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objection to Hong Kong's proposals being considered without relation to the existing rates of cost of living allowance in Malaya.
3. The remaining important point is that of possible repercussions on U.K. "foreign service allowances" payable to Service personnel in Hong Kong and Malaya - vide the first three paragraphs of Mr. King's minute of 10/1.
On this point the Treasury have an interest from the U. K. point of view and it is a matter on which they have displayed this interest in earlier discussions (while Hong Kong was still under Treasury control) about the cost of living allowances recommended by Hong Kong Salaries Commission. In the same discussions (partly for the same reason) they also urged very strongly close liaison between the Hong Kong and Malaya Governments in dealing with cost of living allowances (which has already got us into the difficulty about payment of cost of living allowance on leave which is discussed in minutes leading up to the issue of (13/15)).
We put the matter of the results of the 1947 War Office enquiry, to which Mr. King refers in paragraph 1 of his minute of 10/1, to Hong Kong in (179) on 53723/47-8 (the Salaries Commission main file) and Hong Kong answered us in (195) on that file. We shall get no change by quoting it at them again.
I do not think we should delay approval of the present proposals because of possible repercussions on U.K. Service personnel. The Hong Kong Government must be left to be judges of what is necessary in amatter of this kind, provided they don't want to do something utterly unreasonable and provided they can pay for it themselves. No-one can say that these proposals are unreasonable (see for example paragraph 4 of (21)); and there is no reason to suppose that the Hong Kong Government cannot pay for them.
4. We need Finance Department advice on how to deal with the Treasury in this case. In my view we must at all costs avoid getting involved in detailed discussions which, judging from my experience of the Salaries Commission, will result only in delay, intense irritation at the Hong Kong end, murmurings (and perhaps worse) among the Government servants, and in the end a few petty modifications not worth talking about. I say this because I am sure Hong Kong will fight to the end over these proposals. (See reasons at C in Mr.King's minute of 10/1 particularly Nos. 1 and 4). Therefore, reference D of Mr. Blaxter's minute of 11/1, I think we should proceed as at E of Mr. Radford's minute of 6/1.
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14.1.49.