471
PUBLIC RECORD OFFICE
Reference :-
MC.O.882/11
PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
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13. An alternative proposal:—I put forward for the information of Govern- ment a scheme of pension proposed by Mr. Phillipson of this oflice, which provides an alternative to "abolition "terms, each officer being allowed to have his pension "aboli- calculated either under Mr. Phillipson's scheme or under a scheme embodying
This alternative is certainly tion" terms, whichever is more favourable to him. ingenious and the result of its adoption would no doubt be that the pensions granted on premature retirement to officers at different ages would be in more ideal propor- tions to each other. My objection to the scheme, however, is that it will be more costly than granting abolition" terms, and as I think that such terms would be sufficiently liberal to meet the requirements of justice, 1 cannot recommend that any more expensive scheme should be adopted.
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14. Under Mr. Phillipson's proposal the largest compensatory fraction grantable to any officer would be 15/120ths (exclusive of climate bonus) instead of 10/120ths abolition " terms. This maximum (also exclusive of climate bonus) under compensatory fraction would be granted to officers retiring at the age of 40 with at least 15 years' service. An officer retiring at 40 with less than 15 years' service would suffer a proportionate reduction of the maximum compensatory fraction of 15/120ths. If the officer retired before or after 40 years of age his maximum com- pensatory fraction would decrease as his age at retirement fell short of or exceeded 40 years of age and his actual compensatory fraction would be related to the period of his service. The factors determining the magnitude of the compensatory fraction would thus be (1) proximity of the officer's age at retirement to 40 years of age and (2) the length of his service. The way in which the reductions of the maximum compensatory fraction will be affected is shewn in the draft rules referred to below.
15. Draft rules:-I annex two sets of draft rules typed side by side for con- venience of comparison, the first set showing how the pensions should be calculated if my recommendation in paragraph 17 is adopted and the second set showing how they would be calculated under the more liberal scheme devised by Mr. Phillipson.
16. Illustrative table of approximate pensions*:-I also annex a table of cases showing how the two sets of rules would operate in a number of cases which have been selected as typical. The pension given in column 12 as the pension under the second (Mr. Phillipson's) set of rules is in all cases the pension calculated by his method. Where, however, the pension so calculated is less than a pension calculated under the first set of rules (" abolition "terms) the larger pension would be awarded by virtue of No. 2 (ii) of the second set of rules.
17. It will be seen that the second set of rules will be much more favourable than the first to officers who have joined young and are between 35 and 45 at retirement. If the same officers postponed their retirement until after 45 the second set of rules would be less favourable to them than the first if it were not for the proviso in the second set which has the effect of giving them a minimum pension equal to that under the first set.
18. War Service :-The Donoughmore Commission recommended that “ special consideration should be given to the cases of those oflicers who, after serving in the War. entered the service of the Ceylon Government at a later age than they would otherwise have done." The Civil Service Association ask that such officers should be entitled to count as actual service for pension the same service which they are deemed to have had for the purpose of salary. I have provided for this concession to Civil Servants in both sets of rules. The Donoughmore Commission's recommenda- tion, read literally, covers all services, not only the Ceylon Civil Service. I do not think, however, it is practicable to extend the concession to other services, as the ages at which officers ordinarily enter is difficult to determine except in the case of the Civil Service. The Ceylon Civil Service was the only service for which there was a definite post-war "re-construction '' system of recruiting and Civil Servants were the only officers who were given a concession in respect of war service by being allowed to start above the initial salary of the scale.
19. Commutation:-I think Government must refuse to allow commutation of any part of an Order in Council pension granted in respect of premature retirement on account of the new Constitution. As pointed out by the Civil Service Association, commutation would have to be permitted upon terms related to the age of the officer upon retirement and not on a fixed basis of 10 years' purchase. This means that in many cases considerably more than 10 years' purchase will be payable. It is quite out of the question to heap burden upon burden on the revenue of the Colony as a result of the new Constitution. It is all very well to say, as the Civil Service Association
* Not printed.
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memorandum says, that commuted pensions cost the Colony no more in the end. The point is that they will cost the Colony very much more at the beginning, just when so many other additional burdens resulting from the new Constitution will have to be assumed. The capitalization of ordinary pensions has already added an immense burden to the Colony's revenue which is extremely embarrassing, and I cannot advise Government to contemplate any additional burden of this sort.
20. I would amend the Pension Minute so that it will permit all officers within the scope of the scheme of Order in Council pensions who have already exercised the option of partial commutation of their ordinary pensions an opportunity to revoke their option if they so desire. I would also allow those of the same class who have let the latest date for the exercise of the option pass without exercising it, a second opportunity to exercise it. In both cases the opportunity should be open to them for not more than six months after the announcement of the terms on which pensions would be granted on premature retirement. Options thus revoked or exercised would become completely inoperative in any event in the one case and operative only if the officer was eventually granted an ordinary pension (without any compensatory addition) in the other.
21. Leave and Passages :—I see no reason why there should be any special rules in regard to leave and passages on retirement. I think the ordinary rules would be properly applicable.
22.
Procedure:-I suggest that Government should decide upon a scheme as soon as possible and submit it to the Secretary of State for approval or modification, and that the scheme finally approved by him should be published as the Secretary of State's fiat, not open to further discussion.
October, 1930.
A.
W. W. Woons.
Colonial Treasurer -
B.
Draft regulations applying abolition of Draft regulations embodying Mr. Phillip-
terms to Order in Council office
son's scheme, which retains, and also Pensions
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1 (a). In these regulations the term "Public Servant means any Public Servant, holding & permanent office in the service of the Colony, separately provided in the Estimates, which has been declared to be pensionable by a notification pub- lished in the Gazette, and belonging to one or other of the two classes of public servants on whom Article
of the Order in Council dated
confers the right
of premature retirement from the public service on account of the alteration in their conditions of service.
(b) Otherwise the terms used in these regulations shall bear the meaning which they bear in the Minutes on Pensions, unless that meaning is inconsistent with the con-
text.
2. Subject to the exceptions and pro- visions hereinafter contained, every Public Servant, who shall retire from the public service under Article
of the Order in Council dated
may be granted, in addition to any award which he might receive under the Section (or Sections) of the Minutes on Pensions which would be appropriate to his case if his retirement
provides an alternative to, "abolition of office terms.
1. The same as Section 1 opposite.
2 (i). Subject to the exceptions and provisions hereinafter contained, every Public Servant, who shall retire from the public service under Article of the Order in Council dated may be granted in addition to any award which he might receive under Section (or Sections) of the Minutes on Pensions which would be appropriate to his case
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