allows us to assign these men to educational institutions and to the National Guard for various duties and as instructors.

PAY AND ALLOWANCES OF REGULAR ARMY RESERVISTS.

The CHAIRMAN. For pay and allowances of Regular Army reservists on active duty you estimate $17,000. How many reservists are there? Somebody said there were only a few.

Lieut. BRETT. I think there are over 4.000. Under the act of August 24, 1912, every man enlisted on and after November 1, 1912, went into the reserves at the end of four years unless he applied to be kept on active duty; so that, beginning with November 1, 1916, or four years after the law went into effect, we began rapidly to get the reserves. Prior to that time we only got such men as asked to be placed in the reserves. They were men who had had long service, and we only got a few men. Now we get them into the reserves very rapidly.

The CHAIRMAN. How is this estimate reached?

Lieut. BRETT. He loses his $24 a year, or $2 per month, under the act of June 3, 1916, and gains the pay of his grade.

COMMUTATION OF QUARTERS.

The CHAIRMAN. For commutation of quarters and of heat and light to commissioned officers, members of the Nurse Corps, and enlisted men on duty at places where no public quarters are available, including enlisted men of the Regular Army Reserve and retired enlisted men when ordered to active duty, you ask $1,000,000. Lieut. BRETT. We have no means of arriving at that.

The CHAIRMAN. You have had for this purpose $1,500,000? Lieut. BRETT. Yes, sir. That is arbitrary. Every officer on duty where the Government has no public quarters is entitled to commutation for quarters, beginning with the second lieutenant with two rooms and increasing one room in each grade, at the rate of $12 per

room.

The CHAIRMAN. You have appropriated $1,500,000. money be used during this coming year, or any of it?

Will this

Lieut. BRETT. I think a great deal of it will be used this year.
The CHAIRMAN. Before the 31st of December?

Lieut. BRETT. There are many officers on duty in cities where the Government has no quarters, and those officers are drawing commutation for quarters.

The CHAIRMAN. Have you any information as to how much will be paid out this month for this purpose?

Lieut. BRETT. No, sir; we could not give the amount paid this month. The accounts for the Philippine Islands would leave there about the 10th of August, and they would not get here until the 20th of September. Then, they would not be analyzed until 60 days after that. It would be at least three months before we could get anything reliable for the month of July.

NOTE. The cost for commutation of quarters reported on our books for the nine months ending March 31, 1917, is $746,458.61, or at the rate of $995,298.15 per year. It must, however, be borne in mind that that amount covers a period antedating the time when the Regular Army was increased by four

increments, and the National Army was being created. These and the large increase in the National Guard, necessitating the stationing of many officers and detached enlisted men away from the field in places where no Government quarters are available, will greatly increase the cost under commutation of quarters.

MILEAGE TO COMMISSIONED OFFICERS, ETC.

The CHAIRMAN. The next item is:

For mileage to commissioned officers, members of the Officers Reserve Corps when ordered to active duty, contract surgeons, expert accountant, Inspector General's Department, Army field clerks, and field clerks for the Quartermaster Corps, when authorized by law, $750,000.

Lieut. BRETT. We received a letter this morning from the chief of the finance division, Col. Lord, stating that they will want $2,649,000 more than this, making $1,909,000 that they will want in addition to this. The chief of the finance division, which handles the disbursement and allotment of this money, says that they are going to require for the balance of this fiscal year $2,649,000 more than you have already appropriated. Of that $2,649,000 we have estimated here $750,000, leaving an apparent deficit of $1,909,000. That is the status of the mileage appropriation.

Capt. DALY. Those figures are based on reports submitted by the chiefs of the various bureaus as to the mileage that will be required by them.

Lieut. BRETT. That report of $2,649,000 that they are going to require can be reduced a little by the laws that have been recently passed that is, that travel in connection with the Ordnance Department shall be paid from ordnance appropriations, that travel in connection with the Aviation Section of the Signal Corps shall be paid from aviation funds. Travel in connection with the engineering works and Quartermasters Corps works is in a bill which has not yet become a law. There is a provision in a House bill that their travel expenses shall be paid from their appropriation. That will reduce the apparent deficit by several hundred thousand dollars.

The CHAIRMAN. It is estimated that $2,600,000 will be required in addition to the $1,250,000 already appropriated?

Lieut. BRETT. Yes, sir.

ADDITIONAL PAY OF OFFICERS ON FOREIGN SERVICE.

Mr. SHERLEY. The next item is, "For additional 10 per cent increase of pay of officers on foreign service, $9,966,055.70." What basis is that figured on?

Gen. SHARPE. That is figured on one-half of the officers being abroad.

Mr. SHERLEY. For the period of a year?

Gen. SHARPE. Yes, sir; for the period of a year.

Mr. SHERLEY. That is just an arbitrary assumption?

Gen. SHARPE. Yes, sir; it is an arbitrary assumption.

Mr. SHERLEY. Was there any discussion had or conclusion arrived at, other than this arbitrary assumption?

Gen. SHARPE. No, sir.

Lieut. BRETT. That is just taking the pay of the officers and taking one-half of that, and computing 10 per cent on it.

Mr. SHERLEY. What is the total pay of officers?

Lieut. BRETT. $102,605,570.

Mr. SHERLEY. This really represents 5 per cent on that? Lieut. BRETT. Yes, sir; just exactly that. You have given us $250,000.

ADDITIONAL PAY OF ENLISTED MEN ON FOREIGN SERVICE.

Mr. SHERLEY. The next item is, "For additional 20 per cent increase of pay of enlisted men on foreign service, $79,265,805.20.” How is that arrived at?

Lieut. BRETT. In the same way that the 10 per cent for officers was arrived at, except that the enlisted men get 20 per cent instead of 10 per cent. The officers get an increase of 10 per cent and the enlisted men get an increase of 20 per cent. For pay of enlisted men the appropriation is $800,658,052.

Mr. SHERLEY. What reason have you for making that assumption any more than any other?

Lieut. BRETT. None.

Mr. SHERLEY. It does not represent even a conclusion, then?
Lieut. BRETT. No, sir.

Gen. SHARPE. There is no way of knowing the number of troops that will be abroad. We just had to assume some figure.

Mr. SHERLEY. Of course, presumably there are some people in the department that have something more than a guess as to the number of troops that will be abroad during the year. As I understand you, your estimate does not reflect any judgment at all, but it is purely an arbitrary assumption that may or may not have any relationship to the actual fact?

Gen. SHARPE. Yes, sir; that is true.

Mr. SHERLEY. Has any question been raised as to whether, in view of the increased compensation paid enlisted men, the 20 per cent increase for foreign-service pay was not to be allowed as heretofore? Gen. SHARPE. No, sir.

Lieut. BRETT. The Quartermaster Corps submitted a draft of legislation doing away with or modifying what is known as foreignservice pay by providing that foreign-service pay shall not accrue to enlisted men drawing what is known as war-service pay.

Mr. SHERLEY. In the act of May 18, in section 10, we provide the pay that men should receive.

Lieut. BRETT. Yes, sir; but there is nothing in there, as you can see, that disturbs the allowance for foreign service.

Mr. SHERLEY. There is nothing directly stated that does; but I was wondering if the question had been raised of whether constructively this section 10 of the act of May 18 in any way changed or modified the provision of 20 per cent additional pay for foreign service.

Lieut. BRETT. It has been raised and settled by the comptroller in this way: The question was asked the comptroller whether the 20 per cent increased pay for foreign service should be based on these increased rates, and the comptroller came back and said no, that the foreign-service pay was based on the peace pay. So that indirectly the question has been settled by the comptroller.

Mr. SHERLEY. If I understand you, this $79,000,000 for the additional 20 per cent increase of pay of enlisted men for foreign service does not represent 20 per cent of the total pay, but it represents 20 per cent of the peace pay that these men would have gotten.

Lieut. BRETT. Yes, sir.

Mr. SHERLEY. Is that true?

Lieut. BRETT. That is true.

Mr. SHERLEY. Then, in point of fact, you have figured it wrong. Lieut. BRETT. I think there has been an error there. I see what you are driving at. We can quickly arrive at that. That could be reduced by about $30,000,000. I am taking a very low per capita, but that might be cut $25,000,000.

Mr. SHERLEY. You can figure that out and insert in your hearing just the amount that it would be on the basis that you are calculating on; that is, figuring on the peace pay instead of figuring, as you have done, on the war-pay basis.

Lieut. BRETT. I will do that.

Peace pay of enlisted men, on which foreign-service pay is computed.

[Foreign-service pay is 20 per cent increase over peace rates.]

1,928 men, at $900 per year. 1,187 men, at $780 per year.. 2, 818 men, at $600 per year. 25, 359 men, at $540 per year. 4,968 men, at $480 per year. 26, 101 men, at $432 per year. 186, 836 men, at $360 per year.

30, 252 men, at $288 per year. 247, 810 men, at $252 per year. 400, 707 men, at $216 per year. 1, 105, 379 men, at $180 per year..

Pay for service, marksmanship, certificate of merit, mess sergeants, rated positions, etc...--

$1,735, 200

925, 860 1,690, 800 13. 693, 860 2,384, 640 11, 275, 632 67, 260, 960 8,712, 576 62,448, 120 86, 552, 712 198,968, 220

455, 648, 580 620, 000

455, 028, 580

7,400,000

462, 428, 580

Twenty per cent of which is foreign-service pay, $46,242,858, which amount may be substituted for $79,265,805.20, which was based on war pay.

That decision was made after these figures were made up.

Mr. SHERLEY. Was there a formal decision rendered on that subject?

Lieut. BRETT. Yes, sir; there was a formal decision.
Mr. SHERLEY. Suppose you put that in the hearings.
Lieut. BRETT. I will do so.

FOREIGN-SERVICE PAY, ARMY.

The monthly increase of pay of enlisted men of the Army provided in the act of May 18, 1917, is not to be included in the basis on which to compute the 20 per cent increase of pay for foreign service.

COMPTROLLER WARWICK TO SECRETARY OF WAR, MAY 29, 1917.

By your indorsement of the 24th instant, decision is requested as to whether the 20 per cent increase for foreign service authorized to be paid to enlisted

men of the Army under the provisions of the act of June 30, 1902 (32 Stat., 512), is to be computed on the monthly increase of pay authorized by the act of May 18, 1917 (Public, No. 12).

The provision in the act of 1902 is as follows:

"That hereafter the pay proper of all commissioned officers and enlisted inen serving beyond the limits of the States comprising the Union and the Territories of the United States contiguous thereto shall be increased ten per centum for officers and twenty per centum for enlisted men over and above the rates of pay proper as fixed by law for time of peace, and the time of such service shall be counted from the date of departure from said States to the date of return thereto."

Section 10 of the act of May 18, 1917, provides that—

“Commencing June one, nineteen hundred and seventeen, and continuing until the termination of the emergency, all enlisted men of the Army of the United States in active service whose pay does not exceed $21 per month shall receive an increase of $15 per month * *: Provided, That the increase of pay herein authorized shall not enter into the computation of continuous-service pay."

It will be observed that the 20 per cent increase authorized in the act of 1902 is to be “over and above the rates of pay proper as fixed by law for time of peace," and that the monthly increase authorized under the act of May 18, 1917. are to continue only until the termination of the emergency. As the rates of pay "as fixed by law for time of peace" do not include these monthly increases provided for time of war, such monthly increases can not enter into the computation of the 20 per cent increase provided for foreign service. The question submitted is answered in the negative.

PAYMENT OF EXCHANGE.

(See p. 420.)

Mr. SHERLEY. The next item is:

For payment of exchange by acting quartermasters serving in foreign countries, and when specially authorized by the Secretary of War by officers disbursing funds pertaining to the Quartermaster Corps when serving in Alaska, and all foreign money received shall be charged to and paid out by disbursing officers of the Quartermaster Corps at the legal valuation fixed by the Secretary of the Treasury and published on the first day of each quarter, $74.400.

Lieut. BRETT. That is legislation we need very badly. That legislation is exceedingly important.

Mr. SHERLEY. Suppose you state the reason for it.

Gen. SHARPE. The reason for that is because of fluctuations in the rates of exchange. By fixing it at the first of the month, everyone will know exactly what computation ought to be made, as fixed by the Treasury Department.

Mr. SHERLEY. This provides for fixing it not every month but every three months.

Gen. SHARPE. Every three months-yes, sir-every quarter.

Lieut. BRETT. We ask $74,400 for exchange. For instance, we go over into some country, and we get ready to pay our soldiers; the disbursing officer draws his check on the Treasurer of the United States and practically sells it in the market there and gets local currency and pays the soldiers enough of the foreign money to be equivalent to American money on that particular day. Now, in order that the disbursing officer may have a known means of accounting for his funds, he will base his rates of exchange on the Treasury circular which is to be issued quarterly. This is what we want, so that it will not be necessary for the disbursing officer to find out every day what the rate of exchange is. You have given us every