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No increase of force having been provided to meet the increase of the work, I was compelled to withdraw from the other work fifty clerks to record, jacket, make preliminary searches, and as far as possible push forward this new class of claims. This greatly retarded the work upon the other classes, with which the office was already overcrowded, and the resulting delay has not yet been overcome.
Your attention is invited to Table 6, showing the transactions under the provisions of section 4744, Revised Statutes.
The whole number of cases investigated was 1830. Of these, 798 were cases in which pensions had already been allowed ; 880 were pending claims ready, or nearly so, for final action, apparently meritorious, and without investigation would probably have been allowed. The other 152 were miscellaneous investigations, mainly touching the conduct of claim-agents, magistrates, and others connected with the prosecution of pension-claims, and touching the violations of the pension laws, hereafter referred to.
It resulted from these investigations that of the 798 cases in which pensions had already been allowed, 477 were dropped from the rolls as not entitled to pension; the others were reaffirmed. Of the 880 claims which but for investigation would probably have been admitted, 180 were rejected, and the testimony in behalf of the balance was generally strengthened.
In addition to the above, 68 pensions were reduced in rate, after preliminary inquiry and special medical examination.
Besides, 77 claim-agents were suspended from practice in the bureau for irregular and illegal practices, and 45 were finally dropped from the roster of attorneys in the Department of the Interior. One hundred and three cases of criminal violations of the pension laws were discovered and reported for prosecution ; 35 persons were indicted and 29 convicted.
The convictions were for the following offenses: Two for presenting false and fraudulent claims ; 9 for demanding and receiving illegal fees for prosecuting claims; 9 for filing false and fraudulent affidavits; 2 for withholding pension-money; 3 for presenting false pension-vouchers; 2 for fraudulently personating pensioners; and 2 for forgery. Seventeen of the indictments and 13 of the convictions were of claim-agents, and 59 of the 103 violations of the law reported for prosecution were also by claim-agents.
The total amount saved to the government by the investigations in pensions already accrued to those dropped from the rolls and to those whose claims were rejected with one year's pension added in each case, the amount for one year of the reduction in the rates of those whose pensions were reduced and the amount of money refunded which had been improperly collected by pensioners was $402,096.95.
The total cost of the investigations to the fund appropriated for the expenses of that service was $38,235.80.
Considering the extraordinary opportunities for the successful prosecution of fraudulent or unmeritorious claims which exist under the present system of adjudication, in connection with the fact that the Commissioner of Pensions has no authority to go out and hunt for fraud, but is limited by the statute to the investigation of such cases only as suspicion attaches to in the usual routine of the office, the investigations of the last year, as well as those of the preceding year, furnish a very suggestive lesson. I am convinced that a great number of persons have been
pensioned who had no just title, and that the number of that class is being constantly increased in the settlements which are now going on, and this must continue to be the case until some measure shall be adopted by which the truth of the parol testimony which is offered can be tested. No such test is possible under the present system.
The constantly increasing efficiency of the bureau, both among the clerks in the office and of the special agents during the two last fiscal years, as shown by the increased work over that of the preceding year, is very marked, and a subject of congratulation.
In my last annual report, I took occasion to mention the reorganization of the office and the greater conveniences which had followed its removal to its present location in part explanation of the increased efficiency during the fiscal year ending June 30, 1877; but there have been other forces operating in the same direction, which ought to be particularly noted, because they throw some light upon the much-vexed question of reforming the departmental civil service.
During that period, and especially during the last fiscal year, comparatively few changes have occurred in the personnel of the office by reason of dismissals, and these only for reasons which were recognized by the clerks in the office as substantially just. This course has operated to dispel the feeling of uncertainty and insecurity in relation to the tenure of their offices, which had before prevailed and distracted the minds of the clerks from their duties. They are now impressed with a sense of comparative security in their positions, dependent upon their honesty, industry, and efficiency; and this has greatly tended to inspire them to closer application to duty, in order that they might be deemed worthy of continued employment.
And, again, the promotions for meritorious service which have been made were of persons whose merit was recognized in the office as entitling them to reward, and have tended to encourage not only those who received the promotions, but their fellows also, to greater effort.
Throughout the three last fiscal years the character of the business of the office has been uniform, except that as we have receded from the war period the facts upon which the claims rest have become more and more obscure, and the cases more and more difficult of settlement from year to year.
The following table shows the character of the work performed and the number of cases settled each year from 1873 to 1878, inclusive, the money expended in salaries, and the average cost of each case to the salary-fund:
Notwithstanding the salary-fund for the year 1876 exceeded that for the year 1877 by $33,550, and that for the year 1878 by $35,800, the work of 1877 exceeded that of 1876 by 221 per cent., and the work of 1878 exceeded that of 1876 by 56 per cent.
The average cost of settling the claims in the three several years named fell from $17.11 in 1876 to $12.81 in 1877, and to $10.15 in 1878.
The work of 1877, performed at the average cost of 1876, would have required an expenditure in salaries of $596,180—$149,500 more than was actually expended; while the work of 1878, at the same average cost, would have required the expenditure in salaries of $748,802, being $304,372 in excess of the actual expenditure; which sum added to $35,800, the excess of the salary appropriation for 1876 over that for 1878, and we have a clear saving to the government, on account of the increased efficiency of the clerical force, for the year 1878 over the year 1876, of $340,172.
The saving in the same direction in 1877 over 1876 was $183,050.
The cost of settling the cases in 1873, '74, '75 appears to have averaged less than for the years 1877 and 1878, it being for the respective years, $8.69, $10.47, and $11.76; but an analysis of the work of those years shows that, in addition to the fact that the cases were by so much nearer the war period, which circumstance of itself greatly simplified the settlement of all classes of claims, there were settled in each of those years many thousands of claims of so simple a character that any comparison between the work of those years and the three following years will be unreliable. Of the 133,563 cases settled in 1873, '74, 75, 25,685 were invalid-increase claims under the acts of June 8, 1872, March 3, 1873, and June 18, 1874; 19,088 were widows' increase under the ninth section of the act of March 3, 1873, and 18,180 were 1812 pension-claims and bounty-land claims..
On the 7th of May, 1877, an order was issued by the President, which was afterwards modified, as to the location of 2 of the agencies, by which the number of agencies for paying pensions was reduced from 58 to 18, by consolidating 7 agencies in Maine, New Hampshire, and Vermont into 1 agency at Concord, N. H.; 4 in Massachusetts, Connecticut, and Rhode Island into 1 agency at Boston, Mass.; 4 in New York into 2 agencies, 1 at the city of New York and 1 at Canandaigua; 3 in Pennsylvania into 2 agencies, 1 at Philadelphia and 1 at Pittsburgh; 4 in New Jersey, Delaware, Maryland, and District of Columbia, into 1 agency at Washington, D. C.; 5 in Virginia, West Virginia, Tennessee, and North Carolina, into 1 agency at Knoxville, Tenn.; 2 in Kentucky into 1 agency at Louisville; 3 in Arkansas, Mississippi, and Louisiana, into 1 agency at New Orleans; 3 in Ohio into 1 at Columbus ; 3 in Indiana into 1 agency at Indianapolis; 2 in Michigan into 1 at Detroit; 4 in Illinois into 1 agency at Chicago; 4 in Wisconsin and Minnesota into 1 agency at Milwaukee, Wis.; 4 in Iowa and Nebraska into 1 agency at Des Moines; 4 in Missouri, Kansas, and New Mexico, into 1 agency at Saint Louis; and 2 agencies in California and Oregon into 1 agency at San Francisco, the consolidation to take effect July 1, 1877.
Under instructions issued by me, the consolidation was effected promptly and without confusion. Taking place at the end of the paymonth, the pensioners were more than usually prompt in applying for their pensions, which were due on the 4th of June, and comparatively few payments remained to be made in July and August, and the pay. ments being taken up at the consolidated agencies in most cases as early as July 20, and at all the agencies before the end of the month, but little inconvenience was experienced by the pensioners.
The quarterly payment which was due September 4, of 1877, involved the biennial examination of the invalid pensioners, and the agents were compelled to pay upon the rolls of the agencies which had been consolidated with their own, many of which had been imperfectly kept. This payment was watched with some degree of anxiety as the severest test which the plan of consolidation would ever be subjected to, but, notwithstanding the unfavorable circumstances under which the agents labored, that payment was made quite as promptly as the quarterly payments had been made prior to the consolidation.
I received a daily report from each agency during that month, beginning with the fourth day, showing the number of vouchers received by mail for payment, the number of pensioners paid by mailing their checks, and the number paid in person at the agency, and this report has been rendered to me during the pay month at each subsequent payment.
Of the 226,643 pensioners on the rolls on the 30th of June, 1877 (which number had not materially changed in September), 187,403 were paid in that month ; 6,040 more would have been paid had the surgeon's certiticates of biennial examination been received. Of these, 158,361 were paid by mail and 29,042 in person at the agencies. Those paid, aug. mented by the 6,040 which awaited the surgeons' certificates, aggregate 85 per cent. of all the pensioners upon the rolls. Each of the three subsequent payments within the year was more promptly and satisfactorily made than the September payment; so satisfactorily, indeed, to the pensioners that comparatively few complaints were heard in any quarter, except at the time of the temporary suspension of the payments in the New Orleans and New York agencies upon a change of agents.
The following table is a compilation of the payments during the pay. month of each quarter since the consolidation; showing the number paid in each quarter during the first six days, during the first nine days, and during the month. The daily reports were continued through the whole March quarter, and the payments for each month are shown for that quarter; the total number of pensioners paid during the quarter being 212,871.