POSTAL SAVINGS DIVISION.

Mr. KRAM. In the estimate for the audit of the accounts of the Postal Saving System there are eliminated 1 clerk of class 3, 5 clerks of class 2, 12 clerks of class 1, and 2 clerks at $1,000 per annum.

Mr. BYRNS. What is the aggregate of those salaries?

Mr. KRAM. $25,000 on the Postal Savings roll and $12,000 on the regular roll, a total of $37,000, which sum is added to the estimate for the lump-fund appropriation to provide for the increased work in auditing the money-order business in the next fiscal year.

Mr. BYRNS. You propose to drop those clerks, which amount to a reduction of $37,000?

Mr. KRAM. Twenty-one of the statutory positions recommended to be eliminated are vacant at this time, and vacancies which will occur prior to the beginning of the next fiscal year will obviate the necessity for discontinuing the services of any employee on account of the reduction in force.

LUMP SUM FOR AUDIT OF ACCOUNTS.

Mr. BYRNS. And you propose to increase your lump-sum appropriation how much?

Mr. KRAM. $37,000, increasing the amount of the lump-fund appropriation from $247,730 for 1917 to $284,730 for the next fiscal year.

Mr. BYRNS. That does not serve to increase the appropriation for your office, and the appropriation will be exactly the same for 1918 that it is for the current year?

Mr. KRAM. For salaries and compensation the estimates for 1918 are the same as the appropriation for 1917.

Mr. BYRNS. How about your work? Has it increased to any extent?

Mr. KRAM. Yes, sir; there was an increase of over 15 per cent in the number of money orders paid in the fiscal year 1916 over the preceding year, and a 10 per cent increase in the volume of postal revenues. The cost of auditing is regulated by the number of transactions rather than their dollars and cents aggregate. Increases in the volume of postal revenues are reflected for the most part in larger items rather than increased numbers; consequently it has been possible to take care of the large increases in those items with relatively small additions to the clerical force. On the other hand, increased money-order business means increased numbers. It is a unit proposition, and it costs as much to audit the last million money orders as the first million. The present indications are that there will be an increase of at least 15 per cent in the number of money orders paid in the present year, as compared with 1916, bringing the total up to 142,000,000. Should this rate of increase continue during the succeeding year, the number paid in the fiscal year 1918 would total 163,300,000. In the fiscal year 1912 there were 88,995,153 orders issued, as compared with 164,900,000 estimated for the fiscal year 1918, and as the estimates of appropriations for 1918 call for $731,270, as compared with $741,490 for 1912, it will be seen that the cost of auditing has been practically cut in half.

Mr. BYRNS. How do you effect that?

Mr. KRAM. Through the introduction of improved methods, the standardization of procedure, the installation of modern electrical accounting machinery, and the increased efficiency of the force. The electrical accounting system was first utilized in the audit of domestic money orders issued and paid. Later it was extended to the audit of international money-order accounts, and more recently it has been extended to the audit and settlement of postmasters' postal accounts, as well as accounts with late postmasters. The business of the fiscal year 1918 can be efficiently handled with no additional cost for clerical labor over 1912, the only increase necessary being for the purchase of additional tabulating cards and the rental of electrical machines.

TABULATING EQUIPMENT.

Mr. KRAM. On page 126 we do, however, ask for an increase in the amount required to reproduce the money orders on the cards. We are asking for an increase of $26,650-$22,500 for additional cards which will be needed to handle an estimated increase of 21,300,000 money orders over the current fiscal year and $4,150 to provide for a 15 per cent increase in the rental of assorting and tabulating machines used in the audit of these money orders.

Mr. BYRNS. Why do you anticipate an increase in rental? Are you going to rent more machines

Mr. KRAM. It is not an increase in the rate of rental per annum, but for the additional machines that will be required. The appropriation for 1917 for tabulating cards was $84,900 and for rental of machines $27,850, a total of $112,750. In order to provide for the increased volume of money-order business the estimates for 1918 are submitted for $107,400 for tabulating cards and $32,000 for rental of machines, a total of $190,400.

Mr. BUCHANAN. For the additional business?

Mr. KRAM. Yes, sir.

Mr. BYRNS. You estimate for a considerable increase in the number of money orders?

Mr. KRAM. Fifteen per cent is the estimated increase. We have the audit of the business for the first 10 months of the present calendar year, which shows an increase of 15.97 per cent.

Comparative statement of money orders issued fiscal years 1912 to 1918,

inclusive.

1912.

1913.

1914.

1915.

1916.

1917.

1918.

Fiscal year.

Based on exact percentage comparison of 1916 with 1915.

Based on 15 per cent increase in the number of domestic orders, and no increase in the number of international orders.

Mr. BUCHANAN. I believe it will be at least 15 per cent this year. Mr. KRAM. It will probably go higher than that. It has gone as high as 20 per cent.

Mr. STAFFORD. That will depend on whether the European war stops or not.

Mr. KRAM. We have not taken that into consideration. There has been a considerable increase in the money-order business by reason, we believe, of the extension of the parcel post.

REVISED ESTIMATE.

Mr. Chairman, the department has approved a recommendation which I have submitted for a modification of the estimates, so as to provide an increase of $60 per annum in the salaries of 56 subclerical employees below the grade of $780 per annum. No increase in the amount of the appropriation will be necessary as the recommended increase in compensation will be offset by a decrease of five positions, viz, one skilled laborer at $720, one male laborer at $660, one messenger boy at $420, one messenger boy at $360, and one clerk of class 1, $1,200. By filling vacancies in these grades as they occur from time to time with temporary appointees the decreases will all be provided for before the close of the year:

The modifications submitted are as follows:

The compensation of the 20 employees on the char force has never been increased and there is practically no opportunity for promotion. An increase of $60 per annum is proposed to be made in the compensation of each, as follows:

Appropriation for 1917 and estimates for 1918:

Forewoman

1, at $480_.

Charwomen—

19, at $240_

Revised estimates for 1918:

Forewoman

1, at $540.

Charwomen

19, at $300

$480

4, 560

5, 040

540

5,700

6, 240

5, 040

1, 200

Increase_.

A decrease of one $1,200 position has been made to take care of the above increase.

In order to place all classes of employees on the same leave basis, the following restrictive proviso relative to leave of absence to nonstatutory employees should be eliminated:

Provided, That not exceeding $32,200 may be used for the payment of compensation to said employees absent on leave.

Table showing compensation from lump-fund appropriation, electrical account

Table showing compensation from lump-fund appropriation, electrical accounting system-Continued.

STATEMENT OF MR. J. C. SOUTH, CHIEF CLERK.

SPEAKER'S AUTOMOBILE, MAINTENANCE.

Mr. SOUTH. Mr. Chairman, I have gone through these sheets from beginning to end carefully, and there is nothing to be added to the estimate sheets for the House expenses, except on page 37, for driving, maintenance, and operation of automobile for the Speaker, blank dollars. They have increased it here now $500 over the former estimate of $2,000 and $1,000 over the amount of $1,500 allowed for the Speaker and Vice President each. They made a joint estimate before, one-half to be expended by the Clerk of the House, and onehalf by the Secretary of the Senate. This does not maintain the ma'chines. Vice President Marshall, I understand, is out over $700 on his machine last year. I handle the fund for the Speaker's car and he is going to be behind considerably this year. I think if you would provide $2,500 for 1918 that would be sufficient.

Mr. BYRNS. Mr. South, what expense does this involve?

Mr. SOUTH. The chauffeur and all of the repairs, gasoline, etc., every expense attached to the cars.

Mr. BYRNS. What is the salary of the chauffeur?

Mr. SOUTH. We are only paying our man $80. The Vice President pays his chauffeur $100, and that makes him come out with a larger shortage.