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The Army Council was created in 1904 with other the institutional changes made in that year to the British Army.

The disastrous campaigns of the Crimean War led to the consolidation of all administrative duties in 1855 under the Secretary of State for War, a Cabinet post. He was not, however, solely responsible for the Army; the Commander-in-Chief (C-in-C) held a virtually equal level of responsibility. This was reduced in theory by the reforms introduced by Edward Cardwell in 1870, which subordinated the C-in-C to the Secretary for War. In practice, however, a huge amount of influence was retained by the exceedingly conservative C-in-C Field Marshal Prince George, 2nd Duke of Cambridge, who held the post between 1856-1895. His resistance to reform caused military efficiency to lag well behind Britain's rivals, a problem which became painfully obvious during the Boer War.

The situation was only remedied in 1904 when the post of Commander-in-Chief was abolished and replaced with that of the Chief of the General Staff. An Army Council was created along similar lines to the Board of Admiralty, chaired by the Secretary of State for War, and an Imperial General Staff was established to coordinate Army administration.

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