Page images
PDF
EPUB
[merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][ocr errors][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small]

Filipinos taking examinations in English during the nine months ended June 30, 1904.

[merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][ocr errors][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small][merged small]

EXHIBIT D.

ANNUAL REPORT OF THE INSULAR PURCHASING AGENT, FISCAL YEAR ENDING JUNE 30, 1904.

MANILA, P. I., October 26, 1904.

The EXECUTIVE SECRETARY FOR THE PHILIPPINE ISLANDS,

Manila, P. I.

SIR: I have the honor to submit herewith the annual report of the bureau of the insular purchasing agent covering the period of the fiscal year July 1, 1903, to June 30, 1904, showing in detail the transactions of the bureau:

I. The report of the disbursing and cashier's division with exhibits.

II. The report of the property division with exhibits; covering sales of rice and corrugated iron under the Congressional Relief Fund.

III. Report of the record division with exhibits.

IV. Special report of the land transportation division.

V. Special report on importation and sales of carabao.

With the report of the disbursing division is a comparative statement of sales from the establishment of the bureau to June 30, 1904, which shows the steady increase of the business of the bureau:

[blocks in formation]

In connection with the volume of business shown above, attention is called to the financial statement of the bureau submitted with the report of the chief of the division of accounts, From this it appears that a very large proportion of the 10 per cent collected under Act 231 has continued to accumulate, thereby increasing the available capital at the disposal of the bureau and enabling it to carry a large stock-a most necessary element in the reduction of cost price as well as affording a fund by which the large indebtedness of the various bureaus and provinces can be carried. Thus this fund is in a manner as available for all government expenditures as though it had been turned into the treasury; in fact, more so, since it is active working capital instead of dead reserve funds. During the latter part of the fiscal year 1904 we repaid to the insular treasury $103,033 United States currency which had been advanced for the purpose of increasing our stock and carrying the large indebtedness of the various bureaus and provinces. Without the surplus derived from Act 231, this would have been impossible, and direct appropriations would have been required from the Commission to enable our debtors to liquidate our bills.

In March, 1903, at the request of the chief of the Bureau of Insular Affairs, Washington, D. C., the honorable Commission, by resolution, directed the insular purchasing agent to proceed to the United States for consultation with the chief, Bureau of Insular Affairs, and to agree upon and recommend a system for the purchase of supplies in the United States. I reached Washington, D. C., during the latter part of May. Colonel Edwards had already in effect a system that was very efficient and needed only some minor changes to make it nearly perfect in its operation. Books and forms were ordered changed in Manila, and the same system of records and bookkeeping put into effect in Manila and New York as was already in operation in Washington. The insular purchasing agent then prepared 40

stock orders numbered consecutively, for staple and special articles required in Manila, and with the assistance of the acting purchasing agent in New York, purchased and shipped a stock approximating in value $400,000 United States currency. By means of these orders that were duly recorded in Washington and New York, the insular purchasing agent in Manila could by code word cable reference to number of order and articles and have any item duplicated, saving from forty to sixty days in time and enabling the government to take advantage of the markets, obtaining always the best goods for the least price.

After thorough investigation and trial, the chief, Bureau of Insular Affairs, Colonel Edwards; Mr. J. G. Jester, chief of purchasing and disbursing division; and the insular purchasing agent, joined in a report recommending that the New York office be made permanent with a statement of the personnel required to economically handle the business for the Philippine government. And I take this occasion to recommend that the report of the above-mentioned committee, modified to suit present conditions, be approved and proper legislation passed. There is daily necessity for such a branch in New York. The existence of the office in its present state has saved the government many thousands of dollars. As a medium of information it would pay to maintain it.

Shortly after the departure of the insular purchasing agent for the United States, in March, 1903, it became necessary to send Captain Davies, local purchasing agent, on a tour of investigation in the interests of the government looking to the importation of carabao to supply the needs of the planters and farmers, whose losses by reason of rinderpest and surra in 1901 and 1902 equaled fully 75 per cent of all the animals in the country. This tour extended over a period of six months. During this time the bureau was administered by the assistant insular purchasing agent. The markets of Manila could not meet the demands of the increasing business, which increase was equal to 69 per cent over the preceding year. This fact, and necessary delays in getting supplies shipped from the United States, caused many serious complications by failure to fill requisitions, which led to much adverse criticism of the bureau. In November both the insular purchasing agent and the local purchasing agent returned to their post of duty, and with the assistance of the supplies purchased in the United States, which began to arrive about this time, were able in a measure to meet demands and soon were able to bring order out of chaos. The system has been steadily improved until requisitions are promptly and satisfactorily filled. I am pleased to say that, where criticism was rife in the latter part of 1903, we now hear pleasant things regarding the management. A complete reorganization has been effected and all executive positions filled by capable, loyal, and efficient men.

In September, 1903, the honorable Commission adopted the plan of requiring the insular purchasing agent to pay duty on all importations. Since the passage of this law the insular purchasing agent has paid duties in the sum of $117,530 United States currency. The operation of this law has greatly increased the work of the bureau, and there are delays in getting goods on sale after the arrival of the ships-from six to fifteen days. His time is consumed in making out the consumption entries for the custom officials, the examination and pricing of goods.

In the latter part of 1903, at the suggestion of the honorable, the civil governor, a plan was put into operation to dispense with buying supplies needed, in New York, except such things as were special, and to advertise for all staple goods, machinery, etc., in Manila. This was done to build up the commercial interests of Manila, and to encourage the merchants to carry large stocks. It was agreed that a profit of 10 per cent should be allowed over cost of importation -this to include freight, insurance, lighterage, arrastre, duty, cartage, and bank charges.

Since July, 1903, circular proposals have been advertised in Manila, amounting to P2,250,000, for coal, lumber, cement, general supplies, and awards made thereon. The bulk of all these contracts has gone to agents and brokers who carry no stocks, or to the older English firms who are satisfied to do business on a smaller margin of profit than Americans can afford. This is brought about by the lack of American capital invested in Manila. There has been no appreciable increase in general stocks except in hardware and plumbing goods and stationery. Merchants with limited capital can not afford to invest in large stocks, pay high rents, employ necessary clerks and labor to operate their business, and go into competition with brokers and agents of the large exporting houses of the United States who have none of these expenses.

In my opinion there should be some discrimination in favor of merchants who carry stocks over mere agents and brokers in the matter of staples. As it is now, the business necessarily goes to the lowest bidder, quality and time of delivery being considered. The broker is satisfied with 5 per cent and in many cases 21 per cent on indent orders, and can deliver as quickly as the regular merchant, unless the material is in stock. When it is considered that the purchase of supplies by this bureau amounts to over 14,000,000 per annum, it may be seen at once that the present state of business in Manila can not meet the demands from stock, nor are bona fide merchants justified in very materially increasing their stocks if they must be forced into competition with brokers and agents. I believe if orders for goods not

now carried in stock in Manila were ordered direct from New York, it would have a tendency to bring better stocks here, when it was seen that the government would not order staple goods from agents and brokers.

The one great need of the islands is reliable wholesale general stores with capital sufficient to carry very large stocks and by increasing business enable merchants to sell at lower rates. I have one example to which I wish to invite your attention. I recently had a letter from a business firm in Manila saying that they were willing to take indent orders at 5 per cent commission; if goods were bought in small quantities from their stock, they expected their regular retail prices; if large orders were given on their stock, they would allow 50 per cent off their retail prices. What must be the profit of business run on this basis?

Every inducement should be held out to capital to invest in wholesale stores. The business of the islands will justify it, and good interest can be realized on money so invested. There are some lines which must of necessity be handled by agents-machinery particularly, where in nearly every order different specifications occur, and therefore can not be anticipated and carried in stock. In these cases, too, it is generally better to order through agents on the ground, who are familiar with conditions and are present to aid in erecting plants and putting them into running shape.

COAL YARDS AND COALING STATIONS.

During the year the price of coal at nearly all the stations has been reduced. The prices last year at the principal stations were as follows:

[blocks in formation]

By direction of the chief executive, I made a tour of inspection of all coaling stations, and after mature consideration decided to reduce the number of regular stations to 6, cutting out 13. The cost of delivery at so many ports and the inadequate facilities for handling increased the expense so materially that it was found more economical to have fewer stations and better facilities. We are constructing coal sheds at these permanent stations to protect the coal from the weather. Exposure to weather caused rapid deterioration equal to from 10 to 20 per cent per annum. It may become necessary in the near future to establish other coaling stations--one on the northwest coast, one on the east coast of Luzon, and, possibly, one on Palawan.

LUMBER YARDS.

This division is one of the most important of the bureau. All building material, firewood, and coal for city delivery are handled here. About 4,000,000 board feet of lumber (largely American pine and redwood) and 12,000 tons of coal are received and delivered during the fiscal year. The cost of operation of the yard, including water and land transportation, labor, superintendence, has cost a little less than 6 per cent on the amount of sales and delivery.

TRANSPORTATION DIVISION.

With the steadily increasing business of the bureau, this division has been increased to meet the requirements until the already inadequate quarters were unable to accommodate animals or vehicles. Every effort to provide shelter for both was made, but our contingent fund was insufficient, and in view of the fact that our new stables were nearing completion, no further appropriation was made. The overcrowded condition of the stables was a menace to the health of the animals. Our losses continued to increase, resulting as follows:

[merged small][merged small][merged small][merged small][merged small][subsumed][subsumed][merged small][subsumed][ocr errors]
« PreviousContinue »