}
- 3·
our terms of reference va consider it desirable to set forth in extenso the points upon which agroununt was reached in the discussion with Professor Banham mentioned in paragraph 4 above, since these conclusions afforded us valuable guidance, and were adopted by us at our first mooting as a basis for our deliberations.
10.
Those conclusions on the subject of the Cost of Living Allowances of Government staff were as follows:
11.
"(1) Review should be made quarterly.
This did not
necessarily imply that a change in allowances should be made each quarter. chango would be made only if there word evidence of a marked change in the cost of living or other relevant factor.
"(ii) The first date of review should be 1st October.
"(iii) The Committed for revision would consist, in
Hong Kong, of Chaiman, and one official and one unofficial. (This as understood by us to apply to future periodic revisions).
it
"(iv) Representatives of the Service should not be
members, but should be able to submit representations to the Committed." (This was understood by us to refer to future periodic revisions).
"(v) Other factors busidus the cost of living should
be taken into consideration:
(a) The general kishi of the trade and cormurce
of the Colony.
(b)
The state of Gvernment's financos.
Rates of Tommoration paid in private employment.
"(vi) For possible quarterly variaticas different pur--
contage changes for different categories would be indvisable, and therefore type budgets, which would reveni different purcuntage variations, could not be used. One index figaro must be used as the yard stick covering the principal itums bought by all sections of the public pervice.
"(vii) Stability of tot: 1 toney incomes was desimble,
cnd therefore the test of Living «llowance should not be changed unless thure van on sporociable variation in the indor.
"(viii) As the Retail Price Indow is not the only factor
and ng the effect of changes in the cost of living is offset bo som uzbunt as tople vary their patterns of expenditure when particular prices change, the principle should be that the ghungos, upards or downwards, should not fully reflect the chance in the cost of livinst.
"(ix) / Retail Price Index of 100 for March 1948, for
this purpone should be taken as the biso on which to vary the high Cost of Living Allowances.
"(x)
D.
suparate index, for long Nos, should be calculated for rents".
The inadequacy of the orusent rates of
Cost of livins Allow.ncub
at the outset it is dusimble to aphasise that our tomo
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