E.—3b

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sidered. That is my impression. The conversation took place, if I remember aright, between yourself, the Assistant Secretary of the Department, and myself. We were all agreed that it was desirable that such record should be kept. . 52. You would not have been surprised if, on the first visit I had an opportunity of making, I should have asked for such a rule to be introduced ?—I fully expected that you would so ask. 53. But my first visit did not take place till June ?—I was away from the office at the time that your visit took place. 54. With regard to the immediate purposes of your visit—the matter of the Wages Account -will you explain to the Commission how the wages of the service inmates are dealt with under the Act?— The procedure is laid down in section 57. [Section read.] 55. That is to say, the wages of the service inmates that are actually paid in cash may consist, besides pocket-money and clothing, of what may be paid to the manager under the terms of the license ? This money is paid in the name of the inmate into the Post-office Savings-bank ?— Yes. In the case of private schools there would be no deductions from the earnings on account of maintenance, as the payment to the institution covers all maintenance. 56. Mr. Wardell] When do they go out ?—Somewhere about the age of fifteen years. 57. Mr. Hogben.~\ The whole of the wages set down in the license as payable to the Manager should be paid by him on account of the inmate into the Post-office Savings-bank ?—Yes. 58. Mr. Wardell] Do the Government pay anything after the age of fifteen? —No. The license form provides for the employers to clothe the inmate when in service. 59. Mr. Hogben.] What check has the department that the amount in the Savings-bank is the amount that should be there under the terms of the license ?—The department requires a return to be submitted every month. That shows every change of status of an inmate. _ If a boy leaves the school, the Manager must enter in the returns the date on which he leaves. Similarly, if an inmate returns to the school, the Manager makes an entry. If the inmate should leave his place of service without permission, he should be shown as missing in the return. That is a matter of departmental administration, and applies to all the schools. 60. In short, the Department has the means of finding out the wages due to any inmate if the return is properly kept?— Yes. 61. It would have the means of checking the license by the return?— Yes. You would take the date of going out from the school, and calculate up to the day the boy left the service. If he received ss. a week it would simply be a matter of so many weeks at that sum. That amount in full should be deposited in the Post-office Savings-bank. 62. In short, the Department has the same means of cheking the Wages Account at this school as at other schools ?—Exactly the same. 63. Did you find any errors when you came over ?—Yes. 64. Were those errors due to laxity in setting down the dates ?—My investigation left the impression on my mind that whatever Dean Mahoney was he was not an official. I think " laxity " explains the position. 65. Did you think it possible for the Department to adjust all these accounts with a proper regard to the interests of the inmates themselves?— No. In some cases the Department would have to adjust them in quite an arbitrary way. The Wages Account, after I left the institution after auditing were, so far as my ability went, in a thoroughly satisfactory position. Dean Mahoney then understood the requirements of the Department. That was in December last. My visit was more in the nature of laying a thorough foundation upon which the Manager had to work. I found nothing irregular otherwise. 66. Do you think that such errors as have existed owing to laxity in regard to setting down dates could, on a general basis of equity, be adjusted by the department ?—I left written official instructions from the Department to the Manager of the school. I tried by all means in my power to fix the approximate dates in the cases in which the actual dates were not given. I instructed Dean Mahoney to send out the wages accounts for the amounts I had calculated; if the employers objected, to press them; and if they still objected, to refer the matter to the Department for 67. Mr. WardelL] The irregularities you observed were in respect to the dates ?—Yes. The absence of dates made it impossible to make exact calculations. 68. Mr. Wardell] There was absolutely no irregularity of a serious nature? —The irregularities did not disclose even the suspicion of any dishonesty on the part of Dean Mahoney. 69. Is there any suggestion that money had been received by Dean Mahoney on account of these boys and not put to their credit; or was it that he had failed to make an entry, and that therefore the money had not been received from the employer ?—There was no suggestion whatever that Dean Mahoney had received money not accounted for; none whatever. It was probably on account of the Brothers at the school not having advised him of boys having gone out. _ That was, I believe, the source of the irregularities. Dean Mahoney thought that boys were still in the institution, and two or three months afterwards it was discovered that they were out. Technically they were illegally out, as there was no license. 70. Mr. Hogben.] I think it appears clear that, according to your investigation there were no errors which could not be adjusted on the basis of equity ?—Yes, that could be done. 71. You know this form [form produced] of the Wages Account of Industrial Schools, which allows the Department a complete check on every account from the inception to the end ?—Yes ; that form is now being used in St. Mary's School, Nelson. There is one private school where it is not being used. It will probably be introduced during the next month or two there. If we only have correct dates our check is absolute. 72. That includes an account of withdrawals also?— Yes; the manager has no authority to withdraw unless the application is countersigned by the Minister. The savings are dealt with in