NOTE. In addition to the above, the organization of the Coordinator for Ship Repair and Conversion, engaged under contract with the United States Maritime Commission and the Navy Department jointly. will incur expenditures during the fiscal year 1942 under an approved budget of approximately $175,000, 50 percent of which will be reimbursed by the Navy Department, the balance being borne by the Com mission. Admiral LAND. Might I say, on this small-ship program, there has been taken over the administration of yards all over the country in order to spread the work and, when I told you we had 31 large yards. and 53 altogether, there are 22 of what I call peanut shipyards. Now you have to set those up with an office and they have to have inspectors-hull inspectors, engineer inspectors, plant inspectors-and accountants. Normally, we would not have that. Now you have Mr. Odlum in the picture and, whether you agree with the policy of Special expert in Division of Operations and 1 15 230 3,450 Special expert in Division of Emergency 27, 500 360 7,500 Assistant to Director, Examining Division. 24,000 360 4,000 115 75 1, 125 29,000 360 9,000 Assistant Director of Division of Operations Mr. Odlum or not, I think we were the pacemakers in the splitting up of contracts, in answer to your question (Mr. Starnes), among subcontractors. Frankly, I am very proud of what the Commission did long before Mr. Odlum came in, but that is in the set-up and we got from high authority a couple of pats on the back because we did set this up. Maybe we will get a kick in our stern sheets before we get through. It looks like a beautiful picture but, practically, there are a lot of loopholes both as to curses from the supposed beneficiaries, as well as time and cost. It costs us probably more for accountants than the amount that we save the Government, but that is the law. If we have a small ship company, we have to set up a complete inspection force, accountants, plant inspectors, and so on. What you are going to save down the line by having cost accountants there probably would not pay the salaries of the people that are there. Of course, that is not true in a big yard, but in a small yard that is what we have to do, because it is the law. You get to the point of diminishing returns in some of these instances, but I do not know where the end is. CHANGES MADE IN METHOD OF MAKING PURCHASES Mr. WIGGLESWORTH. Let me ask you another question on this administrative table. When you were here in June or July, you indicated that you had, as I recall it, in effect, three set-ups-one for your regular, one for the "Ugly Ducklings," and one for the lend-lease, distinct from each other. Does that condition still obtain? Admiral LAND. We have three financial set-ups, but we now have only one construction set-up. Captain VICKERY. The technical work is all done in the technical division, and the field work is all done now by the construction group. Mr. WIGGLESWORTH. You have a division as to finance, and then what else? Captain VICKERY. Everything in the field is done by the construction group. All the technical work, the design work, the approval of plans, is done by the technical group. Mr. WIGGLESWORTH. Where is the duplication as to set-ups, with respect to finance and what else? Captain VICKERY. Not as to finance. You simply keep your accounts different. It is not a duplication. Mr. WIGGLESWORTH. You do not feel there is a lack of economy here through this duplication of set-up since the summer? Admiral LAND. It was not working satisfactorily and we changed it. We shifted it, and put all the field work under the construction division for standard and for emergency ships. Another major change is, we have taken the purchasing out of the hands of the private people, where we had it for these emergency ships, and put it here in Washington. There has been some question in my mind as to whether or not that was a good move, but it gives us direct control; it makes us responsible for complaints, no matter where they come from, rather than having them go through a third party. That, again, accounts for some of this increase in personnel, because we are setting up a purchasing section that not only purchases small stuff, the culinary equipment, the kitchen equipment, the hotel equipment, but purchases all the material that goes into a ship. That was done in New York for the emergency ships by Gibbs & Cox, and we paid a fee for it. We felt that we paid plenty for it and they felt that we did not pay enough, so we just split business with them and said, "Good-bye, boys," and kissed each other on both cheeks, and we are running our own show now. EFFECT OF NEW LANGUAGE REQUESTED Mr. WOODRUM. Admiral, you have explained this provision with reference to the $90,000,000, but will you explain the new language on page 171 of the bill which reads: Provided, That the said construction fund shall be available for carrying out the activities and functions which the commission is authorized to perform under title III of the First Supplemental National Defense Appropriation Act, 1942 (Public Law 247): Will you tell us something about that new language? Admiral LAND. The first part there, that is just the First Supplemental National Defense Act. The other is the contract authorization. Mr. WOODRUM. It continues those funds made available under the First National Supplemental Defense Act, in order that you may have the benefit of it? Admiral LAND. Yes. And then we ask for $90,000,000 under our own Independent Offices Act. Mr. WOODRUM. It also makes the funds that you are asking bere available for the same purpose; is that correct? Admiral LAND. That is right. Mr. WOODRUM. You have explained the $90,000,000 item already. CONTRACT EMPLOYMENT SERVICE Tell us something about this item, training of personnel of the Commission, where you have an increase of some $75,000. Mr. KIRSCH. The first supplemental national defense appropriation, 1942, give the Commission an additional $150,000. Therefore the increase is from $225,000 to $255,000. We now have under contract employment approximately 35 employees, on the basis of $15, $20, $25 per day for special services. Mr. WOODRUM. That is in your training program? Mr. KIRSCH. No, sir; this is not training. This is in our emergency shipping program. Mr. WOODRUM. Emergency shipping, yes. Mr. KIRSCH. This is an item for assisting in our emergency shipping program. We have 34 employees right now on a contract basis ranging from $15 to $20 to $25 a day, or six or seven thousand dollars The total of that, for the number we have right now, is per annum. $161,000, on an annual basis, and that is increasing as the program increases or as the emergency increases. Mr. WOODRUM. The reason for that increase is the stepping up of the program? Mr. KIRSCH. Yes, sir; that is due to the stepping up of the program. Admiral LAND. It is also due to the repeal of the Neutrality Act, where we will now have more representatives, because we will have more ships in places where they never were before. Archangel is an example; London will probably be an example. NUMBER OF SHIPS UNDER THE SEVEN PROGRAMS Mr. WIGGLESWORTH. Admiral, I take it that you have given us or will give us for the record these seven programs broken down separately, so that we can see how many ships are in each, and the total cost of each, and the number under construction? Admiral LAND. Yes, sir; those are in the sheets that I have mentioned to you. LIBERTY SHIPS Mr. DIRKSEN. Admiral, none of the ships under the act of February 6 have been completed? Those are the Liberty ships? Captain VICKERY. It is a question whether we will get two or four this month. Mr. DIRKSEN. Those represent the first completed ships? Mr. DIRKSEN. How long does it take from the time of launching until the ship is actually commissioned and put into service, for a normal ship? Admiral LAND. Anywhere up to 3 months, depending upon how efficient the people may be. Just to make that clear, you can launch a ship when it is 33% percent completed or when it is 99 percent completed. It is up to the management of the yard as to when it is launched, depending on facilities that you have by way of fitting out basins and piers and so forth. Mr. DIRKSEN. So the first of those Liberty ships will actually go into service when? Admiral LAND. They will actually go into service this month. That is about 10 to 11 months from the time we were told to do it, and about 9 to 10 months from the time the contracts were let until the ship is completed. Mr. DIRKSEN. From there on, commissionings will accelerate and there will be a few more each month? Admiral LAND. That is right. |