The circumstances in which this great and far-reaching change in organization was brought about were as follows. In the spring of 1917 proposals were made to the Admiralty by the then Prime Minister that some of the work carried out at that time by the Third Sea Lord should be transferred to a civilian. At first it was understood by us that the idea was to re-institute the office of additional Civil Lord, which office was at the time held by Sir Francis Hopwood (now Lord Southborough), whose services, however, were being utilized by the Foreign Office, and who had for this reason but little time to devote to Admiralty work. To this proposal no objection was raised. At a later stage, however, it became evident that the proposal was more far reaching and that the underlying idea was to place a civilian in charge of naval material generally and of all shipbuilding, both naval and mercantile. Up to the spring of 1916 mercantile shipbuilding had been carried out under the supervision of the Board of Trade, but when the office of Shipping Controller was instituted this work had been placed under that Minister, who was assisted by a committee of shipbuilders termed the "Shipbuilding Advisory Committee." Statistics show that good results as regards mercantile ship production were not obtained under either the Board of Trade or the Shipping Controller, one reason being that the supply of labour and material, which were very important factors, was a matter of competition between the claims of the Navy and those of the Mercantile Marine, and another the fact that many men had been withdrawn from the shipyards for service in the Army. There was especial difficulty in providing labour for the manufacture of machinery, and at one time the Admiralty went so far as to lend artificers to assist in the production of engines. The idea of placing the production of ships for both services under one head appealed to and was supported by the Admiralty. The next step was a proposal to the Admiralty that Sir Eric Geddes, at that time the head of the military railway organization in France with the honorary rank of Major-General, should become Admiralty Controller. This would place him in charge of all shipbuilding for both services as well as that portion of the work of the Third Sea Lord which related to armament production. I was requested to see Sir Eric whilst attending a conference in Paris with a view to his being asked to take up the post of Admiralty Controller. This I did after discussing the matter with some of the heads of the War Office Administration and members of General Headquarters in France.