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MEMORANDUM OF THE SECRETARY OF STATE RELATING TO THE ARMY ESTIMATES FOR 1907-08.

TOTAL ESTIMATES.

The sum which Parliament is asked to vote for Army Services in 1907-08 compares with the total of the Estimates for 1906–07 as follows:–

f 1906-07 . . - - - - - - - - ... 29,796,000 1907-08 . . - - - - - - e - ... 27,760,000

Decrease .. e - 2,036,000

This decrease, however, does not represent the total of the savings that have been effected, as it has again been necessary to find money to meet the automatic growth of certain charges, viz.:£ Amount by which the Estimates of 1906-07 were reduced, owing to the depletion of the Regular Infantry in that year - - - - - - ... 90,000 Increased cost of Army Reserve - - - - ... 141,000 Increased charge for stores and clothing, due to the reduction of the surplus stocks available from the South African War . . - - - - ... 187,000 Increased cost of the Militia (including Reserve) .. 35,000 Increase of the Vote for works, owing to closing of

loan expenditure e - - - - - ... 42,000 Increased charge for service of loans .. - - ... 41,000 Increased charge for pensions .. - - - - ... 38,000

Total . . . ... 574,000

The reductions effected thus amount in total to some 2,600,000l.

This figure includes a decrease of 699,000l. in the amount provided for the Re-armament of the Horse and Field Artillery with quick-firing guns. The progress of expenditure on this scheme has been more rapid than was originally anticipated ; and the sum of 488,000l. to be voted in 1907-08 will complete the equipment of the Artillery with these guns. The total cost will have been 3,116,000l.

The total reduction in the Estimates would have been still larger but for the fact that a reduction of establishments does not at once produce a saving equal to the whole cost of the officers and men reduced. They cannot be summarily struck off the books, but must be allowed to finish their engagements; nor can all share of promotion be denied to them. The reduction of actual strength must be effected by taking fewer cadets and fewer recruits; but here again the stoppage cannot be made abruptly. Everything practicable has been done during the year 1906–07 to bring the actual strength of the Army to the level of its new establishment, but provision has to be made in the Estimates of 1907–08 for considerable numbers of supernumeraries. Recruiting as a whole continues to be good, and one result of this has been that the depletion of Line Infantry battalions at home, due to the efflux of three years' men to the Reserve, is rapidly disappearing.

LOAN ExPENDITURE.

Besides the reduction of the Estimates, the restriction of expenditure of borrowed money calls for notice. In the ten years from 1896-97 to 1905-06, the total amount spent under Army Loans was 15,754,000l., an average of 1,575,000l. a year. It was decided early in 1906 not to exhaust our borrowing powers under existing Acts, but to wind up the Military Works Loan as soon as certain indispensable services had been finished. The expenditure in 1906-07 will amount to some 650,000l. and in 1907-08 probably to a similar sum.

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GROWTH OF ARMY EXPENDITURE, 1896–1907.

During 1905–06 and 1906–07, the Estimates of which years were of practically the same total, the peace expenditure of the Army may be said to have reached high-water mark; and I have been at some pains to analyse the causes of the great growth which took place between the years 1896–97 and 1906–07. In that period the Estimates, for peace services only, increased by 11,741,000l., of which 11,231,000l. was for effective services, and 510,000l. for pensions.

GROWTH OF PENsions.

This growth of the pension charges is of course largely due to the South African war, but by no means entirely so. Increases in the numbers of the Army and in scales of pension take many years before they produce their full effect on the non-effective votes; and, in regard to officers especially, the pensions now being paid pertain to a period when the Army was much smaller than at present. There is a further growth of 38,000l. in the noneffective votes this year, which now account for no less than 3,596,000l. out of the total Estimate of 27,760,000l. ; and unfortunately there is every prospect of this growth continuing for some years to come.

Cost of PERSONNEL.

Of the 11,231,000l. by which the Estimates for effective services in 1906-07 exceeded those for 1896-97, 9,301,000l. was due to the increased cost of personnel. After allowing for the increases on Medical Services (402,000l.), Army Reserve (405,000l.), Staff, Departmental Services and Schools of Instruction (842,000l.), Militia (487,000l.), Yeomanry (424,000l.) and Volunteers (625,000l.),” there remains 5,916,000l. as the increased cost of the Regimental units of the Regular Army. Of this sum, 3,300,000l. represents the cost of 1,660 officers and 41,800 men added to the Army; while the numbers existing in 1896-97 cost more by 2,616,000l. in 1906-07 than in the earlier year, the increase per head being about 23l. for officers and 17 l. 7s.6d. for men. Among the causes of these increases may be mentioned the additions made to the more expensive corps (Artillery, Engineers, Foot Guards, &c.), the larger force maintained at the most expensive station (South Africa), and the better scale of barrack accommodation, &c., now provided. But besides these causes, which apply to both officers and men, the average cash payments to the individual soldier have been increased, by the grant of messing allowance, kit allowance, and service pay, to the extent of some 10l. a-year, after allowing for the abolition of deferred pay. The question of the soldier's emoluments is further dealt with below, under the head of Service and Proficiency Pay. Meanwhile, it may be mentioned that a sum of 49,000l. is included in the Estimates of 1907-08 for the provision of better furniture for married soldiers' quarters; for the furnishing of separate dining rooms for the rank and file in barracks where the necessary space can be found, and of rooms for the use of the Army Temperance Association; and for improving the furniture of serjeants' messes. In the years 1902-03 to 1906-07 a total sum of 135,000l. was provided for similar purposes.

On the other hand, the pay of regimental officers has remained practically unchanged. The Lieutenant-Colonels commanding regiments of Cavalry and battalions of Infantry, with their heavy responsibilities and the many calls to which they are exposed, are badly paid as compared with the officers serving under them ; and I hope to be in a position to effect some improvement in the pay of these and possibly other Lieutenant-Colonels in the coming year.

* Owing to an alteration in the date of payment of Capitation allowances amounting to 200,000l. in 1896, the sum actually voted for the Volunteers in 1896–97 was less by 825,000l. than in 1906–07.

CHARGES OTHER THAN PERSONNEL

The chief factors of the increase of 1,930,000l. under this head were the growth of Loan annuities (894,000l.), the larger numbers of horses maintained (544,000l.), and the increased charge for warlike stores arising from the special provision in 1906–07 of 1,187,000l. for new Horse and Field Artillery

equipments.

1907–08 COMPARED WITH 1906–07.

Without entering upon an exhaustive analysis of the Estimates of 1907–08 on the above lines, the savings of 2,036,000l. in those Estimates may be allocated approximately as follows:–

Reductions in cost of personnel:—

4. 3. Regulars - - - - - - e e - - 980,000 Colonial and Channel Islands Militia - - 5,000 Yeomanry - - e - e - - - - - 17,000 Volunteers .. e - - - e - - - 125,000 * 1,127,000 Less increased cost of Army Reserve .. 141,000 22 ,, Militia .. - - 35,000 provision for Reserve Officers - e 50,000 - 226,000 Net reduction, personnel .. - - 901,000 Reductions in armaments, stores, clothing, and miscellaneous services .. - - - - 960,000 Reductions in horses • * ... • * - - - - 296,000 2,157,000 Less increases:— Works services - - - - - - 42,000 Loan annuities - - - - - - 41,000 Pensions e - - - - - e e 38,000 - 121,000 Net reduction - - - - 42,036,000

STAFF, CoMBATANTS AND DEPARTMENTAL SERVICEs.

The total effective charge for personnel of the Regular Army (excluding the War Office and the Army Reserve) in 1907–08 is 15,261,000l., of which 400,000l. is for Staff, 12,391,000l. for Cavalry, Artillery, Engineers and Infantry, and 2,470,000l. for Medical and Departmental Services (including Labour Establishments).

ESTABLISHMENTS OF THE REGULAR ARMY.

The establishments of the several arms of the Regular Army have been subjected to a methodical examination, special attention having been directed to the two chief determining factors, viz., the Colonial and Indian garrisons to be maintained in peace, and the force which can be put into the field in an organized form.

FIELD Force.

An Order was published in January last providing for the reorganization of the Home part of the Regular Army. The basis adopted was simply that of taking the number of combatant units actually in existence at Home and necessary for the maintenance of the Colonial and Indian garrisons, and organizing these units into a force containing a due proportion of all arms; the size of the Field Force thus being limited by the establishment which it is necessary to preserve in order to find drafts and reliefs for the force abroad.

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The Army at Home, so organized, will furnish a Cavalry Division of four Brigades, six Infantry Divisions of three Brigades each, and a complement of Army troops and troops for lines of communication. The Divisions have been arranged on a larger scale of three Brigades in order to make then correspond with the organization of the British Army in India. To make the new organization possible, it has been necessary carefully to consider what parts of the existing organization were defective. It was found that, owing to the deficiency in administrative elements, such as Ammunition Columns, Army Service Corps, and Army Medical Corps, it would be, as things at present stand, impossible to mobilize as a fully organized force much more than half of the existing combatant units. With a view, among other things, to making possible the provision of these deficiencies, reductions have been made in Regular combatant establishments, surplus to what is required for the organization of the six Divisions, amounting to about 16,000 men.

Of the 99 batteries of Field Artillery now at Home, only 66 are required for the mobilization of the six Divisions; though of these, owing to the present deficiency of reservists to complete ammunition columns, only 42 can be mobilized. The 33 surplus batteries it is proposed to form into training brigades which will train men on a non-Regular basis, to bring the personnel of the Artillery up to its full requirements, including the ammunition columns now lacking.

No reduction, however, of the establishments of the Regular Artillery can properly be made until personnel, trained on a non-Regular basis to the requisite extent, is ready to fill the gap. All the battery establishments of Horse and Field Artillery consequently remain for the present unchanged; certain economies wholly unconnected with this question have however been effected in the establishments of Artillery depôts.

Of the other troops surplus to the requirements of the new organization, two battalions of Foot Guards have been dispensed with, and disbandment has been ordered. One has already ceased to exist, but the other, the 3rd Bn. Coldstream Guards, is usefully employed in temporarily strengthening the British Force in Egypt. The necessity of finding, with due regard to economy, the money necessary for making good the deficient elements in the new force renders it impossible to maintain units of any arm in excess of its due proportion.

Eight battalions of the Line have been reduced from the Colonial

Establishment, as described below, but as the Home battalions perform the vital function of providing drafts for battalions abroad, no more could be dispensed with while the force abroad remains at its present establishment.

Steps are being taken to make good the considerable deficiencies which, as already stated, exist in administrative troops, such as medical, transport, and other departmental services. It would, however, be both extravagant and unnecessary to give all the personnel of these services the costly training of the British regular soldier. Careful investigation is in progress as to what proportion of this personnel is required at the beginning of the campaign to consist of fully-trained Regulars, and what proportion may be civilians specially trained for a sufficient period. The necessary plans for providing this non-Regular personnel, or Special Service Division, and giving it the necessary training, are being closely worked out.

CoLoRIAL GARRISONs.
o

, Infantry.

The consideration by the Committee of Imperial Defence of the garrisons maintained at Colonial stations has enabled the Army Council to make the withdrawal above referred to of eight battalions of British Infantry—four from South Africa, two from Malta, one from Gibraltar, and one from Ceylon, which will be replaced by a Native battalion.

On the other hand, the establishment of all battalions remaining in the Colonies has been raised from 766 to 840 rank and file. This increase in the strength of the 10 battalions remaining in South Africa, together with the addition of a fifth Cavalry regiment there, very largely compensates for the reduction made. The result of these changes is to reduce the number

of Line battalions abroad (including India) from 85 to 77, so that, if the present total number of 156 Line battalions were maintained, we should have, for the first time since the Cardwell system was established, a majority (79) at Home. But these eight battalions are not required for the Field Force; their disbandment leaves us with only the manageable number of three two-battalion regiments with both battalions abroad, as against seven in the establishments of 1906–07, and under present conditions the Government considers that their retention on the Home establishment would not have been justified. The realization of the Cardwell ideal of equal numbers at Home and abroad, thus brought within reasonable distance, may not be long delayed. It has also been found possible to remove two Native Indian battalions from Mauritius, one going to Ceylon to replace the British battalion withdrawn, and one returning to India, where it is no longer a charge upon Army Votes; and to disband the Chinese Regiment.

Garrison Artillery.

A joint Naval and Military Committee, under the presidency of General Sir J. F. Owen, after completing an examination of the fixed coast defences at Home stations, undertook a tour of inspection to examine into the armaments of our Coaling stations. Their recommendations have led to considerable reductions in Garrison Artillery establishments at Home and abroad; but the proposed changes have not yet all been fully worked out.

ESTABLISHMENTS AND TERMS OF SERVICE.

The number of units of each arm to be maintained on the Home establishment having been fixed, the question of the peace establishment to be assigned to each unit remains. This and the closely allied question of the length of the soldier's service with the Colours and in the Reserve form a subject of considerable complexity, requiring for its proper treatment much careful calculation and study of several factors, among which may be mentioned the proportion of the strength of each arm abroad to that at Home, the drafts necessary and the organization for finding them, the possibilities of recruiting, the regular reservists required on mobilization and to make good waste in the field, the length of service necessary to make an efficient soldier of the several arms, the strength necessary for a unit in peace for training purposes, &c. This investigation is not yet complete for all arms of the Service, but much has been done towards putting this part of the subject on a scientific and, it may be hoped, a permanent basis. The following have been fixed as the periods of Colour service for the principal arms:—

Cavalry and Infantry ... 7 years (with 5 in Reserve);
Horse and Field Artillery .. 6 years (with 6 in Reserve);
Garrison Artillery .. ... 8 years (with 4 in Reserve);

with power to retain a man for such portion of an additional year with the Colours as may be necessary, if he be abroad on completing his term of Colour service.

Notwithstanding the return to the shorter period of Colour service for Infantry of the Line, and the consequent eventual increase in the Indian and Colonial drafts, the Army Council are satisfied that the establishment of each Home battalion admits of being reduced from 750 to 720 rank and file.

Cavalry.

The Cavalry organization represented in the Estimates of 1905-06, and provisionally continued in those of 1906-07, depended upon the formation of two large depôts for supplying drafts to regiments abroad. The buildings and training grounds necessary for these depôts do not exist, and it has been decided to omit them from the establishments of 1907–08, maintaining

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