THE HOUSE OF COMMONS STANDS FOR EXTRAVAGANCE
Authoritative character of the evidence tendered by the
several Secretaries of the Treasury. Testimony, in 1902, of
Lord Welby, who had been in the Treasury from 1856 to 1894.
Testimony of Sir George H. Murray, Permanent Secretary to the
Post Office and sometime Private Secretary to the late Prime
Minister, Mr. Gladstone. Testimony of Sir Ralph H. Knox, in
the War Office since 1882. Testimony of Sir Edward Hamilton,
Assistant Secretary to the Treasury since 1894. Testimony of
Mr. R. Chalmers, a Principal Clerk in the Treasury; and of
Sir John Eldon Gorst. Mr. Gladstone's tribute to Joseph Hume,
the first and last Member of the House of Commons competent
to criticize effectively the details of expenditure of the
State. Evidence presented before the Select Committee on Civil
Services Expenditure, 1873.
Before proceeding to the subject proper of this chapter, it is
desirable to say a word about the organization and the work of the
Treasury.[419]
The Treasury consists of the First Lord of the Treasury, who is almost
invariably the Prime Minister; the Chancellor of the Exchequer; and
three Junior Lords of the Treasury. "The Treasury is pre-eminently
a superintending and controlling office, and has properly no
administrative functions." Its duty is to reduce to, and maintain at,
the minimum compatible with efficiency, the expenditures of the several
Departments of State.
The Treasury has three Secretaries: the Financial Secretary, the
Parliamentary, or Patronage Secretary, and the Permanent Secretary.
The Financial Secretary, after the Chancellor of the Exchequer, is the
political head and conductor of the Treasury. He is one of the hardest
worked officers of the Government. His duties were well described,
recently, by Mr. Austen Chamberlain, in the course of a brief sketch
of his official career. Said Mr. Chamberlain: "From the Admiralty he
was transferred to the position of Financial Secretary to the Treasury,
where, as his chief explained to him, he was in the position of an old
poacher promoted to be gamekeeper, and his first duty was to unlearn
the habits of five years and save money where previously it had been
his pleasure to spend it." The Parliamentary, or Patronage Secretary
is the principal Government Whip. "He is a very useful and important
functionary. His services are indispensable to the Leader of the House
of Commons in the control of the House and the management of public
business." "It devolves upon him, under the direction of the Leader
of the House, 'to facilitate, by mutual understanding, the conduct
of public business,' and 'the management of the House of Commons, a
position which requires consummate knowledge of human nature, the most
amiable flexibility, and complete self-control.'" As "Whipper-in," the
Parliamentary Secretary is generally assisted by two of the Junior
Lords of the Treasury, who are, at the same time, Government Whips.
"Those useful functionaries are expected to gather the greatest number
of their own party into every division [of the House of Commons], and
by persuasion, promises, explanation, and every available expedient, to
bring their men from all quarters to the aid of the Government upon any
emergency. It is also their business to conciliate the discontented and
doubtful among the ministerial supporters, and to keep every one, as
far as possible, in good humor." "An estimate of the importance of the
duties which would naturally devolve upon these functionaries--from the
increasing interference of the House of Commons in matters of detail,
and the necessity for the continual supervision of some Member of the
Government conversant with every description of parliamentary business,
in order to make sure that the business is done in conformity to the
views entertained by the House--induced Sir Charles Wood,[420] to
declare, in 1850, that the reduction of the number of Junior Lords from
four to three was a very doubtful advantage."
The Financial Secretary and the Parliamentary Secretary are political
officers, that is, they sit in the House of Commons, and they change
with every change in the Government. The Permanent Secretary, on the
other hand, is a non-political officer, or civil servant, who retains
office through the successive changes of Government, and secures the
continuity of the office. He is the official head of the Department,
and of the whole civil service.
The foregoing facts make it clear that for the purposes of this present
discussion, one can cite no more authoritative personages than the
several Secretaries of the Treasury.
* * * * *
The Select Committee on National Expenditure, 1902, took a great deal
of evidence on the effect of the intervention of the House of Commons
in the administrative details of the several Departments of State,
particularly on the impairment of the power of the Treasury to control
the expenditure of the several Departments.
[Sidenote: _Lord Welby on Change in Public Opinion_]
The most important witness was Lord Welby, who, as Mr. Welby, had
entered the Treasury in 1856; had been Head of the Finance Department
from 1871 to 1885; and had been Permanent Secretary from 1885 to 1894.
Lord Welby said that in theory the Treasury had full power of control
over the expenditures of the several Departments, but that in practice
that power of control was limited by the state of public opinion as
reflected in the House of Commons. As soon as the Treasury became aware
that it had not public opinion at its back, that fact "would have a
certain influence on many of its decisions." Then again, as soon as
the other Departments of State became aware that the Treasury was not
supported by public opinion, the authority of the Treasury over those
Departments was impaired. "If an idea gets abroad that the House of
Commons does not care about economy, you will not find your servants
economical." Lord Welby then went on to say that in all the political
parties in the House of Commons, "the old spirit of economy had been
very much weakened." He put the change of public opinion at about
the middle of the seventies, or, perhaps, rather later, say, in the
eighties. Previous to that change the influence of the Chancellor of
the Exchequer had been "paramount, or very powerful, in the Cabinet."
But with the change in public opinion, "the effective power of
control in the Chancellor of the Exchequer had been proportionately
diminished." Lord Welby concluded: "I constantly hear it said now by
people of great weight that economy is impossible, that you cannot get
the House of Commons to pay attention [to counsels of economy].... The
main object [to be striven after], I think, is that there should be
some correlation both in the minds of the Government of the day and in
the minds of the House of Commons between resources and expenditure;
I think that ought to exist, but I do not think it does exist at
present. I see no evidence of it."[421]
Mr. Hayes Fisher,[422] a Member of the Committee, and Financial
Secretary to the Treasury, in 1902 to 1903, replied to Lord Welby:
"But is not the business of the Treasury, and the main business of
the Treasury, to check that expenditure and keep it within reasonable
bounds, outside of questions of policy?" Lord Welby replied: "Quite
so; but might I venture to ask the honorable Member, who occupies one
of the most important posts in the Government, whether he would not be
glad of support in the House of Commons?" "Most certainly we should on
many occasions," was the answer.
[Sidenote: _Sir George H. Murray on Change in Public Opinion_]
Sir George H. Murray,[423] Permanent Secretary to the Post Office,
was called as a witness because "in the official posts he had held,
particularly as Private Secretary to the late Prime Minister, Mr.
Gladstone, he had had frequent opportunities for observation not only
of the reasons for expenditure, but of the control exercised over it in
Parliament." He said: ...
"But I think the whole attitude of the House itself toward the public
service and toward expenditure generally, has undergone a very material
change in the present generation.... Of course, the House to this day,
in the abstract and in theory, is very strongly in favor of economy,
but I am bound to say that in practice Members, both in their corporate
capacity and, still more, in their individual capacity, are more
disposed to use their influence with the Executive Government in order
to increase expenditure than to reduce it.... That is the policy of the
House--to spend more money than it did, to criticize expenditure less
closely than it did, and to urge the Executive Government to increase
expenditure instead of the reverse."[424]
[Sidenote: _The Commons the Champion of Class Interests_]
Sir Ralph H. Knox,[425] who had been in the War Office from 1856 to
1901, and who, for forty years, had listened to the discussions in
Parliament of the Estimates of Expenditure, said: ... "The mass of
speeches that are made in Supply before the House of Commons, are
speeches made on behalf of those who have grievances, their friends
or constituents, or those with whom they work, or in whom they are
particularly interested. If you take speech after speech, you find
they are simply to the effect: 'we want more'--and they get more....
In former days there were more Members who were willing to get up with
some pertinence and some knowledge to criticize those proposals. But
I cannot say there has been any very great tendency in that direction
when details are being discussed.... What I want, is [someone] to nip
in the bud, new proposals which are made by Members of Parliament
very often on behalf of their constituents. A Member, for instance,
represents what I should call a labor borough; he gets up and proposes
that the pay of every man employed in certain [Government] factories
or dockyards should be increased by so much a week, what I want is
somebody to get up and say: 'That is not the view of the country,
you must not accept that;' but instead of that the matter goes _sub
silentio_, and the Government, which is naturally interested in economy
and in keeping the expenditure down, is induced to think if there is
any feeling in the House at all, it is in favor of doubling everybody's
pay." Sir R. H. Knox said he desired more opposition to unwarranted
proposals, "because I know what extreme weight is attached to the
speeches in Supply by the Minister in charge of a Department, and by
the Department itself; but if they find that there is not a single man
interested in economy when the details of the Estimates are discussed,
it places them in an exceedingly difficult position."[426]
[Sidenote: _Commons Debates weaken Treasury's Hands_]
Sir Edward Hamilton, Assistant Secretary to the Treasury since 1894,
said that the Treasury could depend less than formerly upon the support
of the House of Commons, and that often-times the tendency of the
debates in the House was to weaken the hands of the Treasury.[427] Sir
Edward Hamilton had entered the Treasury in 1870; had served as Private
Secretary to Mr. Lowe, Chancellor of the Exchequer, in 1872-73; and as
Private Secretary to Mr. Gladstone, First Lord of the Treasury, in 1880
to 1885. He had been made successively Principal Clerk of the Finance
Division in 1885; Assistant Financial Secretary in 1892; and Assistant
Secretary in 1894. In 1902 he was made Permanent Financial Secretary.
Mr. Austen Chamberlain, a member of the Select Committee, asked Mr.
R. Chalmers,[428] a Principal Clerk at the Treasury: "Is it within
your experience as an official of the Treasury that Ministers of other
Departments not infrequently represent, as the reason for allowing
expenditure, the strong pressure that has been put upon them in the
House of Commons?" "Yes; I have seen repeated instances of that." "And
their inability to resist that pressure for another year?" "Yes."[429]
Sir John Eldon Gorst, M. P., a man of large experience of the Public
Service, said he had no doubt that in all offices there were officers
who had ceased to have anything to do; and that was particularly
true of the Education Department, where there was much reading of
newspapers, and much literary composition. He had "even heard of rooms
where Ping Pong was played, there being nothing else to do at the
moment." Sir John Eldon Gorst continued: "The Treasury has power to
make an inquiry into every Office, it could institute an inquiry to
see whether the office was or was not economically managed, but so
far as I know that power never has been exercised. It would be very
difficult indeed for the Parliamentary Head of a Department to call in
the Treasury for such an investigation. It would make the Parliamentary
head extremely unpopular. The only person who, in my opinion, as things
are, can really influence the expenses of an office, is the Civil
Service head.... But although the Civil Service head of the office
has a very great motive to make his office efficient, because his own
credit and his own future depend on the efficiency of his office, he
has comparatively little motive for economy. Parliament certainly does
not thank him; I do not know whether the Treasury thanks him very
much; certainly his colleagues do not thank him; ... and the natural
disposition of a man to let well enough alone renders him reluctant
to take upon himself the extremely ungrateful task of making his
office, not only an efficient one, but also an economical one. I think
anybody who has any experience of mercantile offices, such as a great
insurance office, or anything of that kind, would be struck directly
with the different atmosphere which prevails in a mercantile office
and a Government office.... I have no hesitation in saying that any
large insurance company, or any large commercial office of any kind, is
worked far more efficiently and far more economically than the best of
the Departments of His Majesty's Government."[430]
Sir John Eldon Gorst's statement that he knew of no instance of the
Treasury exercising its power of instituting an inquiry conducted by
Treasury officers, into the administration of a Department of State,
recalls to mind some testimony given by Sir R. E. Welby, Permanent
Secretary to the Treasury, before the Royal Commission on Civil
Establishments, 1888. Mr. Cleghorn, a Member of that Commission, asked
Sir R. E. Welby: "Is there anybody at the Treasury, for instance, who
could say to the Board of Trade, or any other particular Department:
'You have too many clerks, you must reduce them by ten?' Is there
anybody at the Treasury with sufficient power and knowledge of the
work to be in a position to say that, and to take the responsibility
of it?" Sir R. E. Welby replied: "No." Thereupon Mr. R. W. Hanbury,
another Member of the Commission, asked: "There is not?" Once more the
answer was: "No."[431]
Again, in 1876, before the Select Committee on Post Office Telegraph
Departments, Mr. Julian Goldsmid, a Member of the Committee, asked Mr.
S. A. Blackwood, Financial Secretary to the Post Office: "You would not
like, perhaps, to give the reasons for that enormous overmanning which
existed in some of the [telegraph] offices [in 1873 to 1875]?" Mr.
Blackwood replied: "I am not acquainted with the reasons myself."[432]
Sir Ralph H. Knox, in the course of his testimony, had quoted Mr.
Bagehot's statement: "If you want to raise a certain cheer in the
House of Commons, make a general panegyric on economy; if you want to
invite a sure defeat, propose a particular saving." He had continued:
"I should like to add, 'If you want to lose popularity, oppose the
proposals for increase.' There ought to be some Members in the House of
Commons who would undertake that line."
[Sidenote: _Gladstone's Tribute to Hume_]
This wish of Sir Ralph H. Knox recalls to mind the tribute paid,
in 1873, by Mr. Gladstone, to the memory of Joseph Hume, the first
as well as the last Member of the House of Commons to acquire a
knowledge of the expenditures of the Government which was sufficient
to enable the possessor to criticize with intelligence the details
of the expenditures of the Government. Said Mr. Gladstone: ... "and
in like manner, I believe that Mr. Hume has earned for himself an
honorable and a prominent place in the history of this country--not by
endeavoring to pledge Parliament to abstract resolutions or general
declarations on the subject of economy, but by an indefatigable and
unwearied devotion, by the labor of a life, to obtain complete mastery
of all the details of public expenditure, and by tracking, and I would
almost say hunting, the Minister in every Department through all these
details with a knowledge equal or superior to his own. In this manner,
I do not scruple to say, Mr. Hume did more, not merely to reduce the
public expenditure as a matter of figures, but to introduce principles
of economy into the management of the administration of public money,
than all the men who have lived in our time put together. This is the
kind of labor, which, above all things, we want. I do not know whether
my honorable and learned friend [Mr. Vernon Harcourt], considering his
distinguished career in his profession, is free to devote himself to
the public service in the same way as Mr. Hume did. If, however, he is
free to do so, I would say to him: 'By all means apply yourself to this
vocation. You will find it extremely disagreeable. You will find that
during your lifetime very little distinction is to be gained in it, but
in the impartiality of history and of posterity you will be judged very
severely in the scales of absolute justice as regards the merits of
public men, and you will then obtain your reward.'"[433]
The British public, needless to say, still is waiting for the man,
or men, who shall take upon themselves the invidious but honorable
task of stemming the tide to extravagant expenditure, which, in Great
Britain, as elsewhere, is the besetting sin of popular government. The
British people still are waiting, though, since 1870, they have vastly
increased the functions of the Government by nationalizing a great
branch of industry, and therefore are more than ever in need of persons
who shall emulate the late Joseph Hume.
* * * * *
In conclusion, let us compare with the testimony given in 1902, the
testimony given in 1873, before the Select Committee on Civil Services
Expenditure.
A Member of the Select Committee of 1873 asked Mr. W. E. Baxter,
Financial Secretary to the Treasury: "Am I right in thinking that
you do not agree with the Chancellor of the Exchequer's declaration
with regard to the Treasury? I asked him this question: 'Then it is a
popular delusion to believe that the Treasury does exercise a direct
control over the expenditure of the Department?' And the Chancellor
replied: 'I do not know that it is popular, but it is a delusion; I
think that it would be much more popular that the Treasury should
exercise no control at all.'" Mr. Baxter replied: "I think that the
Chancellor stated it too broadly, and would, probably, if he had been
Secretary to the Treasury for two or three years, have found that the
Treasury did, in point of fact, go back to some extent over the old
expenditure as well as try to stop increases." A moment before, Mr.
Baxter had said: "The most unpleasant part, as I find it, of the duty
of the Financial Secretary to the Treasury is to resist the constant
pressure brought day by day, and almost hour by hour, by Members of
Parliament, in order to increase expenditure by increasing the pay
of individuals, increasing the pay of classes, and granting large
compensations to individuals or to classes." The Chairman of the
Committee queried: "And that pressure, which is little known to the
public, has given you, and your predecessors in office, I presume, a
great deal of thought and a great deal of concern?" Mr. Baxter replied:
"As I said before, it is the most unpleasant part of my duties, and
it occupies a very great deal of time which probably might be better
spent." At this point Mr. Sclater-Booth asked: "You spoke of the
constant Parliamentary pressure which has been exercised with a view to
increasing salaries or compensations, do you allude to proceedings in
Parliament as well as private communications, or only to the latter?"
Mr. Baxter replied: "I did in my answer only allude to private
communications by letter and conversation in the House, because that
was in my mind at the time. But of course my answer might be extended
to those motions in the House which are resisted without effect by
the Government, and which entail great expenditure upon the country."
Mr. Herman queried: "When you speak of the pressure put upon you by
Members of Parliament for the increase of pay to classes, and the other
points that you named, I suppose that you mean that it is partly party
pressure, and that you are more subject to it at the present time than
you would be if a Conservative Government were in power?" Mr. Baxter
replied: "In my experience it has very little to do with party; men
from all quarters of the House are at me from week to week." "Do you
mean to say that men opposed to you in political principles apply to
you for that sort of thing now?" "Certainly I should wish it to be
distinctly understood that they do not ask this as a favor; they do
not ask favors of me. They simply wish me to look into the question of
the pay of individuals and of classes of individuals, as they put it,
with a view of benefitting the public service.... In very few instances
since I have been Financial Secretary to the Treasury have I been
asked by anyone to advance a friend, or to do anything in the shape of
a favor. The representations are of this sort: 'Here are a class of
public officers who are underpaid. We wish you to look into the matter,
and to consider whether or not it would be advantageous to the public
service that their salary should be increased.' I look into it, and I
say that I am not at all of that opinion, upon which my friend tells me
that he will bring the matter before the House, and show us up." "And
the other evil is one which is rapidly diminishing, and, in fact, is
very small now, namely, interference in favor of individuals?" "Very
small indeed."
To a question from Mr. Rathbone, Mr. Baxter replied: "I do not think
that the representations in question have much effect; I only stated
that the most unpleasant part of my duties was resisting the pressure
brought to bear in that way." Thereupon Mr. Rathbone continued: "They
may not have an effect when the Government has a majority of one
hundred or so, or when there is no election impending, but do you
think they have no effect when, as we have seen in former years for
long periods, the Government is carried on, whether by one side or the
other, by a very small majority, or when an election is impending?"
Mr. Baxter replied: "I have no doubt that they have had the effect
in former times in those circumstances." "Do you think they would be
liable to have that effect again if either party should be reduced
to that condition?" "It may be so." "Can you suggest any mode of
abating the Parliamentary pressure to which you have alluded, whether
it be exercised by public motions or by private influence?" The
Financial Secretary to the Treasury replied: "No; it is an evil very
difficult to remedy. I think the better plan would be to inform the
constituencies on the subject and let them know the practice which
so widely prevails, in order that, if inclined to take the side of
economy, they may look after their Members of Parliament." A moment
later, Mr. Sclater-Booth asked: "Do you not think from what you have
seen of the public service, that the Treasury, existing particularly
for that purpose, is the body which must be permanently relied upon
to keep down expenditure?" "Decidedly so." "Even the constituencies
can scarcely, as a rule, be appealed to in that sense, can they?" "No;
I attach very much more importance to the power of the Treasury than
either to the action of the House of Commons, or, I am sorry to say, to
the voice of the constituencies."[434]
FOOTNOTES:
[419] The subjoined statements, excepting the quotation from Mr. Austen
Chamberlain, are taken from A. Todd: _On Parliamentary Government in
England_.
[420] Sir Charles Wood, first Viscount of Halifax. Private Secretary
to Earl Grey, 1830 to 1832; Financial Secretary to the Treasury, 1832
to 1834; Secretary to the Admiralty, 1835 to 1839; Chancellor of the
Exchequer, 1846 to 1852; President of the Board of Control, 1852 to
1855; First Lord of the Admiralty, 1855 to 1858; Secretary of State for
India, 1859 to 1866; raised to Peerage as Viscount Halifax in 1866;
Lord Privy Seal, 1870 to 1874.
[421] _Report from the Select Committee on National Expenditure_, 1902;
q. 2,516 to 2,605.
[422] _Who's Who_, 1905, Fisher, Wm. Hayes, M. P., Financial Secretary
to the Treasury, 1902-1903; Junior Lord of the Treasury, and a
Ministerial Whip, 1895 to 1902; Hon. Private Secretary to Sir Michael
Hicks-Beach, 1886 to 1887; and to Right Honorable A. J. Balfour, 1887
to 1892.
[423] _Who's Who_, 1904, Murray, Sir G. H., Joint Permanent Under
Secretary to the Treasury since 1903. Entered the Foreign Office, 1873;
transferred to Treasury, 1880; Private Secretary to Right Honorable W.
E. Gladstone and to Earl of Rosebery, when Prime Minister; Chairman
Board of Inland Revenue, 1897 to 1899; Secretary to the Post Office,
1899 to 1903.
[424] _Report from the Select Committee on National Expenditure_, 1902;
q. 1,631 to 1,673, and 1,730 to 1,732.
[425] _Who's Who_, 1904, Knox, Sir Ralph H., entered War Office
in 1856; Accountant-General, War Office, 1882 to 1897; Permanent
Under Secretary of State for War, 1897 to 1901; a Member of the
Committee which worked out Lord Cardwell's Army Reform, and of the
Royal Commission on Indian Financial Relations, 1896; Civil Service
Superannuations, 1902; and Militia and Volunteers, 1903.
[426] _Report from the Select Committee on National Expenditure_, 1902;
q. 1,567 to 1,569, and 1,823 to 1,825.
[427] _Report from the Select Committee on National Expenditure_, 1902;
q. 2,081 to 2,084.
[428] In 1905 Mr. Chalmers was made Assistant Secretary to the Treasury.
[429] _Report from the Select Committee on National Expenditure_, 1902;
q. 615 to 618.
[430] _Report from the Select Committee on National Expenditure_, 1892;
q. 2,406 to 2,419, and 2,502.
[431] _Second Report of the Royal Commission on Civil Establishments_,
1888; q. 10,683 to 10,684.
[432] _Report from the Select Committee on Post Office_ (_Telegraph
Department_), 1876; q. 5,397 to 5,600.
[433] _Hansard's Parliamentary Debates_, February 18, 1873, p. 632 and
following.
[434] _Third Report from the Select Committee on Civil Services
Expenditure_, 1873; q. 4,672 to 4,768.