Evening star., 1946-08-17
Million in Excessive
Transport Charges
Recovered by GAO
last OF q Series.)
BY Joseph HonIon
"a Washington Correspondent Of the
81. Louis Posf-Dispotch)

EACeSSlVe transportation cnarge
for materials and personnel wer
one of the sources of waste in wa
expenditures about which Control
Ter General Lindsay c. Warren ha
complained. They accounted TO
nearly half of the 5000, ,0O0, 900 tn
General Accounting ONCE was abl
to recover during the war period OF
claims it disalowed.
Mr.. Warren Is steering clear o
the big quarrel over charges tina
railroads prof1ted through exorbi
tant rates, because this Is concerned
with the very intricate matter o
classifying freight shipments to de-
termine the applicable rate sched.
uIes.
GAO has not seen fit to question
whether this or that shipment was
properly classified but it is to bt
expected that this will be the sub
ject of further congressional in.
quiry.
Cases OF Needless travel.
What has disturbed Mr.. Warren
are instances of needless travel
collection of expenses for the same
travel from both contractors an6
Government agencies, and neglect
of contractors to obtain the lower
Government rate when available or
shipments.
Mostly these are relatively petty
amounts, but the payment of COM
mercial rates when the lower lan6
grant rate for Federal shipments
should have been available amount
ed to substantial sums in individual
cases and bulks quite large in the
aggregate.
Reporting on shipbuilding con-
tracts with one firm, for instance
the GAO found that more than ST.
100000 might have been saved in
l943 and early 1945 had the Gov
ernment taken title to materials
equipment and supplies at their
points of origin.
At Commercial Rates.
Instead the contracts, between
the Navy and the Todd Pacific Ship
yards, Inc, Tacoma, Wash, pro-
vided that title would vest in the
Government after delivery, so that
the shipments moved at commercial
rates.
The GAO report on this matter
adds:
Records indicate that direc-
tive was issued May 25, 1943, by
the Undersecretary of the Navy to
all bureau chiefs, directing that
contracts for the purchase of naval
material, unless there were COM
pelling reasons to the contrary
should be made fob. carrier so that
shipments could be made under
Government bills of lading.
1T was not until Nov. 25 1943
that procedure under the above di-
rective was forwarded by the acting
chiefs, Bureau of Ships and Bureau
of Supplies and Accounts, to the
local supervisor of shipbuilding.
Contract Provisions.
Contract provisions were modi-
fed to permit title to materials
used Hereunder to pass to the Gov
ernment at the point of origin, at
the discretion of local administra-
tive officials.
Such discretion was not used by
the Navy supervisory of shipbuild-
ing at the contractors yard until
February 8, 1914"
In the waste and extravaganza
reports on travel Of individuals on
file at the GAO are shown disal-
lowances of expenses for such
reasons as these:
Government officials charged
travel expenses to localities which
proved to be either their homes
or favorite vacation spots and often
on the day of arrival began their
vacations. not going back on duty
until they boarded trains to return
to their stations.
Per Diem Allowances.
Expense of trips charged up by
cost plus contractors while officials
also drew expenses and per diem
allowances from the Government.
Expense of transporting prospec-
tive employees of war contractors
long distances charged up to cost
plus even though employees were
rejected for service on arrival at
the distant point after medical
examinations which, GAO held,
should have been made at their
homes.
In the case of the Maritime Com
mission, Warren told the Mead
Committee of the Senate, it was
the rule rather than the exception
for its representatives to accept
travel and entertainment expenses
from contractors while at the same
time collecting from the Govern
ment.
For several years Mr.. Warren
annual reports on the MARTINI
Commission and War Shipping Ad
ministration have criticized thei
accounting procedures as made
quate and led to the charge b
Senator George D. Aiken, Repre-
sentative, of Vermont that thes
agencies had not accounted properl
for more than s8,00o,0oo of thei
funds.
The overall charges against tn
Maritime Commission have bee
thoroughly aired but two particula
reports of the GAO on waste an
extravaganza not hitherto publ
cized may illustrate something {
the nature of Mr.. Warren's com
plants.
One deals with contract betWee
the Maritime Commission and tn
Great Lakes Engineering Work
Detroit, Mich, for construction {
ore carriers. The fixed price, suk
ject to adjustment under certai
conditions, was to be s19 $50, 900 an
on this contract, GAO reporte'
the Government paid more tina
s1,o00,00o in excess of what shoul
have been paid.
In arriving at the fixed price {
q figure of $3.50, 900 was used as til
estimated cost of materials. o
part of the materials actual price
were to be used In making the fin;