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Mr. Lloyd George at its head, and the members and staff of the Armaments Output Committee and of the Treasury Com- mittee as the nucleus of its personnel.

The first year of the Ministry of Munitions was the creative period not only as regards the internal structure of the Ministry itself, but also in regard to its main duties. It was a period in which army demands were defined, manufacturing programmes laid down, methods of dealing with labour formulated and put into effect, large numbers of specialized factories designed for mass production constructed, and devices evolved for exercising control over the industrial life of the country.

The Ministry of Munitions Act, which received the Royal assent on June 9 1915, did little more than create the post of Minister of Munitions. The definition of his functions was left to be fixed by Orders in Council. The Act was therefore followed a week later by an order transferring to the Minister of Munitions the main functions of the Master-General of the Ordnance in relation to contracts and the supply of munitions (including explosives) and the inspection of munitions. The Minister of Munitions was given concurrent power with the War Office under the Defence of the Realm Act which gave authority to take over and regulate the work of any factory. The Minister was also given a general duty to " examine into and organize the sources of supply and the labour available for the supply of any kind of munitions of war, the supply of which is in whole or in part undertaken by him, and by that means, as far as possible, to ensure such supply of munitions for the present war as may be required by the Army Council or the Admiralty or may otherwise be found necessary."

In the first instance the War Office retained the control of the ordnance factory at Woolwich, the small-arms factory at Enfield, and the Waltham powder factory, and also the right to lay down the standards of inspection to be observed by the inspectors in the factories. Provision was made, however, for the transfer of these or any other functions in the future as might be agreed upon between the Minister of Munitions and the Secretary of State for War or the head of any other interested department, such as the Admiralty.

The ordnance factory at this time and for many months to come was doing the lion's share in supplying the army with munitions, not only because of the volume of its output but even more because its large supply of skilled labour, its staff of technical officers, and the fact that it had drawings and specifications available of all stores in army service, made it the only means of supplying the sudden and often small demands which the inadequate and miscellaneous character of the equipment in the field made inevitable. The War Office was therefore unwilling to hand over so vital an institution until the new organization had got on its feet. The transfer was, however, made in Sept. 1915.

Internal Organization. From the outset the work of the Ministry fell into two main sections: that concerned with the supply of munitions and all that this involved in technical assistance to contractors, supervision of inspection, stores, trans- port, control of materials and regulation of non-munition work; and, on the other hand, the regulation and control of muni- tion labour. These two functions divided the Ministry into two divisions which were housed in separate buildings and developed along divergent lines of organization. The labour section of the Ministry, staffed largely by personnel drawn from the Labour Exchanges Branch of the Board of Trade, developed its organiza- tion on civil-service principles, the heads of departments report- ing to the Minister through the general secretary of the Ministry, Sir Hubert Llewellyn Smith. The business men, on the other hand, who were called in as heads of the supply departments, had a profound distrust of orthodox Government methods and demanded the right of direct access to the Minister. A brief controversy on this point between the general secretary and the director-general of munition supply (Sir Percy Girouard) ended in the latter's victory. This was perhaps justified by the imperative necessity for prompt action; and as Mr. Lloyd George encouraged the heads of departments to act upon their own responsibility on the basis of general instructions, it enabled a

large number of activities to be pressed forward at the same time. It had the effect, however, of making the general secretary practically head of the labour sections only of the Minis- try; and moreover, as the right of access was secured not only by Sir Percy Girouard (who was succeeded in August by Sir Frederick Black), but also by the deputy directors Mr. Glynn West (in charge of ammunition), Mr. Booth (establishment, foreign orders, etc.), Mr. Eric Geddes (small arms), Mr. C. E. Ellis (guns) and by the heads of the departments of explosives (Lord Moulton) and trench warfare (Gen. Louis Jackson, and Mr. Alexander Roger), and as the number claiming this privilege continued to increase, it gave rise to difficulty in coordinating the work of the various sections. Within the first few weeks, these various heads of departments went to the corresponding sections of the War Office, discussed requirements and gave instructions to the contracts department or placed their own contracts, without reference to the programme of the depart- ment as a whole. This difficulty was overcome by setting up a " Requirements and Statistics " department, whose primary duty was to be the sole official channel of communication between the Ministry of Munitions and the War Office on all questions relating to supply. Informal discussion was en- couraged, but the various departments were authorized to act only on the formal demand from this new department. Since this department had passing through its hands the programme as a whole, it was also given the duty of compiling the statis- tics of the Ministry and receiving weekly progress reports from the supply departments.

The diversity of experience in organization among the busi- ness men also led to confusion in the mechanical arrange- ments for distribution and registration of papers, and it was some months before the newcomers grasped the essential dif- ference between acting as head of a section of a large public service which is a part of a still greater whole and acting as head of a private business. These defects, which arose from the very qualities which enabled the Ministry successfully to set rapidly in motion and ultimately to control the immense in- dustrial reserves of the country, finally induced Mr. Lloyd George in March 1916 to change his headquarters from the labour department to the main supply department. In March 1916, Mr. E. B. Phipps was transferred from the Board of Education as second general secretary to take charge of the mechanical organization of the supply departments.

Munitions of War Act. The first task of Mr. Lloyd George was to make the country realize that the munition effort must be second only in importance to the work of the army in the field, and must override all such ideas, for instance, as of the importance on economic grounds of maintaining the export trade. Hence during June he undertook a campaign of speeches in the chief industrial centres to prepare the minds of both employers and workpeople for the very great restrictions imposed by the Munitions of War Act.

The chief provisions of this Act (July 2 1915), which brought to a head the developments in the labour situation seen during the first year of the war, may be summarized as follows: arbitration in disputes as to wages, hours and conditions of service made compulsory; strikes and lockouts prohibited; Minister authorized to declare factories " Controlled Establish- ments"; profits of these establishments limited by means of a tax known as the " Munitions Levy"; no wage changes to be made in controlled establishments without consent of Ministry; migration of labour prevented by provision that a controlled establishment must not engage a man unless he held a " leaving certificate" from previous employer; Minister authorized to demand statistical returns; Minister given authority to issue badges which protected men from pressure to join the army and to suppress illicit badges; Minister authorized to create corps of war munition volunteers available for transfer at his discretion; Minister authorized to demand removal of labour from non-munition work. The administration of the labour sections of the Act was placed in the hands of " Munitions Tribunals " set up in all industrial centres. The Act had con-