REPORT ON WAR STORES SCANDAL.

North Otago Times, 27 October 1906, Page 1 (Supplement)

REPORT ON WAR STORES SCANDAL.

EXPOSWtB OF SWINDLING AND

sruriDfJT.

Tha War Office has now issued the report of the ltoyal Commission * ap•pointwl, with Mr Justice Farweil us chairman, to investigate and report iiiwn the allegations made in the rc'port of tlio Committee presided over liy Lieutenant-General Sir William Butler, and all tho circumstances connected with conti acta, sales, and refunds to and by contractors in South Africa after the oonclueion of peace.

Although the Commissioners make 110 general summary of conclusions, comment, or recommendations, there is a running condemnation throughout the report of the system adopted, of the methods by which it was worked, and of the culpability of certain officers and non-oommissioncdofficers concerned. There is severe condemnation, for instance, of the transaction between Meyer and Colonel Morgan, as a,result of which Colonel Morgan's brother secured an appointment at £I2OO a .year.

"We are of opinion," says the report, "that this arrangement with b Meyer for the employment of F. C. Morgan was contrary to the dpirit and letter of the • King's • Regulations." In concluding, this part of the inquiry, wo feel compelled to add that Colonel Morgan can hardly complain if his conduct in these matters lias given rise to gravo suspicion." After referring to the process of the organisation of Mevor (Limited),the report adds;—"lt it).'plain, therefore, that no prudent ■person would have accepted'the tender of such a company an Meyer (Limited)," and later, ''Colonel Morgan shares with Colonel Hipwell and Captain Limond the responsibility for the admission of Meyer (Limited) as tenderei's, and must also answer for having recommended' their- acceptance.' , , MEYER COMES OFF-BEST. With regard to xiie favoured, treatment accorded Meyer (Limited), one cade l .is cited, where -Meyerfs were regarded as.: tho ■ purchasers of supplies before all the tenders.for those supplies h#s- been, received. or.considered, and •it: is: pointed' 'but thai although it is ,the. ordinary 'praetioa in the Army to require payment on delivery of good* s ■ sold, not only was this not enforced in. t|ie:cas3.of Meyer,,hut the idea.of requiring .payment,or security,,did- not itself lo Colonel, Hipwell or Captain! Limond until the end of. Jan-

nary. 1903. The result was ihat while on tire one hand Meyer was receiving long credit in respect of Minis owing from li'im on his contract to purchase, on the other hand ho was) being paid promptly and in full for everything ho supplied. "The only explanation of the proceedings offered to us is that it was desirable to avoid complicating accounts in the Pay Department ; but the whole transaction is quite inexcusable, and tho blaino nvusfc r&t on Colonel Hipwell and Captain Limond of tho Supplies Office, and Colonel Downr and Colonel Swire, of tlio Pay Department, in their respective degrees, for theso concessions." Generally, whilo Meyer was without supplies and without means of storing or issuing at several stations, the military authorities, instead of buying in default or inflicting fines, were railing up supplies, (ftorinc .them in army depots, debiting them to Meyer at a purchase of lis., and crediting him with the same (Applies on issuo to tho troops at 17s. llj<l,

The report goes on to deal in detail with other transactions whjph were brought,to public notico during tho sitting of tho Oommiusion, Commenting on tho Stepney contract failures, tho Commissioners taj-fi;—'"Colonel Hipwell and Major Walton■ must both be hold responsible for the loss .of £1270 of public money."' The Sieve caso "is another 'instance in which carcleobncss in drafting a contract led to <;otifusiou and loss of public money," -In the Wilson, Son, and Company caso responsibility is thrown on Major, 1 Walton, and with regard to the Broudo and Marks oontract tho Commissioners say of tlio samo officer:—"After; hearing lite ovidence and explanations we entirely acquit liim of any corrupt motive, and wo arc driven to say that he was guilty of culpable neglect and stupidity."

DEPLORABLE LAOIC OF INTELLIGENCE.

After going into other similar mattors at great length and detail, the -report says:—"We refer to tho- casefe dstailed in this report as Showing that tke business of the office of the Dilator of Supplies was conducted with inexcusable carelessness and extraordinary ineptitude, and that .of the Pay Department with a want of intelligence that is deplorable, flier© is ground for tho allegation ill the Butler report that in many eased the signing away of thousands of pounds, the granting of refunds or rebates, and tho acceptation of a contractor's representation without query or comment/ were regsrdod as ordinary occurrences in evoryday administration, worthy of less attention than would liave been _ bestowed on a few pound# or shillings in a similar situation at home, Wo consider that Colonel Hipwoll, Captain Limond, and Major Walton, have not properly appreciated that it was their duty to protect the public and to act as trustees of the money they were dispensing. & No private lii"m could avoid bankruptcy if it allowed its agent to deal with business matters in the mode in which these three officers liavo dealt with the purchase and sale of supplies.

"The salient matters out of which ( the loss® Suffered by the State have i grown wero the adoption of the system of local contracts, the acceptance of contracts to supply the Army at extravagant prices, tie contracts to sell to contractors shortly afterwards at much'lower prices, With regard to the fimfc, although General Lyttelton considered ho had tire great authority of Lord Kitchener for the adoption of the system, yet by his telegram of July 1 he himself recommended it, but while Lord Kitchener regarded it as an experiment General Lyttelton appeal's to have assumed that it was to be carried out to the end at all ootte. The responsibility for advising this course must rest on him. As to the second, the acceptance of the supply contracts,- we think lie was entitled to rely on tho Director of Supplies and. his officers, while tire third, point appeart to us to fall under the duty of watching the progress and working of the system, for the neglect of which we consider that the General Officer Commanding cannot entirely escape responsibility."

THIEVING BY OFFICERS. Tho report proceeds:—"Tho evidence taken in South Africa has brought to light various dishonest contrivances by which contractors and non-commission-ed officers, either separately or in oon> junction, succeeded in robbing the llnny of large sums of money, tho exact amount of which it is now impossible to ascertain. Wo have to report that large losses also occurred by reason of tho inept management of tho Supply and Pay Departments in South Africa, but wo can report that there is no evidence that any of tho officers in charge of these departments or any officer holding His Majesty's commission, with tho exception of those mentioned below (nine officers are mentioned), liavo received any bribe or 'inducement, pecuniary or otherwise, from ■any contractor or contractors' agent. On the other hand, our evidence shows that'payments by contractors to noncommissioned officers were frequent."

In concluding, 'the Commissioners, dealing with the items lost on sales £4f>0,609, and loai on purdliasc £G-18, 013, say that a large amount of saying would have been effected had the Army been more in touch with the Repatriation Department, and sold more to repatriation instead of to contractors. 'To sum r.p the position, leaving entirely out of account* the loss of £752,657 under the head of shrinkage, shortage, bad, condemned, destroyed by fire, etc., all of which wo treat as unavoidable under the circunrancos, wo estimate the total preventable loss to tho home taxpayer during the twenty-two months after peace as lying somewhere between thvwjuartors (if a million sterling and one and a quarter million sterling."