Total estimates for the 12 projects amount to $26,108,340. The total of low bids for these projects is $35,211,282. The total of low bids exceeds total estimates by 35 percent. In order to provide more comparable figures, the estimates tabulated for new hospital projects are net, i. e., estimated amount to be paid the contractor, excluding allowances for Veterans' Administration extra overhead and contingency related to hospital construction. Net figures, where used, are approximately 6 percent less than estimates upon which the appropriation was based. LABOR AND MATERIAL Information requested by Mr. Taber is attached as tab B to show established hourly wage rates for labor and ceiling prices of building materials at New York, St. Louis, and Seattle, for April 1945, July 1945, and April 1946. This table was prepared by the Veterans' Administration with information secured from the Department of Labor. It must be noted, however, that established hourly wage rates and ceiling prices for materials do not; in fact, reflect the actual extent of increased costs to which contractors are subject, particularly on large contracts, in maintaining a required production rate under employment conditions in a tight labor market or in getting scarce materials delivered on the project in accordance with working schedules. TABLE A.-List of projects for which awards have been made and bids received and rejected during period February 1945 through March 1946 1 Bids rejected. contract. Fifth Certain additions and alterations, estimated to cost $600,000 are included in the figures but are not under Fourth .865 1,550, 515 877 1,575, 883 1.025 1,848, 883 TABLE A.-List of projects for which awards have been made and bids received and rejected during period February 1945 through March 1946-Continued THURSDAY, MAY 23, 1946. VETERANS' ADMINISTRATION STATEMENT OF GENERAL OMAR BRADLEY, ADMINISTRATOR; MAJ. GEN. PAUL R. HAWLEY, CHIEF MEDICAL DIRECTOR; H. W. BREINING, ASSISTANT ADMINISTRATOR FOR INSURANCE; COL. R. P. BRONSON, ACTING ASSISTANT ADMINISTRATOR FOR CONTACT AND SERVICES; F. H. DRYDEN, ASSISTANT ADMINISTRATOR FOR CONSTRUCTION AND SUPPLIES; R. S. POOLE, DEPUTY ASSISTANT ADMINISTRATOR; J. J. ROCKEFELLER, DIRECTOR OF CONSTRUCTION; S. M. MOORE, JR., DIRECTOR OF BUDGET AND PLANNING; E. R. OVERTON, ASSISTANT DIRECTOR OF BUDGET AND PLANNING; JAMES B. CASH, CHIEF OF BUDGET DIVISION, VETERANS' ADMINISTRATION; AND BRIG. GEN. JOHN S. BRAGDON, DIRECTOR OF MILITARY CONSTRUCTION, OFFICE OF THE CHIEF OF ENGINEERS, UNITED STATES ARMY ADMINISTRATION OF MEDICAL, HOSPITAL, AND DOMICILIARY SERVICES Mr. CANNON. General Bradley, we have an estimate here contained in House Document 593 of $35,000,000, Veterans' Administrationadministration of medical, hospital, and domiciliary services, 1946. This would be in addition to your $395,843,000 previously appropriated. This additional amount is a net figure. The revised requirements indicate that lesser amounts will be needed for certain objects. The principal additional requirements are: Salaries, $32,831,109. Transportation charges, $1,843,848. Tuition, $6,061,678. A break-down of this begins on page 10. I notice that your statement is a rather lengthy one and no doubt it should be explained to me as to the $35,000,000, but I suggest that you just give us a résumé of it without reading the statement in full and we will insert the complete statement in the record at this point. (The statement referred to is as follows:) VETERANS' ADMINISTRATION "SALARIES AND EXPENSES" Additional funds totaling $35,000,000 are requested as a deficiency appropriation to cover expenses of the central office, the field offices, hospitals, homes, and supply depots; the cost of travel and examination of beneficiaries; payment of burial expenses and reimbursements for such expenses; repairs and alterations to hospitals, homes, and property in which Veterans' Administration facilities are housed and to the equipment utilized; payments to contract facilities wherein Veterans' Administration patients are hospitalized; reimbursements to States at the statutory rate for those veterans cared for in State soldiers' homes who are eligible for admission to Veterans' Administration hospitals or homes; the cost of administration in connection with vocational rehabilitation, education and training, readjustment allowance and loans; in general, all items of expense which are not direct monetary benefits to the veterans. The accompanying table No. 1 shows by object classification the revised estimate of funds required, $430,843,000, the total amount appropriated for "Salaries and expenses," fiscal year 1946 to date, $395,843,000, and an analysis of the $35,000,000 for which appropriation is requested. In view of the size of this summary, it may or may not be inserted in the record, depending upon the desires of the committee. In the subcommittee hearings of the House of Representatives on the second urgency deficiency appropriation bill for 1946, page 10, the following statement is recorded: "During the present fiscal year, the 2,100,000 veterans of World War II, June 30, 1946, will increase to between 12,500,000 and 13,000,000 by the end of June 1946, if present Army and Navy schedules are attained. These 10,500,000 separations from the armed forces during the present year, with about 5,000,000 occurring in the second quarter, results in many involved administrative and operating problems which are difficult to compute into costs. To meet the requirements of this great new group of veterans, a major reorganization of the Agency is being carried out concurrently with meeting day-to-day demands. Since the reorganization must proceed on a basis of full speed ahead, scheduling and measurement of expenditures becomes dependent on immediate availability of space, personnel, materials and effectiveness of procedures and methods; all such factors can be approximated only within reasonable limits when reviewed against the scale on which operations are based, against gradually easing of scarcities, and the short period under consideration. Also, the load patterns, when related to the World War II group, are largely conjectural, having very little experience as a foundation and subject to changing legislation, policy and economic conditions. For these reasons, the amount requested ($114,000,000) may be too conservative and additional funds may be requried to more quickly effectuate reorganization or to satisfy unanticipated load demands. The several factors which could not be fully anticipated, for the reasons given above and for which I now am requesting additional funds, are: The extent of overtime salary payments and personnel recruitment necessary to reduce backlogs; readjustment benefit, medical, insurance, and pension programs demand increases which were not provided for in original estimates due to lack of experience with the World War II group of veterans; activation of Army surplus hospitals during the last 6 months of fiscal year 1946 and possibly nine additional regional offices in the final quarter of the same period; and the rapidity with which decentralization is progressing. As to principal backlogs in the several programs, the following progress is being made concurrently with meeting the extraordinary current demands of the rapidly increasing millions of veterans through extensive use of overtime or recruitment of second and third shifts: The backlog of new World War II disability cases pending adjudication was reduced 105,000 during March 1946. The 556,000 cases pending adjudication on March 31, 1946, equals only 1.2 times the 452,000 cases adjudicated during March. Similar ratios for prior months show a 2.4 months' work load pending on February 28, a 2.6 months' work load pending on January 31, a 2.9 months' work load pending on December 31, and a 2.5 months' work load pending on November 30, 1945. Newly requested outpatient physical examinations for disability claims, hospital care, insurance, etc., of 61,162 were processed during March. Compared with February totals, the March figures reflected a 15-percent increase. Despite the increasing load, 14 percent more requests were cleared during March than in February (53,012 as compared with 46,549). For the first time, clearances by examination showed a striking increase in accomplishment, an increase of almost 54 percent, to reach a peak of 39,913 examinations. As a result, the total number of examinations pending held almost static, increasing only 1,903 during the month of March to reach the present total, 189,940. Vocational training (Public Law 18) had 37,820 cases pending induction into training on March 31, or 14 percent more cases than the 33,333 at the end of February. Although this lower rate of increase is an improvement over the 23-percent increase reported for the month of February, the load of 37,820 veterans awaiting induction into training is nevertheless equivalent to about 3 months' work at the rate veterans were inducted into training during March. Education and training (Public Law 346) applications were processed at an increased rate of 568,770 during March, an increase of 28 percent over the 445,121 applications processed during February. As a result of this increased rate at which applications were processed, the number pending determination of eligibility at the end of the month, 105,312, showed a decline of 23 percent over the number 137,241 at the end of February and 27 percent over the end of January. Loans: Notwithstanding the increased volume of loan applications, VA action on the work load as a whole has been relatively prompt. Of the 140,775 applica tions received through March 27, a total of 127,705 had been acted upon as of that date, leaving 13,069 in process or awaiting final disposition. While this is a substantial number of pending applications, a considerably larger number in fact than previously reported pending, it represents a backlog of only 1.6 weeks' work at the average rate of disposition prevailing during the last March reporting period. However, the Public Law 268, Seventy-ninth Congress, amendments to the loan provision of the law is expected to result in loan guaranties of 150,000 during the final quarter of the present year. Readjustment allowances: While this program affects "Salaries and expenses" cost mainly for payments to States for administrative services, the following trends in volume are included: Initial claims, January 26, 250,000; February 23, 207,000 April 6, 158,000, as compared with veterans paid, January 26, 841,000; February 23, 1,147,000; Apri! 6, 1,705,000. National service life insurance: Applications for national service life insurance increased from 74,878 in February to 102,143 in March. The number of applications dealt with also increased from 71,435 to 91,858, but not sufficiently to avoid an increase in the number of applications pending. Although the backlog has increased since January from 68,953 to its present level of 82,631, it is still no more than 1 month's work. Current applications rates may increase sharply depending on passage of the two bills, H. R. 4965 and S. 1677, together with intensive agency efforts to prevent policy lapses. Hospitalization: The number of veterans awaiting hospitalization April 1 was 25,985, or the highest recorded to date. This total will not abate until new hospitals are available in sufficient numbers to provide facilities to care for these ailing veterans. Only 911 of those awaiting hospitalization are veterans requiring care for service-connected disabilities, as contrasted with 25,074 for non-serviceconnected disabilities. Fourteen surplus hospitals acquired from the Army may start operations during the last quarter of the current year furnishing approximately 12,000 additional beds and requiring nearly 10,000 employees. A second factor, integrated with the reduction of the above backlogs, is the effect of certain load demands, estimated for fiscal year 1947, moving forward into the present year, resulting in increased costs in this appropriation. The sharp trends upward, resulting in the following revised estimates, cheifly occurred in the immediately prior months and/or resulted from new legislation and policy. In addition to requirements for reduction of backlogs, together with unanticipated load demands which could not be fully anticipated, expansion and decentralization has moved more quickly than originally estimated. April 1 all branch offices became operative, a factor which will add several additional thousand personnel to the rolls, distributed in the third quarter of the current year and over into fiscal year 1947, depending on ability to recruit and gear these employees into the operations. Also, nine additional regional offices have been authorized, which may place a recruitment burden of approximately 8,000 more employees largely in the last quarter of the present year. These factors, together with |