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Washington, October 10, 1881. SIR: In compliance with circular letter from your office of September 16, 1881, I have the honor to inclose my annual report to the Secretary of War, with a synopsis of the same. Very respectfully, your obedient servant,


Paymaster-General, U. S. A. The ADJUTANT-GENERAL of the Army.

[First indorsement.]


Washington, October 11, 1881. Respectfully submitted to the Secretary of War.

C. MCKEEVER, Acting Adjutant General.


Washington, October 10, 1881. SIR: I have the honor to submit my annual report of the transactions of the Pay Department of the Army, for the fiscal year ending June 30, 1881.

Tabular statements herewith inclosed show in detail the fiscal oper. ations of the department for that year, summarily stated as follows. viz:


JUNE 30, 1881.

Balance in hands of paymasters July 1, 1880.
Amount received from Treasury.
Amount received from soldiers' deposits..
Amount received from paymasters' collections.

$1,379, 338 15 13, 292, 306 52

524, 112 72 435, 210 41

Total to be accounted for.

15,630, 967 80

Accounted for as follows:

To Regular Army.

$12, 966, 200 09
To Military Academy.

190, 259 07
To volunteers, claims of freedmen, &c., on Treasury

570, 000 99

13,726, 460 15 Surplus funds deposited in Treasury..

121, 173 82 Paymasters' collections deposited in Treasury

434, 403 43 Balance in hands of paymasters June 30, 1881.

1,348, 925 40 Total accounted for....

$15, 630, 967 80 All the requirements of law have, I believe, been faithfully executed, and the Army has been regularly and promptly paid to the close of the year.

The amount received during the year from soldiers' deposits will be seen to be $524,112.72. The amount received for the previous year was $477,174.44, an increase of $46,938.28.

I again respectfully invite attention to the subject of pay to officers of the Army while on leave of absence.

The laws in reference to leaves of absence were passed, severally, on March 3, 1863; June 20, 1864; May 8, 1874; and July 29, 1876. The two latter acts are modifications of the former. Under these laws an officer can receive a leave of absence of thirty days each year—not to be cumulated more than four years—on full pay, and for any time in excess of that he is reduced to half pay.

It is considered that the first two laws above cited were enacted as war measures, and their effect was no doubt salutary among the large number of new and undisciplined officers gathered from the various walks of life; but the time has fully come, in my judgment, when they should be done away with. Their operation is harsh and very unequal. Very many of the officers are stationed at remote posts in the West, and when a leave is obtained the whole, or a large portion, of the thirty days is often necessarily consumed in travel to any of the Atlantic cities—where most of the officers desire to go—and in returning to their posts.

For any excess of thirty days they are reduced to half pay, and this, with the expense attending the journey, is very onerous to them. I therefore respectfully recommend that Congress be asked at the approaching regular session to repeal the laws in question. The extent to which leaves should be granted may safely be left to the recommendation of the department and division commanders and the General of the Army, and the decision of the Secretary of War.

The appropriation act now limits the number of paymasters' clerks to fifty-four. It often happens that the services of additional clerks are much needed in order to prevent delay and injury to public creditors. I would therefore recommend that the number be increased to fifty-six, the two additional ones to be employed by the Paymaster-General, subject to the approbation of the Secretary of War, as in the case of other paymasters' clerks.

In this connection, I beg again to call attention to the inadequate compensation now allowed these clerks, whose duties are important and responsible, requiring an intimate knowledge of figures and considerable business capacity, and often necessitating long and toilsome journeys and exposure to danger. I therefore recommend that Congress be requested to repeal so much of section 1190, Revised Statutes of the United States, as fixes the compensation of paymasters' clerks, and provide that

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