CO129-602-4 Cost of living allowance 27-3-1948 - 11-12-1948 — Page 7

XI

12.

I find this a difficult case. Throughout consideration of the Hong Kong Salaries

Commission Report we stressed (much to Hong Kong's annoyance) the importance of co-ordination

with Malaya and Singapore and we stressed this particularly in relation to cost of living allowance and to the work of periodical review of this allowance which we insisted must be undertaken (e.g. side-lined passages in our telegrams Nos. 44, 243 and 354 to Hong Kong, which I have filed at (12)).

2. Later, after the tumult and the shouting about the Hong Kong Cost of Living Allowance had died down, the Malayan Cost of Living Allowances were sanctioned and, it appears, the proposal that these allowances should be payable on leave outside the Colony slipped through with the rest.

3. This particular proposal does not seem to have been argued on its own merits and indeed, since salaries in Malaya have (as I understand it) been revised to post-war level, it would seem very difficult to justify it.

4. We therefore want to advise Hong Kong not to follow this Malayan example, yet at the same time our insistence on co-ordination of the work of the Cost of Living Allowance Boards of Review still stands uncancelled. We have got ourselves into a very awkward position,

5. I think however the line taken in the draft is the right line, but I shall be surprised if we have heard the end of this.

6. Mr. Palmer saw this (vide minute of 26/7) when a different line of reply was proposed and agreed that we need not bother the Treasury except to send them a copy of our reply after issue. That decision of course stands all the more since the reply now proposed is likely

to be more acceptable to the Treasury. Nevertheless, in view of the difficulty we have got into and of his recent close interest in Malaya Hong Kong Salaries Commission co-ordination, I think Mr. Bourdillon should see this.

J.creen:

17.8.48.

Yes. But I feel will la

bacu

Sum that

Com

If there is a comeback, we could try the

I agree with Compromise of t1⁄2 COLA rates on leave. But

the draft

also agree with X.

H.T.B 18/8

I wouldn't suggest quing that live until

we have the Comeback.

1878