, it is stated, "the following month certain sales •were transferred from the main oflices of the buying department to Major Van den Bergh's own office." REMARKABLE TRANSACTIONS. The sales arranged from this office amounted to more than £500,000, and the committee say that in no single instance could they find that Major Van den Bergh consulted the buyers at the main oflices with regard to the adequacy of any offer he received. An employee in the service of the | Board, " who had considerable oppor- j tunity of acquainting himself with the stocks of goods held by the Board, and lowest prices which would be accepted for surplus goods.' , resigned his posi- i . tion, and shortly afterwards purchased | ! from the Board, on behalf of Mr. Blake, j a large block of goods to the value of approximately £250,000. Major Van den Bergh sold 7560 dozen j pairs of sQcks at 7/ a dozen in August, j 1919. In the following October tha Board bought further quantities of I these socks, of only slightly better ! quality, at 23/2 a dozen. The financial statement shows that the excess of profit over the losses was £R,718,G49. After certain adjustments had been made there was a total distributable profit of £9,865,633.