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of traveling where they happen to be. For instance, in Texas, some of the routes there are very long and it takes almost two months to make a round trip, whereas in Nebraska and Wyoming they can do this in a week or two.

Question. Would they then have the balance of the two months to stay at home in their quarters ?

Answer. Yes, sir,

Question. Could the present system of paying the Army be changed, so that the number of paymasters could be largely reduced and a part of the paying to the troops personally be made by some officer at the

post ?

Answer. I think it could. I see no reason why it could not be. After muster-day, which takes place every two months, we promise our men their pay, and all it requires is for some responsible party to go and get the money and disburse it, or have it sent to him, and after receiving it disburse it and take receipts on the rolls, make his returns, and the payment is made. Now, one paymaster at department headquarters, who is always kept in funds, can distribute money to officers sent from posts for it just as well as to send a paymaster out from de. partment headquarters to pay.

Question. Could the troops be paid by a system of drafts on the United States Treasury, after the manner of payiug pensions? They are mailed. If the pay-rolls were made out and forwarded to the pay. master, could not that be done ?

By Mr. GUNCKEL : Question. With the provision added that in remote and inaccessible points a paymaster should carry the money?

Answer. I don't see anything to make that system impracticable at all. The commissioned officers in point of fact nearly always draw their pay by checks from the paymaster.

By the CHAIRMAN: Question. State whether there would be any difficulty in getting these drafts cashed at any ordinary posts on the railroad ?

Answer. I think there might bo some difficulty at some remote posts, but I think at most posts, especially those near the railroad, they could be cashed.

Question. How do you find the railroad and express companies in that respect; do they do something of a banking business on the frontier; do they accommodate the people with exchange ?

Answer. I don't know a great deal about them in that respect, but so far as I know they are perfectly reliable as transporters of anything.

Question. I am asking now about whether they would not take up these drafts and give money?

Answer. At the railroad offices, do you mean ?
Question. Yes. How do you get your pay !

? Answer. I send my pay account to the paymaster. I get checks for different sums as I want to use the money.

Question. Do you find any difficulty in getting them cashed !

Answer. None at all. I get them cashed at the nearest town or by the post-trader.

Question Do you think the post-traders would impose on the soldiers in casbing those drafts ?

Answer. Yes, sir; I think they would. That would have to be regulated by law or order.

Question. Are the post-traders usually supplied sufficiently with money?

Answer. That depends on the posts, but I suppose they are. It would come to be an object for them to get the drafts as a good pieans of making their remittances to the East, where they buy their supplies.

By Mr. GUNCKEL : Question. Where bave you and the other officers been receiving these checks or drafts ?

Answer. For the last few years I have received mine in Nebraska and Wyoming

Question. And had them cashed by post-traders?
Answer. Yes, sir, if I desired it.
Question. Did you ever have any discount?
Answer. No, sir; they would not think of such a thing.

Question. Were they glad to get them because they were a means of transmitting money!

Answer. Yes, sir. They would not think of discounting a Government check.

By the CHAIRMAN: Question. Can any improvement be made in the method of purchasing supplies for the Army, the present one being by advertisement and pub. lic bidding!

Answer. As a general rule I think the present system is best in the long run—the most economical for the Government. Cases do arise occasionally, however, where for small amounts of supplies it would be better to purchase in open market, but as a rule I think the contract system is the best. Most of the posts are so located that it is impossible to get their supplies in the immediate vicinity of the posts, so that pur. chases for a considerable time ahead must be made by somebody where the supplies can be had. The practice of the Government, however, is to purchase supplies from persons who have them to spare in the vicinity of the posts, and the advertisements now always invite such parties to propose for what tbey can furnish.

By Mr. GUNCKEL: Question. Looking to our whole war establishment, could there be a reduction of the expense without injuriously affecting either the character or the efficiency of the Army ! Answer. Yes, sir. A great deal of money may be saved by discon

. tinuing the transfer of regiments from one part of the country to another. In such movements, which should be made every few years for sanitary purposes, I would transfer only the permanent part of the regiments; that is, the commissioned and a few of the non-commissioned officers.

Question. If our war establishment is too expensive, where is it too expensive, and how can it be reduced ?

Answer. There is no other way than that you propose. The only thing which you can cut off at once would be the enlisted men. You would do that by stopping enlistment; and an analogous treatment for the officers would be gradual reduction, and diminish the rank and pay in the staff departments.

By the CHAIRMAN: Question. State what you think of the present management of the Indians and of the peace policy of the Government under the Department of the Interior.

Answer. I think the most efficient management of the Indians possible would be secured by having their management confided to the War Department, because if any misunderstanding whatever occurs with the Indians no impression can be made upon them until force is used or exhibited. Indians have no respect for any person, Government agent, or anybody else, who has not a force at his control.

Question. Please state whether a system could be advantageously adopted whereby a portion only of the vacancies in the lieutenants of the Army should be filled by the graduates of theil Mitary Academy.

Answer. The Army should be officered from three sources: The gradu ates of the Military Academy, civilians educated elsewhere, and the enlisted men when practicable.* It is hardly possible to fix the proportions from each source to be appointed annually. It would probably be best to make the principle a matter of law and leave the proportion · from each source to the President. The vacancies in the grade of second lieutenant at the time of appointing annually, say about the time a class graduates, may be sufficient to absorb the whole class and also give some appointments from the other two sources. The number from the Army suitable for appointment will be very small for several years, but will probably increase from year to year as the system becomes known to the country. The number of cadets educated at the Military Academy might be considerably increased with the present force of professors and instructors without a proportionate increase of expense. The usefulness of the institution to the country at large would thus be greatly enhanced. When the vacancies are not sufficient to absorb the entire graduating class, under the rule above stated, a portion of them would have to be discharged from the service, with their education and diplomas, to make their way in the world. They would soon make themselves known if their services should be needed in case of war, and the more such men we can have in the country the better for the general good.

Statement of Gen. W. H. H. Terrell, United States pension-agent at Indianapolis, Ind.

Indianapolis, March 12, 1874.


House of Representatives, Washington, D. C.:

DEAR SIR: I have the honor to acknowledge the receipt of your let ter of the 3d instant, in which you ask certain questions in relation to the payment of pensions by drafts, (or checks,) and the cost thereof, with the view of applying the same principle of payment to the Army. I regret that this reply, which it gives me great pleasure to make, should have been so long delayed, but the regular quarterly payment of pensions having begun on the 4th instant it was impossible for me to respond to your inquiries until now.

Not being familiar with the details of Army payments by paymasters, I will not venture an opinion as to whether the pension system of payment by checks can be advantageously applied to the payment of the Army or not; but I will endeavor, in answering your questions, to show that the pension system is well adapted to the pension-service, and that

This is, in fact, the present practice; but it is not required by law.

it is economical, safe, and acceptable to the worthy class of citizens for whose benefit it was devised.

Question 1. "How many pensioners do you pay and how often?"

Answer. The number on the rolls of this agency at the last summing up was 10,250. The present number will not vary much from that. Payments are made quarterly, commencing on the 4th days of March, June, September, and December in each year. The number of separate payments, including commutation for artificial limbs and examining-surgeons' fees, is about 41,500 annually,

Question 2. "How much do you pay them at each payment, in the aggregate?”

Answer. I have only paid three full quarters, June, September, and December, and can only give my experience since the 1st of May, 1873, at which time I entered upon my duties. The average amount of each of the above quarterly payments is $313,000; giving a total for the three payments of $940,000 nearly; or, at the same rate, $1,253,000 annually. Question 3. "How much do you, on an average, pay with drafts ?” Answer. All payments, without exception, are made by drafts, or rather by official checks, drawn on designated United States depositories of public money-the First National Bank of Indianapolis, the Indianapolis National Bank, and the Third National Bank of New York City -for which duly executed vouchers are in all cases taken and forwarded monthly to the proper accounting officers of the Treasury for examination and settlement. No currency is handled by me, nor is any money drawn or transferred under any circumstances except as above stated. Question 4. "Is there any saving of time, labor, &c., in the method of paying by drafts; if so, how is it ?”

Answer. Yes; as between the plan of paying in checks and paying in currency there is a saving of time and expense to the pensioners, and of time and labor to the agent, as I will endeavor to explain.

When a quarterly payment is due the pensioner forwards a duly executed voucher, which has been previously filled out and sent to him through the mail by the agent; it is carefully examined and compared with the records, and, if found correct, a check is drawn for the full amount due, with as little delay as possible; the same is properly regis tered on the depository cash-book, noted on the pension-roll, and transmitted to the pensioner's address, with another voucher ready to be exe cuted for the next quarterly payment. This is repeated at each subsequent payment, without expense to the pensioner, he being subjected to no outlay whatever, except a fee of fifteen cents to the magistrate for each oath or certificate, and three cents for return-postage. In new cases or "increase" cases the vouchers are prepared and sent to claimants in the order the certificates are received from the Pension Bureau, so that pensioners living at a distance have no need of visiting the agency at all, and they are saved the time and expense of travel, and the vexations and delays necessarily incident to making personal application for their money. The helplessness and decrepitude of many pensioners, by reason of their infirmities, arising from wounds, old age, &c., appeal strongly to a generous sympathy, and it is therefore peculiarly fitting that simple, easy, and safe means be provided for their payment, without unnecessary cost or delay. The system is absolutely safe, expeditious, inexpensive, and satisfactory, generally, to the persons whose best interests it is the aim of the Government to serve and protect. In these respects it is in striking contrast with the former plan of paying under powers of attorney. Now the pensioner is sure to get all he is lawfully entitled to, while under the old system attorneys almost invariably

charged for their services, and not infrequently (having the money in their

own hands) helped themselves liberally, sometimes extravagantly, and occasionally appropriated the whole. No middlemen are now neces. sary, and the safeguards already explained have been found sufficient for each and every case. During the time I have acted as agent but few instances have occurred (only three or four) where checks have been lost in the mails, and the number wbich have failed to reach their proper destination by reason of misdirection, &c., is surprisingly small. Every check is made payable to the order of the pensioner, and up to the present time I bave not-heard of a single case of fraudulent collection by forged indorsement or otherwise.

There are other pepsioners, however, to whom the above plan of pay. ment does not apply: those who make personal application at the agency for their checks, as, for instance, those who reside in or near the city of Indianapolis. Their vouchers having been prepared in advance, are executed in presence of the agent, who takes the necessary proofs without charge, and then delivers the checks directly to the persons entitled thereto. About one thousand are paid in this way each quarter, principally residents of Marion County, requiring, usually, the whole attention of the agent and clerks for the first week of the quarter. Much more time is consumed in making these payments than payments through the mails. In widows' and guardians' cases the testimony of witnesses must be taken ; all signatures must be attested; duplicate receipts signed, the officer's jurat affixed, &c., and then the pensioner must wait until his check can be made out, signed, and entered upon the records. At least three payments can be made on mail-vouchers” to one at the office counter.

Question. “How many clerks do you have or need ?”

Answer. I have six clerks, and need that number for the prompt and accurate dispatch of business. During the first month in each quarter I could advantageously use one or two more if I had room for them; besides, I give my own personal attention to the business of the agency in all its details. Payments really extend throughout the year, but it is only during the first four or five weeks, at the beginning of a quarter, that the pressure is great. After that all delayed work is brought up, vouchers are systematically arranged and entered upou abstraors for audit, and the work of preparing the vouchers is attended to in time for the next payments. Since I entered upon duty in May last, a complete set of new, enlarged, and improved pension-roll books have been completed at heavy personal cost, to take the place of the old aud imperfect ones, which had become defaced and badly worn from long use. A daily register of receipts, disbursements and balances in each depository bas been kept up, and the date of payment of each check noted thereon. This register, I am informed, is a new feature in pension-agencies, and although it involves a great deal of patient labor to keep it written up, I find it invaluable. The correspondence is quite extensive and receives prompt attention. The clerks average about nine hours of labor daily, and in the winter season are required to work at night. The bus ness in all its intricate details requires the closest attention, and, therefore, only competent and skiliful clerks can be employed.

Cost and expenses of the agency.This agency ranks as the fourth in size in the United States. Boud, $650,000. The agent is paid by salary, $4,000, and by a fee of 30 cents as full compensation for all service, including postage for each voucher prepared and paid by him, which salary and fees are paid by the United States. The fees for the year

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