DEFENCE EXPENDITURE.

Press, Volume LIV, Issue 16161, 15 March 1918, Page 7

DEFENCE EXPENDITURE.

SITTINGS OF COMMISSION AT j DU.N'EDIX. j L'.S.S. COMPANY AND THE GOVERNMENT. EVIDENCE OF COMPANY'S GENERAL MANAGER. I (SPECIAL TO ''THE FRES9.") ! DUNEDIN, March 14. ! Before tho Defence Expenditure , Commission, Dr. Falconer, AssistantDirector of Medical Services for the Otago District, continuing his evidence, said that it was an anomaly to have the Dr-fenco Office in charge of civilians. The Defence Office 6hould maKo tho fullest use of tho Rod Cross in dealing with, convalescents. I>. A. Aiken, General Alanager of the Union Company, said tlio Company now had seven vessels under charter to tno Government, two ol' these being Hospital ships. '1 he Company expended money on behalf ol tno Government for stoics, coal, refitting, etc., and did not receive nor ask ror any remuneration by way ol commission or interest for that sorvice, but there was a charge of £75 for supervision for tho round trip of every vessel, this amounting to about £50GO in the three and a haif years. Owing to tho Government Audit Department's requirements, it was generally two months or moro after a vessel sailed before the Company wore a bio to render a lull account and obtain a progress payment. Tho outstanding disbursement averaged, at a low estimate, £70,G00 to £80,000 continuously, this capital standing idle without recompense. The gross amount received for hire of vessols from the beginning of the war to Februaiy 9th, 1918, was £1,578,547 8s 2d, and tho reimbursement of moneys advanced on Government account to February 9th, 1918, was £1,309,943 10s 2d. Tho form of charter was based on tho form of charter. The cost to tho New Zealand Government per annum under the present charter for tho seven vessels was £359,4G0 18s; under the Admiralty charter form, the cost would be £388,444 10s. There was a saving to the New Zealand Government on tho present form of charter of £28,983 12s per annum. The average net rate per gross ton per month was 14s Id, as against 15s 2d under the Admiralty charter, 32s 3d under the American transport charter, and 17s 9d paid for transports employed during the Boer war. Wages had increased by an average of £3 per man per montli. This increase had been borne by the company and the Government in equal shares. The wages on vessels used by the British Government had increased by from £5 to £6 per man per month, and the whole of that increase was borne by the Imperial Government. In the case of tho loss of any vessel leased to the Government, tho loss fell on the Government to the extent fixed by the charter party. Tho Avenger, Waikawa, Aparima, Roscommon, and Limerick had been lost, and tho Westmeath seriously damaged. The Wairuna also was lost. She was to have been taken over by the Imperial Government. AH these vessels wer>; lost British Government charter. The Aparima was valued in the New Zealand charter at £60,000, but under the Imperial charter _ f,he would be paid for on' the ascertained value. The Imperial Government- had one of the company's ships oil charter. The hire had varied according to the employment of tho ship; up t0.28s per ton, the net average rato being 19s per ton. The British Ministry of Shipping had three of the company's vessels on hire, two for cargo purposes, the rate for each of these two being 15s 3d per ton per month. The New Zealand Government had the right tinder th'! charter to purchase any of the company's vessels except one. The price of purchase was fixed in tho individual charters. The company did not consider that the final reconditioning of the chartered vessels would be a very serious matter if there was freedom from congestion and sufficient labour was available. It was estimated that the smaller ship 6 would cost £6000 to £8000, and the larger ones £12,000 to £15 ; 000. Statements had been made publicly that the company has bcon paid £2,400,000 for the hiro of transports, but this was over-eta ted to the extent of £800,000, which amount was in repayment of a portion of the moneys expended on account of the Government in payment for stores, coal, etc. It was estimated that the amount® that would be recovered for the lost and damaged ships w° u 'd R° only half-way towards supplying their places with fresh tonnage. The company could not get ships to replace them. Ships contracted for in 1914 were not yet even laid down. The company had had to charter tonnage at very high rates, up to £700 per day in one case, in order to replace tonnage requisitioned by tho Government. So far from exploiting tho position in any way the company had been content with something less than the authorities had accorded to British shipowners in other parts of the Empire, and a great deaf less than had been secured by neutral owners. Captain McDonald, Marine Superintendent of the Union Company, said that about the middle of 1910, instrucI tions were received to fit a vessel for 500 horses and 450 men. When the work was well advanced, urgent instructions wero received that tho horso fittings wero not required. He understood tho instructions were sent by the Imporial authorities. Tho fittings were removed. They cost about £1000, and were of very little use for anything else. In the afternoon, Mr Aiken said the company sold a large number of stores to tho Government, which socured a substantial advantage, as tho company bought in large quantities. Tno Commission will sit at Westport next week.