July 4, 19 i 8 
Land & Water 
17 
Controlling National Finance: By F. Aldridge 
NOT one person in a thousand can tell you where 
are the headquarters of the Controller and 
Auditor - General. His address is simply 
"Victoria Embankment," yet it has been in the 
same place for nearly twenty j'ears. Nor can 
one person in a hundred tell you the exact functions of this 
public official who enjoys the exceptional privilege— the 
unique privilege — of being independent of the Executive or, 
in other words, of the Government of the day, and who is 
only removable by the Sovereign on a joint address by the 
two Houses of Parliament. 
The Auditor-General is not merely the Grand Inquisitor 
of Expenditure, but he is responsible for all money issued 
as well as for all money spent. In other words, he endorses 
by actual signature every - 
cheque or draft drawn by the 
Treasury on the Exchequer for 
any Government Department. 
This sounds simple enough ; 
but every cheque has to be 
examined and the correctness 
of its issue, so to speak, visdd. 
Few kno\y, indeed, how the 
method of financing Govern- 
ment machinery is carried out. 
The State can either vote an 
exact sum of money for 
specific departmental services 
— money which has to be 
applied to specified objectsr— 
or it can vote a credit which 
gives absolute latitude to the 
Executive as to how it applies 
these funds inside the terms of 
outlay. The Vote of Credit 
is always comprehensive in 
terms so as to embrace every 
purpose connected with the 
subject for which the money- 
is voted. The terms of the 
last Vote di Credit practically 
allowed the expenditure of 
the money in any and every 
way connected with the actual 
conduct of the war. 
In years of peace the 
country's machinery is carried 
on by estimates strictly worked 
out, but in war time the Execu- 
tive must resort in part to 
Votes of Credit. It does 'so 
because certain Departments 
such as the ^\'ar Office, .Admiralty, and Ministry cf 
Munitions, decline on national grounds to give details 
of their expenditure, and ( therefore if estimates of the 
usual type were provided they would be so vague as 
to be useless for the purpose of information. In a way, the 
systefln is helpful to the Government of the day, since under 
a Vote of Credit it can obtain monej' to be devoted to anv 
scheme it Violds to be useful to the prosecution of the war 
without having to specify its nature in public. Let it be 
stated, in passing, that the Auditor-General knows what is 
done with the money, since nothing is secret from him 
— he has the right to enter any Government Department 
at any convenient time and call for papers on anything and 
everything. Nothing can be withheld from hiin, however 
important its nature. This presupposes a vast amount of 
tact in the person of the Auditor-General, a condition which 
is fulfilled by Sir Henry Gibson. 
All moneys collected by taxation or by loan are paid into 
the Exchequer Account at the Bank of England. It is not 
the case that Departments to which specific sums are allocated 
by Parliament at once withdraw them by indenting on the 
Treasury. They usually draw according to current require- 
ments, atid the Treasury cheque goes to the Auditor-General, 
who has in the first place to see that the charge is authorised 
by Parliament and in the next that it is within the limits of 
authorisation. If the original estimate has been exceeded, 
then a supplementary one must be presented to the House 
of Commons. There used to be pl^ty of such excesses 
— thirty to forty a year — but in recent time the control has 
been so thorough that some six or seven are the customary- 
number. In respect to a Vote of Credit, the Controller- 
General cannot check the employment of the money according 
to any prescribed scheme of allocation, but he can control 
the extent of the drawings, and afterwards he can, of course, 
see that the whole of the sum has been laid out on the exact 
lines included within the terms of the \'ote. 
In addition, the Controller grants issues, on Treasury 
requisition, for all such purposes as the King's Civil List, 
the Judges' salaries, and the like, and the receipts have 
ultimately to be sent to him for verification. He alsc; signs 
all warrants for Exchequer Bonds and Treasury' Bills, So 
much for the payments, though it should be added that 
naturally the Controller receives from the Banks of England 
and Ireland a daily account of their receipts and issues. 
Next comes the checking of the employment of the money. 
^ The vita, point in consider- 
^„„, ... _. „ ^.-.„-,,.,, ^ I ing the work of the Auditor- 
General is to remember that 
receipts must be furnished for 
everything. This explains 
why occasionally, to take 
Arpiy work, as an instance, 
so much trouble has to be 
taken in a regimental unit to 
account for a few pounds. 
People are apt to forget that 
this work of accounting^for 
all outlay has to go on all 
over the British Empire where 
there is British expenditure, 
and^ therefore it is not sur- 
prising that in every Appro- 
priation Account which is 
furnished yearly ' there are 
certain pages devoted to 
"losses consequent on theft, 
fraud, arson, , or gross neg- 
ligence" and to " losses other 
than by theft, fraud, arson, 
etc." Such Accounts deal in 
separate form with the 
Departments if they are 
important enough, but other- 
wise they are grouped together. 
The marvel in these reviews 
Ik is not what is discovered, but 
how little there is to discover. 
Thus in the Army Report of 
1916-7 ordered by the House 
of Commons to be printed this 
year-they are necessarily much 
in arrear — there are only 46 
items in the former and 149 
Here is a small ta-ble of 
J. Kusscil ana Sons 
Sir Henry Gibson, K.C.B. 
items in the latter category, 
the sums : 
Claims abandoned for 
pay, etc., over-issued 
in prior years, rents, 
value of stores, etc. 
Losses due to fraud, etc. £149,464 7 8 
Losses other than fraud, etc. £^325, 702 8 y 
Cash 
;^3.775 8 
;^236,624 16 
Considering this is war time, these are n^t so very terrible, 
and as a type in the first class one may mention "Loss of 
sheep in East Africa attributed to thefts by natives," and in 
the latter "stores and cash losses sustained through the fall 
of Kut el Amara." In addition, there are a number of sums 
written oH "under Treasury .Authority," "by authority of 
the Army Council," "by authority of General Officers Com- 
manding," "written oi^ by Treasury and War Office Board 
of Investigation," and "debtor balances on non-effective 
soldiers' accounts." Even with all these additions, the 
aggregate totals are only £475,166 i6s. 3d. and 
£240,400 5s. 
These details have been given to show how thorough is the 
examination of the accounts of each Department, though it 
should be added that often there are included in these state- 
ments more or less critical analyses of the methods of pro- 
cedure of the Ministry whose affairs are under examination. 
Now, if the Auditor-General was to check every item of 
expenditure of any Department he would obviously need 
thousands of assistants. Of course, he docs nothing of the 
kind. In normal cases of ad hoc Estimates his policy is to 
take test cases and examine them in detail. His workers 
are selected for their ability to "spot" possibly weak points. 
