zotero/storage/XGIQ3W28/.zotero-ft-cache

History ol the second worm wa
British
Intelligence
in the
Second
World War
FHHinsley
E E Thomas
CFG Ransom
RCKnight




BOSTON
PUBLIC
LIBRARY


BRITISH INTELLIGENCE
IN THE SECOND
WORLD WAR
ITS INFLUENCE ON STRATEGY AND OPERATIONS


The authors of this, as of other official histories of the Second World War, have been given free access to official documents. They alone are responsible for the statements made and the views expressed.


BRITISH
INTELLIGENCE
IN THE
SECOND WORLD
WAR
Its Influence on Strategy
and Operations
VOLUME ONE
by
F.H. HINSLEY
President of St John's College and Professor of the History of International Relations in the University of Cambridge
with
E. E. THOMAS
C. F. G. RANSOM
R. C. KNIGHT
LONDON
HER MAJESTY'S STATIONERY OFFICE


© Crown copyright 1979 First published 1979
HER MAJESTY'S STATIONERY OFFICE
Government Bookshops
49 High Holborn, London WCiV 6HB
13a Castle Street, Edinburgh EH2 3AR
41 The Hays, Cardiff CFi 1 JW
Brazennose Street, Manchester M60 8AS
Southey House, Wine Street, Bristol BSi 2BQ
258 Broad Street, Birmingham Bi 2HE 80 Chichester Street, Belfast BTi 4JY
Government Publications are also available through booksellers
Printed in England for Her Majesty's Stationery Office at the University Press, Cambridge Dd 597077
ISBN o 1 1 630933 4*


CONTENTS
Preface vii
List of Abbreviations xi
PART I: ON THE EVE
Chapter i : The Organisation of Intelligence at the Outbreak of War 3
Chapter 2: The State of Intelligence up to September
x 939 45
PART II: IN THE DARK
Chapter 3 : From the Outbreak of War to the Spring of
1940 89 Chapter 4: From the Invasion of Norway to the Fall of France 1 2 7
Chapter 5: The Threat of Invasion and the Battle of Britain 1 59
Chapter 6: The Mediterranean and the Middle East to November 1940 191 Chapter 7: Intelligence on the German Economy, September 1939 to the Autumn of 1940 223 Chapter 8: Strategic Intelligence during the Winter of
1 940-1 94 1 249
PART III: DAYLIGHT COMES
Chapter 9: Reorganisation and Reassessment during the Winter of 1 940- 1 94 1 267 Chapter 10: The Blitz and the Beginning of the Battle of the Atlantic Chapter 1 1 : The Balkans and the Middle East from November 1 940 to the German Invasion of Greece Chapter 12: North Africa and the Mediterranean, November 1940 to June 1941 375 Chapter 13: Operations in Greece, Iraq, Crete and Syria 403 Chapter 14: 'Barbarossa' 429
3'5
347
v


vi
Appendix i : The Polish, French and British Contributions to the Breaking of the Enigma 487 Appendix 2: The SIS Air Photographic Unit 496
Appendix 3: The Organisation of the German Economy 500 Appendix 4: The Displacement of German Capital Ships 505 Appendix 5: The Oslo Report 508 Appendix 6: The COS Directive to the JIC 17 May 1940 513 Appendix 7: AI and MI Appreciations 17 and 18 October
1940 515 Appendix 8: Terms of Reference for the Axis Planning Section 22 March 1941 525
Appendix 9: Intelligence in Advance of the GAF Raid on Coventry 14 November 1940 528 Appendix 10: The Operational Chain of Command of the GAF 549
Appendix 1 1 : GAF Navigational Aids 550
Appendix 1 2 : GC and CS Reports on German Weather-reporting Ships 565 Appendix 13: The Special Signals Service from GC and CS to the Middle East 570 Appendix 14: MI Appreciation on German Action in Syria
and Iraq 2 May 1941 573 Appendix 15: MI Summary of German Troop Movements
to the East April to June 1941 575


PREFACE
IN CARRYING out our brief, which was to produce an account
of the influence of British intelligence on strategy and operations during the Second World War, we have encountered two problems of presentation. The first was how to furnish the strategic and operational context without retelling the history of the war in all
its detail; we trust we have arrived at a satisfactory solution to it. The second arose because different meanings are given to the term intelligence. The value and the justification of intelligence depend on the use that is made of its findings; and this has been our central concern. But its findings depend on the prior acquisition, interpretation and evaluation of information; and judgment about its influence on those who used it requires an understanding of these complex activities. We have tried to provide this understanding without being too much diverted by the problems and techniques associated with the provision of intelligence. Some readers will feel
that we have strayed too far down the arid paths of organisation and methods. Others, to whom such subjects are fascinating in themselves, will wish that we had said more about them. It is from no wish to disarm such criticisms that we venture to point to the novel and exceptional character of our work. No considered account of the relationship between intelligence and strategic and operational decisions has hitherto been possible, for no such account could be drawn up except by authors having unrestricted access to intelligence records as well as to other archives. In relation to the British records for the second world war and the inter-war years, we have been granted this freedom as a special measure. No restriction has been placed on us while carrying out our research. On the contrary, in obtaining access to archives and in consulting members of the war-time intelligence community we have received full cooperation and prompt assistance from the Historical Section of the Cabinet Office and the appropriate government departments. Some members of the war-time community may feel that we might have made our consultation more extensive; we have confined it to points on which we needed to supplement or clarify the evidence of the surviving archives. As for the archives, we set out to see all; and if any have escaped our scrutiny we are satisfied that over-sight on our part is the sole explanation. In preparing the results of our research for publication we have been governed by a ruling that calls for a brief explanation. On 1 2 January 1978, in a written reply to a parliamentary question, the Secretary of State for Foreign Affairs advised war-time intelligence staff on the
vii


Vlll
limited extent to which they were absolved from their undertakings of reticence in the light of recent changes of policy with regard to the release of war-time records. He drew a distinction between the records of the Service intelligence directorates, which will be placed with other departmental archives in the Public Record Office, and 'other information, including details of the methods by which this material was obtained'. He explained that this other information 'remains subject to the undertakings and to the Official Secrets Acts and may not be disclosed'. And he concluded with a reference to this History: 'if it is published, the principles governing the extent of permitted disclosure embodied in the guidance above will apply in relation to the Official History'. This statement has not prevented us from incorporating in the published History the results of our work on records which are not to be opened. The records in question are the domestic records of some of the intelligence-collecting bodies. We have been required to restrict our use of them only to the extent that secrecy about intelligence techniques and with respect to individuals
remains essential.
The need to apply this restriction to the published history has at no point impeded our analysis of the state of intelligence and of its impact, and it has in no way affected our conclusions. It has, however, dictated the system we have adopted when giving references to our sources. Government departments, inter-governmental bodies and operational commands - the recipients, assessors and users of intel
ligence - have presented no difficulty; to their intelligence files, as to their other records, we have always supplied precise references. This applies not only to documents already opened in the Public Record Office, and those to be opened after a stated period of extended closure, but also to individual files and papers which, though they may not be available for public research for a considerable time to come, nevertheless fall into categories of war-time records whose eventual opening in the Record Office may be expected. But it would have served no useful purpose to give precise references to the domestic files of
the intelligence-collecting bodies, which are unlikely ever to be opened in the Public Record Office. We have been permitted - indeed encouraged - to make use of these files in our text and we have done so on a generous scale, but in their case our text must be accepted as being the only evidence of their contents that can be made public. This course may demand from our readers more trust than historians have the right to expect, but we believe they will agree that it is preferable to the alternative, which was to have incorporated no evidence for which we could not quote sources. The above limitations have arisen from the need for security. We turn now to others which have been imposed on us by the scale on which we have worked. The first of these is that not merely when security has required it but throughout the book - in the many cases


IX
where security is no longer at stake and where readers mav regret our reticence - we have cast our account in impersonal terms and refrained from naming individuals. We have done so because for our purposes it has generallv sufficed to refer to the organisations to which individuals belonged: the exceptions are a few activities which were so specialised or were carried out bv such small staffs, and thus became
so closelv associated with individuals, that it has been convenient sometimes to use names. In addition, however, we must admit to a feeling for the appropriateness of Flaubert's recipe for the perfect realistic novel: pas de monstres, et pas de hews. The performance of the war-time intelligence communitv. its shortcomings no less than its successes, rested not onlv on the activities of a large number of organisations but also, within each organisation, on the work of manv individuals. To have identified all would have been impossible in a book of this canvas: to have given prominence to onlv a few would have been unjust to the manv more who were equallv deserving of mention. As for the organisations, it has been impossible to deal at equal length with all. In some cases we have had to be content with a bare sketch because thev kept or retained few records. With others we have dealt brieflv because most of their work falls outside our subject. This applies to those responsible for counter-intelligence, securitv and the
use of intelligence for deception purposes: like the intelligence activities of the enemv. we have investigated them in these volumes onlv to the extent that thev contributed to what the British authorities knew about the enemv's conduct of the war. Lack of space has restricted what we have been able to sav about intelligence in the field - about the work that was carried out. often in hazardous conditions,
bv Service intelligence officers with fighting units and bv the people
who were responsible in the field for signal intelligence, for reporting to the SIS and SOE. for examining enemv equipment and for
undertaking photographic interpretation. POW examination and manv similar tasks. As for the contribution of the manv men and women who carried out essential routine work at establishments in the United Kingdom and overseas - who undertook the continuous manning of intercept stations or of crvptanalvtic machinerv. the maintenance of PR aircraft and their cameras, the preparation of target information for the RAF or of topographical information for all three Services, the monitoring of foreign newspapers, broadcasts and intercepted mail, and the endless indexing, tvping. teleprinting, cvphering and transmitting of the intelligence output - onlv occasional references to it have been possible in an account which sets out to reconstruct the influence of intelligence on the major decisions, the chief operations and the general course of the war. Even at this last level there are unavoidable omissions. The most important of these is that we have not attempted to cover the war in


X
the Far East; when this was so much the concern of the United States, it is not possible to provide an adequate account on the basis of the British archives alone. A second derives from the fact that while the archives are generally adequate for reconstructing the influence of intelligence in Whitehall, there is practically no record of how and to what extent intelligence influenced the individual decisions of the operational commands. It has usually been possible to reconstruct what intelligence they had at their disposal at any time. What they made of it under operational conditions, and in circumstances in which it was inevitably incomplete, is on all but a few occasions a matter for surmise. And this is one matter which, after stating the facts to the best of our ability, we have left to the judgement of our readers and to the attention of those who will themselves wish to follow up our research by work in the voluminous records which are being made available to the public. That room remains for further research is something that goes without saying. Even on issues and episodes for which we have set out to supply the fullest possible accounts, the public records will yield interpretations that differ from those we have offered. At the opposite extreme there are particular undertakings and individual operations to which we have not even referred. In our attempt to write a co-ordinated yet compact history we have necessarily proceeded not only with a broad brush but also with a selective hand, and we shall be content if we have provided an adequate framework and a reliable perspective for other historians as well as for the general reader.
We cannot let this volume go to press without making special reference to the contribution of Miss Eve Streatfeild. In addition to sharing in the research, she has for several years carried out with great skill and patience the bulk of the administrative work that the project has involved.


ABBREVIATIONS
Any (Ph\ A^istunt F)irprtr>r Cppr-pf ^prvifp
kJCLlCl JCl vitc,
T n tp 1 1 1 crp n c(* dloU v>
( PVi ot r» err a r> H i c \ LJ V^i 1V1 lVf i ni ctf^ri ss 1 {""om
1V11II15LC1 Idl v> will
A n T ($>r\
JA D 1 \c>C) .T\.35l3t<lllt JL/UCCLvJI mitt i"\fi T lie
IlllttCC Oil Ula
liitenit^eiicc armament
l^OdCTIlCC ) JUCUULy v^IllCl Ul
/V33l5Ld.IlL U1I CLIUI tnc iMdvdi otdii I |r\P ritlAnQ T T^l f-rfZk 1 _
WUCI dtlOIldl XlltCl - uepuiy uirecior ligcncc senile ^x notograpny)
^-TYLUIllI dxty
y
l Ait* \A inict T"i t i
^/\II iviiiiiMi y
^
AAIT A ir TntpllifTAnrp
/All HltCllliiCllL.C U LJ L uepuiy uirecior A PC A vie Plon nin rr
/AXIS X ldlllllllid OI IIlLClIlgCllCC
OCLtlLMl /Air ^st^fF^
A Ait ^<~ifnt"irif"
axil OC1C11 tlllC T)T)TC
LJ LJ X \_j UCUliLy X71I CL.HJ1
T n tf* 1 1 1 crf*n rf*
1 IltClllgdlCC CtY\f^v^t t\dv\ ^1 T n f 
V/Utl dLlOlldl X11LC1
A1d Advisory Com- llgCIlCC vjCIIIIC mittee on i racie / A nnniriltiz^
^/\C1II11I dlLy )
WllCStlOIla 111 1 1II1C LJ LJ 1V1 X \L } Flf^r^iitv Dirf^^tor
UCLILlLy XJ1ICL.HJ1
i^f War
OI vv ax TVfilitQrv Tnt^lli
lVllllLdl y 1I1LC111
R A FF
DAr r Rnticn A it* h t \tt c
IJlItlMl .rill x yjl CCS cr<=»nrp i'lntplli
t llllvlll
in France gencej
RF F XJllLlMl XL, A LJCLi 1 DDMI (O) Dpnntv Dirprtor nonary r orce \J[ 1 1
1
1 o fv Tntf^lli
lVllllLctl y XllLvTlll
aiso ujj. rieaa 01 the Secret Service tions) Combined Bur- LJ LJ 1V1 K_J -LJCLIUiy XJ1ICCHJI
eau Middle East and I of Military Oper
Combined Intelli- aiioiis aiio intelli
gence Committee gence CID Committee of r\n\TT
DUJN1 Deputy Director
Imperial Defence oi iM aval intelli
CIGS Chief ot the gence
Imperial General "TV T Direction Finding Staff DMI Director of MiliCIU Central Interpre- tary Intelligence
tation Unit DMO Director of MiliCOS Chiefs of Staff and I tary Operations CSDIC Combined Ser- and Intelligence vices Detailed DNI Director of Naval I nterrogation Intelligence Centre DPR Ministerial CSS Chief of the Committee on
xi


xii
DPR (cont.) Defence Policy Jis and Requirements JPS
DRC Defence Require
ments Sub-Com- LRDG
mittee (of the
CID) MEIC
DSD Director Signals
Division (Ad- MEW miralty)
EP Economic Pres- MI sure Sub-Com
mittee (of the ATB Committee) NID EWI Economic Warfare Intelligence
FCI T 1 ^ ' 1 T 11 '
Industrial Intelli- OIC gence in Foreign Countries Sub
Committee (of OKH the CID) FECB Far East Combined Bureau FOES Future Opera- OKL tions (Enemy) Section
GAF German Air Force GC and CS Government /"V IT "IV /T
OKM
Code and Cypher School GS Int General Staff
Intelligence
HDU Home Derence OK W
Units IAF Italian Air Force IIC Industrial Intelligence Centre ISIC Inter-Service In- TV r\ T T
PDU
telhgence Committee PIU ISSB Inter-Service Security Board PR Jic Joint Intelligence
Sub-Committee PRU (of the COS)
Joint Intelligence
Staff Joint Planning Staff (of the COS)
Long Range Desert Group Middle East Intelligence Centre Ministry of Economic Warfare
Military Intelligence (Branch of
the War Office)
Naval Intelli
gence Department Operational Intelligence Centre
(Admiralty)
Oberkommando des Heeres (High
Command of the German Army) Oberkommando
der Luftwaffe
(High Command of the German
Air Force)
Oberkommando der Kriegsmarine
(High Command of the German Navy) Oberkommando des Wehrmacht (High Command of the German
Armed Forces) Photographic Development Unit Photographic Interpretation Unit Photographic Reconnaissance Photographic Reconnaissance Unit


xiii
PWE Political Warfare Executive PWIS Prisoners of War
(Home) Interrogation
Service RAE Royal Aircraft Establishment RFP Radio Finger Printing RSS Radio Security Service R/T Radio Telephony S A L U Sub-section of Air Section GC and
CS, specialising in the fusion of high and low-grade GAF Sigint. (Not
strictly an
abbreviation.)
SCU Special Commun
ications Unit
Sigint Signal Intelligence SI ME Security Intelligence Middle East SIS Special or Secret Intelligence Ser
vice
SLU C "1 T *
Special Liaison Unit SOE Special Operations Executive
c r\ t Matt Umcer
(Intelligence)
TA Traffic Analysis
TTM A
1 1 IN A Not an abbreviation; Study of morse charac
teristics of in
dividual wire
less operators
1 KH Telecommuni
cations Research Establishment
tj y c
V CILrO Vice Chief of the imperial oenerai Matt
TAJ T T T
W
1 JJ u wireiess lnieiii
gence and Devel
OpiIlCIlL U I11L W/T Wireless Telegraphy Y See definition in Chapter i, p. 21, note *




PART I
On the Eve




CHAPTER i
The Organisation of Intelligence
at the Outbreak of War
IN THE years before the Second World War several bodies within
the British structure of government shared the responsibility for intelligence. They were far from forming a single organisation. They had evolved on different lines, within different departments, and no one authority directly supervised them all. Nor could any one authority have done so, given the nature of their responsibilities and the variety of their activities. In some ways, however, they were coming to think of themselves as being parts of a single system for the first time. Perhaps the most significant development of these years is reflected in the fact that they recognised by 1939, as they had not recognised before 191 8, the need to strike the right balance between the impracticability of centralisation and the dangers and drawbacks of independence and sub-division. Steps to improve the relations between them were taken before the war began - some, as a result of experience in the First World War, as early as 191 9. There is no reason to doubt that the achievements of British intelligence in the Second World War were all the greater because these measures had been adopted earlier and could then be built upon. Before the war they met with little success. Indeed, it was not until the war was more than a year advanced that co-ordination between the organisations, and even within them, developed suffi
ciently to produce an efficient, if still not a perfect, system. Why was this so? Why did measures which proved to have been far-sighted after the passage of time, and under the stress of war, fail to provide efficiency in peace-time, or even in time for the outbreak of hostilities? An accurate assessment of the work of war-time intelligence, of which the early short-comings were as marked as the later successes, depends upon the answer to this question. It is only part of the answer to say that the pre-war steps were inadequate, or were implemented in too leisurely a fashion. 'If you want peace, be prepared for war.' There is no lack of evidence to the effect that Great Britain's neglect of this ancient maxim applied to her intelligence preparations no less than to her rearmament programmes. At the time, on the other hand, there was no lack of anxiety for more and better intelligence. Particularly after 1935, the anxiety was so pronounced as to suggest that the explanation must take into account the complexity of the problems as well as the fact that they were not tackled with any great urgency before that date. On closer
3


4 The Organisation of Intelligence at the Outbreak of War
inspection, this suggestion is confirmed: another reason why the attempts to improve matters^ had so little effect during the inter-war years was that they ran into difficulties which could be brought into focus, for clarification and solution, only under the stress of war-time conditions and with the help of war-time opportunities. Some of these difficulties stemmed directly from technical obstacles which limited the amount and type of intelligence that could be obtained. We shall explain them when we discuss the sources from which information was obtained.* Those that were mainly organisational in character arose from the various pressures and resistances - administrative, psychological and political - which complicate relations whenever several bodies share responsibility in a single field. They were all the more intractable, however, because developments in the field of intelligence were setting up a conflict between the need for new organisational departures and the established, and perfectly understandable, distribution of intelligence responsibilities.
Intelligence is an activity which consists, essentially, of three functions. Information has to be acquired; it has to be analysed and interpreted; and it has to be put into the hands of those who can use it. Most of the pressures for change in the inter-war years resulted from the fact that increasing professionalisation tended to separate these functions and to call for new, specialised inter-departmental bodies to undertake them. The creation, successively, of the Special or Secret Intelligence Service (SIS) and of the Government Code and Cypher School (GC and CS) at the level of acquiring information, of the Industrial Intelligence in Foreign Countries Sub-Committee (FCI) of the Committee of Imperial Defence and its Industrial Intelligence Centre (IIC) at the level of analysing and interpreting information, and of the Joint Intelligence Sub-Committee (JIC) of the Chiefs of Staff in an effort to ensure that intelligence would be more effectively used,
illustrated, as we shall see, how powerfully this tendency was at work. On the other hand, several departments of state, each having different and onerous responsibilities to the central government and to subordinate authorities at home and abroad, were naturally reluctant to exchange reliance on inter-departmental bodies for their own long-established control of the acquisition, the interpretation and the use of whatever information might bear on their work. Most of the resistance to change arose from this reluctance and - what were more commonly encountered - so did most of the uncertainty and the lethargy with which agreed changes were implemented and most of the neglect to exploit to the full the more complex structure of intelligence that was gradually emerging.
* See Chapter 2.


The Organisation of Intelligence at the Outbreak of War 5
Of the departments most involved - the Foreign Office and the three Service ministries - the Foreign Office, the most important in peacetime, was also the one which displayed least interest in the problem we have now outlined. To the extent that it maintained close relations with the head of the SIS and an active interest in the intelligence produced by the SIS and GC and CS, it was more than nominally in charge of those organisations; but it hardly concerned itself with
guiding their activities or smoothing their day-to-day difficulties. Its reluctance to participate in the JIC was not the least reason why that body was slow to develop. These are some examples, to be elaborated later on, of the ways in which the primacy of its influence gave special weight to its lack of initiative in making or accepting changes. One reason for its attitude was its conception of intelligence as an activity. Unlike the Service departments, the Foreign Office possessed no branch or section of its own that was especially entrusted with intelligence. Attempts had been made from time to time to develop its library and its research department in this direction, but sometimes amalgamated and at others separated - those bodies had never become more than organisations for the storage, indexing and retrieval of an increasingly voluminous archive of correspondence and memoranda because the Foreign Office's overriding interest was in the conduct of diplomacy. Although this entailed the provision of advice to the Foreign Secretary and the Cabinet on problems and choices in foreign policy as well as the execution of day-by-day detailed business, the Office made no distinction between its executive and its advisory work, but performed both by having the same geographical departments reporting upwards to the same set of higher officials. In the same way, it did not separate intelligence activities from its executive and advisory functions. The higher officials were at the same time the chief executives, the senior advisers and the ultimate assessors of the information which the department mainly derived from the daily contact with British embassies abroad and foreign embassies in London. This flow of information was not called intelligence and there were no arrangements for ensuring that
it was sifted by specialist intelligence officers who, as uncommitted analysts, might have stood back from the pressures that were inseparable from the Foreign Office's work. It was partly on this account that the Foreign Office also had no regular arrangements for comparing and collating its own conclusions with the analyses and appreciations of other ministries, particularly
the Service ministries, and that it showed little interest in developing
any. But its disinclination to take notice of other views was all the stronger for two other reasons. In the first place, it possessed in the shape of the reports of the diplomatic service by far the most continuous and comprehensive of all the sources of information about foreign countries, and it had the further advantage that no other


6 _ The Organisation of Intelligence at the Outbreak of War
department of state was in a position to develop a comparable or rival information service. Thus, it had long been laid down that the Service attaches must be attached to the embassies and that, while they could correspond informally with their departments, they must report to London officially only via the embassies and the Foreign Office. Because the attaches' reports often contained material and opinion on technical military matters, which could be competently assessed only by the Service ministries, the Foreign Office normally acted as a postbox for them, forwarding them to the Service ministries just as they were received and refraining from comment on them unless asked for its opinion. But it formed its own opinion on them and if that differed from Service opinion, and even when it concerned such essentially Service matters as the growth of the German Air Force, it by no means felt constrained from acting on its own interpretation without consultation with the Service departments. On the contrary. On the basis of a principle which finally determined its relations with other government departments in the field of intelligence - which influenced, indeed, the organisation of the British government system as a whole - it assumed the right and duty to do so.
This principle, itself the justification for the arrangements controlling the position of the attaches, had been established a long way back in British history. It was the principle that in time of peace the Service ministries should have no say, except through their representatives at the level of the Cabinet and its committees, in that field where the Foreign Office was the responsible department: the field of advising on foreign relations and on the foreign policy which would influence whether and when war would come. In modern times the principle had never been challenged by the military authorities. Even the bitter struggle which arose between the 'frocks' of the political leadership and the military 'brass-hats' about the strategic direction of the First World War had centred, rather, on the assertion by the military authorities of what seemed to them to be its corollary: the principle that in their professional conduct of the war they should be subject to no interference from civilians, not excluding even the Cabinet. It was not for that reason less carefully guarded; and it had been imposed in the field of intelligence activities, though not without
friction and delay, when traditional civilian suspicions of the influence of military establishments on government were re-aroused by the modernisation of the intelligence branches of the Service departments. This last development had begun during the last quarter of the 1 9th century, when the startling success of the Germans in the FrancoPrussian war was followed by the discovery that the continental states were creating large and influential intelligence organisations within
their military establishments. Given this knowledge and the increase of international tension, Great Britain had to follow suit. The


The Organisation of Intelligence at the Outbreak of War 7
Intelligence Branch of the War Office was re-organised in 1873 and empowered 'to collect and classify all possible information relating to the strength, organisation and equipment of foreign armies, to keep themselves acquainted with the progress made by foreign countries in military art and science and to preserve the information in such a form that it can be readily consulted and made available for any purpose for which it may be required'. 1 In 1887 it was further strengthened by the creation of the post of Director of Military Intelligence. The same year saw the establishment of the post of Director of Naval Intelligence at the Admiralty, which had acquired a separate intelligence branch (the Foreign Intelligence Committee) for the first time as recently as 1882, and his Naval Intelligence Department was similarly charged ' to collect, classify and record with a complete index all information which bears a naval character or which may be of value during naval matters, and to preserve the information in a form available for reference'2 The early DMIs and DNIs were powerful figures. Before the institution of a General Staff the DMI was responsible for mobilisation and home defence, and the DNI was similarly responsible for mobilisation and war plans, including anti-invasion plans, so long as
the Admiralty resisted the establishment of a Naval War Staff. The combination of these duties with their responsibility for intelligence
meant that, despite the fact that their carefully defined intelligence briefs had restricted them to collecting, preserving and analysing information, they acquired a considerable ability to influence foreign policy. Nor did their influence disappear with the decision of the government soon after 1 900 to set up, with the object of ensuring that foreign policy and strategic military appreciations were more carefully integrated, the Committee of Imperial Defence (CID). If anything, indeed, the readiness with which they expressed their views on such matters as the invasion threat, the contracting and renewal of the Anglo-Japanese Alliance of 1902 and the terms of the Anglo-French Entente of 1904, 3 and the part they played in inaugurating military and naval talks with France before these were made formal at the end of 1 905, 4 suggest that their influence increased at this time when Great Britain was ending her 'splendid isolation' and such departures in foreign policy as the Anglo-Japanese Alliance and the Anglo-French Entente were creating uncertainty and controversy throughout Whitehall and even in the Cabinet. Even so, the CID machiner) ensured
1. Lt Col BAH Parritt, The Intelligencers, p 99 (privately printed).
2. ADM 1/7166B; C Morgan, SID History 1 g$g-i 945, pp 3-4.
3. A R Wells, Studies in British Saval Intelligence i88o-ig4$, pp 355-361 (1972,
unpublished thesis, University of London) using CAB 2/1 and FO 99/400 (1902) and
FO 64/1630 (1905)). 4. C Andrew, Theophile Delcasse and the Making of the Entente Cordiale (1968), pp
281-285.


8 The Organisation of Intelligence at the Outbreak of War
that the last word remained with the civilian authorities and its meetings provided the opportunity to re-assert the principle that, since the Foreign Office was primarily responsible for advising on foreign policy, it must have not only a monopoly in collecting, analysing and advising on the use of political intelligence but also, at least in peace-time, the last word in assessing the political significance of even military information. v At one level the CID proved to be a valuable, indeed an overdue, innovation. By bringing together at fairly frequent intervals members of the Cabinet and the Chiefs of Staff under the chairmanship of the Prime Minister, or a Cabinet Minister acting as his deputy, and by having a permanent secretariat to prepare for its meetings and follow up its enquiries, it did something to ensure that the different opinions of the Foreign Office and of the Service departments were reconciled, or at any rate taken into account, in policy and strategy appreciations which formed the basis of Cabinet decisions. Neither before 191 4, however, nor even between the two world wars except in the limited field of appreciating industrial information on the war capacity of foreign countries, for which it established the FCI and the IIC, did its existence lead the departments themselves to collaborate in assessing and making use of intelligence. Nor was this due solely to the attitude of the Foreign Office. The Service ministries insisted vis-a-vis the Foreign Office that their responsibility for giving military
advice meant that their say in interpreting military intelligence must be as complete as was that of the Foreign Office over political intelligence and the giving of political advice. In addition, their attitude to intelligence was such that they placed little importance, at least in peace-time, even on regular collaboration between themselves.
One reason for their attitude was diffidence lest they should cross
the dividing line between military and political responsibility. Thus
the Foreign Office, in its insistence on having the final say in the
interpretation of political information, was inclined to rely on its own judgment of the political significance of even military information,
but the Services preferred to disregard the possible military significance of political developments, and of such political information as the Foreign Office supplied to them, rather than be suspected of wishing to exert influence in the Foreign Office's field. In 1935, for example, discussing a proposed multilateral Air Bombing Pact, the First Sea Lord told the CID that the Chiefs of Staff realised that it contained ' both political and military implications . . . and that it was not for them to say which were the most important'. The COS had ' tried not to remark on the political considerations, but the two were so intermingled that it was difficult to keep them separate'. 5 From the
5. CAB 2/6, CID 268th Meeting, 25 February 1935; CAB 24/253, CP 43 (35) of 26 February.


The Organisation of Intelligence at the Outbreak of War 9
end of 1937, when decisions on such matters as staff talks with other countries began to involve them as closely as they involved the
Foreign Office, the Chiefs of Staff became less diffident on this score. But even then they continued to be inhibited in their views on the military implications of political developments, and did so for a second reason. This - which tended to limit them to the study of factual information about the military, naval or air capabilities of foreign countries - was that even in the military field they confined their interest to intelligence which immediately related to their own
operational responsibilities.
In the War Office this had been a matter of principle since the formation of the General Staff in the early 1900s. Partly, perhaps, because the power of the early DMIs had aroused opposition within the Army, no less than on the part of the civilian departments, it was then laid down that intelligence should be only an advisory subdepartment. From 1904 the post of DMI was abolished, intelligence was incorporated into the Intelligence and Mobilisation Department of the War Office, and that Department became part of Military Operations - the G branch of the General Staff which had executive control of troop movements and major operational decisions. During the First World War the increased importance and complexity of intelligence made it necessary to re-introduce the separate post of DMI in 1 91 6, but the pre-war organisation was reverted to when a Combined Directorate of Operations and Intelligence was reestablished in 1922. When the Air Staff was set up in 191 8 the same pattern was followed: the Air Intelligence Branch was made a subordinate part of the Directorate of Operations and Intelligence. In theory the pattern ensured that the War Office and the Air Ministry would make regular and effective use of their specialised
intelligence branches. In practice, it deprived intelligence officers of the opportunity to make their views known independently, and encouraged both the tendency of operations to reach conclusions without consulting intelligence and the tendency of the intelligence branches in the different Service departments to work in isolation from each other. It must be added, however, that these tendencies were just as strong in the Admiralty as in the other two Service departments despite the fact that in the Admiralty the Intelligence branch was not formally subordinated to the Operations Division. With the modernisation of the Admiralty from 1907, and especially after Winston Churchill's attempt to create a War Staff there in 191
2
and the final establishment of the Naval Staff in 191 7, the Naval Intelligence Department had been gradually restricted to intelligence responsibilities. During the First World War, however, these responsibilities had continued to give extensive influence to the DNI, not least because of his control of the Admiralty's cryptanalytical staff, and the colourful Admiral 'Blinker' Hall had wielded it so vigorously building up his own espionage system, deciding for himself when and


i o The Organisation of Intelligence at the Outbreak of War
how to release intelligence to other departments, and acting on intelligence independently of other departments in matters of policy that lay beyond the concerns of the Admiralty - that in 1 9 1 8 there was a considerable body of naval opinion, supported by the Foreign Office, in favour of abolishing the posts of DNI and DDNI. 6 Perhaps because the Admiralty exercised a more centralised control over the Navy than the War Office did over the Army, the NID survived this attack and remained a premier staff division. In the inter-war period - as throughout the war - the DNI continued to enjoy direct access to the First Sea Lord. Despite this fact, the NID's standing among the divisions of the Naval Staff was much reduced after the First World War, and its influence in the Admiralty was no greater than was that of the intelligence branches in the other Service ministries. For what was thus a general neglect of intelligence in the Service departments, and a good deal of inertia by their intelligence branches, some weight must be allowed to the fact that, while the resources deployed on military intelligence are bound to be run down in peace-time, they were reduced after 1 9 1 8 for a longer period and to a greater extent than was wise. Because this danger might otherwise have been avoided even while the over-all resources available for the armed forces were being severely restricted, perhaps even more weight should be allowed to the fact that, though men like General Wavell and Vice-Admiral Sir William James were notable exceptions, the higher ranks of the armed forces showed some antipathy to the intelligence authorities, or at least a lack of interest in their work. These sentiments have been ascribed to a variety of causes. Whatever their origin - resentment against the influence which the intelligence branches had wielded outside the strictly informational field in their
early days; dislike of the officer class for the less gentlemanly aspects
of intelligence work; anti-intellectualism on the part of fighting men - they certainly existed, and produced a vicious circle. On the one hand, intelligence work was thought of as a professional backwater, suitable only for officers with a knowledge of foreign languages and for those who were not wanted for command. On the other hand, the activities of the many men of average or less than average professional competence who were thus detailed for intelligence confirmed the low estimate that had already been made of the value of intelligence work. The situation which is revealed in these various ways was not entirely surprising at a time when, with political preoccupations uppermost and military operations not imminent, static and routine information prevailed over operational intelligence in the output of the Service branches. While the Foreign Office was a department without an intelligence branch but with a tendency to regard itself as the fount
6. ADM 137/1630, Rear Admiral Ley's Committee on the NID, 1918; Wells, op cit, pp 42, 98-99, 100-109.


The Organisation of Intelligence at the Outbreak of War 1
1
of all important information and the final arbiter in the interpretation of it, the Service departments, despite their possession of intelligence branches, had little recognition that intelligence involved more than the collection of factual information. Nor did they find it easy to change this attitude, let alone to overcome its long-term effects, when they were aroused to the need for better intelligence by the worsening of international conditions. Down to the outbreak of war, when they benefited from an intake of recruits from civilian life, their intelligence branches remained too weak in numbers and, still more important, in quality to make up for their accumulated deficiencies. Of such staff as they had, again, too many continued to be occupied on routine work of an unimaginative kind. Thus the bulk of the NID continued to be divided into geographical sections which were content to collect static or topographical information - and to be in arrears in their distribution of the information to the naval commands - while in the commands, to quote from a peace-time intelligence officer with the Mediterranean Fleet, 'the main sources were ports' consuls and ships' intelligence officers filling in NID questionnaires, usually with data
quite easily available in public sources' 7 Beyond that, like its counterparts in the War Office and the Air Ministry, the NID did little more than pass on to the naval authorities, parrot fashion, the political tit-bits handed out by the Foreign Office. At least on the organisational level, however, the Service departments made some important adjustments from 1935, and as a result of these their intelligence arrangements were reasonably ready for war
by I 939
These adjustments were made on two fronts. Some improved the position of the intelligence branches within their own departments. Others, equally the result of initiative on the part of the Service departments, sought to bring about co-ordination between their intelligence branches - to narrow that gap between their activities which the CID, after so many years, had failed to bridge. Before dealing with their inter-departmental initiative it will be well to outline the changes which the Services adopted for themselves. In the War Office and the Air Ministry the first step was to grant a greater measure of independence to their intelligence branches. In the War Office this process, which was to culminate in the appointment, once again, of a separate DMI in September 1939, began in 1936: an intelligence deputy to the Director of Military Operations and
Intelligence (Deputy Director of Military Intelligence: DDMI) was established after Germany's occupation of the Rhineland. In the Air Ministry this step was taken in 1935, when the resurgence of the
7. S King Hall, My Naval Life igo6-ig2g (1952), p 223.


1 2 The Organisation of Intelligence at the Outbreak of War
German Air Force led the Air Staff to create for the head of air intelligence the post of Deputy Director of Intelligence (DDI), a promotion which placed him for the first time on a level with the Deputy Director of Operations in the combined Directorate of Operations and Intelligence and which was also followed by the creation of a full Director of Intelligence at the outbreak of war. The Admiralty moved at the same time but, because the NID was already a separate division, it did so in the opposite direction. In 1936, just when the War Office and the Air Ministry were giving their intelligence branches more independence from their operations staffs - or at least within their combined Operations and Intelligence Directorates - it began to plan the expansion of the hitherto insignificant Movements Section of the NID into the first section of what was intended to become, like its predecessor which had been brought into existence by the end of the First World War, an Operational Intelligence Centre (OIC) that would, among other things, bring its intelligence staff into closer contact with its operational staff.
The duties of the naval operational staff differed from those of its counterparts in the War Office and the Air Ministry. The Admiralty, unlike the War Office and the Air Ministry, exercised executive control over the outlying operational commands, and could at its
discretion even issue orders direct to HM ships. Apart from establishing overseas Operational Intelligence Centres to serve the more distant Commanders-in-Chief, those of the Mediterranean and the China stations, the Admiralty from 1936 accordingly concentrated its efforts on ensuring that its own central OIC, with its particular responsibility for Home Waters and the Atlantic, was in a position to gather and analyse in one place the product of every source of operational information - that is, information that might have a bearing on operations or intended operations by British or Allied ships - and to transmit its findings not only to the operations staff in the Admiralty but also to the commands. To the extent that this was a practicable objective - and we shall see
later on that it had ceased to be entirely so as a result of developments since the First World War - it was being achieved from June 1937, when the OIC began to take shape. During the Munich crisis some of the civilian staff earmarked for its war-time expansion were temporarily mobilised. In February 1939 the OIC was inaugurated as such, and a Deputy Director of the Intelligence Centre (DDIC) appointed to take charge of it. When, shortly before the outbreak of war, it moved to offices alongside the Admiralty's operations staff and those responsible for convoys, it had acquired all its war-time specialised sections - dealing with surface warships and disguised raiders; U-boats; air operations concerning the Navy; merchant shipping and minefields; and wireless interception. Its communications with the operations staff, as with the other divisions of the Naval


The Organisation of Intelligence at the Outbreak of War 1
3
Staff, were direct, the DNI having abandoned the requirement that his subordinates should report only through him. In the same way, it was authorised to pass immediate operational intelligence direct,
without consulting the operations staff or DNI, to HQ Coastal Command and to the intelligence officers of the naval home commands, with which it was linked by telephone, and to the commands overseas by wireless. 8 From each command, in turn, the Staff Officer (Intelligence) (SOI) was responsible for sending to the OIC whatever intelligence he could collect in his area. This service supplemented the Naval Reporting Officer network which the NID had long maintained, with the aid of businessmen and consular officials, at about 300 ports throughout the world to provide it with reports of ship movements and topographical information. In addition, the OIC was in contact by special telephone with the other intelligence organisations in the United Kingdom and
with the Navy's wireless intercept and direction-finding (DF) stations
there. The War Office had no executive command function. Army intelligence doctrine laid it down that the Military Intelligence Branch of the War Office should be responsible for preparing the compre
hensive, long-term intelligence required for strategic plans and appreciations as well as for organising and administering the entire Army intelligence machine, but that operational intelligence be provided to commanders by their own field intelligence staffs. These staffs were thus expected to control such sources of intelligence as they could exploit themselves. By 1939, however, it was clear that to a far greater extent than in 1 9 1 4-1 8 they would be dependent on others for comprehensive 'background' intelligence against which to appraise that obtained locally. Thus, to oversimplify (for there was much two-way working, and short and long-term intelligence was often indistinguishable) the intelligence staff of the British Expeditionary Force was to be backed up by the War Office, while the Middle East Intelligence Centre* which was still being set up in the summer of 1939
was originally intended to back up the intelligence staff of GHQ, Middle East. While expanding and reorganising itself to meet the growing need for long-term and background intelligence, the chief task of the MI Branch of the War Office was that of ensuring that enough trained
men were available for filling field intelligence posts on mobilisation. It was a task which it was allowed to take up only belatedly and in which it only just succeeded. In peace-time intelligence officer posts existed
* See below, pp 40-41.
8. ADM 1 / 1 0226, NID 004/1939, 'Development of the Operational Intelligence
Centre at the Admiralty'. See also D McLachlan, Room 39 (1968), p 56 et seq; P Beesly, Very Special Intelligence (1977), p 9 et seq.


1 4 The Organisation of Intelligence at the Outbreak of War
in the units and formations of the regular army (battalion and upwards). The extent to which they were filled, or filled effectively, depended very much on the outlook of commanders and in any case few trained officers had been available to fill them. This was in part a consequence of the abolition in 1 9 1 8 of the Intelligence Corps, which had trained officers for field appointments, and in part a reflection of the low esteem into which intelligence had fallen. In the event, the Intelligence Corps was not resuscitated until 1940, and it was only as a result of desperate improvisation in the MI Branch after the Munich crisis, and with unofficial help from the Security Service (MI5), that the intelligence component of the BEF was got together in time for mobilisation. 9 In the Air Ministry in 1 935 the Air Staff, as well as creating the post of DDI, authorised a modest increase in his total staff and in the effort devoted to Germany. Until then the intelligence component of the Directorate of Operations and Intelligence, the central authority responsible on the one hand for advising the Air Staff on all information about foreign air forces and on the other hand for providing the air commands with the intelligence they needed for plans and operations, had consisted of only 1 o officers ever since 1 9 1 8
.
10
The only area which they had studied intensively had been the Middle East, where the RAF had special defence responsibilities. Intelligence on Germany had found a place in the queue along with that on the major aeronautical powers, France, the United States, Russia and Italy. From 1935 the status and the establishment of the intelligence staff, and particularly of the German Section, were steadily improved. But since the Air Ministry, like the War Office, was not an executive command, it was still more important that steps were taken from 1 936
to form intelligence staffs at HQ and lower levels in the operational commands - Fighter, Bomber and Coastal - of the Metropolitan Air Force. Intelligence staffs at these levels, with the task of filtering intelligence prepared elsewhere down to the squadrons and of passing intelligence obtained by the squadrons upwards for analysis and interpretation,
already existed in the overseas commands. In the United Kingdom they were now created for the first time. In 1 938 the Air Ministry took the further step of arranging that in the event of hostilities all immediately exploitable intelligence - in practice this meant what could be readily derived from the German Air Force's tactical wireless traffic in low-grade codes, especially the prolific air-to-ground communications of its bomber and long-range reconnaissance units would be passed directly from the main RAF interception station at Cheadle to the operational command concerned. This scheme could
9. Brigadier E E Mockler-Ferryman, Military Intelligence Organisation, pp 30-32. 10. Air Historical Branch, Air Ministry Intelligence, pp 6-7.


The Organisation of Intelligence at the Outbreak of War 1
5
not be put into full operation immediately on the outbreak of war as it was thought necessary that the Air Intelligence Branch at the Air
Ministry, which also received this wireless intelligence and mated it with information from other sources, should play a part in its interpretation. By the time intensive German air operations against this country began, however, most teething troubles had been overcome. In the spring of 1939 the Air Ministry undertook yet another new
development. On the recommendation of a committee under Sir Henry Tizard, after the committee had held discussions in February with the SIS and the DDI, the Air Ministry agreed to appoint a Scientific Officer to the staff of the Director of Scientific Research for liaison with the Air Intelligence Branch 'as a preliminary measure towards improving the co-operation between scientists and the intelligence organisation '. But although the Air Ministry approved this post in May, it was not filled until a few days after war had begun. In the Admiralty and the War Office not even this belated step was taken. Despite the fact that in February 1939 the Air Ministry reported its intention to the JIC, and expressed the hope that the other departments would join it in forming a joint scientific body, they continued to rely on their own research branches for advice on
scientific intelligence. 11 Technical intelligence fared little better. In the Admiralty NID did indeed have a technical section, but it had but one officer with plans to augment it on the outbreak of war. 12 The War Office and the Air Ministry organisationally had no technical sections,
although each had in their German intelligence sections an officer
charged with technical matters. 13 This effort was far too small, and as the officers concerned had little authority to ask for intelligence and were able merely to collate such information as came their way, they made no extensive study of enemy weapons, and did not enquire whether advances which were already being made in the United Kingdom on such matters as radar and rockets were also taking place in Germany.
We must now give fuller consideration to the pressures that were bringing the Service departments to collaborate with each other and
with the Foreign Office in their intelligence activities and, on the other hand, to the obstacles which impeded them. We have already indicated in general terms the nature of these obstacles and the source of these pressures. At a time when powerful arguments continued to demand that the different functions of
11. AIR 20/181, CSSAD 46th Meeting, 9 February 1939; JIC 23rd Meeting,
3 February 1939; R. V. Jones, Most Secret War (1978), pp 52, 58.
12. Morgan, op cit, p 245.
13. Mockler-Ferryman, op cit, p 24; Air Ministry Intelligence, Part I, Chapter 1.


1 6 The Organisation of Intelligence at the Outbreak of War
intelligence should be kept together under departmental control, within each departmental division of executive responsibility, equally powerful forces were arising in favour of separating these functions and creating specialist inter-departmental bodies to perform them. We
may now add two more detailed points. These forces, which included the pressure for retrenchment and economies as well as the increasing technical complexity of the intelligence processes, came to a head at different stages according to whether the function was the acquisition, the interpretation or the use of information. And it was in connection with the acquisition of information that they first produced the acknowledgment that inter-departmental arrangements were essential. These points are illustrated by the fact that the earliest and, for several years after 191 8, the only important developments were the final establishment of the Special Intelligence Service (SIS) and the formation of the Government Code and Cypher School (GC and CS). The SIS or, as it was also called, the Secret Service was set up to be responsible for acquiring intelligence, but only for acquiring it, by means of espionage. It had in fact come into separate existence in 1 909, when a Secret Service Bureau was created to serve three purposes: to be a screen between the Service departments and foreign spies; to act as the intermediary between the Service departments and British agents abroad; to take charge of counter-espionage.* The Secret Service Bureau had a Home Section (the ancestor of the Security Service or MI5) and a Foreign Section (later to become the SIS). For some time, however, its position within the structure of government had remained undecided. Though intended to be independent of any individual department, the Bureau was originally placed administratively under the War Office. In 1910 its two sections separated, the Home Section remaining under the War Office and the Foreign Section being transferred to the Admiralty, then its chief customer. In 1 91 6, when the Home Section became part of the new Directorate of Military Intelligence as MI5, the Foreign Section was also restored to the nominal control of the War Office and named MI 1 (c), but by the end of the First World War the Foreign Office had replaced the War Office as the controlling department. During the First World War, moreover, partly from dissatisfaction with the work of the Foreign Section and partly from anxiety to have control of it, the Admiralty, the War Office and even other departments had established espionage
* Hitherto, the Special Duties Division of the Military Operations Directorate had been responsible for counter-espionage. But, as the CID discovered when it examined the defects in strategic planning after 1902, intelligence in the other of these directions had been virtually non-existent. Despite the investigations of the CID, improvement did not come rapidly. In 1907 there were still no British agents in Europe, and no plans for organising an espionage system in the event of war. As the War Office commented in that year, 'the only consolation. . .is that every foreign government implicitly believes that we already have a thoroughly organised and efficient European Secret Service'.


The Organisation of Intelligence at the Outbreak of War i 7
systems of their own. 14 It was not until 1 92 1 , as a result of the deliberations of a Secret Service Committee first appointed by the Cabinet in 1 91 9 to advise on post-war arrangements, that the SIS was at last made exclusively responsible for espionage on an inter-Service basis - indeed, on a national one, the Home Office, the Colonial Office, the India Office and the new Air Ministry being added to the Foreign Office, the War Office and the Admiralty as its customers - and that its relations with the departments were regularised. By the 1 92 1 recommendations the SIS remained under the control of the Foreign Office - and continued to be funded from the Foreign Office's secret vote - although it also retained a military intelligence title as MI6. At the same time, the intelligence branch in each of the three Services came to house one of its sections in the SIS, where it
formed part of the HQ staff, and the interest of the three Services was further safeguarded by the understanding that they would take it in
turns to supply its chief.* The arrangement reflected the expectation that the SIS would continue to be a supplier of military information mainly to the Service departments. It also allowed for the susceptibilities of the Foreign Office. When the SIS had first emerged as a specialised service the Foreign Office had expressly excluded the gathering of political intelligence - its own jealously-guarded field from its activities. Now, while agreeing that the SIS might range beyond the military field, it remained anxious to safeguard two points. The first was that the espionage system should be kept operationally separate from its own political information system. t The second, secured through the Foreign Office's ultimate control of it, was that,
in so far as the SIS engaged in political intelligence, it should do so as a supplier of information to the Foreign Office, under Foreign Office supervision, and not as part of a Service department which might be tempted to extend its influence beyond the field of military
intelligence. The 1 92 1 arrangement had its strengths and its weaknesses in
* Known as CSS or 'C; not, however, that 'C was an abbreviation for chief. It derived from the surname of the first head of the Foreign Section of the Secret Service Bureau before 191 4. t Whereas previously the SIS had been at a disadvantage compared with the secret services of other countries, whose representatives had for years been posted as attaches or embassy staff, the Passport Control organisation by now provided official cover for the SIS HQ's representatives abroad. But SIS staff in the Passport Control offices, being attached to the embassies and legations, acted for the most part only as post boxes, and the secret service work itself continued to be carried out by private individuals paid out of Secret Service funds. 15
14. Committee of Officials on Secret Service 1925 and Secret Service Committee,
1 91 9 File, GT 6965 of February 191 9, paper 5 (Retained in Private Office of Secretary of the Cabinet). 15. Hankey Report of 1 1 March 1940, Appendix I (Retained in Private Office of Secretary of Cabinet). See also War Office paper, 19 March 1920, in 191 9 File of Secret Service Committee, copy of which in the Lloyd George Papers, House of Lords Library.


1 8 The Organisation of Intelligence at the Outbreak of War
operation. Under it, the SIS received suggestions and requests for information direct from its various customers, and it reported selections from its findings direct to them without interpretation. On the debit side, with the Foreign Office exercising no day-to-day control, this meant that the SIS was not a strong enough organisation to settle priorities as between the requests that were made of it, or even to resist demands for assistance that went beyond its resources. When these demands became insistent and conflicting, as they did during the 1930s, it was over-stretched by the user departments. Nor could matters have been improved for the Service departments, which were especially critical of it for inefficiency, if they had complained to the Foreign Office, since the Foreign Office had little knowledge of the SIS's organisation and methods and refrained from taking an interest in them. But if it is beyond question that the system produced frustration in the user departments, and especially in the three Service departments, it is also true that their criticisms ignored an important point. The fundamental limitations on the efficiency of the SIS were not such as could have been overcome by administrative devices in Whitehall, as we shall see when we consider the sources of intelligence.* It is by no means impossible, moreover, that even the organisational defects of the 1 92 1 arrangements were less serious than those that would have followed had it been feasible to adopt other solutions to the problem. Of the obvious alternatives one was to place the SIS firmly under a single department; it was ruled out by the conflict of interests between the SIS's different users. Even more radically, the SIS could have been incorporated with other intelligence organisations in a unified intelligence centre which would have been virtually an independent body even if it had been put nominally under one of the departments. This arrangement was proposed from time to time up to 1927 but was then abandoned because it had fallen foul of the same conflict of interest and had also aroused the more fundamental, if less articulate, objection that intelligence should not be concentrated
into too few hands. At the end of the First World War, when the DM I urged that MI5 and MI i(c) should be amalgamated under the Foreign Office and provided with Service officers, CSS opposed the project and the Foreign Office supported his arguments: there was no real connection between counter-espionage and the work of the SIS; in peace-time political and economic intelligence would be more important than Service intelligence; amalgamation would increase expense and reduce secrecy. In 1920 Mr Churchill, as Secretary of State for War, suggested that economies could be effected if the SIS, MI5 and the civil Directorate of Intelligence - a security organisation that had a brief existence under the Home Office from 1 9 1 9 to 1 92 1 - were
See Chapter 2, p 50 et seq.


The Organisation of Intelligence at the Outbreak of War 1
9
combined. He admitted, however, that the amalgamation of 'three distinct and very secretive organisations. . .cannot be brought about in a hurry having regard to the peculiar nature of the matters dealt with and the importance of not disturbing the relationships which exist'; and the proposal was not considered at the Secret Service Committee meetings in 1 921. 16 In 1925 and 1927, when the Secret Service Committee again reviewed intelligence arrangements, it was the turn of a new CSS to press for amalgamation under his own control. Complaining of duplication of work, inactivity and general inefficiency, he proposed that the SIS, GC and CS, MI5 and perhaps Scotland Yard's Special Branch should be combined into a single service. The Foreign Office now agreed with CSS, and some members of the Committee were mildly disposed in favour of a single organisation. But others stressed that it would be difficult to find a succession of officers who would be capable of running it, and no less
difficult to settle who should exercise ministerial responsibility for it, and after taking evidence the Committee decided that as the relations between the various intelligence bodies and their customers were more important than those between the intelligence bodies themselves, it would be wise to respect 'the marked reluctance of the majority of those concerned . . .
' 17
The SIS thus remained under the Foreign Office and the arrangements adopted in 1921 - the arrangement by which administrative charge of it was vested in one department but by which all interested departments retained direct relations with it and some opportunity to influence its activities - at least reassured the departments that intelligence could be acquired on an inter-departmental basis without depriving them of their individual control of the interpretation of information and of the use that was made of it.
Where the SIS was concerned, the Service departments adjusted themselves quickly enough to this division of labour. For all their complaints about the service they received, they made no further attempts after 1 92 1 - except for the tactical and operational purposes
of their field security sections, in agreement with the SIS 18 - to organise their own espionage systems, as they had done during the First World War and as did their counterparts in Germany and other countries during the second. With the Government Code and Cypher School, the inter-departmental organisation set up to be responsible
16. War Office paper on Reduction of Estimates for Secret Services and covering note, 19 March 1920 (Retained in Private Office of Secretary of the Cabinet). 17. Unregistered papers in Cabinet Office Archive.
18. WO 197/97, Notes on I.b organisation in the BEF at the start of active
operations in May 1940.


20 The Organisation of Intelligence at the Outbreak of War
for acquiring intelligence from another most secret source, they found it more difficult to reconcile themselves to the same division of responsibility. The Cabinet established GC and CS in 191 9 both to study the methods of cypher communication used by foreign powers and to advise on the security of British codes and cyphers. Brought into existence as an inter-Service organisation of 2 5 officers recruited from remnants of the war-time Room 40 and MI i(b), the cryptanalytical sections of the Admiralty and the War Office during the First World War,* it was initially placed under the Admiralty for administrative purposes. In 1922, on completion of the enquiries of the Cabinet's Secret Service Committee, it went with the SIS into the administrative control of the Foreign Office - and it was arranged that the cost of it, unlike that of the SIS, should be met out of the ordinary Foreign Office vote. In 1923 a further change of responsibility for it was effected. The head of the SIS was re-named 'Chief of the Secret Service and Director of GC and CS ' and GC and CS, while remaining separate from SIS, came under his authority. Perhaps because the use of wireless cypher communications by foreign armed forces was declining at that time, the three Service departments made no objection to these arrangements. But they accepted them with two important qualifications or reservations. Their reservations arose from their experiences during the First World War. As a result of the introduction of wireless since the beginning of the century, the study of the methods of cypher communication used by foreign powers had then proved to be of greater importance than ever before - and vastly superior to espionage - as a source of intelligence. What was more important, two lessons had been learned by those who had been engaged in this work. The first was that wireless had brought into existence a new field of intelligence - the comprehensive study of communications systems (later to be called Signal Intelligence or Sigint) - in which cryptanalysis, the ancient craft of reading codes and cyphers, was but one of several processes. Before wireless messages could be decyphered they had to be intercepted (the process which came to be called Y). As well as providing material for cryptanalysis, their place of origin could be discovered by means of direction-finding (DF)t and they could be studied (by the process which came to be called Traffic Analysis) as the product of communications networks whose behaviour, procedures and techniques could
* Room 40 (which was incorporated into the NID in 191 7) and MI i(b) had developed independently and on the basis of little, if any, pre-1914 experience, and except for general agreements like that by which Room 40 dealt with the requirements of the Royal Naval Air Service, while MI i (b) dealt with those of the Royal Flying Corps, they had had no contact with each other during the war. t A direction-finding station took a bearing on a transmission, and the intersection of the bearings from two or more stations - usually at least three were needed - indicated the whereabouts of the transmitter.


The Organisation of Intelligence at the Outbreak of War 2
1
yield further information. In the event of their being decyphered, finally, their contents still called for interpretation by specialists if their significance was to be fully and accurately assessed; and the immediate or operational interpretation of individual messages might well depend on long-range research based on the analysis of many. It was not until the middle of the Second World War that a standard terminology was laid down for these activities.* But already by the end of the First World War their specialised techniques had come to be well understood. So had the second lesson. If maximum use were to be made of the four main Sigint processes - interception,
including DF; Traffic Analysis; cryptanalysis; interpretation - then, at least in time of war, they must be carried out in close proximity both to each other and to the operational and planning staffs who acted on the results. Only if the cryptanalysts were in close contact with those responsible for enemy wireless interception and for Traffic Analysis could the cryptanalytical obstacles be surmounted with the minimum of delay. On the other hand, only if they were aware of the needs and intentions of the operations staffs, and thus in close contact with them, could those responsible for evaluating the findings from cryptanalysis and Traffic Analysis, and marrying them with intelligence from other
sources than Sigint, be fully efficient at doing their job.t These experiences, combined with their inability to relinquish responsibility for evaluating whatever intelligence might be of use to their respective Services, explain the reservations which the Service
* In the foregoing paragraph we have used the terminology as it was standardised in October 1943: Sigint (the general term for all the processes and for
any intelligence they produced), Y Service (the interception of signals, including the operation of DF; but this was known in the USA as the RI = Radio Intelligence
Service), TA or Traffic Analysis (the study of communication networks and of
procedure signals, call-signs, low-grade codes and plain language, together with DF and other technical aids). Until 1943 these terms were used in different ways and
others also existed, leading to much confusion. Thus for TA itself other terms
existed like W/T Intelligence, W/T Operational Intelligence, Wireless Network Research and even Operational Intelligence. Y, again, sometimes meant only interception and sometimes interception and Traffic Analysis and also came to cover the breaking and exploitation of low-grade signals in the field. It should be added that throughout this book the term 'low-grade' refers to the degree of security provided by a code or cypher and does not imply that the traffic in it was either unimportant or easy to break and interpret. t The experience of the Admiralty illustrates the learning of this lesson. Initially Room 40 did no more than pass individual decrypts to the Operations Division. From February 191 6 it began analysing the accumulation of decrypted material and issuing the Operations Division with a daily summary in addition to individual urgent messages, but this did not solve the basic problems, which were that Operations Division was swamped with material and was not sufficiently familiar with it to assess it accurately. These were the problems which hampered the efficient handling of Sigint during the battle of Jutland. Not until the summer of 191 8 was a satisfactory routine established - one by which Room 40 under Captain (later Admiral) James ceased to pass individual items of intelligence to Operations Division and was made responsible both for the evaluation of operational intelligence and for long-range intelligence research. 19
19. Beesly, op cit, p 5.


2 2 The Organisation of Intelligence at the Outbreak of War
departments applied to the establishment and development of GC and CS. It was their intention from the outset that, while GC and CS might continue to be responsible for breaking new cyphers on an inter-Service basis, all readable codes and cyphers would from the outbreak of war be exploited by the intelligence branches of the departments or the HQs of the operational commands, in close proximity to the operational staffs. Thus the War Office's plan of 1926
was that:
'On the outbreak of war the War Office will be responsible for intercepting the enemy's field wireless sets and for collecting all information obtainable from this source. For this purpose it will provide, from officers on the active list and on the reserve, the necessary personnel for wireless intelligence and cryptanalysis. At this stage the help of GC and CS will only be required in the event of the enemy using a cypher which cannot be broken by the cryptanalysts in the field . . . when this has been done, the results will be handed over to the cryptanalysts in the field who will thenceforth decypher the messages'.
And in 1930 the War Office reserved the right 'to move the [Army] Section in whole or in part at any time if in their opinion the military situation dictates such a course'. In the same way a memorandum between CSS and the DNI of 16 November 1927 said: 'On the outbreak of war the entire naval section of the GC and CS will be transferred to the Admiralty, who may require it to go abroad . . . the Admiralty will always decide when transfer is necessary'. In October 1932 this agreement was modified. Thereafter it applied only in the event of war or emergency in the Far East, but in the case of war or emergency elsewhere it was agreed that the Naval Section 'will not be immediately transferred to the Admiralty and will remain at GC and CS and expand its work on its present lines ... until the Board of Admiralty consider it desirable to transfer it to within the Admiralty'. On this account, the staff the Service departments contributed to the original nucleus of GC and CS, which went on to the strength of the Foreign Office in 1922, was provided on a secondment basis and such staff as they added later was organised in Service appendages - the Naval Section being added from 1924, the Army Section from 1930, and the Air Section from 1936. For the same reason this staff was cryptanalytical staff only, attached to GC and CS to work on or to be trained in working on the foreign cyphers that concerned their own Service. If the first reservation of the Services was that the cryptanalytical process should as far as possible be undertaken in their departments and commands in the event of war, the second was that even in peace-time the other Sigint processes - interception and Traffic Analysis - as well as evaluation should remain a Service
responsibility. When the Service departments undertook the improvement and


The Organisation of Intelligence at the Outbreak of War 23
expansion of their intelligence branches, from 1935, these reservations came back into prominence. The Admiralty's plans for the development of its OIC envisaged the removal from GC and CS to the OIC of as much of the Naval Section as was feasible, and also the incorporation into the OIC of 'the enemy W/T section' (later to become DSD/NID 9) which the Admiralty had set up in 1932 to study foreign naval wireless communications and to administer the naval Y stations. In 1935 the Air Ministry added a Traffic Analysis section
(AI 1 (e)) to its intelligence branch, and in 1 936 it began to plan for the day when, at the approach of war, it would subordinate this work and the work of GC and CS on air codes and cyphers to its Directorate of Signals and have as much of it as possible done at its main interception station. For the Army, which alone among the three Services had continued to work on low-grade codes and undertaken Traffic Analysis without a break since 191 9, if only on a small scale and at its Y stations abroad, and which had invested most heavily in Sigint, the main priority was, as we have seen, the provision to
Command HQs of staff skilled in the Sigint processes. By 1935, however, the earlier decision to carry out all peace-time cryptanalysis at one place, on an inter-departmental basis, had combined with the fact that Sigint was a continuum of processes, which could not easily be separated from each other, to produce a situation where powerful arguments in favour of preserving an inter-departmental basis for Sigint even in time of war cut across the plans for re-organising
Service Sigint on a Service basis. The first step towards this situation had occurred as early as 1924. 'At the request of the Fighting Services and with the consent of the Foreign Office', GC and CS had established a 'Cryptography and Interception Committee' to guide the work and settle the priorities. The Committee had met only very rarely and in 1928 had spawned a standing sub-committee to secure the better-co-ordination of wireless interception (the Y Sub-Committee). The three Service ministries were represented on these bodies alongside GC and CS,* and they retained control of the personnel and the installations of their own interception stations. But the three Services could not all have interception stations everywhere and by the 1930s a system had grown up in which the War Office undertook most of the work that
* The Main Committee, re-named 'The Co-ordination of W/T Interception
Committee' consisted of representatives of GC and CS and the Signals branches of the Service ministries, reinforced later on by members of the Service intelligence
departments. The Y Sub-Committee consisted of the Head of GC and CS and representatives from NID 9, MI 1 (b) and AI i(e), together with Scotland Yard, the
GPO and the Head of the W/T Board (an inter-Service body for, among other things, technical research in the field of interception which the three Services had established in 191 8). There was never any continuity in the Service membership of the Main Committee - of the 50 officers who attended during the next 14 years, only
10 attended more than one meeting. But on the Y Sub-Committee, meeting much more regularly, a greater measure of continuity was attained.


24 The Organisation of Intelligence at the Outbreak of War
was done in the Middle East, the Navy looked after the Far East and the Air Ministry confined itself to what it could do in the United Kingdom. Even within this general sub-division of responsibility, moreover, inter-Service integration had developed. Of Middle East traffic, the Air Ministry was intercepting communications between colonial authorities in Italy and east Africa and the Navy was intercepting Italian Air Force traffic between north Africa and the Dodecanese, while the Army's interception unit at Aden was mainly engaged on intercepting Air Force material. In the United Kingdom, to take another example, the naval stations were occupied to the extent of 50 per cent on non-naval communications, while of the strategic communications of the German Air Force a large part was intercepted by the War Office on the assumption, which lasted until 1939, that it was German Army traffic. In the same way, the influence of the Service departments on the cryptanalytical priorities adopted at GC and CS took second place to that exerted by the technical possibilities and demands of the cryptanalytical situation. Thus from 1937 the naval cryptanalysts at
GC and CS worked almost entirely on non-naval Japanese cyphers, leaving the Japanese naval cyphers to be worked at Hong Kong, while in 1939 some of the Army cryptanalysts were engaged on breaking
new Japanese naval cyphers. By then, moreover, although GC and CS had made scarcely any inroad into Germany's cyphers, it was clear that her Army, Navy and Air Force, not to speak of some of her other State organisations, were all using closely related cyphers based on the Enigma machine,* and that the attack on them would require a single co-ordinated effort. In these circumstances, in the spring of 1 938, the inter-departmental Y Sub-Committee decided that the next logical step was the formation of an inter-Service 'Operational Intelligence' (i.e. Traffic Analysis including DF)t section at GC and CS, and recommended the interconnection by teleprinter and telephone of all interception and DF stations in the United Kingdom with each other and, to the extent that it did not already exist, with GC and CS. But while they did not object to the extension of the telephone and teleprinter system, which was put in hand, 20 the Service ministries resisted the centralisation of Traffic Analysis. This would have extended the work of GC and CS beyond the acquisition and provision of information and infringed their individual responsibility for appreciating and evaluating it. Instead, assisted in their arguments by the decision that it would be wise to move GC and CS from London to Bletchley on the outbreak
* See Appendix 1
.
t See above, p 2 1 Fn *. The idea of such a centralised section had appeared on the agenda of the first meeting of the Main Committee in 1924.
20. See, for example, ADM 1 16/4080 for teleprinter links between GC and CS and the naval intercept stations.


The Organisation of Intelligence at the Outbreak of War 25
of war, they worked out during the next 18 months separate compromise agreements in which they safeguarded this responsibility while conceding that GC and CS, by retaining Service sections, should continue to be an inter-departmental organisation in war-time to a greater extent than they had originally intended. As late as the beginning of 1 939 the Admiralty, considering that the ' dress rehearsal
'
move of GC and CS to Bletchley during the Munich crisis had not worked well, decided that on mobilisation the whole of GC and CS's Naval Section should move to the Admiralty or go overseas. But it was finally persuaded to apply this decision in the first instance only to the German sub-section of the Naval Section, which had no cryptanalysts at the outbreak of war. Except that they transferred more work on easily exploitable codes and cyphers to outlying Service groups on the pattern that had long operated between GC and CS and Hong Kong - some went to the main RAF intercept station at Cheadle, some to the Admiralty's Mediterranean OIC, at Malta or Alexandria - these agreements left Service cryptanalysis centralised at GC and CS. They left the control of Service interception to be exercised jointly by GC and CS and the Service departments, though the Service departments continued to staff and administer their own intercept stations. Over Traffic Analysis and the evaluation of decyphered material, on the other hand, they firmly asserted the control of the intelligence branches of the Service departments, taking away existing staff and leaving GC and CS to undertake as much duplication in these fields as it could justify for cryptanalytical purposes and taking the view that the additional staff required for such duplication should be provided by the Foreign
Office.
In all these discussions the Foreign Office itself took no part. Although it paid for the civil staff of GC and CS and although this staff outnumbered that which was attached to GC and CS by the three Services put together, the Foreign Office had always been content to be represented by CSS on the Main Committee and by the civilian Head of GC and CS, a retired naval officer, on the Y Sub-Committee. According to the Head of GC and CS, this arrangement had the unfortunate result that GC and CS 'became in fact an adopted child of the Foreign Office with no family rights, and the poor relation of
the SIS, whose peacetime activities left little cash to spare'. But it
faithfully reflected the Foreign Office's attitude to intelligence and its lack of interest in peace-time collaboration with the Service departments in intelligence matters. Moreover, the approach of war did not necessitate new measures for that part of GC and CS's work in which the Foreign Office was directly interested. With the deterioration of the international situation the Service departments were forced to reconsider their relations with GC and CS. But until the Foreign Office
began to recruit 'hostilities only' civilians, to undertake work on the


26 The Organisation of Intelligence at the Outbreak of War
diplomatic cyphers of the Axis powers as well as to increase the effort against their Service cyphers, from just before the Munich crisis, only two developments affecting fhe civil side of GC and CS occurred. In 1 937, when the Y Sub-Committee realised that the Service interception stations would be occupied full time on military traffic in the event of war, it arranged for the GPO to erect and man the first of several stations to intercept Axis diplomatic traffic on behalf of the Foreign Office. In 1938 a specialised commercial section was added to the civil side of GC and CS to scan and select from intercepted foreign traffic, mainly in plain language or in public commercial codes, information primarily on behalf of the Industrial Intelligence Centre.
In the case of the specialised sources exploited by the SIS and GC and CS the Service departments had conceded that the process of acquiring information demanded the existence of inter-departmental bodies, even if they had insisted on retaining control over the evaluation of the intelligence. To aerial photographic reconnaissance, a no less specialised source, they applied the same reservation no less rigorously. In this case, however, little attention had been paid to the source until late in the inter-war period, so that in September 1939 no adequate arrangements had been made even for acquiring intelligence from it. One reason for the delay was that, although aerial photographic reconnaissance had proved to be a valuable source of operational intelligence in the First World War, the development of it up to 1 9 1
8
had taken place within technical limitations of aircraft and camera performance which had restricted operations to low heights and short photographic ranges. On this account it had come to be regarded as being essentially a source of tactical information, of real value only in association with actual or imminent military movements. It was partly for this reason that after 191 8 the Air Ministry did not again resort
to aerial photography for intelligence purposes until 1935, when the RAF photographed Eritrea, Abyssinia, Cyrenaica and Sicily because the possibility that the Italo-Abyssinian conflict would lead to war had aroused concern for the defence of Egypt and of communications through the Mediterranean. Even when these flights were being made, however, other developments were suggesting that aerial photography might produce
intelligence of more than tactical value. In July 1935 the DMO and
I drew attention to air target intelligence as 'an outstanding example of a case in which intelligence is received from a multiplicity of sources, which necessitates careful and elaborate collation before it can be put to effective use'. 21 In January 1 936 a report on the 'Central
21. CAB 54/3, DCOS 3 of 22 July 1935.


The Organisation of Intelligence at the Outbreak of War 2 7
Machinery for the Co-ordination of Intelligence', drawn up after discussions between the Secretary of the CID and the Deputy Chiefs of Staff, recommended, among other innovations,* the establishment of an Air Targets Sub-Committee of the CID's Industrial Intelligence in Foreign Countries Sub-Committee, t As developments in aircraft
were making it possible to attack industrial targets well inside Germany, and as the study of such targets was beyond the competence of the individual intelligence branches, this Sub-Committee, consisting
of DDNI, DDMO and I, DDI Air Ministry and the head of the Industrial Intelligence Centre, under the chairmanship of the FCI's chairman, was made responsible for co-ordinating all target information, including aerial photography. 22 It began work in June 1936.
This step represented, as we shall see, a further stage in the development of inter-departmental collaboration in the interpretation
of intelligence in the economic field. It did nothing in itself to remove the obstacles which still impeded the development of aerial photography. Not unnaturally after so long an interval, some of these arose from defects in the techniques, the training and the equipment and aircraft available, defects which were prolonged by the almost doctrinal opposition of the Air Ministry to specialisation in such matters. Others were connected, rather, with the lack of adequate preparation for the interpretation of photographs, a highly technical process which had to be undertaken before operational intelligence could be obtained or, if strategic information was to be procured, before the Air Targets Sub-Committee could do its co-ordinating work. In the first of these directions - on equipment, research, development and training in photographic reconnaissance - the Air Ministry expended large sums from 1 936. But in the time that remained before the outbreak of war, and also in comparison with the Air Ministry's expenditure, little progress was achieved with the taking of photographs. After the war the Air Ministry concluded that this was due to its continuing failure to appreciate the potential intelligence value of the source for other than tactical purposes. 23 To the extent that this judgment is valid, it was a failure which the Air Ministry shared with the other Service ministries. Thus before the winter of 1 938-1 939 there was little pressure from the Admiralty for more vigorous measures even though in the winter of 1 936-1 937 the DCNS drew attention to the importance of the 'new aeroplane reconnaissance' in memoranda in which he advocated the establishment of the OIC. 24 It may be
* See below, pp 34-35. t See below, pp 30-3 1
.
22. CAB 53/5, COS 1 61 st Meeting, 13 January 1936; CAB 2/6, CID 273rd Meeting,
30 January 1936; CAB File 14/31/16, paper ICF/279/B of 1 June 1 939
23. AIR 41/6, Photographic Reconnaissance, Vol I, Part 1:2.
24. See, eg, ADM 223/84, NID 0135/37 of 1 1 February 1937; Memorandum by Admiral Sir William James.


28 The Organisation of Intelligence at the Outbreak of War
doubted, however, whether this was the main cause of delay after 1937,
as it had undoubtedly been before 1935. On the one hand, the Air Ministry was emphasising b^ March 1938 that industrial as well as military installations would have to be photographed, that methods of assessing bomb damage from photographs would have to be improved and that, for the purpose of detecting changes and movements, continuous or repeated reconnaissance would have to be provided. 25 On the other hand, the other difficulties had by now come
into play.
The RAF's dislike of specialisation in men or machines was a dislike bred of a long period of financial restriction. For this reason, photography continued to be regarded as one of the many functions of the all round flying man so that, although cameras were installed in aircraft and air-crews were trained to take photographs, no plans were evolved for a specially or centrally directed photographic reconnaissance programme, and little thought was given to the development of specialised reconnaissance aircraft despite the fact that from 1937 Bomber Command was insisting that these would be essential in the event of war. Equally important here, no doubt, was another consequence of earlier neglect - the fact that there were many other pressing claims for aircraft development in the last years of peace. And interlocking with these considerations, and heightening their effect, there was the fact that things had reached the point at which, if aerial photography was to meet the most pressing intelligence needs, it had to become a clandestine activity. The reconnaissance flights of 1935-36 had used the technique of oblique photography, 'looking in from the perimeter' rather than over-flying the areas under scrutiny, and this limitation was accepted in the photographing of Pantellaria, the Red Sea, Italian North Africa and the Dodecanese that was carried out in 1937, 1938 and 1939. This technique was of no assistance against targets deep in Europe. Leaving aside the fact that vertical photographs were far more revealing, the photographing of German installations and movements necessitated the penetration of German air space, and in peace-time this was an undertaking that required secrecy. The French undertook it for the first time since 1 929 in 1 936, though they limited themselves to the photographing of military targets near the French frontier with Germany. Their results were made available to London through liaison between the SIS and the Deuxieme Bureau de l'Armee de l'Air. One result of this liaison was that the SIS was led to take an active interest on its own account. But the Air Ministry felt unable to do so for international political reasons. Clandestine reconnaissance called for the protection of an ostensibly civilian organisation, with a cover
story. The SIS provided these by engaging an Australian, Mr F S Cotton,
25. AIR 41/6, Part L5.


The Organisation of Intelligence at the Outbreak of War 29
towards the end of 1 938 to set up the Aeronautical Research and Sales Corporation, acquire a Lockheed 12A and operate as a businessman from a suitable French base on behalf of the British and French authorities.* Cotton's operational flights began in March 1939. Unlike the RAF, whose programme of research and training still took no account of the need for such specialisation, he realised that clandestine operations required high altitude, high speed, long range and a low chance of detection, as well as improved camera performance and operation. By the end of April, when his collaboration with the French came to an end and his aircraft was transferred to them, he had photographed large areas of Germany and the Mediterranean. In June, July and August, operating from England with another Lockheed, he made further sorties over Germany, where he photographed units of the Fleet for the first time, and the Italian empire, where he photographed vertically the key points from Sicily to Rhodes and Italian East Africa which had been 'previously covered obliquely by RAF machines flying discreetly beyond the six-mile limit'. His photographs surpassed all earlier ones because he had paid attention to developing the performance of his aircraft and cameras. His second Lockheed, fitted with extra tanks and painted a pale duck egg green
to lessen detection, had its range increased from 700 to 1 ,600 miles. By using special film and arranging his RAF cameras in a frame of three, one pointing vertically down and the others set at an angle of
40 0
, he could photograph a strip of 1 1 miles at an altitude of 20,000 feet. He fitted additional concealed cameras in the wings. At the outbreak of war Cotton and his small team - by then he had a co-pilot and a photographic specialist and had acquired a second aircraft - had just recommended to the Air Ministry that a Spitfire should be modified for reconnaissance work and added to their resources. Neither in the Air Ministry, however, which was to take over his unit, nor by way of inter-departmental arrangements, had sufficient progress been made to permit the rapid expansion of his
activities.
This was especially the case with arrangements for the interpreting of photographs. After the First World War there had been a general understanding that, while the RAF should be responsible for taking all photographs, the Army was solely responsible for interpreting them. Thus, although the RAF School of Interpretation had been set up in 1922, the Army provided all its instructors and pupils until 1938. When interest in aerial reconnaissance for more than tactical or battle-field purposes began to spread, this understanding broke down and no agreement was made as to what should take its place. In March 1 938 the Air Ministry announced, apparently unilaterally, that as well as being responsible for taking photographs for all three Services, it would be responsible via its intelligence branch for all photographic
* See Appendix 2.


30 The Organisation of Intelligence at the Outbreak of War
interpretation. 26 In fact, however, all the Service intelligence branches maintained their attempts to interpret photographs for themselves, for their different operational purposes, when Cotton's results, which in any case infringed the RAF's monopoly in taking photographs, added to the peace-time trickle of material on which to work; and it was not until after the outbreak of war that an inter-Service unit for this specialised work, based on Cotton's pioneering activities, was organised.
In their arrangements for aerial photography, as in their relations with the SIS and GC and CS, the Service departments had insisted on retaining control over the evaluation of intelligence. In one special
ised area of intelligence, however, that of economic intelligence about potential enemies, they came to recognise, as did the Foreign Office, that even for the task of assessing information it was necessary to develop inter-departmental bodies to complement their own
activities.
The first step in this direction was taken in December 1923 when the CID set up an Advisory Committee on Trade Questions in Time of War (the ATB Committee) to ensure the readiness of administrative machinery for creating economic pressures on an enemy. From the end of 1925 this committee, under Foreign Office chairmanship, extended its activities beyond administrative matters to the assessment of economic intelligence in the field of 'economic pressure' or 'economic warfare'. From May 1933 it established an Economic Pressure (EP) Sub-Committee under the chairmanship of Mr Walter Elliott - and with a membership representing the Foreign Office, the Board of Trade and the Director of Plans at the Admiralty and including Sir Maurice Hankey, the Secretary of the CID. ATB reports thereafter represented an important part of the economic intelligence reaching the CID. A second co-ordinating body in this field had by then been created. In 1929 the Secretaries of State for War and Air, whose departments
were not represented on the ATB Committee, asked the CID to establish machinery for the study of industrial mobilisation in foreign countries, and for this purpose the CID appointed a sub-committee of itself, the Industrial Intelligence in Foreign Countries SubCommittee (FCI), with a chairman from the Department of Overseas
Trade and a membership which included the DDMO and I and the
D of O and I Air Ministry.
Like the ATB Committee and its Sub-Committee, the FCI at first lacked research staff. But, in 1930, it recommended the creation of a small research centre, which came into being as the Industrial
26. ibid, Part 1:5.


The Organisation of Intelligence at the Outbreak of War 3
1
Intelligence Centre (IIC) in 1 93 1 . Until 1935, when it was 'administratively attached' to the Department of Overseas Trade, the IIC was funded from the Foreign Office's secret vote. Until 1934 it was given no formal terms of reference, but in that year the CID defined its functions as being, first, to assist in the collection, interpretation and distribution of industrial intelligence and, secondly, to co-ordinate this intelligence for the Admiralty, the War Office, the Air Ministry and the ATB Committee. 27 By thus making the IIC the organisation which collected information and undertook research for the ATB Committee as well as for the FCI, the terms of reference avoided duplication of effort between those two inter-departmental bodies. They did not at once succeed in reconciling the individual departments to the idea that the IIC should develop into a central organisation for the assessment of economic intelligence. In order to avoid duplication between the departments and the IIC the terms of reference specified that the departments should put their requests for industrial intelligence to the IIC in the first place, and that they should communicate to the IIC any important items of industrial intelligence they received. At the same time, however, they laid it down that nothing in the new structure was
to alter existing intelligence arrangements and that, in particular, memoranda produced by the IIC must be submitted to the intelligence branches of the Service departments for their approval before being distributed in Whitehall. In November 1 937, after what had clearly been a period of friction, the CID re-defined this division of function to the advantage of the IIC. From then on, while the departments remained free to collect and distribute industrial intelligence, the IIC, as the sole authority for co-ordinating this intelligence on behalf of the Service departments, the FCI Committee and the ATB Committee, was empowered to
circulate or comment on any industrial intelligence it received from any quarter. 28 Nor were the Service departments any longer disposed to resist this change. In the autumn of 1935 the Deputy Chiefs of Staff had noted that ' the intelligence which it is now necessary to cover in time of peace in order to be properly prepared for the eventuality of war with any Great Power had been almost immeasurably extended and complicated by reason of: (1) the extent to which modern war involves the whole of the resources of the nation; and (2) the vast extension of the zone of operations that has been brought about by the advance of aviation'. 29 Thereafter, the German threat having now become dominant, the
27. CAB 48/4, FCI 47 of 31 January 1934; CAB File 14/3 1/6, ICF/279/B of 1 June '939
28. CAB 4/22, CID 1 139B of 14 May 1934.
29. CAB 54/1, DCOS 2nd and 3rd Meetings, 29 October and 29 November 1935.


32 The Organisation of Intelligence at the Outbreak of War
ATB Committee's Sub-Committee on Economic Pressure had become the Sub-Committee on Economic Pressure on Germany from the middle of 1937, and the volume and specialisation of economic intelligence assessment had much increased. As we have already seen, it was at the request of the Service departments themselves, that the FCI Committee had established since June 1 936 a further addition to the structure of inter-departmental bodies -r the Air Targets SubCommittee - ' to supervise co-ordinated interchange of information and reports between the Defence Departments and the Departments concerned in regard to air target intelligence in foreign countries'.* The IIC was by 1 937 doing most of the research work required by this
Sub-Committee30 in addition to having a special responsibility to the structure as a whole for the preparation of drafts, and a more general one for the collection at a central point of the information needed for economic intelligence research. The IIC's responsibilities were further increased by the creation, also in 1936, of the Joint Intelligence Sub-Committee of the Chiefs of Staff, t It supplied the JIC with most of its economic information and was represented at its meetings. Lastly, by the eve of the war the IIC had added to the responsibilities with which it was formally charged by its terms of reference the preparation of material for the Joint Planning Sub-Committee of the Chiefs of Staff, whose meetings the Head of the IIC attended as required. The extent to which these arrangements were limited to those aspects of economic intelligence that were directly relevant to the military or defence field will be obvious enough. The ATB Committee had been set up to assess the vulnerability of foreign countries to external pressure in the event of war and, particularly, in view of Great Britain's membership of the League of Nations, in the light of her obligation to apply economic sanctions against states which resorted to war in disregard of the Covenant. In the IIC's original terms of reference the province of the FCI, industrial intelligence, was defined as ' any information regarding the industrial or economic development of a designated foreign country which may throw light on the extent of its readiness for war from an industrial point of view'. The Air Targets Sub-Committee of the FCI concentrated on studying the location and structure of Germany's industrial plant. Nor was the FCI unaware that the resulting inter-departmental structure was weak on the civil side. As early as March 1934, for example, it drew attention to the fact that financial questions were beyond its competence, and proposed that it should be given a Treasury representative. 31 As
* See above, p 27. t See below, p 36 et seq.
30. CAB 4/24, CID 1208B of 20 January 1936.
31. CAB File 14/31/16, ICF/279/B of 1 June 1939.


The Organisation of Intelligence at the Outbreak of War 33
the arrangements established themselves as a part of the Whitehall machine, they built up a reasonably good working relationship between the Service departments and the specialist civil departments. Representatives from the Foreign Office and the Treasury attended the FCI from June 1935. From 1937 a representative from the Treasury joined those from the Foreign Office, the Board of Trade and the Admiralty at the meetings of the ATB's Sub-Committee on Economic Pressure on Germany. By this time the IIC had developed the practice of calling on the Treasury, the Foreign Office and the Board of Trade, as well as the Service departments, for assistance in preparing its memoranda. On the whole, however, it is perhaps true to say that the full weight of these civil departments was not brought to bear on economic intelligence assessments and that the interdepartmental system for economic intelligence which evolved under the CID remained somewhat isolated from the main stream of economic thought and discussion in Whitehall. When we consider the state of intelligence sources in 1939, and try to assess the use that had been made of them, we shall see that in consequence of this limitation the general German economic situation escaped regular and systematic discussion by the inter-departmental system.* Thus, there is no record that the German Four Year Plan, which was directly concerned with the development of war potential, was at any time considered as a whole. It would, however, have required a very large central staff to re-examine, for their relevance to defence planning, the information and the opinions on the various aspects of foreign economies that were accumulated in the departments concerned with Great Britain's financial and commercial relations; and the result of such a re-examination might well have been too complex for defence purposes. Another of the system's shortcomings was that, although it confined itself to matters most obviously relevant to defence planning, its coverage was less than complete. The IIC, with an original staff of three administrative officers and four clerical officers, which was enlarged to only eight administrative officers and a proportionate clerical establishment in 1936, was constantly in arrears with its programme of work. The size of its establishment in 1939 was fifteen, but it remained small in relation to the increase in the range of its work after 1936.
For this defect, to which the IIC did not fail to draw attention, the responsibility lay at the highest level. The assessments prepared by the IIC and the committees and sub-committees which it served were almost always approved by the CID without discussion of matters of substance. The lack of controversy, among ministers and senior officials representing departments that were entitled to make their own assessments, suggests that there was considerable confidence in the
* See Chapter 2, p 69 et seq.


34 The Organisation of Intelligence at the Outbreak of War
effectiveness of the inter-departmental system at the working level,* but also that at the highest leyel interest in economic intelligence was at best moderate.
Despite the development of arrangements for the inter-departmental co-ordination of reports and appreciations in the field of economic intelligence, no steps were taken to provide machinery for the co-ordination of intelligence on a wider scale until 1935. It was not until then, at the time that they were discovering the need for the Air Targets Sub-Committee, that the Service departments began to realise that their collaboration was deficient, not to say non-existent, in two other ways, and that they began to set about repairing the deficiencies. By the outbreak of war they had devised new machinery on the one hand for co-ordinating their appreciations in every field of intelligence and, on the other, for ensuring that more efficient use
was made of intelligence on inter-Service topics. At the same time, the introduction of this machinery had combined with the pressure of events to draw the Foreign Office into collaboration with the Service departments. But only a skeleton or an outline organisation existed at these levels when the war began. The enlargement of the scope of the FCI to include air targets intelligence had itself been precipitated not only by the re-awakening of interest in aerial photography but also by a new awareness, to quote
again from the DMO and I's memorandum of July 1935, 'of the increasing tendency for certain specific aspects of intelligence to develop, in which two or more separate departments are equally interested, with the result that the danger of uneconomical duplication in the collation and recording of such intelligence is tending to increase'. 33 But air targets intelligence was but one illustration of this tendency, and it was with the aim of filling a wider vacuum that in October and November 1935, in discussions chaired by Sir Maurice Hankey, Secretary of the CID, the Deputy Chiefs of Staff recommended not only the addition of air targets intelligence to the work of the FCI and the IIC, but also the establishment of an Inter-Service
* Some members of the CID occasionally felt that the coverage of the economic problem was not entirely adequate. On 18 November 1937 the Secretary of State for Air suggested that the CID should receive periodic reports on the economic situation in various countries. 32 He was told by Hankey that the JIC was in close touch with the IIC, which provided this information, and that the FCI Sub-Committee also made regular reports. This reply did not satisfy all members of the CID. The Home Secretary, Sir Samuel Hoare, asked the Minister for the Co-ordination of Defence, who was in the chair, to have the matter looked into. Nothing further was heard of it at subsequent meetings.
32. CAB 2/7, CID 301st Meeting, 18 November 1937.
33. CAB 54/3, DCOS 3 of 22 July 1935.


The Organisation of Intelligence at the Outbreak of War 35
Intelligence Committee (ISIC), and that in January 1936 the Chiefs of Staff and the CID approved their recommendations. 34 The Inter-Service Intelligence Committee, the first determined attempt* to set up an organisation in which the three Services could jointly undertake the administration and assessment of intelligence, at a level of detail which had always been impracticable at the CID, proved also to be an abortive experiment. The records of the CID, the Chiefs of Staff and the Deputy Chiefs of Staff contain no further reference to it after the agreement to set it up, and of its own meetings - if, indeed, it held any - no records have been found. This was partly due to the fact that it was premature. The CID noted when
setting it up that it could not be expected to function efficiently until more money was provided for intelligence. Moreover, when it was set up, the process of improving the status of the intelligence branches within the Service departments had itself scarcely begun, and it was perhaps optimistic to expect of a committee consisting of the Deputy Director of Naval Intelligence, the DDI (Air) and the Head of MI 1 branch of the General Staff, unsupported by any staff of its own and authorised to meet merely at the request of any of its members, that it would function at all while the intelligence branches remained subordinate to the operations staffs of their own departments. But as well as being premature, the arrangements made for the committee did not go far enough. This is clear from the list of subjects considered suitable for handling by the ISIC, whose emphasis is on factual military topics connected with operational plans. t It also emerges in a second direction. In the shape of the Joint Planning Staff (JPS), the CID and
* In 1934 the DNI and DMO and I had discussed the need for collaboration on intelligence appreciations between their two organisations, but the project had come to nothing. 35 t '(a) Preparation of Intelligence Reports and provision of maps and plans for such publications. (b) Joint appreciations on possible enemy operations from the Intelligence point of view, eg Japanese operations against Hong Kong and Singapore. (c) Press liaison and security in combined exercises.
(d) AA defences of foreign countries. (e) Coastal defences of foreign countries. (f) Intelligence from Procedure Y. (g) Signal communications and developments. (h) Co-ordination of the work of the Intelligence Staffs of the three Services in special circumstances. (i) Questions involving the Defence Security Service where the thr^e Defence Departments are concerned.'36
34. CAB 54/1, DCOS 2nd and 3rd Meetings, 29 October and 29 November 1935;
CAB 53/5, COS 161 st Meeting, 1 3 January 1936; CAB 4/24, CID 1 208B of 20 January
1936; CAB 2/6, CID 273rd Meeting, 30 January 1936.
35. Memoirs of Admiral Godfrey, Vol 5, Part I, pp 154-155 (National Maritime
Museum, Greenwich). 36 CAB 54/3, DCOS 7 of 17 December 1935.


36 . .The Organisation of Intelligence at the Outbreak of War
the Chiefs of Staff had possessed since the 1920s tolerably adequate machinery for co-ordinating the work of the three Services in the planning and conduct of operations. As a result of the Abyssinian crisis and a concurrent Press campaign for an improvement in defence arrangements, this machinery was strengthened from the beginning of 1936, at the time of the appointment of a Minister for the Co-ordination of Defence. Each Joint Planner was given an assistant and the scope of the JPS's work was enlarged so that it might give fuller consideration to problems before submitting them to the Chiefs of Staff. The setting up of the Inter-Service Intelligence Committee was intended to complement the strengthening of the JPS. It was not realised, however, that progress towards the co-ordination of Service intelligence depended upon establishing direct relations between the ISIC and the Joint Planners. When each intelligence branch was accustomed to serving only its own operations staff, and when the interpretation and the use of a good deal of its intelligence in fact had no bearing on the concerns of other departments, the Service departments were unlikely to consider how far they could profitably collaborate unless they were prompted to do so by having common problems submitted to them by the Joint Planners.
In June 1936 the DMO and I seized on this defect. With the help of Hankey, he succeeded in persuading the Chiefs of Staff to replace the Inter-Service Intelligence Committee with a Joint Intelligence Sub-Committee (the JIC ) whose function was to assist the JPS by acting as the channel through which the Planners obtained intelligence on all subjects on which more than one Service might have something to contribute. 37 The Joint Planners were made responsible for making requests to the JIC, as necessary, and the Secretary of the JPS was made Secretary also of the JIC* The membership of the JIC was the same as that of the abortive Inter-Service Intelligence Committee except that it was empowered to co-opt the help of the Industrial Intelligence Centre, whose head in fact attended, or was represented at, most of its meetings. From its inauguration on 7 July 1936 its meetings were held at intervals of two to four weeks except, until 1939, during the long summer break. At least to this extent, it at once established itself as a regular part of the intelligence machine, to which not only the JPS and the individual Service departments but also, if only occasionally and on military- questions, MI5 and the Foreign Office turned for opinions.
* In the first instance the Chiefs of Staff decided that this would be too much for one man and that, lest his work for the Planners might suffer, the Secretary of the JPS should act only in a liaison capacity for the JIC. But Hankey got the original suggestion for a common Secretary restored after the JIC had pointed out that it could not otherwise perform its functions properly. The two bodies had the same Secretary until June 1939.
37. CAB 53/6, COS 178th Meeting, 16 June 1936.


The Organisation of Intelligence at the Outbreak of War 37
Until the summer of 1939, on the other hand, it remained a peripheral body - one which had considerable difficulty in developing a function to supplement those already being performed by the intelligence branches of the Service departments, the FCI and the Joint Planners - for several reasons. The Planners did not call for its views except on topics on which intelligence was either of a routine nature or hard to come by. Nor did the JIC itself show any initiative in volunteering appreciations on more important questions like the intentions and military thinking of foreign states, partly because there was a dearth of reliable information on such questions and partly because Service opinion in Whitehall frowned on speculation. These problems are illustrated by the fact that the most extensive of the JIC's pre-war activities, and the only one of them for which it spawned sub-committees, was the attempt to discover what could be learned about air warfare by studying the available information on operations
in Spain and China.* This produced some valuable conclusions - for example in showing that in both Spain and China the air fighting had been largely confined to support of land operations - but it had little impact on military thinking, perhaps because the conclusions, being unconfirmed by reliable detailed information, were also tentative. It was, however, useful both in drawing attention to the need for more intelligence and in bringing closer together individual members of the Service intelligence branches. Thus the relevant geographical section of NID was now brought into closer touch with its opposite numbers at the War Office and the Air Ministry. 40 Even so, these sub-committees aroused some hostility in the Service departments, and also from the Air Targets Sub-Committee of the FCI.t Nor was that all. The
* The first sub-committee, set up in May 1937 as a result of an Admiralty proposal, sat under an Air Ministry chairman and had representatives from the Admiralty, the War Office, the Foreign Office and the Air Raid Precautions Department of the Home Office. Its terms of reference were to co-ordinate the intelligence about air warfare that was coming in from Spain. It produced five reports for circulation to the Chiefs of Staff, on anti-aircraft (artillery) defence, attacks on oil fuel storage, low-flying attacks on land forces, air attacks on ships and on control of the Straits of Gibraltar. 38 The second sub-committee, set up in July 1938 as an extension of the first, attended by the same departments, except that the IIC replaced the Foreign Office, added the Far East to Spain in its field of study. It too produced five reports, on air attacks on sea communications, air co-operation with land forces, air attacks on industry, the effect of air warfare on internal communications, and on active and passive air defence. 39 t The Air Ministry was reluctant to participate in the first sub-committee on the ground that it already had a special section at work on the subject, and the War Office joined it in resisting the setting up of the second. The War Office also objected to the first of the sub-committee reports, on anti-aircraft defence, so that the JIC had to undertake that its future reports would incorporate the views of the
38. CAB 53/33, COS 622 (JIC) of 6 October 1937, COS 623 (JIC) of 7 September
1937 and COS 624 (JIC) of 6 October 1937; CAB 53/36, COS 685 (JIC) of 17
February 1938; CAB 53/9, COS 734 (JIC) of 12 June 1938.
39. CAB 54/6, DCOS 100 (JIC) to 104 (JIC), all of 10 June 1939.
40. Morgan, op cit, p 85.


38 _ The Organisation of Intelligence at the Outbreak of War
individual Service departments displayed little initiative in making use of the JIC on more urgent, problems. On the subject of Germany's rearmament, for example, the subject that most pre-occupied them and the higher levels of government, they continued to make, in collaboration with the IIC, their own individual assessments for the Joint Planners and the Chiefs of Staff, as did the Foreign Office. If the JIC played little part in co-ordinating the available intelligence and still less in analysing its implications on this and other matters of pressing importance on which the Service departments themselves were already engaged, this was no doubt because the Service departments felt that reference to the JIC would be a superfluous and time-consuming exercise. At the same time, however, they were only too ready to take this view. When asking for the establishment of the JIC they had been impressed by the importance of co-ordinating the collation of intelligence on matters of inter-Service concern to avoid duplication of effort. Having brought it into existence they effectively ensured that its work did not expand in such a way as to reduce the influence on policy and strategy which they individually derived from their responsibility for assessing intelligence for their own departments and their share in any decisions that might be based on it. In adopting this attitude, moreover, they were not discouraged by the Joint Planners. It was the Planners who, even more than the individual departments, had been expected to call on the JIC for co-ordinated studies, and it was they alone who, by engaging it in more profitable activities, could have off-set the understandable reluctance of the departments to make full use of the new organisation. With few exceptions, however, they not only confined their enquiries to the JIC to routine or unanswerable requests but also handled the replies in a manner that conveys the strong impression that on matters of first importance they regarded the co-ordination of intelligence, and of intelligence with planning, as a process which they were capable of performing for themselves. The Planners' request were of two kinds. They were associated either with the preparation of the regular strategic appreciations and defence reviews, for the drafting of which the JPS was responsible,*
individual Services. A later report, on air attacks on ships, came in for fierce criticism from the Air Targets Sub-Committee which considered its practical value to be 'almost negligible' for its lack of information on essential technical details. 41 * The first of these to involve the JIC was the Far East Appreciation of 1936-37; it supplied details on the defences of Hong Kong and Singapore, but there is neither acknowledgement of nor reaction to its contribution in the minutes of the JPS meetings at which the appreciation was drafted. 42 This pattern repeated itself during 1937 and 1938 in the drafting of the Mediterranean, Middle East and North Africa
Appreciation and of an Appreciation of the Situation in the Event of War with Germany; for the revise of the latter the Planners asked the JIC for a firm estimate
41. JIC 8th Meeting, 26 April 1937; JIC 11th Meeting, 6 October 1937; JIC 15th and 1 6th Meetings, 25 April and 3 June 1938; JIC 18th Meeting, 8 July 1938.
42. JIC 2nd Meeting, 29 September 1936; JIC 13 of 7 October 1936; CAB 53/7,
COS 207th Meeting, 18 May 1937; CAB 16/182, DP(P) 5 of 14 June 1937.


The Organisation of Intelligence at the Outbreak of War 39
or with the provision of assessments and information to British delegations abroad and to foreign and Commonwealth governments. As the need for the latter increased the JIC did, indeed, begin to find a role and also to devote less time to the former, to which its contribution had been found to be not indispensable. During the first half of 1 939 it was preparing appreciations in connection with the visit of the British delegation to Moscow and drawing up the information on the military value and possible use of Soviet and Italian forces that was used by the British delegates during the Anglo-Turkish Staff talks; in addition, although it was excluded from the preparations for the Staff talks with France and Poland, it was drawn in after those with France had begun. At an early stage in these talks a ministerial committee authorised the fullest exchange of intelligence with the French, cryptanalysis being, however, excluded, and the JIC was charged with making the necessary detailed arrangements. 46 Its last pre-war undertaking was the co-ordination down to the last detail the wearing of uniforms, the provision of cars and drivers - of the preparations for the establishment of British Military Missions in Poland, Romania and Turkey. Even in the development of this side of its work the JIC was not immune from the wrath of the Joint Planners, who complained that its correspondence with the French embassy was cutting across their own arrangements and who laid it down that no one committee should deal directly with the embassy on subjects in which other committees were concerned. 47 At the same time, the JIC's work had begun to impinge on that of the Foreign Office.* It was on this account that the
of the number of divisions Italian industry could maintain in the field, since there was a conflict between the IIC estimate of 10-15 and the War Office estimate of 36, but did not wait for its answer. 43 In fact, the JIC was unable to pronounce on this division of opinion and on later occasions, also, it was unable to supply what was wanted. Thus after the Munich crisis, when work began on revising previous appreciations on the assumption of a European war in 1939 against Germany and Italy, with possible Japanese intervention, it was asked to furnish the JPS with estimates of the strength of these powers, but there is no sign that it did so. 44 Again in June 1939 it was asked for an appreciation of the situation from the point of view of Japan, in connection with the revision of the Far East Appreciation, but had not provided one by the outbreak of war and did not subsequently do so. 45 * Thus in December 1937 the Chiefs of Staff asked the JIC to comment on doubtful secret reports from the Foreign Office to the effect that Spain might make territorial and other concessions to Italy if Franco won the war. 48 In the summer of 1938 the Foreign Office asked for the advice of the JIC on how far Spanish fortifications in the Straits of Gibraltar constituted a menace to the fortress and to British shipping. 49
43. CAB 53/40, COS 755 of 15 July 1938; CAB 55/13, JP 305 of 19 August 1938.
44. CAB 55/13, JP 319 of 25 October 1938; CAB 16/183A, DP(P) 44 of 20 February
1939. 45. CAB 55/3, JP 256th Meeting, 14 June 1939.
46. CAB 29/160, AFC(J) 8th Meeting, 4 April 1939, AFC(J) 35 of 21 April 1939;
CAB 16/209, SAC ^th Meeting, 17 April 1939.
47. CAB 55/3, JP 267th Meeting, 1 1 August 1939, Item 1 7.
48. CAB 53/43, COS 651 (JIC) of 17 December 1937; CAB 53/8, COS 226th
Meeting, 22 December 1938. 49. JIC 1 6th and 17th Meetings, 3 and 15 June 1938.


40 - The Organisation of Intelligence at the Outbreak of War
JIC and the Foreign Office were first brought to work together, the more so as the situation was beginning to call for co-ordination of intelligence abroad as well as in Whitehall. As far back as the 1920s a Sigint group had been established in the Far East, on the flagship on the China Station, by collaboration between the Admiralty and GC and CS. Partly because the Navy was the only one of the three Services to have an important presence in the area, and partly because a good supply of intelligence was then being obtained from the cyphers of all three Japanese Services, this group became a factor in the development in 1 935, without too much inter-Service friction, of the Far East Combined Bureau (FECB).* In the Middle East, by contrast, no progress had been made towards bringing the intelligence staffs of the three Services into closer proximity, or towards defining the division of labour that should exist between them and the Whitehall branches and GC and CS, when the Munich crisis revealed that these problems must be settled if inefficiency was to be avoided. By November 1 938 the necessity for a Middle East Intelligence Centre was accepted, but agreement was still lacking as to what its scope and functions should be, and it was mainly because this question was placed on the JIC's agenda that the Foreign Office attended its meetings for the first time. The question was one on which the Service departments still differed between themselves. The Army favoured a large degree of decentralisation of responsibility from the United Kingdom. The Air Ministry was reluctant to accept anything more than a bureau which would combine the intelligence staffs which were already at work in
the area. The Admiralty's position was unsettled on this point, but it wanted to retain its own OIC, which had been at Malta or Alexandria since 1936, in addition to participating in an inter-Service centre. In the end, however, all three compromised on establishing at Cairo a Middle East Intelligence Centre to co-ordinate information and all agreed that it would be desirable if the co-ordinating centre covered political as well as military matters and thus had Foreign Office as well as Service staff attached to it. The Foreign Office objected to a political/military centre and despite signs during the spring of 1939
* The Bureau was formed from single-Service intelligence offices which had long existed in the Pacific area and had as its head the head of the local naval intelligence staff (COIS, China Station). It was a purely Service organisation, designed to collate and evaluate military intelligence relevant to the possibility of an attack by Japan without disturbing local single-Service intelligence arrangements. Originally housed in Hong Kong, the FECB transferred to Singapore in 1939, leaving a small support
staff in Hong Kong. Though there was not much inter-Service friction there was a considerable amount between the Sigint group and the COIS on the Station, through whom, from 1937, all the group's output was handled operationally, and this friction was to continue throughout the war. 50
50. Mockler-Ferryman, op cit, pp 198-199.


The Organisation of Intelligence at the Outbreak of War 4
1
that its opinion was wavering, 51 it remained so firmly opposed that at the end of June 1 939, with the Deputy Chiefs of Staff urging the need for haste, the CID approved the immediate formation of the MEIC, postponing the question of political representation on it.* 52 By that time the need for closer collaboration between the Service departments and the Foreign Office at home had become apparent, and here, where it had long been neglected, this problem could no longer be shelved. The Chiefs of Staff had been restless for some time about the unwillingness of the Foreign Office to discuss political intelligence with their own organisation. In April 1938 they had pointed out that it would be an advantage if, before drawing up strategic appreciations, the Joint Planners could have meetings with the Foreign Office instead of merely incorporating in the appreciation a summary of the political situation provided by the Foreign Office. 53 In January 1 939, by which time the Foreign Office had begun to attend
some meetings of the JIC, the DDMI had opened a correspondence with the Foreign Office in which he urged that the JIC would be a more effective body if, without interfering with the liberty of action of the individual departments, its members were given a Foreign Office chairman and it was empowered to ' sift all political intelligence . . . and compile a reasoned analysis of international affairs'. The Foreign Office had fended off this approach. 54 But it could hold out no longer when in April 1939 the Chiefs of Staff demanded that, at the least, all
intelligence, political and military, that seemed to call for quick decisions should be pooled and processed by a Situation Report Centre to which the Foreign Office should appoint a representative. The Situation Report Centre, set up by the Minister for the Co-ordination of Defence at the instigation of the Chiefs of Staff and with the approval of the Prime Minister, consisted of representatives of the Directorates of Intelligence of the three Service departments and of the Foreign Office. It met in the offices of the CID, under the chairmanship of the Foreign Office, to issue daily reports after checking and co-ordinating all intelligence that might seem to call for
emergency action. Later, for the same very limited circulation, it also produced a weekly commentary on the international situation. In these ways it was designed to fulfil in an increasingly critical situation two
* See Chapter 6, pp 192-193 for the further development of the MEIC.
51. JIC 77 of 20 October 1938; JIC 20th Meeting, 16 November 1938 and 21st
Meeting, 1 1 January 1939; CAB 4/29, CID 1548B of 20 April 1939; CAB 2/8, CID
356th Meeting, 11 May 1939.
52. JIC 28th Meeting, 13 June 1939; CAB 4/30, CID 1556B of 27 June 1939; CAB
2/9, CID 363rd Meeting, 29 June 1939.
53. CAB 1^6/183, DP(P) 31 of 2 September 1938.
54. FO 371/23994, W 793/9 (FO to DDMI, 15 February 1939), W 5320/9 (DDMI to
FO, 28 March 1939 and FO to DDMI, 21 April 1939).


4 2 The Organisation of Intelligence at the Outbreak of War
requirements which the JIC, with its lack of staff, its pre-occupation with long-range issues and problems of organisation and having no regular Foreign Office member, had not been designed for. The first was the need for the departments to collaborate in ensuring that proper use was made of intelligence at the emergency or operational
level, as well as at the level of planning. The second was the need to ensure, at both levels, that this co-ordination extended beyond the Service departments and at last incorporated the Foreign Office with them. During the Munich crisis, and still more since the beginning of 1 939, these needs had been becoming obvious enough. It had been becoming increasingly obvious, again, that they were closely interlocked. On the one hand the Foreign Office, long critical of the strategic appreciations of the Chiefs of Staff and the Joint Planners, had attended a meeting of the JIC for the first time in November 1 938 because the preparation of a new European strategic appreciation was on the agenda, as well as because it had serious reservations about the project for a Middle East Intelligence Centre. On the other hand, its attendance at JIC meetings had thereafter remained spasmodic and it had continued its established practice of issuing items of intelligence direct to the Service departments. At a time when these items were increasingly alarmist in tone and military in their contents, matters were made worse by the fact that they were not infrequently found to be false after they had been issued, as we shall see later on.* It was
after their incautious circulation by the Foreign Office had created a series of incidents that the Situation Report Centre was set up. 55 But it was because such incidents were at last recognised for what they were - as being merely one illustration of the defects that were arising at all levels in conditions of near-war in consequence of the autonomy of the Service intelligence branches and of the peace-time separation from them of the Foreign Office - that after being in existence for two months the Centre proposed its own amalgamation with the JIC, and that in July 1939 the Foreign Office fully approved of the amalgamation. 56 In the resulting re-organisation of June-July 1939 the JIC acquired the form which, in all essentials, it retained throughout the war. It consisted henceforth not only of the heads of Intelligence of the three Service departments, or their deputies, t but also of a Counsellor from the Foreign Office. In theory it had no chairman, the Services having
* See Chapter 2, p 84.
t The heads - by this time all designated Directors - did not attend regularly until 1940.
55. CAB 53/1 1, COS 290th Meeting, 19 April 1939; CAB 53/51, COS 935 (JIC) of 4 J ulY *939
56. FO 371/23983, W 6765/108/50, W 7989/108/50; FO 371/23986^9715/108/50,
minutes of 21 and 27 June; FO 371/23901, W 9975/9, minute of 1 August 1939.


The Organisation of Intelligence at the Outbreak of War 43
objected to a Service committee being chaired by the Foreign Office and the Foreign Office having raised difficulties about nominating a man of suitable seniority to a subordinate position. In practice, as the members of the Situation Report Centre had initially recommended and despite the fact that it remained a sub-committee responsible to the Chiefs of Staff, its Foreign Office member chaired its meetings. It was provided with a Secretary of its own instead of continuing to share one with the Joint Planning Staff. And in its new form it was given an enhanced status as against the separate departments as well as against the Planners, as will be clear if we quote the terms of reference that were now given to it. These laid it down that the Committee 'should continue to issue the Daily Reports and Weekly Commentaries at present produced by the Situation Report Centre and should also be charged with the following duties:
(i) The assessment and co-ordination of intelligence received from abroad with the object of ensuring that any Government action which might have to be taken should be based on the most suitable and carefully co-ordinated information obtainable.
(ii) The co-ordination of any intelligence data which might be required by the Chiefs of Staff or the Joint Planning Sub-Committee for them.
(iii) The consideration of any further measures which might be thought necessary in order to improve the efficient working of the intelligence organisation of the country as a whole'. 57
'The intelligence organisation of the country as a whole.' It was a concept that had been evolving for twenty years, but evolving slowly, haphazardly and only in response to events in the absence of a single co-ordinating authority.
57. CAB 53/5 1 , COS 935 (JIC) of 4 July 1 939.




CHAPTER 2
The State of Intelligence up to
September 1939
FROM WHAT we have said about the organisation of intelli
gence up to the outbreak of war it will be clear that not the least
of the obstacles to efficiency were administrative in origin and
character. As we shall see, it was in consequence of these, and particularly of the lack of co-ordination and of provision for central assessment, that information existed without being properly used. But intelligence was also impeded by difficulties arising from the nature and the state of its sources of information, and these difficulties were not only more technical than the administrative obstacles but also more
intractable. At any rate theoretically, there was no restriction on the freedom to make organisational improvements; actually, if slowly, such improvements were made. Even in principle, however, by the very nature of the sources, some of the technical difficulties were insurmountable in time of peace, and this placed serious limitations on the information that intelligence could provide. By far the most extensive system for acquiring information was the overt one by which British diplomatic missions overseas sent in a stream of despatches, telegrams and letters to the Foreign Office. It was one of the chief functions of the missions to keep London informed of political, military and economic developments in the countries to which they were accredited. Their principal sources of information were the obvious ones: the Press and other public media, of which they undertook a closer scrutiny than was attempted by the departments in London; the opportunities they had in most countries for making first-hand observations; the judgments they formed on the information they received, confidential and otherwise, in the course
of their official and unofficial contacts. Their reports were not regarded as intelligence, a term restricted to information obtained from secret sources, and before September 1939, when the DNI arranged with ' C ' that discreet co-operation could take place between the naval attaches and representatives of the SIS, the missions, and the Service attaches who were attached to them, were discouraged from using clandestine methods or even from having official connections with those who were using such methods - the overseas representatives of SIS. Their opportunities for acquiring information thus varied from place to place and from time to time, according to the condition of
45


4 ^ The State of Intelligence up to September ig$g
Great Britain's relations with the country to which they were accredited, the security measures in force there, a mission's relations
with the embassies of other* states and the ability of the individuals employed. From Moscow, for example, the British Ambassador often complained during 1937 that Russians never came to see him; 'as a result he gets no information and the condition of the country is a mystery to him'. 1 In October 1938 he was still reporting that 'it is impossible to obtain even an inkling of what is discussed within [the Kremlin's] walls'. 2 From early in 1939, when a change of ambassador coincided with a change in the Soviet government's outlook, the embassy was able to pass on rumours that Germany was interested in an agreement with Russia and also to report that the Soviet authorities were hinting that, although the capitulation of France and Great Britain in the Munich crisis had disturbed them, they were interested in a rapprochement with Great Britain. 3 By then, however, such hints and rumours were common currency in Europe, and neither from the embassy nor from any other source did the British government obtain reliable and timely intelligence about the Russo-German negotiations of the summer of 1 939. In Berlin contacts were good up to 1 937 - the embassy's opportunities being all the greater because the German government allowed British officers a wide if not an unlimited access, on a reciprocal basis, to its military establishments4 - but thereafter they deteriorated rapidly. The loss of official contacts in Germany was partly offset by the opening of others when the hostility of the German authorities made the task of the Berlin embassy more difficult. The British attaches themselves improved their methods of making first-hand observations of Germany's military preparations. The attaches of other states which felt threatened by Germany pooled their knowledge with their British colleagues. German citizens, and even officers of the German General Staff, fearing that Hitler's policies threatened to lead to war, passed confidential information to the embassy. 5 Increasingly, also, Germans in opposition to Hitler made visits to London to convey warnings to the British government either directly or through the agency of their private contacts with British subjects. 6 The work of the embassies and the attaches had always been
1. Mr Neville Chamberlain's letters, 7 October 1937 (Neville Chamberlain Papers,
Birmingham University Library). Quoted in K Middlemas, Diplomacy of Illusion
(1972), p. 28.
2. FO 371/22289, N5764/97/38. 3. E L Woodward and R Butler (eds) Documents on British Foreign Policy igig-iggg, Series 3, Vol 4, pp 70-7 1 , 1 23-1 24.
4. Major-General K Strong, Intelligence at the Top (1968), p 24.
5. ibid, for a good general account of the work of an attache. 6. I Colvin, Vansittart in Office (i 965), p 1 54; FO 371 1
2
1 732, C8520/1 94 1 /i 8. See also
T Prittie, Germans against Hitler (1964); G Ritter, The German Resistance (1958);
P Seabury, The Wilhelmstrasse (Berkeley, 1964); A P Young, The 'X' Documents (1974).


The State of Intelligence up to September igjg 47
supplemented by reports which British subjects - bankers and industrialists, merchants and merchant navy captains, politicians and journalists - passed to embassies or to their acquaintances in Whitehall. Like the approaches made by German citizens, on which they were now more frequently based, such reports also increased as the international system became more disturbed; and in 1938 and 1939, to judge by the number that remain in the files of the Foreign Office, they became a flood. Like them, moreover, they began to exert an independent influence in some official quarters, whereas they had previously been checked against information obtained from official sources and kept firmly subordinate to it. From the end of 1 932, to take one example of this development, the Foreign Office received regular assessments of the political situation
in central Europe from Group Captain M G Christie, who had previously served as Air Attache in Berlin though he was now a private citizen.* The Foreign Office occasionally asked for his advice when it was preparing memoranda, but until the end of 1935 it was comparing his assessments with the official attache reports and sometimes commenting sceptically upon them. 7 But from the end of 1 935, when they became more frequent and more detailed, Christie began to send almost all his reports direct to the Permanent Under-Secretary, Sir Robert Vansittart, and the Permanent UnderSecretary began to make use of them as part of what was virtually a
private intelligence service - first by quoting telling phrases from them
in his own memoranda, and attributing them to 'a very secret source', and later, especially after he was made Chief Diplomatic Adviser in January 1938, by circulating them as they stood, with only such alteration as was necessary to make it appear that they had been written by himself. 8 Nor did this collaboration stop at the official circulation of private political assessments. During 1938 and 1939 Vansittart turned several messages from Christie and other private informants9 into insistent minutes to the Foreign Secretary in an attempt to influence the decisions of the Cabinet. 10 The growth of these practices owed something to the uncertainty
* He was not, as has been claimed, employed by the SIS.
7. FO 371/15946, C8681/235/18; FO 371/17706, C2309/29/18; FO 371/17708, C4839/29/1 8^0371/18352, 1^3606/37/3^037 1/18857X891/1 1 i/i8;ChristiePapers, Churchill College, Cambridge, 1 80/1/6. 8. eg a Christie report on 12 March 1938 (Christie Papers 180/1/26A) reappears as
a Vansittart memorandum, (see Vansittart Papers, Churchill College, Cambridge, 1/23).
9. See T P Conwell-Evans, None so Blind (1957); Young, op cit; S Aster, ig$g: The Making of the Second World War (1973), pp 57-59, 345; Middlemas, op cit, p 298.
10. FO 37 1/2 1728X731 5/1 941/18 of 21 July 1938; FO 371/21 729X7648/1 941/18 of
27 July 1938; FO 371/21708, C7007/1 180/18 of 24 July 1938; FO 371/21708,
C
1 2655/1 1 80/ 1 8 of 7 Dec 1938; FO37 1/2 1 729X7560/1 941/18 and C759 1 /i 941 /i8of 25
and 26 July 1938; FO 371/21664, Ci 1 164/62/18 of 29 Sept 1938.


48 The State of Intelligence up to September ig$g
and the disagreements about policy that accompanied the rapid deterioration of the international situation. It owed something, also, to Whitehall's lack of adequate arrangements for central and considered assessment of such intelligence as was available; and from early in 1939, by which time criticism of Vansittart's 'private detective agency' and of his impulsive response to information had become rife both in the Foreign Office and elsewhere in Whitehall, 11 it contributed to the determination to remedy that defect.* But underlying these wider explanations there were two more particular reasons for the development. The first was that when the deterioration was so closely associated with the activities of Germany, Russia, Italy and Japan, totalitarian states where intense security precautions and drastic police measures greatly exacerbated the difficulty of obtaining good intelligence, the diplomatic reporting system was unable to give advance notice of new developments with the firmness and precision that was increasingly called for. The second was that when the supply of information from the embassies was unable to meet this need, the clandestine sources were also failing to do so. In the case of one of these sources, aerial photographic reconnaissance, we have already sufficiently explained why its clandestine use, involving the over-flying of Germany and the Mediterranean states, began only in the spring of 1939 and was not organised on a Service basis before the outbreak of war.f The others - the SIS's espionage system and Sigint - were in organised existence throughout the inter-war years and there is no simple explanation of their deficiency during the approach to war. It was due in some measure to financial stringency, in some measure to technical difficulties which could not be surmounted in peace-time, and in some measure to the fact that they could no more meet the most urgent of peace-time requirements, particularly the need for information about the intentions of foreign states, than could the diplomatic reporting system.
Evidence that they suffered from shortage of funds is to be found in the proceedings of Cabinet and CID committees and sub-committees. These show that from 1935, when the inability of the embassies to provide precise forward intelligence was beginning to be recognised,
* See Chapter 1 , p 42.
t See Chapter 1, pp 28-29, an(^ Appendix 2.
1 1. B Bond (ed) Chief of Staff: The Pownall Diaries, Vol 1 (1972), p 183 (23 January
1939, p 187 (13 February 1939); D Dilks (ed) The Diaries of Sir Alexander Cadogan,
( 1 97 1 ), p 182 (18 August 1939); J Harvey (ed) The Harvey Diaries (1970), pp 326-327
(1 November 1939); Middlemas, op cit, pp 91 , 232, 245, 32o(n). We are also indebted
to Mr D G Boadle who is writing a dissertation on this subject for the PhD degree in the University of Cambridge.


The State of Intelligence up to September igjg 49
urgent requests were made at the highest level for a large increase of expenditure on the SIS. They also show, however, that these requests were met only in part, and with considerable delay, and this is confirmed by a series of complaints and pleas from the CSS. In April 1935 the Cabinet set up an emergency committee to consider Hitler's claim, in his recent discussions with Sir John Simon, the Foreign Secretary, that the German Air Force had already achieved parity with the RAF. In the following month this committee, among other steps, recommended that the SIS should be given more money and that, as it was undesirable to use supplementary estimates for this purpose, the Foreign Office and the Treasury should effect an increase in some other way. 12 The Cabinet in its discussion of this report appears to have paid no attention to this recommendation. 13 Later in 1935, however, the recommendation was repeated by the Defence Requirements Sub-Committee of the CID (the DRC). The DRC had been set up in November 1 933 to report on the worst deficiencies facing the armed services. Between then and the second half of 1935 it submitted three reports to a ministerial committee.*
The first DRC report concluded in March 1 934 that Germany was the main potential enemy against which long-term defence must be prepared. 14 The outcome of the second DRC report was a decision
by the ministerial committee in July 1935 that, as it was impossible
to guarantee peace beyond January 1939, the DRC must elaborate defence programmes providing for a state of readiness by the end of the fiscal year 1938-39. 15 Intelligence from the SIS and GC and CS exercised little influence on these crucial decisions, which were mainly based on application of overt information and common sense to strategic and political assessments of the changing international situation. Essentially, the same was true of the DRC's third report. A vast series of detailed recommendations for the overhaul of British defences, this incorporated reasonably detailed information on some subjects - on foreign naval strengths and naval reconstruction and modernisation programmes, as also on the expected development of Japanese naval air power - but it stressed the meagreness of existing knowledge about Germany's offensive capacity, especially in the air, and it included in this connection a recommendation about intelligence.
* At first this was the Ministerial Committee on Disarmament (DCM). From mid- 1 935 the reports went to a Ministerial Committee on Defence Policy and Requirements (DPR).
1 2. CAB 21/417, FA/D/33 and CAB 2
1
/4 1 9> FA/D/35 ; CAB 23/8 1 , CAB 24 (35) of 1 7
April; CAB 24/255, CP 1 00 (35) of 1 3 May, CP 1 03 (35) of 1 7 May, CP 1 06 (35) of 20
May; CAB 24/254, Anglo-German Conservations, 25 and 26 March 1938.
13. CAB 23/81, Cab 27 (35) of 15 May, Cab 29 (35) of 21 May.
14. CAB 16/109, DRC 14 of 28 February 1934.
15. CAB 16/136, DPR 4th Meeting, 29 July 1935; CAB 4/24, CID 1 2 1 5B of 2 March
1936, enclosure No 2, Vol I, Annex.


5° The State of Intelligence up to September ig$g
Possibly in reference to information about warship construction at Kiel which the SIS had obtained in May 1934, and which it had circulated as the first sign that Germany was contravening the naval clauses of the Versailles Treaty, the report noted that 'a recent illustration of effective concealment on Germany's part is to be found in her naval rearmament, on which our Intelligence proved defective', and then went on to say 'We know something of Germany's industrial development and capacity, but it would be a dangerous illusion for us to infer that we have a reliable measure of what she can do; still less of what she may be able to do in the near future. The best we can do is to strengthen our Intelligence system and our own war potential (output capacity) so as to be able to increase our forces correspondingly in the case of a German increase. But, although we have included recommendations for both these purposes, we can give no assurance, especially in regard to aircraft production, that we may not be at a serious disadvantage compared with Germany'. 16 Its recommendation for the strengthening of intelligence took the form of urging more funds for the SIS. ' If [its] allowance is not augmented, and very largely augmented, the organisation cannot be expected to fulfil its functions, and this country will be most dangerously handicapped. It is difficult to assign an exact figure to this service, on which increased demands are continually being made; but nothing less than £500,000 will be really adequate.' 17 This figure may be compared with the one established in 1 922 after economies were made following the First World War. In 191 9 the 1920 estimates for the SIS were reduced from £240,000 to£i 25,000. In 1920 the Foreign Office, under Treasury pressure, proposed to reduce this sum again, from £1 25,000 to £65,000. In view of objections to any further reduction from Mr Churchill, Secretary of State for War, on behalf of the General Staff, the Secret Service Committee, originally a ministerial committee under the chairmanship of the Foreign Secretary, was revived as a committee of officials under Sir Warren Fisher in 1 92 1 , when it fixed expenditure on the SIS at £100,000. In 1922 after further discussions in which the War Office countered a reduction to £65,000 with a demand for
£
1 50,000, the Secret Service Committee set the figure at £90, 000. 18 For later years no figures are available; the Secret Service Committee was reconvened in 1925 and 1 93 1 but finance is not mentioned in the surviving records of these later meetings. The Defence Policy and Requirements Committee accepted the recommendation of the DRC in principle at the end of January 1936, thus authorising the Treasury to allow for an increase in the secret vote in its estimates for the coming financial year. Cabinet approval
16. CAB 4/24, CID 1 21 5B of 2 March 1936, enclosure No 2, Vols I and II. 17. ibid, Vol I, para 106. 18. Unregistered Papers in Cabinet Office Archive. A copy of some of these papers is to be found in the Lloyd George Papers in the House of Lords Library.


The State of Intelligence up to September igjg 51
followed at the end of February. 19 But the Committee had accepted that it would be impossible to grant so large a sum as £500,000 immediately and, apart from the fact that the Cabinet and its committees do not appear to have discussed the subject again before the outbreak of war, the complaints of the CSS make it clear that, whatever increases he did receive, he regarded them as quite inadequate. At the height of the Abyssinian crisis in 1935 the CSS had warned that financial stringency had long ago forced the SIS to abandon its activities in several countries which would have been good bases for obtaining information about Italy; and he had complained at the same time that the SIS's total budget had been so reduced that it equalled only the normal cost of maintaining one destroyer in Home Waters. After the German occupation of the Rhineland in the spring of 1936 he attempted to get more funds than the Cabinet had approved in the previous February, or to get funds more quickly, but he met with so little success that the SIS 'had to depend more and more on French information' about Germany. During 1938, following the Anschluss of Austria, he secured some increase. But financial stringency returned after the Munich crisis in the autumn of that year. The gravest effects of this stringency were encountered, without doubt, only when war broke out. The SIS had then to establish reporting systems and stay-behind networks in Europe in haste, and in difficult conditions, because the work had previously been impossible for lack of money.* At GC and CS, in the same way, work was impeded at the outbreak of war, and for some time afterwards, by the lack of pre-war preparations.! There was a desperate shortage of receivers for wireless interception, notwithstanding the fact that it had issued frequent warnings on this subject since 1 932, while the staff was for some time less familiar than it might have been with the military communications systems of Germany and potential enemy states because by no means all the available military traffic of these states had been intercepted in recent years and even less of it had been closely studied. More immediately, for their bearing on the state of intelligence in the pre-war years, the direct consequences of the shortage of funds were less serious than the fact that the shortage accentuated the other limitations facing GC and CS and the SIS.
* There is no evidence that, as has sometimes been claimed, 20 a ban was placed on SIS activities in Italian territories before the war.
t GC and CS was borne on the Foreign Office Vote, and not on the Secret Service vote like the SIS, and we have traced no record of what was spent on it, or asked for on its behalf, before the war.
19. CAB 4/24, CID 1 2 1 5B of 2 March 1 936, covering note and enclosure No 1 , para
51; CAB 16/123, DPR ( DR ) 9 th Meeting, 31 January 1936.
20. Major General I S O Playfair, The Mediterranean and the Middle East, Vol 1
,
(1956), p. 9; CAB 79/6, COS (40) 255th Meeting, 8 August.


5 2 . The State of Intelligence up to September ig$g
For some years after its establishment the staff of GC and CS and the interception resources provided for it, limited though they were, were not inadequate for the amount of work available. As a result of the phasing out of military activities and the extension of land-lines, the armed forces of foreign states made little use of wireless after the early 1920s. Until the early 1930s, moreover, most military wireless transmissions were in plain language, which in London, though not at the Sigint establishments overseas, was regarded as being of little value for intelligence purposes, and used medium frequencies which were not easily intercepted over long distances. The German armed forces were exceptional in regularly transmitting encvphered signals on stand-by wireless links for practice purposes; and it was far more difficult to intercept their signals in the United Kingdom or at British intercept stations in the Middle East than at stations in, for example, Poland and Czechoslovakia. Until 1935, for these reasons, GC and CS judged that none of the military traffic that it could decypher was worth circulating to the intelligence branches in the Service departments in Whitehall. At the same time, its research on the diplomatic cyphers of the important foreign states was yielding no results. Perhaps as a result of the notoriety gained by the decryption of the Zimmermann telegram in the First World War, those of Germany remained unreadable in the inter-war years, and those of Russia - without doubt in consequence of revelations made in the House of Commons after the Arcos raid 21 - had become unreadable after 1927. From the mid- 1930s, as a result of the introduction of high frequencies for wireless, and still more in consequence of the acceleration of military preparations and the resumption of military operations, more and more encyphered military traffic was intercepted. And GC and CS by no means neglected the increased opportunities thus offered to it. Some of its Service sections received additional staff; the Italian sub-section of the Naval Section grew from 5 in 1934 to 18 by September 1937 and the Japanese sub-section
was also expanded. The ablest cryptanalysts at GC and CS applied themselves to military cyphers. They did so to some purpose despite the fact that more sophisticated cyphers were being introduced, so that the most difficult cyphers of the First World War would have barely qualified for inclusion among the medium-grade cyphers that were now being used by the important states. By 1 93 5 GC and CS had broken the chief army and naval cyphers of Japan and some of the high-grade cyphers used by the Italian Services and colonial authorities and was beginning to make progress with Italy's diplomatic cyphers.* The resulting intelligence threw useful light on Italy's intentions before
* See Chapter 6, pp 199-200.
2
1 . Hansard Parliamentary Debates Vol 206, Cols 1 842-1 854, 2 195-2310; Cmd 2874 (i9 2 7)


The State of Intelligence up to September ig$g 53
and during the Abyssinian crisis and the Spanish Civil War; and in the third report of the DRC and subsequent strategic appreciations it guided the estimates made for the Chiefs of Staff of the condition and whereabouts of the Japanese and Italian forces. 22 But by 1 937 the
contrast between these successes and GC and CS's lack of progress against German and Russian high-grade cyphers was becoming acute. And between 1937 and the outbreak of war in Europe, while the German and Russian cyphers remained impregnable, the Japanese cyphers also became unreadable. Japan introduced a new army cypher in 1937 which was not easily mastered. During 1 938 and 1939 she made greater changes, and it was not until September 1939 that, beginning
with the Fleet cypher, the new cyphers began to yield to GC and CS's
attack.* There was, of course, some increase of Sigint about the Russian and German armed forces from the early 1930s. From Russia sufficient
military wireless traffic was intercepted from 1932 to justify the recruitment of two cryptanalysts; they made some advance against low-grade codes. With Germany's low-grade codes progress was made from 1934, when the regular interception of German military signals was undertaken for the first time in 1 5 years. The German Air Force produced a large amount of tactical traffic in the course of training; some of this was readily exploitable and from 1 93 5 , in conjunction with Traffic Analysis, it greatly eased the task of estimating the current operational strength and the dispositions of Germany's bomber and reconnaissance units. It had firmly identified 60 ground stations and 578 individual aircraft by September of that year, and although this kind of information by no means removed uncertainty about the further growth of the GAF, it remained the best source on that subject when the other sources were providing conflicting and only tentative assessments. Exploitation of the German Navy's use of call-signs made it possible to establish the number and, with the assistance of DF, the movements of its U-boats and surface units. But the Germany Navy made virtually no use of medium and low-grade codes, and for lack of traffic the medium and low-grade codes of the German Army remained as unreadable as did Germany's high-grade military cyphers. About those more was known than about Russia's. By 1937 it was established that, unlike their Japanese and Italian counterparts, the German Army, the German Navy and probably the Air Force, together with other state organisations like the railways and
* However, some Japanese Sigint continued to be available because of the familiarity with Japan's communications systems that had been built up over the years. It remained possible, for example, to keep track of her main naval movements.
22. For various detailed papers on the Japanese Navy see FO 3 7 1 / 1 7600,
A8313/1938/45; ADM 1/9587, 9589, 9649, 9713; and Wells, op cit, pp 253-254, 320-321.


54 The State of Intelligence up to September ig$g
the SS, used, for all except their tactical communications, different versions of the same cypher system - the Enigma machine which had been put on the market in* the 1920s but which the Germans had rendered more secure by progressive modifications. In 1937 GC and CS broke into the less modified and less secure model of this machine that was being used by the Germans, the Italians and the Spanish nationalist forces. But apart from this the Enigma still resisted attack, and it seemed likely that it would continue to do so. As late as July 1 939, before receiving invaluable information about it from the Poles,
who had been having some success with it for several years, GC and CS could hold out little hope of mastering it even in the event of war.* There need be no doubt that obstacles of a technical nature go far to account for the lack of progress. On the one hand, the modifications the Germans added to the Enigma machine during the 1 930s were making it an instrument for cyphers far more secure than those of Italy and Japan - and so much so that by 1938 the Germans had virtually brought the success of the Polish cryptanalysts to a close and had themselves become confident that the Enigma would be impregnable even in war conditions. On the other hand, even the most sophisticated cypher is liable to become more vulnerable if heavily used on interceptable communications; and whereas Italy and Japan, with their involvement in military operations across extended lines of communication, were at last producing enough military wireless traffic to enable the cryptanalysts to make progress, the German armed forces, like the Russian, were either less active or were operating on interior lines of communication and thus resorting far less to wireless. But when this has been said it remains unfortunate that despite the
growing effort applied at GC and CS to military work after 1936, so little attention was devoted to the German problem. The volume of German wireless transmissions, in Enigma as well as in the GAF's lower-grade codes, was increasing; it was steadily becoming less difficult to intercept them at British stations; yet even in 1939, for lack of sets and operators, by no means all German Service communications were being intercepted. Nor was all intercepted traffic being studied. Until 1937-38 no addition was made to the civilian staff as opposed to the service personnel at GC and CS; and because of the continuing shortage of German intercepts, the eight graduates then recruited were largely absorbed by the same growing burden of Japanese and Italian work that had led to the expansion of the Service sections. Although plans were made to take on some 60 more cryptanalysts in the event of war, there was no further addition to staff before the summer of 1 939 apart from the temporary
call-up of some of the 'hostilities only' staff during the Munich crisis. Thus almost down to the outbreak of war, when GC and CS's
* See above, pp 47-48.


The State of Intelligence up to September ig$g 55
emergency in-take quadrupled the cryptanalytical staff of the Service sections and nearly doubled the total cryptanalytical staff, work on Germany's Service cyphers was all but confined to the small group which, headed by civilians and working on behalf of all three Services, struggled with the Enigma. The naval sub-section of the German Section, which was started with one officer and a clerk as late as May 1938, still had no cryptanalysts. Since virtually no military traffic was intercepted except during summer exercises, the only regular work by cryptanalysts in the army sub-section was on police traffic. In the air sub-section the communications of the GAF were being studied by only a handful of people.
Had more German Sigint been available, it might still have failed to illuminate the darkening scene. At least in peace-time, governments are neither inclined nor forced to refer to the highest secrets of state in their signals communications. The German authorities were taking drastic security precautions. The intelligence branches in Whitehall were as yet unpractised in the art of inferring plans and intentions from the evidence of Sigint which, if always incontestable, is also always incomplete. However that may be, the almost total lack of German military Sigint, together with GC and CS's inability to read Germany's diplomatic cyphers, added to the already considerable difficulties of the SIS. At a time when the embassies and the other overt sources were issuing conflicting warnings and rumours about Germany's intentions, when warnings and rumours that were equally conflicting and equally difficult to substantiate formed the staple content of the diplomatic cyphers that were being read, and when little or no intelligence about such things as Germany's military strength and development was coming from these sources, the fact that the Whitehall departments had no reliable intelligence on these subjects from Sigint induced them to put mounting pressure on the SIS. In the absence of the Sigint check, on the other hand, they found it no less difficult to distinguish what was reliable and what was dubious in the reports circulated by the SIS, and their mounting pressure was accompanied by mounting
criticism. By the beginning of 1 938 the War Office was regularly complaining that the SIS was failing to meet its increasingly urgent need for factual information about Germany's military capacities, equipment, preparations and movements, while in that year the Air Ministry, somewhat better placed up to then as a result of the receipt of useful SIS reports and of the existence of low-grade Sigint about the GAF, dismissed SIS intelligence of this kind as being 'normally 80% inaccurate'. And both departments believed that the SIS was failing in what they judged to be its main task because its limited resources were being too much diverted to, or distracted by, the collection and


56 The State of Intelligence up to September ig$g
distribution of political speculation about Germany's immediate intentions. By February 1939, however, the Foreign Office was also disenchanted with the SIS's* performance, and so much so that Sir Alexander Cadogan, the Permanent Under-Secretary, felt it necessary to issue a minute in defence of it. ' Our agents ', he wrote, ' are of course bound to report rumours or items of information which come into their possession; they exercise a certain amount of discrimination themselves, but naturally do not take the responsibility of too much selection and it is our job here to weigh up the information which we receive and try to draw more or less reasonable conclusions from it. In that we may fail and if so it is our fault, but I do not think it is fair to blame the SIS. Moreover' - and here he was referring to reports received from the embassies as well as from Vansittart's private detective agency -* ' it is true to say that the recent scares have not originated principally with the SIS agents in Germany, but have come to us from other sources'. 23 There was some substance, naturally, in the departmental criticisms. In July 1938, defending his organisation against the Service complaints, the CSS admitted that except on naval construction, where it was excellent, the SIS's intelligence on military and industrial matters was at best fair; he also recognised that its political reports contained too much propaganda, both from Nazi sources and from the opposition groups in Germany. On this account, instead of circulating all political reports, the SIS in the immediate pre-war years was eliminating all items that were obviously of doubtful credibility. But in the attempt to use its discretion it ran the risk of introducing bias into the selection from the reports. Moreover, while the SIS received too little guidance from the Service departments in the form of requests for precise intelligence or direct questions about the SIS reports they had received on military matters, it was under increasing pressure from the Foreign Office to obtain as much political intelligence as possible, even on such matters as whether the German opposition groups could form an alternative German government. 24 1
Nor, finally, did the criticisms sufficiently allow for the fact that, although in some ways the SIS found it more and more difficult to
get reliable intelligence, or to get it in good time, this was because its organisation in Europe sustained a series of severe blows as the international situation became more bleak.
* See above, pp 47-48.
t Various references to the activities of the SIS in relation to this subject occur in documents that have been opened to the public, and they have evoked suspicions which call for a brief commentary. The SIS's search for information as to the likelihood of a revolt in Germany widened in the spring of 1939, at his request, into preliminary discussions with a
23. Aster, op cit, pp 53-54, quoting from FO 800/270, 39/9; letter from Cadogan to
Neville Henderson. 24. CAB 27/624, FP (36) 35th and 36th Meetings, 23 and 26 January 1939


The State of Intelligence up to September ig$g 57
Having suffered one serious setback when the German entry into Austria in the spring of 1 938 led to the arrest of the head of its Vienna station, it suffered another when the German seizure of Prague in the spring of 1939 brought about the collapse of its organisation
in Czechoslovakia. Earlier still - though it remained unaware of this development until its representatives at The Hague were captured at Venlo - its organisation in Holland had been penetrated by German counter-intelligence since 1935. To make matters worse, the SIS was unable before 1939 to begin issuing W/T sets to its agents in the field even though events emphasised the need for faster communications. During the Munich crisis, for example, intelligence from some of its sources in Germany was cut off or greatly delayed by the closure of the German-Danish frontier. Despite the difficulties, however, the SIS's performance was im
German emissary about the conditions on which the British government might recognise and support the German resistance if it attempted to establish an alternative German government. These discussions became detailed only after the outbreak of war. Transferred to Holland, they culminated in the capture at Venlo, on the Dutch-German border, on 9 November 1939 of two of the SIS's representatives at The Hague; the German emissary was a German security official. On the basis of documents in the PRO and other open archives, it has been claimed that in these discussions the Prime Minister 'used the SIS to investigate the possibility of a compromise peace with Germany in ... an operation which was concealed from the majority of his colleagues' and that 'it was only because the affair ended dramatically with the kidnapping of two British agents from Holland that this episode became known at all. . .'25 Such opened documents as we have seen do not justify these claims. They show that the discussions, though carried out through the SIS, were authorised and supervised by the Foreign Office; that on 24 October 1939 the Foreign Office obtained the approval of the Prime Minister for the reply to a request for a statement of the British conditions; that when this statement prompted a further German request for elaboration the Prime Minister put the matter before the War Cabinet on 1 November; and that it was after consultation with other ministers following this meeting that the Prime Minister and the Foreign Secretary on 6 November authorised the terms of a further statement to the German emissary and that, expressing considerable doubt as to whether the German approach would lead to anything or was even genuine, the Foreign Secretary on 7
November told the French Ambassador what was taking place. Although the documents suggest that in the discussions with their colleagues from 1 November the Prime Minister and the Foreign Secretary were embarrassed by the fact that they had not reported the earlier stages of the negotiations to the Cabinet, they also suggest that the reason for this omission was not their wish to negotiate without the knowledge of the Cabinet but their scepticism as to whether anything would come out of the German request for detailed negotiations. 26 Certain Foreign Office files referring to this episode have not been released. They are closed till the year 2015 on the grounds mentioned in our Preface: they contain
references to technical matters and to individuals. We have been allowed to consult these files in accordance with the terms outlined in the Preface. In our opinion they contain nothing to modify the conclusions we have reached on the basis of the opened documents about the relationship between the SIS and the Prime Minister and between the Prime Minister and the rest of the Cabinet.
25. Letter from Dr C MacDonald, The Times, 1 December 1977.
26. Dilks (ed), op cit, pp 226, 228-230; CAB 65/4, WM (39) 67 CA, 1 November;
Neville Chamberlain Papers (Birmingham University Library), NC 8/29/1-4 of 30 October, 7 November and 16 November 1939.


58 The State of Intelligence up to September ig$g
proving in some ways during the 1 8 months before the outbreak of war. Although Whitehall had been more than half expecting the German occupation of the "Rhineland in 1936 and of Austria in the spring of 1 938, the SIS, like the embassies and the other overt sources, gave no advance warning of these moves. Before and during the Munich crisis, the German entry into Prague and the attack on Poland, in contrast, it provided plentiful intelligence; about Germany's plans. The main reason why it was able to do this lay with the German moves themselves. Especially after the Anschluss with Austria in March 1938, these were creating the circumstances in which it is possible to recruit the best, and perhaps the only good, agents - those who from positions of responsibility volunteer their services from opposition to some policies or principles of government, or from devotion to others, rather than for money. One such informant, who was to continue to supply the SIS with first-class political and military intelligence during the first two years of the war, was a high-ranking officer in the Abwehr, the German military intelligence agency, who approached the Czech intelligence service in February 1936. Between then and the outbreak of war, indirectly through the Czechs at first, directly when he was exploited jointly by the SIS and the exiled Czech intelligence service in London after the German occupation of Prague in the spring of 1939, this man, Paul Thummel, known to the Czechs as A-54, supplied not only excellent information about Germany's order of battle and mobilisation plans, and some information about the equipment of the German Army and Air Force,27 but also advance notice of Germany's plans for intervention in the Sudetenland from the summer of 1937, for action against Czechoslovakia from the spring of 1 938, for the seizure of Prague in the spring of 1 939 and, from the spring of 1939, for the attack on Poland. 28 * From as early as 1936 informants of the same kind established contact with MI5. From one such source Whitehall obtained during the Munich crisis the schedules of Germany's original mobilisation plans and, as they arose, the alterations the Germans made to them. Men in similar positions offered their services to the French intelligence authorities29 and no doubt to others also.
* As there will be speculation on this subject we may say that insofar as the British records are any guide A-54 was the sole Abwehr officer who collaborated directly with the Allied intelligence organisations. As will be mentioned later in the text General Oster, the second in command of the Abwehr who was also a member of the German resistance, confined himself to giving last-minute warnings to various authorities on the continent of impending German attacks, see Chapter 3, pp 113, 114, 117, Chapter 4, p 1 35.
27. C. Amort and I M Jedlica, The Canaris File (1970), pp. 1 1, 23; F. Moravec, Master of Spies (197 5), pp 77-87.
28. Dilks (ed) op cit, pp 1 55-1 56, 1 58; Moravec, op cit, pp 1 23-1 31,1 50-1 5 1
,
182-183; Amort and Jedlica, op cit, pp 24, 26-41. 29. P. Paillole, Services Speciaux, pp 107-108, 115, 117, 147, 152-153.


The State of Intelligence up to September igjg 59
As was to be expected of informants as well placed as these, their
information was as reliable as it was detailed. But it is clear from
historical analyses of the pre-war crises that, as with the increasingly frequent and increasingly alarming reports coming in from the embassies, the attaches and Whitehall's various unofficial informants, so with those reaching the SIS, it was no easy task to distinguish reliable information from alarmist warnings or even from the spurious rumours that were being circulated by the German authorities. 30 More than that, it is equally clear from these analyses that, as the international scene became more critical, the over-riding problem in Whitehall was ceasing to be that of knowing what the German government intended to do next and was becoming that of deciding whether and how the British government should act, and thus of calculating how Hitler would respond to whatever the British government might do. On Hitler's intentions there was no lack of
intelligence, even if it was not all reliable. As to what Hitler would do if other governments moved to check or deflect his expansionist plans, no agent, however well placed, could provide the answer, or could be believed if he professed to do so, for not even Hitler and his immediate entourage knew what the answer would be.
Whitehall's uncertainty as to how Hitler would react to such steps as might be initiated by other governments - an uncertainty that could not be reduced by obtaining advance information about his state of mind from political and military indications - was all the greater because Whitehall was confronted by difficult problems in assessing the state of the German economy. In a situation in which Hitler's intentions were clearly disruptive but his determination to pursue them could only be guessed at, it would at least have been helpful to know whether or not he would be restrained by economic considerations. This, too, however, was a matter on which Whitehall was in no position to make a judgement. It had established an inter
departmental body for collecting and assessing intelligence on the economies of foreign states, especially Germany. But this organisation, which in any case did not claim that political and military implications could be deduced from economic analysis, recognised that such an exercise would be especially unprofitable in relation to Germany. Even at the elementary level, despite its long experience in the routine work of collecting the facts about the economies of foreign states, the organisation found it no easy task to calculate the capacity and limitations of Germany's economy. This task was in any case difficult because the factual evidence was
30. Aster, op cit; Middlemass, op cit: Dilks (ed), op cit.


60 The State of Intelligence up to September ig^g
incomplete. The German government, secretive about the economic information which democratic governments customarily made public, did not even publish an annual Budget after 1935, and to seek this type of information by intelligence operations was out of the question in view of the higher priority of military and political intelligence. To make matters still more difficult, by the standards of the democratic nations with market economies the German economy under the Nazi dictatorship presented unorthodox characteristics that were open to a variety of interpretation. While there could be no doubt that the economy was geared to massive rearmament and other war preparations, the degree to which resources had been mobilised for that purpose and the true costs of these preparations for the German people were very difficult to estimate. Outward signs of strain were evident in the balance of payments difficulties which marked the years immediately before 1 939; full employment seemed to leave little room for further expansion of industrial output; large imports of raw materials were clearly essential if the momentum of rearmament was to be maintained. On the other hand, the civilian standard of life was reasonably well maintained and capital expenditure on civil projects continued on a very large scale. How long the economic policy of ' guns and butter' could be prolonged, especially if Hitler were to plunge the country into a major war, was a matter for debate. In this situation intelligence faced two principal problems. One was to determine the actual level of armaments production and the scale and type of equipment being provided for the German armed forces. The second was to assess the condition of the economy as a whole, its manpower, food supplies, and raw material and fuel resources, and from readings of these basic facts to draw conclusions about Germany's capacity to sustain her military strength in war and her vulnerability to economic pressure exerted by her enemies. None of the German armed services was of greater concern to the British government than the Air Force. The German aircraft industry was therefore the object of intense study by the Industrial Intelligence Centre (IIC) and the Air Ministry, who collaborated in producing twelve reports upon it between March 1 934 and July 1 939 which, after scrutiny by the Industrial Intelligence in Foreign Countries SubCommittee (FCI), were submitted to the CID. 31 Observation of individual factories and, especially, the size and composition of their labour forces provided the basis in these reports for statistical
3
1 . CAB 4/22, CID 1 1 34B of 22 March 1 934; CAB 4/23, CID 1 1 5 1 B of 5 November
1934, CID 1 1 72B of April 1935, CID 1 186B of 9 September 1935; CAB 4/24, CID
1218B of 9 March 1936, CID 1250B of 22 July 1936; CAB 4/25, CID 1284B of 30
November 1936; CAB 4/26, CID 1339B of 7 July 1937; CAB 4/27, CID 1407B of 4
March 1938; CAB 4/28, CID 1472B of 15 August 1938; CAB 4/29, CID 1541B of 20
March 1939; CAB 4/30, CID 1569B of 24 July 1939.


The State of Intelligence up to September ig^g 61
calculations of the current output of air frames and engines. Until 1 938
access to the German aircraft industry by British aeronautical engineers was comparatively easy and they were the principal source
of information; it is significant that visits by British observers to German factories, the first by an Air Ministry mission in May 1 936 and the second by Mr Roy Fedden of the Bristol Aeroplane Company in the summer of 1937, are recorded as major sources of intelligence used in correcting estimates based on other material. The other sources were the SIS and the energetic Air Attache in Berlin, who used his
own plane to observe factories and GAF installations from the
air. 32
Using this type of source material the IIC and the Air Ministry drew an intelligence picture of the aircraft industry which took account of special features such as the shortage of engines which occurred before 1 935, the systems used in manufacturing components and assembling planes, the number of shifts being worked, hours of work and plar reorganisation. The intelligence was sufficiently sensitive to de^ct periods of stagnation in the growth-rate in mid- 1936 and in 1938-39 and sufficiently accurate to permit estimates of the output of complete
'military-type' aircraft (including trainers), at 550 a month in 1938 and 725-750 a month in mid-1939, which were only slightly above the figures of actual output. By the autumn of 1 939 output was in fact 700
aircraft a month. 33 Reliance upon the size and utilization of the labour force as the chief factor in calculating the output of the industry was, however, to be a contributory cause of British over-estimates of the output of German aircraft in 1 940 and 1 94 1 . The estimates for mid-July 1939, which were so nearly accurate, assumed that at that time the industry was working upon a one-shift system, but the IIC and the Air Ministry also calculated that, in an 'emergency', output could be increased to 1 ,500 planes a month if three shifts and a seven-day week were to be introduced. Without an intimate knowledge of German intentions and of the internal problems of the industry there was a natural tendency in Britain to make a 'worst case' assumption that German output would move towards its estimated full potential of 1,500 planes a month after the outbreak of war. The German authorities in fact planned to produce 2,000 planes a month at the outbreak of war, but actual output fell far short of this, partly because planning and managerial shortcomings in the industry hampered its performance. By December 1940 actual output reached only 779
planes a month. 34
32. CAB 23/87, Cab 5 (37) of 3 February and Cab 9 (37) of 24 February; CAB
24/268, CP 69 (37) of 20 February (Air Vice Marshal Courtney's Mission of May
1936); CAB 16/182, DP (P) 7 of 16 July 1937 (Fedden report).
33. AIR 41/10, The Rise and Fall of the German Air Force (1948), p 19.
34. A S Milward, The German Economy at War (1965), p 137.


62 The State of Intelligence up to September ig$g
The difficulty of calculating the exact state of the industries producing weapons and munitions for the army was more acute, since production was dispersed bver many sectors of industry and the number of factories was enormously greater. Estimates of arms production in this field, made jointly by the IIC and the War Office,35 differed from the reports in the aircraft industry series in not setting out the basic factory information on which the global estimates were based, and they did not break down those estimates to give, for example, the number of tanks produced. The last assessment before the war, in July 1939, 36 estimated that Germany had available for immediate mobilisation a total of 120-130 divisions, of which about two-thirds would be fully armed and equipped in the most modern fashion, and that the delivery of arms and equipment was proceeding at a rate sufficient to arm 16-17 new divisions per annum. However the calculations were made, their effect was to over-estimate the number of tanks produced for the German Army before the war. In September 1939 the War Office believed that the Germans possessed 5,000 tanks of which 1,400 were medium and 3,600 were light. 37 German Army records show that the total German stock in September 1939 was 3,000 tanks, of which 300 were medium and the remainder light (including 1 ,500 Pzkw I). 38 Of the armaments industry the report of July 1 939 said that ' in spite of the continued demands made upon industry by naval and air construction, the export market, the Four Year Plan... and other special activities . . . the average rate of output of armaments for the German Army ... is slightly greater than in 1 938 .... At the same time the continued intensification of production, the resulting shortage of really skilled labour and the extended use of substitutes has led to a noticeable decrease in the quality of German industry which extends to the armament industry'. 39 Here, in contrast to the aircraft industry, the assessment depicted an industry already very fully extended. No attempt was made to forecast its maximum capacity, and it would almost certainly have been impossible to do so. Pre-war estimates of U-boat production were based upon the numbers of U-boats observed to be in service with the German Navy, on SIS reports and on deductions from the German performance in building U-boats in the First World War. Under the terms of the Anglo-German Naval Treaty of 1935 Germany was allowed to build
35. CAB 4/23, CID 1 152B of 5 November 1934; CAB 4/25, CID 1303B of 4
February 1937; CAB 4/26, CID 1345B of 26 July 1937; CAB 4/27, CID 1421B of 22
April 1938; CAB 4/28, CID 1449B of 21 July 1938; CAB 4/29, CID 1507B of 19
January 1939; CAB 4/30, CID 1571B of 24 July 1939.
36. CAB 4/30, CID 1 57 1 B of 24 July 1939.
37. WO 190/891, MI 14 Appreciation No 27 of 20 February 1940.
38. US Strategic Bombing Survey, The Effects of Strategic Bombing on the German War Economy (Synoptic volume 1945), pp 163-165.
39. CAB 4/30, CID 1 57 1 B of 24 July 1939.


The State of Intelligence up to September ig$g 63
up to 57 U-boats. The Admiralty's own 'count' of U-boats appeared to confirm that this was the number actually completed on the eve of the war, but from the autumn of 1938 onwards SIS had been reporting that Germany had built more U-boats than allowed by the Treaty and that some were already operating in the south Atlantic. Unable to prove or disprove the truth of these reports NID reluctantly accepted them and taking a worst case assumption estimated that by September 1939 the German Navy had 66 U-boats. The fact that the total was 57 at the outbreak of war was not finally established by NID until April 1940.* 40 Using their knowledge of the number of boats on the stocks in the summer of 1939 and drawing comparisons with the first 14 months
of the First World War, NID forecast in September 1 939 that by March 1940 129 vessels (including the pre-war total) would have been completed. This assumed an average production rate of about 10 per month for the period and also assumed that Germany would achieve 'full mass production' by November 1939. 41 It was later to be proved that these assumptions were unduly pessimistic. In fact only 63 were completed by March 1940, though plans of course existed for an expanded output. As in the case of the forecasts of aircraft production made by the IIC and the Air Ministry, the assumption made by NID that the Germans would immediately move to the maximum production of which they were capable on the outbreak of war was mistaken. The error was due not so much to 'economic' miscalcula
tions as to ignorance of Hitler's intentions and of his concept of the
'economics of Blitzkrieg \f In the attempt to assess Germany's capacity and readiness for war these specialised calculations about her armaments industries had to be supplemented by a prolonged study of her vulnerability to economic pressure. On behalf of the Sub-Committee on Economic Pressure on Germany (EPG), the IIC undertook this work in a series of memoranda, initiated in July 1937, on Germany's probable economic situation in 1939. 42 As the work proceeded the IIC brought in the intelligence branches of the Service ministries, 43 the Food (Defence Plans) Department, the Board of Trade44 and other departments to help it with its calculations. From the outset the IIC considered that Germany's difficult external financial situation would not prevent her from waging a war of short duration,45 and
* See below, Chapter 7, p 231. t See below, p 68. 40. Memoirs of Admiral Godfrey, Vol 5, Part 2, Chapter XXXIII, 'Truth, Reality and Publicity'.
41. ADM 233/84, NID 01449/39 of 29 September 1939.
42. CAB 47/13, ATB (EPG) 2 of 5 July 1937.
43. Especially CAB 47/13, ATB (EPG) 5 of 10 October 1937.
44. eg, CAB 47/14, ATB (EPG) 34 of 16 July 1938.
45. CAB 47/13, ATB (EPG) 2 of 5 July 1937.


64 The State of Intelligence up to September ig$g
consideration of the financial situation played little part in later EPG appreciations. Attempts to assess the German manpower situation were soon abandoned, almost certainly because the problem was too complex and the results too speculative.* Thus the appreciations were concerned mainly with the position in food, raw materials and fuel, and were largely based on published figures inadequately supported by reliable high-grade intelligence. v The last appreciation of this type to appear before the war was prepared by the IIC for the Advisory Committee on Trade (ATB) in May 1 939. 47 It concluded that although the Four Year Plan of 1936 was reducing, and might further reduce, Germany's dependence upon imports of certain commodities, she could not yet have made herself 'indefinitely self-sufficient in all raw materials and foodstuffs'. On the
basis of statistics of German imports in 1936 and 1 93 7, qualified by what
was known of the stock position, the IIC identified a large number of deficiency commodities. t It noted that for the first year of a war beginning in 1939 Germany, 'failing large reserves', would have to import 9-10 million tons of iron ore from Sweden. Given suitable political arrangements manganese could be imported from the USSR. The supply of non-ferrous metals would probably suffice for six months, after which a shortage would develop, led by copper. Germany was in a strong position as regards aluminium, zinc and lead, and Yugoslavia might be a most valuable potential source of supply of several non-ferrous metals. Romania was the sole source from which the minimum import requirement of 3 ^2-4 V2 million tons of petroleum and its products in the first year of war could be met. The German government claimed four-fifths self-sufficiency in foodstuffs but supplies of edible oils and fat, of which 40 per cent were imported by sea, were vulnerable. It was clearly impossible to estimate precisely the size of the deficiencies in any one commodity in a year of war without knowing the size of existing stocks and what proportion of imports could be cut off by blockade and other measures of economic warfare. About the size of stocks there was little information, although it was known that the level had been considerably raised during 1938 and that the process was continuing. Germany's objective was believed to be to
create stocks equivalent to one year's peace-time requirements.
* Attempts were made elsewhere, mainly in the War Office, to assess the manpower situation, but the JIC was unable to reconcile the different assessments. 46 t Food and feeding stuffs (cereals, fruit, fish, dairy products, oils and fats, coffee and cocoa). Other vegetable produce (tobacco, timber and rubber). Textile raw materials (cotton, wool, flax, hemp, jute, manila, sisal). Miscellaneous (hides and skins, leather, tanning materials). Minerals and metals (aluminium, asbestos, chrome, copper, iron, lead, manganese, nickel, phosphates, petroleum and products, pyrites, tin, zinc and certain ferro-alloys).
46. JIC 24 of 13 January 1937.
47. CAB 47/16, ATB 181 of 22 July 1938, Appendix I (revised 24 May 1939)


The State of Intelligence up to September ig$g 65
Reserves of foodstuffs, aluminium, certain ferro-alloys and aviation spirit were thought to have reached that level, while those of motor spirit and oils, other non-ferrous ores and metals were not thought to exceed six months' normal supplies. Reserves of iron ore were
thought to be insignificant. This appreciation did not follow up in detail the discussion on the size of petroleum stocks which had taken place in the EPG SubCommittee in 1 93 7. 48 It had then been estimated that commercial
storage capacity in Germany might be 2 V2 million tons and the state emergency reserve about another 1 million tons rising to 2 million tons in 1939. In circumstances most favourable to Germany, therefore, commercial and state reserves taken together would amount to a maximum of 4^2 million tons in 1939 and Germany would require to
import 2V2 million tons in the first year of war. When the situation was reviewed by the IIC on 24 May 1939 the minimum import
requirement was raised to 3 1/2-4 1/2 million tons. 49 On 1 June 1939 the IIC estimated that stocks amounted to something less than 3 million tons.* 50 The general conclusion reached by the IIC and accepted by the ATB Committee was that, as a result of the accumulation of stocks, reserves of food and certain raw materials had probably achieved the equivalent of one year's peace-time requirement. Assuming replenishment by land routes after the outbreak of war and the continuance of iron ore supplies from Sweden, Germany might be able to maintain her industrial activity without contraction for 1 5-18 months of war. 51 As well as resting on a good deal of guesswork about the size of stocks, this conclusion involved an assumption about the extent to which Allied economic warfare measures would deny to Germany her essential imports. When the ATB presented its plan for the exercise of economic pressure to the CID on 27 July 1938 52 Mr Walter Elliott,
Chairman of the ATB Committee, said that the crux of the problem lay in the fact that severe economic pressure could only be exercised through a system of rationing applicable to all neutral countries exporting to Germany. Whereas in the First World War there were only five, not particularly powerful, countries of this sort there were now nineteen to be taken into account, some of which might prove very troublesome. In discussion Sir Warren Fisher of the Treasury took the view that rationing was unlikely to be effective over the whole field. Access to Germany would probably always be available from the
* The actual balance according to German official figures was about 2.1 million tons.
48. CAB 47/13, ATB (EPG) 5 of 10 October 1937.
49. CAB 47/16, ATB 181, Appendix I (revised). 50. CAB/HIST/G/9/1/4, ICF 284 of 1 June 1939.
51. CAB 47/6, ATB 181, Appendix I (revised).
52. CAB 2/7, CID 331st Meeting of 27 July 1938.


66 . The State of Intelligence up to September ig$g
south-east and she would be able to bring in great quantities of supplies from that quarter, regardless of whether other neutrals were rationed. Although his criticisYn was directed primarily at the measures
proposed by the ATB Committee it implied Treasury doubts about the economic appreciation to which the proposed measures were related. The Treasury appears to have been less optimistic about weaknesses in the German economic situation than were either the ATB Committee or the IIC* Treasury views were taken into account during the preparation of the ATB Committee's report, but on the outbreak of war the Treasury ceased to be involved in the economic
intelligence system and its opinion played little or no part in the preparation of war-time assessments. The ATB Committee's conclusion that Germany might be able to sustain full industrial activity for 15-18 months implied that supply difficulties would begin to make themselves felt if the war was to continue for a longer period. At the outbreak of war in September 1 939 the implication was that German supply difficulties should begin to be apparent in the spring of 1 94 1 if the war lasted so long, and that they would thereafter be considerable. British assessments of the German economic situation made in the summer of 1 94 1 were to be considerably influenced by this pre-war assumption. But in 1939 the
IIC and the ATB Committee were under no illusions about the effect of the economic factor on German capabilities in a short war. It would hardly count at all. Their analysis of Germany's probable war-time supply position was not, of course, a comprehensive statement about the nature of the German economy on the eve of war. On this broad and speculative issue other opinions circulated in Whitehall, and while they sometimes conflicted, their general tendency was to strengthen a belief that manpower and resources had already been so fully mobilised as to leave comparatively little room for expansion of general industrial activity under war-time conditions. The most important defect in the evidence upon which this opinion of the German economy rested was not that factual economic information was lacking on many points, but a misunderstanding of Hitler's own conception of the nature of war and the relationship of the economy to it. Hitler was aware of the facts presented to him by his advisers about the limitations of material resources, which did not differ greatly from those appearing in British assessments, but he confidently believed that successful lightning war would provide the nation, at a minimum cost, with the material resources which it lacked. This being so, he believed that mobilisation of resources for war production need not exceed that required for short-term military operations carried out on Blitzkrieg principles, a degree of mobilisa
* See further below, pp 69-70.


The State of Intelligence up to September igjg 67
tion which would not involve economic hardship for the civilian population: indeed the maintenance of the best possible conditions for the nation as a whole under war-time conditions was regarded by Hitler and the Nazi Party as an important guarantee of popular support. Having ensured that by 1940 the economy would provide adequate support for the type of campaigns he envisaged, and having appointed Goering to oversee the Four Year Plan, he expected that the economy would thereafter be rapidly adjusted to his military requirements. Short periods of intense economic effort requiring rapid changes of priority within the war sector of the economy, but leaving the production of consumer goods largely unaffected, would be geared to rapid and successful military campaigns. 53 There is no sign in the available papers that Hitler's conception of the relationship between strategy and economics was understood in London on the eve of the war, although some of its symptoms were recognized in the reporting of the British embassy in Berlin. By 1936 the embassy's coverage of the German economy had become so extensive that its annual economic review appeared as a separate print. The three large economic annual reviews for 1936-38 singled out significant and paradoxical features of the German economy, showing that, within the framework of a stringent external financial situation, the Germans were making a frantic effort to produce steel and armaments, but at the same time continuing massive civilian construction, maintaining the output of consumer goods and keeping
the cost of living stable. Even so, the tenor of the reviews was to the effect that, so structured, the economy was being subjected to increasing strain. Reporting on the situation in 1936 the embassy considered that the home market was approaching a 'war-time' condition, inflation being avoided only by governmental stabilisation of wages and prices. The iron and steel industry was working at almost full capacity, in several other industries the industrial boom was exploiting all available capacity and there was an acute shortage of skilled labour. 54 In 1937 the salient features were the subservience of all economic considera
tions to Wehrwirtschaft: a substantial rise in industrial output (the level of production in particular industries being determined by the rationing of raw materials) and a marked shortage of skilled labour, involving a drive for the recruitment of apprentices. 55 The last pre-war review, covering 1 938 and dated 24 May 1 939, used dramatic language to describe the situation as it then appeared. Germany was heading with 'demoniac persistence' towards the goal of autarky and could not turn back. She must achieve the aims of the Four Year Plan or perish.
53. See B H. Klein, Germany's Preparations for War (Harvard 1959); A S Milward,
op cit; B A Carroll, Design for Total War, (Mouton 1968). 54. FO 371/20727, C3226/78/18 of 21 April 1937.
55. FO 371/21702, C3960/541/18 of 5 May 1938.


68 The State of Intelligence up to September ig$g
'Sooner or later further territorial expansion will be necessary'. The Chancellor was faced with a fatal dilemma: he must either accept a modification of the policy 6f autarky or go to war. The financial position in general had deteriorated and the government was experiencing difficulty in financing its plans. In no industry was the utilisation of labour capacity below 75 per cent and in the engineering and metals industries it was over 1 00 per cen.t (ie substantial overtime was being worked). 'The country is now practically at the limit of industrial production ' and some economy measures might have to be taken. 56 The embassy's assessments did not rely in any appreciable degree upon secret intelligence. The Press, published statistics (often defective), personal observations and off-the-record conversations seem to have been its principal sources. But the impression that Germany by early 1939 was not only suffering from serious economic difficulties, but was being driven by them towards war, was reinforced by secret reports containing substantial amounts of economic intelligence which the Foreign Secretary (Mr Eden until February 1938 and then Lord Halifax) submitted to the Foreign Policy Committee of the Cabinet (FPC) between April 1937 and January 1939. While some of these reports may have emanated from the SIS, it is clear that others, representing the views of German critics of Hitler's policies, came from the sources who were in contact with Sir Robert Vansittart and MI 5.* In April 1937 the Foreign Secretary informed the FPC that he had received a report ' from a very reliable source' concerning controversy in Germany about the pace of rearmament. Various departments of the German government had pointed to the wisdom of moderating the rate of expansion in view of the precariousness of the food and raw materials position.
t
57 Extracts from reports from 'highly confidential sources' were read to the committee in November 1938. One said that the German financial position was now 'absolutely desperate' and that Dr Schacht knew that financial chaos lay immediately ahead of Germany.?59 A paper on 'Possible German Intentions', taken by the committee in January 1939, 61 contained a
* See above, p 47 and below, p 80 et seq.
t The 'very reliable source' of this report cannot be identified. The substance of the report was generally true. In April 1937 Field Marshal Keitel was telling the Committee for Reich Defence of the strain upon economic resources induced by rearmament; in the same month Dr Schacht (President of the Reichsbank) was complaining to Goering that German exports were suffering as a result of the policies being pursued. 58 t The source of this report was probably Dr Carl Goerdeler. 60
56. FO 371/23002, C8149/32/18 of 24 May 1939.
57. CAB 27/626, FP (36) 26 of 14 April 1937. 58. Carroll, op cit, p 143.
59. CAB 27/624, FP (36) 32nd Meeting, 14 November 1938. 60. Aster, op cit, p 55.
61. CAB 27/627, FP (36) 74 of 19 January 1939.


The State of Intelligence up to September ig$g 69
number of references to secret reports, all predicting the onset of economic catastrophe in Germany. One, from a ' high and trustworthy' source, said that economic strain was causing increased unrest among the population. 'An excellent German source' reported that the German transport system was in a very bad way and that old men and women were being used in the armaments industry. Finally there was a report of a secret speech by Dr Brinckmann, 'technical head' of the Ministry of Economics, predicting imminent economic disaster. To this Hitler had reacted by saying: 'Very well, all this means that a vital decision must come at once, and it is coming at once'.* On 23 January 1939 63 the Foreign Secretary advised the FPC to proceed on the assumption that the information in this last paper was true. The recent dismissal of Dr Schacht supported the theory that the financial and economic condition of Germany was becoming desperate and 'compelling the mad dictator to insane adventures'. No member of the committee dissented from this opinion, which clearly influenced its judgment that Hitler might soon spring another coup. Since these reports originated in German circles close to Dr Schacht, among others, they inevitably reflected the opinion of financial experts upon Germany's problems, more especially the external ones. These were indeed severe in the years immediately before the war. But under a dictatorship preparing for war, as the IIC and the ATB had recognised, financial issues were not of long-term significance and were secondary in importance to the state of real resources available. Even had they been wholly correct the reports would still have presented a more 'catastrophic' picture of the German situation than was, in terms of real resources, actually the case, as a comparison with the IIC and ATB findings on the supply position would have demonstrated. But the reports were circulated to the Foreign Policy Committee only and do not appear to have been collated with the views of the IIC or the ATB on the German supply position. These two bodies were inter-departmental, but they constituted an incomplete inter-departmental system, one that was not designed to examine all economic intelligence - still less to speculate on such matters as the possible effects of the German economic situation upon Hitler's political moves, which remained the province of the Foreign Office.
On 3 July 1939 the Treasury issued a paper on 'The German Financial Effort for Rearmament', above the initials of Sir John Simon, Chancellor of the Exchequer, which put the financial aspects of the German situation in perspective. 64 Drawing attention to the fact that
* All this information, including the report of the speech by Dr Brinckmann and Hitler's reaction to it, clearly originated with Dr Carl Goerdeler. 62
62. Aster, op cit, pp 156-160.
63. CAB 27/624, FP (36) 35th Meeting, 23 January 1939.
64. CAB 24/287, CP 148 (39) of 3 July 1939.


7° The State of Intelligence up to September ig^g
no detailed statistics for state expenditure had been published for many years and that only incomplete figures for state borrowing were available, the paper concluded that Germany had an absolutely larger sum to spend on armaments than Britain mainly because far more was raised in taxation. She could probably maintain defence spending on this basis for a long period. The German government might be approaching the end of its borrowing powers, but German policy had been to acquire great stocks of imported necessities, to produce substitute materials and to establish political and economic power over adjacent territories. 'The question of the means of payment for overseas imports in war - an ever-present anxiety in our case scarcely arises in Germany'. The paper gave no definite answer to the question: how much longer could Germany go on with her present policy. But when the Cabinet discussed the paper on 5 July the Chancellor of the Exchequer said that in the Treasury's opinion Germany was better prepared for a long war than was Great Britain, whose prospects would be 'exceedingly grim' unless she obtained US loans and gifts on a massive scale. 65 In the absence of any central point in Whitehall at which all the threads of evidence could be drawn together in a single 'master' appreciation of the German economic situation, the IIC supplied the factual economic information for two attempts, one by the ATB Committee, the other by the Chiefs of Staff, to fill the gap. A report of the ATB Committee in July 1 938 s6 assumed a war beginning in April 1 939 in which Britain and the Empire, France and Czechoslovakia were ranged against Germany including Austria, with Italy liable io enter the war on Germany's side at any moment. On these assumptions four economic factors would be most prominent in the probable German situation. She would be able to supply many commodities essential in war only from stocks or imports, despite efforts to attain self-sufficiency. She would have an all-round minimum of stocks equivalent to 3-4 months' peace-time supplies, although for some commodities reserves were known to be greater. She would meet increasing difficulties in paying for imports as the war proceeded. And she would be critically dependent upon the products of the Ruhr-Rhineland-Saar districts. The second general economic appreciation was contained in the strategic assessment issued by the Chiefs of Staff in February 1939.* 67 This assumed that Germany, in alliance with Italy, would be fighting Great Britain allied to France; that the USA would be a friendly neutral; that the USSR would not intervene but that Japanese intervention on Germany's side had to be considered a possibility. On
* See below, p 80.
65. CAB 23/100, Cab 36 (39) of 5 July.
66. CAB 47/6, ATB 181 of 22 July 1938.
67. CAB 16/183A, DP(P) 44 of 20 February 1939.


The State of Intelligence up to September ig$g 7 1
these strategic assumptions the COS accepted that the evidence supported the following general conclusions about Germany's eco
nomic situation:
'The industrial strength of Germany may be assumed to be adequate to equip and maintain in war all the sea, land and air forces which she plans to put into the field and to maintain the essential services, provided that raw materials for these industries are available. Moreover, her mobilisation planning should enable her rapidly to expand production of war stores after the outbreak of war. . ..' 'Germany, if favoured by fortune, might maintain her industrial resistance for about a year.'* ' In April 1 939 the war preparations of Germany and Italy are likely to be considerably more advanced than those of Great Britain or France. We conclude that, if war occurred, our enemies would endeavour to exploit this preparedness by a rapid victory - within a few months; and that the Allies would have no means of winning quickly.' On the other hand: 'In the past it has been after the outbreak of war that a nation's industry has been adapted and expanded and her manpower organised. In Germany and Italy these processes are now being perfected in time of peace. It seems doubtful whether these processes can be achieved without a loss of hidden reserves which normally exist in time of peace, though it is difficult to assess the extent to which this may affect the lasting power of those nations in war.'t
Thus although assessments of Germany's economic position in the summer of 1939 did not disregard the advantages Germany had secured by making early preparations, they were influenced by a general belief that Germany was about to enter a war with her economy already fully stretched. The cumulative evidence pointed to
* A more optimistic view than that reached by the ATB Committee which had forecast 15-18 months (see above, p 65), but bearing a resemblance to the estimates
being made at that time in Germany. 68 t Contemporary academic writing on the German economy was sparse. The most systematic analysis to appear in Britain was an article on 'The National Economy of Germany' by Dr Thomas Balogh published in the Economic Journal in September 1938. Balogh concluded that the Nazi government had evolved a system which, if the available powers of control were ruthlessly and skilfully used, maintained stable employment; that the system was based on control of costs, investment and international trade and was stable in so far as it did not involve cumulative processes undermining the standard of life. In Balogh's view the real sacrifice imposed on the German people by rearmament and self-sufficiency was very much less than commonly supposed. The penultimate paragraph of the article ran as followed: 'The German picture exhibits the signs of an economy on a war footing using fully those reserves of moral and material character which in other countries are not usually mobilised before the beginning of hostilities. The use of these reserves has hitherto yielded impressive returns. It is questionable whether a further intensification would not have different results. The intense activity, the incentive for which lies beyond the material sphere, must imply an increasing strain on the people which will inevitably have its repercussions in the longer run. And if the stability of employment is safeguarded, the flexibility of the system is being impaired'.
68. Carroll, op cit, p 1 77.


72 The State of Intelligence up to September ig$g
the conclusion that Germany was suffering serious economic stress, in itself a powerful motive for immediate aggressive action by Hitler, and that unless aggressive war weVe to bring substantial gains in terms of economic resources within 12-18 months Germany must run into serious supply difficulties. The extent to which on the basis of her 1939 frontiers and without an enlarged 'Lebensraum' Germany could restructure her civil economy to meet the demands of protracted war remained unclear. On the assumptions made by the ATB Committee and the Chiefs of Staff their view of the current state of the German economy on the eve of war was not unrealistic. The principal assumptions on which their forecast rested were: (1 ) that 'the war' would be between Germany and Italy on one side and France and Britain and their allies on the other; (2) that German economic resources were equivalent to those of the Reich as it existed in the spring of 1 939, after making allowance for an Anglo-French blockade and the continuance of German imports from several European countries; (3) that the war was likely to be prolonged, since France and Britain could not win quickly; (4) that German war mobilisation plans had depleted the 'hidden reserves' of the economy although a rapid expansion of the production of war stores after the outbreak of war must be expected;* (5) that the supply of raw materials was the critical factor.
On these assumptions it was not unreasonable to depict the German economic situation as 'taut', a description which would have been accepted by many German economic administrators at the time. Only two of the assumptions upon which the assessment rested, however, were purely 'economic'. The first three were strategic and political and even the fourth concealed political and administrative problems in Germany which were not examined in depth by British intelligence before the war.f The fifth was narrow, reflecting the terms of reference upon which economic intelligence specialists had been working and anticipating the 'economic warfare' for which plans had been laid in London. After one year of war the military and strategic assumptions of these assessments were to be profoundly affected by the rapid German victories on land in western Europe, and the two principal economic
* The implications of this assumption were not fully thought out before the war. The evident conflict between the assumption that the German economy was already fully stretched while at the same time capable of immediately expanding the supply of armaments presented the newly formed intelligence division of the Ministry of Economic Warfare on the outbreak of war with a paradox which was to remain unresolved in the first eighteen months of war. t See Appendix 3 on German economic administration.


The State of Intelligence up to September ig$g 73
assumptions were themselves changed by the new strategic situation after the fall of France. None of this could have been foreseen in the spring of 1 939. In the first two years of war, the economic intelligence system was to be faced with the problem of adjusting the assessments inherited from the pre-war period to situations in which the pre-war assumptions were no longer valid.
For economic intelligence, even so, Whitehall had at least acknowledged the need for inter-departmental assessment. In relation to intelligence which bore on the military plans and political intentions of foreign states it not only lacked machinery for central assessment but also, until the spring of 1939, the minimum amount of unity of purpose and policy that was essential before any such machinery could be set up. This was especially the case between the Service departments and the Foreign Office, but also within the Service departments, within the Foreign Office and within the Cabinet itself, the division of opinion as to what British policy should be was marked. The need for such machinery had been partially recognised by 1 936 when, however imperfectly, it was met by the creation of the ISIC (later the JIC) in an effort to improve collaboration between the Service departments and between those departments and the Chiefs of Staff.* At that time, however, the fact that it was no less essential to improve collaboration between the Service departments and the Foreign Office, and to ensure that military and political intelligence were considered together in appreciations for the Cabinet or its committees, went unrecognised, or was even resisted. To have thought on these lines would have been to affront Whitehall's deeply entrenched belief about the respective responsibilities of the Foreign Office and the Service departments for advising the government - the belief that they should tender independent advice, provided that the Service departments confined their advice to the military sphere, and have their disagreements regulated only at the Cabinet level, in Cabinet committees or at the CID.t It was in accordance with these views that, also in 1936, in the aftermath of the Abyssinian crisis and the German occupation of the Rhineland, the Cabinet had established the Foreign Policy Committee. 69 Except when it was temporarily replaced by an even smaller inner Cabinet at critical junctures - by the Committee on the Situation in Czechoslovakia, for example, between September and November 1 938 - this committee of prominent ministers, which met under the chairmanship of the Prime Minister and included the
* See Chapter 1, p 35. f See Chapter 1 , p 6 et seq.
69. CAB 23/84, Cab 31 (36) of 29 April; CAB 23/85, Cab 51 (36) of 9 July.


74 The State of Intelligence up to September ig$g
Minister for the Co-ordination of Defence, but not the Service ministers, continued to advise the Cabinet on foreign policy decisions down to the outbreak of war. The one point at which intelligence assessments were acted on, it was also the one place where military and political intelligence were brought together - for the Joint Planners continued to prepare the strategic appreciations of the Chiefs of Staff with the help only of periodic political summaries from the Foreign Office, and the Foreign Office continued to select and evaluate political intelligence, and to submit it to the committee, without consultation with the Planners or the Service departments. Yet the committee met only at irregular intervals, and had much difficulty in reaching agreement, precisely because there was so little inter-departmental co-ordination of intelligence at the lower level. After 1 936 the absence of a system whereby the Foreign Office and the Service departments co-ordinated their intelligence at the working level, and evaluated it jointly before circulating their assessments, became a greater liability with each deterioration in the international situation. But it continued to go unregarded for want of the minimum degree of unity of purpose that was essential before the departments could bring themselves to change their ways. During 1934 and 1935 the Defence Requirements Committee had at least concluded, without great acrimony, that whereas the Service departments estimated that Germany would be ready for war by 1 942, it would be prudent to accept the Foreign Office's disinclination to guarantee peace beyond January 1939.* Thereafter, the division of opinion as to what British policy should be became every year more marked, and more sustained by uncertainty within the Cabinet itself, as Whitehall confronted the fact that Germany's capacity to rearm was outstripping earlier forecasts and was emphasising the threat from the existence in Italy and Japan of two other potential enemies. And although it was a division of opinion which cut across departmental lines, it also led to recrimination between the Services and the Foreign Office. The Chiefs of Staff and the Service departments, with their knowledge that British military preparations were being held back by Treasury restraint, became more and more determined to delay British involvement in military operations and more and more critical of those in the Foreign Office who seemed to be urging initiatives in foreign policy which, especially in central Europe, threatened to outrun the slow progress of British military preparations. In the Foreign Office some of the leading figures became increasingly incensed with the Chiefs of Staff for pessimism in their strategic assessments and took the view that they were exerting too much influence on the formulation of policy. In these circumstances, far from becoming reconciled to the need to pool intelligence and to reach
* See above, p 49.


The State of Intelligence up to September iggg 75
agreed assessments, the two sides persisted in their right to render separate assessments. It would perhaps be unjust to suggest that, in doing so, they were conscious that the institution of joint evaluation would have curbed their opportunities for emphasising or glossing over items of intelligence according to whether they chimed with or cast doubt upon their divergent views on policy. But when these views were so powerfully held there need be no doubt that they in fact influenced the selection and interpretation of the intelligence, so much of which was enigmatic
and difficult to evaluate. For the Service departments and the Chiefs of Staff an increasingly cautious assessment of the country's strategic position reinforced the
traditional military understanding of the role of intelligence in peace-time - one by which it might well discover the actual and, to some extent, the future military capacity of foreign states, but could provide nothing except speculation on larger matters like the political
and military intentions of foreign states that were best settled by reference to strategic and logistic considerations. In 1934 and 1935 confusion had prevailed about the current strength and probable rate of expansion of the GAF. During 1934, when the GAF already possessed 550 aircraft, the Air Ministry calculated that it had 350 and would have 480 by 1935; the Foreign Office insisted that its sources of evidence pointed to higher figures; and Foreign Office complaints of Air Ministry incompetence were answered by Air Ministry resentment at Foreign Office interference. 70 From 1936 uncertainty con
tinued about the future size of the GAF - a matter of profound importance for the successive schemes for the expansion of the RAF - but was accepted as being to some extent unavoidable. Nevertheless the Air Ministry's estimates of the GAF's current strength improved until, as war approached, they became inflated.* In 1938, when the true figure was 3,000, the estimate was 2,640, and at the outbreak of war the estimate was 4,320 as against an actual strength of 3, 64 7. 71 The
War Office's estimates of the current strength of the German Army, and of the number of divisions it was likely to have at future dates, also improved from 1936. In February 1937 it gave the current strength as 39 divisions (plus 2 independent brigades) and the number of divisions that could be mobilised in 1938 and 1939 as 72 and 108 respectively; 72 the actual figures for 1937, 1938 and 1939 were 41,81
* See Chapter 9, pp 299-300.
70. AIR 8/166 and 171 ; FO 371/18833, C2717/55/18, C2881/55/18; FO 371/18835,
C3087/55/ 18; FO 37 1 / i 8838, C36 1 4/55/ 18; F0 37i/i8842,C4i74/55/i8;Colvin,opcit, PP 129-133. 7
1 . CAB 4/23, CID 1 1 5 1 B of 5 November 1 934; AI report of 3 1 August 1 938
(retained in Air Historical Branch); D Richards, The RAF: Vol I (1953),
p 7; B Collier, The Defence of the United Kingdom, (1957), p 66; AIR 41/10, p 21.
72. CAB 4/25, CID 1303B of 4 February 1937.


76 The State of Intelligence up to September ig$g
and 1 03. 73 In July 1939 MI was inclined to scale down the number of divisions available for immediate mobilisation from 1 08 to 99, 74 though out of deference to the French authorities, who had consistently over-estimated the size of the German Army, 75 the General Staff set the figure at 120-130. 76 The NID's estimates of Germany's current U-boat strength were reasonably accurate.* Like the Germans them
selves, however, it had some difficulty in calculating the completion dates of the new German capital ships and it failed to discover their true displacement.! But to work out current strengths or even the rate of expansion of Germany's armed forces was a straightforward task compared with that of foreseeing how she would use them in the event of war. And yet in this direction - on important developments like Germany's preparations for the use of Blitzkrieg methods - the Service departments did not merely lack curiosity. They discouraged
their intelligence branches from speculating about such intelligence
as was available.
In the extant records there is no sign that the War Office circulated any study of the possibility that the German Army would use armoured Blitzkrieg methods though evidence to this effect was certainly coming in. 77 It included a report from a well-placed MI5 source giving intelligence on the constitution of a Panzer column as a self-contained unit equipped for rapid movement in battle. Furthermore, in January 1937 the Military Attache in Berlin, in a report entitled 'German Military Equipment and the next Theatre of War', suggested that the development of the German military machine made it possible that Hitler would resort to a series of short wars with limited objectives, on the Bismarckian model, designed to frustrate the Franco-Russian pact and the operation of collective security arrangements; and though such wars were more likely in eastern Europe, they could also be directed westward. The Foreign Office was impressed by this despatch, and sought War Office agreement to its being printed and circulated in Whitehall. But the DDMI was sent over to turn down this suggestion and to explain that 'high authorities in the War Office desire to confine their activities and those of their representatives abroad to purely military matters'. 78 To the extent that, even so, this was a military matter, the War Office's response was no doubt influenced by its doctrine of deferring in questions relating to the German Army to the French, whose High Command
* See below, pp 62-63. t See A PPenclix 4
73. B Mueller-Hillebrand, Das Heer, Vol I (1954), p 68.
74. CAB 4/29, CID 1507B of 19 January 1939.
75. CAB 4/23, CID 1 148B of 29 October 1934; CAB 4/29, CID 1507B of 19 January *939
76. CAB 4/30, CID 1571B of 24 July 1 939. 77. Strong, op cit, pp 47-48.
78. FO 37 1/2 1 73 1, MA Berlin report No 65 of 25 January 1937.


The State of Intelligence up to September igjg 77
did not expect Germany to resort to Blitzkrieg. At the same time, despite the practice of deferring to the French estimates, it was sceptical of Mi's lower estimates of the rate of expansion of the German Army, on the ground that the War Office could not itself have expanded the British Army at a like speed, and it may be suggested that it was influenced even more by unwillingness to heed intelligence when it pointed to possibilities which lay beyond the War Office's own experience or ideas. This suggestion receives further support from the treatment that the Service departments gave to intelligence reports on German weapons development. After the outbreak of war the British authorities were to be surprised not only by the power and speed of German offensives, and by Germany's use of tanks or aircraft in support of what she hoped would be successful rapid campaigns, but also by encountering weapons whose existence had been reported but had been disbelieved because they were superior in performance to those which Great Britain was developing. Such intelligence as was obtained about German tanks was too incomplete, and too inaccurate, to make firm conclusions possible; even so the belief that British armour was superior was an article of faith, not a matter of evidence. As to new gun developments, an assistant military attache reported just before
the war that Germany had developed a single weapon (the MG 34) capable of serving both as a heavy and a light machine gun; but nothing could persuade the technical branches in the War Office to accept this. 79 When it was reported that the Germans appeared to be using anti-aircraft guns against tanks, they took the view that the use of weapons in this dual role was neither possible nor desirable. 80 Yet
when it was encountered in the anti-tank role in 1940 the German
88 mm Flak gun was found to be superior to anything possessed by Great Britain and France. In the same way, the Admiralty refused to
believe intelligence reports to the effect that Germany's Narvik-class
destroyers mounted 1 5 cm (6") guns until the base plate of a 1 5 cm shell was found on board a British warship after an engagement in 1943. The Air Ministry had a lively interest in discovering the characteristics of German aircraft, and it was chiefly due to the difficulty of obtaining
reliable intelligence that it had failed to establish many details of
known aircraft by 1939, and that in 1940 aircraft were encountered whose development had not been suspected. 81 But it still had a fair knowledge of the aircraft characteristics and the operational methods of the GAF which it failed to use when considering how Germany was likely to use her air force in the event of war. The belief that in the event of war the main role of the German
79. Strong, op cit, p 1 7. 80. ibid. 81. AIR 10/1644, Handbook on the GAF July 1939, Chapter 9.


78 . The State of Intelligence up to September ig$g
Air Force would be the independent, and perhaps the immediate, strategic bombing of Great Britain became widespread in Whitehall from the beginning of the expansion of the GAF.* 1 934 and 1 935 saw
the establishment of two CID sub-committees on air defence - the Home Defence Committee's Sub-Committee on Air Defence Research as well as the Air Ministry's Committee for the Scientific Survey of Air Defence. At the same time, the first report of the DRC drew attention to the need to anticipate large-scale air attacks against a wide range of targets, and the danger of a German bombing offensive was the chief reason why the DRC in its third report recommended greater expenditure on intelligence .t The danger was accepted by the COS as a worst case hypothesis in October 193 5. 84 These were necessary precautions - as necessary as the fear of a German 'knock-out' blow from the air was understandable. But the Air Ministry's assumptions as to how the German Air Force would be used were so much modelled on the Air Staff's own plans for the RAF that it not only neglected the available intelligence but also omitted to subject its acceptance of the prevailing opinion to technical study. Had a feasibility study been made, it might have revealed that, as Marshal of the Royal Air Force Sir Arthur Harris was to write later, the German bombers were ' not equipped for weight carrying' and were 'too small' to deliver on the United Kingdom the vast tonnages postulated. 85 From what was known of German aircraft it should have been possible to deduce that the long-range bomber force would have had to sacrifice much of its bomb load if it was to carry enough fuel for the flight from north-west Germany and back with or without over-flying the Low Countries. Again, the task of manufacturing, moving and storing the required number of bombs would have been truly vast, yet its feasibility was neither examined nor questioned. It is perhaps not surprising that these calculations were not made before 1937, for the RAF had not by then studied how its own bomber offensive was to be carried out. 86 But it is surprising that later, as the limitations on Bomber Command's own ability to attack Germany were revealed, the operational factors governing Germany's power to deliver a ' knock-out
'
blow were not critically examined, or the presumed scale of the attack questioned. In the Air Intelligence branch, it appears, opinion was not unanimous in subscribing to the 'knock-out' blow thesis after 1936. The officer who was DDI3 from 1936 to 1939 has written that 'if my
* It was strenuously pressed by Sir Warren Fisher of the Treasury82 and publicly endorsed by Mr Churchill. 83 t See above, p 50.
82. CAB 1 6/1 12, DRC 22nd Meeting, 30 October 1935.
83. M Gilbert, Winston S Churchill, Vol V 1 922-1 939 (1976), passim from p 571.
84. CAB 53/25, COS 401 of 2 October 1935, para 8.
85. Marshal of the RAF Sir Arthur Harris, Bomber Offensive (1947), p 86.
86. Sir Charles Webster and N Frankland, The Strategic Air Offensive, Vol 1 ( 1 96 1 ), p 9 1 et seq.


The State of Intelligence up to September igjg 79
German section had been consulted about the probable employment of the GAF, they would have urged that all the indications were that the GAF was going to be used primarily for direct support of land operations, probably eastwards at first, but if the drive were to go westwards the role of the GAF would still be subsidiary to the Army role'. 87 There is some evidence in the departmental minutes that he held this view at the time,*88 and his claim that he was discouraged from including his views in lectures may be accepted. It may be on this account that even so the AI branch did not make full use of the intelligence that might have supported his views. Aircraft of the GAF, which on training flights before the war used wireless with few inhibitions, gave no sign of being engaged in the type of exercise that would have been necessary to train a new force to undertake so difficult and unprecedented an operation as the 'knock-out' blow; and the operation would have required immense infra-structural preparations in a relatively small area of north-west Germany. Yet it does not appear that Air Intelligence emphasised the need for these developments, or initiated any search for them. Nor does it seem to have pointed out during the Munich and the Polish crises that the German bombers were deployed in eastern Germany in support of the Army, and were not available for bombing London (or Paris, as the French feared).
When positive intelligence was lacking on this and other strategic problems, and intelligence deductions, if made at all, had to be made from negative evidence, it is not altogether surprising that the Air Staff, and the Chiefs of Staff as a whole, did not press the intelligence branches for their views on this and similar subjects. That they did not do so is clear from the series of strategic appreciations which they issued between February 1937 and February 1 939. 91 There was no lack
* It is perhaps no coincidence that he was chairman of the inter-departmental sub-committee of the JIC which made a detailed examination of the use of air power during the Spanish Civil War. It was as a result of the experience of the Condor Legion in Spain that the GAF decided to adopt support of the ground forces as its main strategic task. 89 As we have seen in Chapter 1 (p 37), one of the sub-committee's conclusions was that 'all, or nearly all, of the air effort of each combatant was primarily devoted to the direct or indirect support of the land forces', though it added the caveat that this provided no basis for judging what might happen in war between first-class powers. 90
87. Air Vice Marshal Sir Victor Goddard, Epic Violet (unpublished autobiography, held in Air Historical Branch), p 33.
88. DDI3 minutes, 15 April 1937, 20 July, 9 and 21 August 1939 and, in particular,
16 May 1937, to PA/CAS (Retained in Air Historical Branch).
89. AIR 41/10, pp 13-14.
90. CAB 54/6, DCOS 1 01 (JIC) of 10 June 1939.
91. CAB 16/182, DP(P) 2, 'Planning for War with Germany' of February 1937, DP(P) 5, 'Far East Appreciation' of 14 June 1937, DP(P) 18, 'Mediterranean, Middle
East and NE Africa Appreciation' of 21 February 1938; CAB 16/183, DP(P) 22, 'Military Implications of German Aggression against Czechoslovakia' of 25 March 1938, DP(P) 32, 'Appreciation of Situation in the event of War with Germany' of 9 October 1938, DP(P) 44, 'European Appreciation 1939-40' of 20 February 1939.


80 The State of Intelligence up to September ig$g
of intelligence in the paragraphs which compared the first-line military strengths of Great Britain and the other major powers, but only in the last, the Europe'an Appreciation for 1 939-1 940 that was drawn up in February 1939, did the Chiefs of Staff incorporate any intelligence bearing on the way in which Germany might use her armed forces; and even then it bore only on the subject of the air threat to the United Kingdom. Looking at t^iis from Germany's point of view the Chiefs of Staff thought that the best results would be obtained by attacking the civil population, sea-borne supplies and war industries; and on balance they doubted whether Germany would initially attack the civil population as ' it is reported ' that some officers in the German High Command believed that the RAF should be the first objective. But they drew attention, also, to ' recent indications ' that the German Air Staff was ' tending to turn ' in favour of attacking the civil population, and noted that the belief of Nazi extremists in British decadence might lead to an attempt to bring about the swift submission of the United Kingdom by demoralising the population. 92
It is evident from this how little it was thought that intelligence on Germany's strategic planning should be allowed to modify the assumptions which the Service departments and the Chiefs of Staff based on professional calculations. And these assumptions being what they were - that, whereas Great Britain could not win a short war and had scarcely begun her preparations for a long one, Germany, being the aggressor and having, as it seemed, economic reasons for needing a short war,* would aim at a rapid defeat of Great Britain or France; that if Germany gave priority to an attack on France she would make it with reserves permitting operations on the scale of 191 8, and might succeed in forcing a quick decision; that if instead she first turned on Great Britain, she would seek to reduce her by concentrated air attack93 - it is understandable that they carried more weight with the
Cabinet than did the Foreign Office's more plentiful political intelligence so long as that intelligence did not point to action by Germany in western Europe. But until the beginning of 1939 the political intelligence pointed either inconclusively (up to the Anschluss with Austria) or conclusively (in the months before the Munich crisis) to German expansion only in eastern Europe. This is clear from the proceedings of the Foreign Policy Committee. Down to the Munich crisis only two of the papers this committee received contained intelligence material, t The first was a Foreign Office survey of July 1937 of reports, mainly diplomatic, pointing to
* See above, p 66 et seq. t In addition, however, the Foreign Secretary reported verbally on intelligence about the German economy in April 1937. See above, p 68.
92. CAB 16/183, DP(P) 44 of 20 February 1939.
93. CAB 16/182, DP(P) 2 of February 1937; CAB 16/183, DP(P) 22 of 25 March 1938; DP(P) 44 of 20 February 1939.


The State of Intelligence up to September ig$g 81
Germany's intention to move against Austria or - though this seemed less likely - Czechoslovakia; and if the committee did not discuss it, this was because the Foreign Office had concluded that the evidence was ' not very strong', and in part contradictory, and had admitted that the British Ambassador in Berlin had poured scorn on it. 94 The second paper was submitted on 2 1 March 1938, in the aftermath of the German occupation of Austria. It was the strategic assessment by the Chiefs of Staff of 'The Military Implications of German Aggression against Czechoslovakia' - a paper which compiled the available intelligence about comparative military strengths; speculated as to what Germany might do if she found herself at war with Great Britain over Czechoslovakia, with emphasis on the possibility that she would attempt a 'knock-out' blow from the air; and concluded in pessimistic tones that Great Britain was unprepared for the world war that would probably develop if a crisis over Czechoslovakia was not handled with the utmost caution. 95 In the light of this appreciation, described by the Foreign Secretary as 'this extremely melancholy document', the committee recommended on 22 March, and the Cabinet accepted, that the British government should adopt the advice of those in Whitehall who had been advocating for some time that the Czech government should be pressed to come to terms with the Sudeten Germans. For the rest of 1 938, before and during the Munich crisis, the sombre conclusions of the strategic appreciation carried even more weight with the Foreign Policy Committee than did the fact that though firmly pointing to Germany's intention to move against Czechoslovakia, the
political intelligence, now a flood,* could give no reassurance that she would not move against Great Britain if her intention was crossed. This did not deter the Foreign Office, where all departments were professionally inclined to be absorbed by the latest political news and some were keen advocates of British intervention, from giving prominence to such of the political intelligence reports as were insisting that Hitler would desist, or could be overthrown, if he was opposed. But these reports were by now suspect to the committee. In July 1 938 the Prime Minister referred to those with this message that were coming from Sir Robert Vansittart's private contacts as being 'unchecked reports from unofficial sources'. 96 In August, when a member of the opposition groups in Germany came to London with a similar message, the Prime Minister commented that 'he reminds me of the Jacobites in King William's reign, and I think we must discount a good deal of what he says', 97 while the Foreign Secretary
* See above, pp 58-59.
94. CAB 27/626, FP (36) 36 of 29 July 1937.
95. CAB 16/183, DP(P) 22 of 25 March 1938. The first draft by the Joint Planners
was CAB 53/57, COS 697 (JP) of 19 March 1938.
96. CAB 23/94, Cab 32 (38) of 13 July.
97. Woodward and Butler, op cit, Series 3, Vol 2, pp 686-7.


82 The State of Intelligence up to September ig$g
felt that all reports to the effect that the German moderates would stage an anti-Hitler coup if the British government stayed firm must be treated 'with some reserve'. 98 Occasionally, moreover, intelligence
from a source of proven reliability seemed to justify this scepticism. Thus on 28 September, at the height of the crisis, a well-placed MI
5
source conveyed the warning that if Great Britain declared war Germany would at once unleash an air attack on London." By November 1938 the burden of the political intelligence had begun to undergo a distinct change. On 14 November the Foreign Secretary called a special meeting of the Foreign Policy Committee to which he outlined the contents of reports received from various highly confidential informants who had proved to be reliable during the summer. 100 He mentioned that some of them were in touch with Schacht or Ribbentrop; others among them were MI 5 contacts in touch with the German propaganda ministry or German offices in London. Taken together they indicated that, partly because Germany's financial situation was 'desperate'* and partly because Hitler was more than ever convinced of French and British decadence, and had received reports on the weakness of their air defences, the German authorities were preparing to take the offensive in the west as well as to extend their position in south-eastern Europe. In the Foreign Office's view the reports rang true for another reason - the gratitude of the German people to the Prime Minister for having averted war over Czechoslovakia had probably so infuriated Hitler that he now regarded Great Britain as his main opponent - and it recommended a firm attitude, which might discourage the German extremists. This meeting was followed by persistent rumours of German preparations for the bombing of London 101 and also by further reports from the same confidential sources. The Foreign Secretary presented these to the Foreign Policy Committee on 23 January 1 939. Reiterating that Hitler had substituted a western for an eastern policy, they added, now, that he was contemplating another coup, the danger period being from the end of February. The meeting also considered assessments in which the Foreign Office concluded that this intelligence had to be taken seriously and suggested that, since Germany seemed to be bent on attacking Great Britain without involving France, the coup would be either an air attack on the United Kingdom or the invasion of Holland. 102 On the strength of this assessment the Foreign Policy Committee
* See above, p 68.
98. CAB 23/94, Meeting of Ministers, 30 August 1938.
99. Compare Colvin, op cit, p 263 for opposite information on 27 September.
100. CAB 27/624, FP (36) 32nd Meeting, 14 November 1938. 1 01. Aster, op cit, p 43; I Kirkpatrick, The Inner Circle (1959), pp 1 37~ 1 39
102. CAB 27/627, FP (36) 74 of 19 January 1939; CAB 27/624, FP (36) 35th Meeting, 23 January 1939.


The State of Intelligence up to September ig$g 83
asked the Chiefs of Staff to report on the implications of a German occupation of Holland. The Chiefs of Staff, though still pessimistic about Great Britain's readiness for war, replied that the move would
be a direct threat to British security and had to be opposed. 103 In the light of this view, long held by the Chiefs of Staff, the committee attended for the first time by the three Service ministers and representatives of the Chiefs of Staff - concluded on 26 January that the Cabinet could no longer defer committing itself to an Expeditionary Force and authorised the opening of staff talks with France, a step which the Cabinet had long resisted on the advice of the Chiefs of Staff. 104 On 25 January the Cabinet had given its approval in principle to these decisions, should they be recommended. 105 It reluctantly confirmed them on 22 February. 106 On 25 January the Cabinet was shown the Foreign Office assessment of the intelligence reports but not the reports themselves; the Foreign Secretary gave only a short verbal summary of them. There is no evidence that the reports w
rere seen by the Chiefs of Staff. In the wake of Germany's entry into Prague on 1 5 March reports of an even less substantial character precipitated the Cabinet's next important decision at the end of March, and did so without being considered by the Foreign Policy Committee. On 28 March the rumour reached London from the embassy in Berlin and through a British journalist who had contacts with the German General Staff that Germany would attack Poland forthwith unless France and Great Britain made it clear that they would fight. The Foreign Secretary asked for a special meeting of the Cabinet. 107 On 30 March he informed the Cabinet that there was now sufficient evidence to warrant 'a clear declaration of our intention to support Poland. . .' and the Cabinet agreed that the Prime Minister should make such a declaration in the Commons on 31 March. 108 So far as can be discovered, the Foreign Office had received no intelligence to support the rumour; the SIS was soon to provide a series of warnings that Germany would attack Poland some time after the middle of August, but these had not yet begun to come in.* On the other hand, the Prime Minister in his declaration of 3 1 March made it clear that an immediate attack on Poland was not expected. The idea that Great Britain and France
* See above, p 59. It may be noted that these reports were not passed on to the
War Office, which received them only on 1 1 August after the CIGS had requested copies from CSS.
103. CAB 24/282, CP 20 (39) of 24 January 1939; CAB 27/627, FP (36) 77 of 25 January 1939.
104. CAB 27/624, FP (36) 36th Meeting, 26 January 1939.
105. CAB 24/282, CP 2 (39) of 25 January 1 939
106. CAB 23/97, Cab 8 (39) of 22 Februarv 1939. 107. Harvey, op cit, Diarv entrv for 29 March 1939: Colvin, op cit, p 303 et seq.
See also S Newman, The British Guarantee to Poland (1976).
108. CAB 23/98, Cab 16 (39) of 30 March.