The Secret History of MI6 - Keith Jeffery [150]
Having sent copies of his paper to Hankey, Fisher, Vansittart and the Chiefs of Staff (he was clearly not taking any chances), Sinclair secured an increase in funding. From £180,000 in 1935 (at which level it had been since the late 1920s), the Secret Service Vote (covering MI5 as well as SIS) was increased to £350,000 for both 1936 and 1937, to £450,000 in 1938 and £500,000 in 1939.2 No evidence of the ‘complete plan’ for ‘permanent resident agents’ has survived in the Service archives (though this may have been the genesis of the Z Organisation created in 1936), and the expansion of SIS activity, especially in Western Europe, was incremental rather than dramatic. And while the budget increased very markedly in the later 1930s, there were still limitations on what could be done. Reflecting in November 1939 on SIS work since 1935, Commander Reginald ‘Rex’ Howard concluded that the Service had been ‘handicapped very considerably by lack of money’. Howard, a sailor who had served on submarines before the First World War, had joined the Service in November 1931 and became Sinclair’s chief staff officer in September 1935. Even as late as 1 June 1939, he had been ‘informed by C.S.S. that our activities had been considerably curtailed owing to lack of money, and later, towards the end of July, C.S.S. informed me that the position was even worse, and it was practically impossible to obtain further supplies’. Recruitment, too, was seriously affected ‘owing to lack of money’, wrote Howard, ‘and also to the fact that employment in S.I.S. is non-pensionable’. These grumbles about lack of resources, as well as (from the service departments) the inadequate supply of information demonstrate twin permanent and unchanging truths about intelligence: that, no matter what the circumstances, there is never enough money; and, equally, no matter how much information is provided, there is never enough of it.
Working in the USA
SIS retained a small but active presence under Passport Control cover in New York during the interwar years. From October 1919 until March 1922 Maurice Jeffes was Passport Control Officer, and was succeeded as Cumming’s representative by J. P. Maine. Captain Herbert Bardsley Taylor, who joined SIS directly from the Royal Navy, took over in June 1929 and held the position (symbolised in SIS as ‘48000’) until August 1937, when he was brought back to London to be assistant to G.2, who headed the Americas section. From then until the war Captain Sir James Paget was head of station. The forty-nine-year-old Paget was not an intelligence specialist. A baronet, thanks to his grandfather having been an extremely distinguished doctor, he had been a career naval officer before retiring in 1937. That he had no particular qualifications for the job (though his mother was American) rather confirms the comparative un-importance of the station by the late 1930s. Between the wars, however, part of the work was for the armed services. In June 1921 the War Office asked for information on American ‘inventions of war material, chemical warfare and aircraft developments’. In March 1922 Stewart Menzies told Sir Warren Fisher’s Secret Service Committee that both ‘the Air Ministry and the Admiralty considered it extremely important to keep a close eye on naval and aeronautical developments in the United States’. Indeed, the £85,000 annual budget under discussion, which was otherwise thought more or less acceptable, ‘would not give adequate scope for such work in America. To do properly what was required in that sphere,’ continued Menzies, ‘from £3,000 to £4,000 extra would be needed.’3 It seems that the committee accepted this point, since they found