TNAG-0055-FCO40-91-Defence-review-1977 — Page 38

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CINCFE.1511/6130/18

UK EYES ONLY

Wo

1,000 are presently cuployed in Singapore.

Both Governments are aware that there is noro to come but as yet, there was no sign of unduo alarm or despondency at official level. From the Trade Unions point of view, however, there was a considerable speculation about the purpose and cute no of the Secretary of Stato's visit. Both here and in Holeysin the Trade Unions had declared that they would not discuss, or be party to, the implementation of redundancy until their several cleins for on improvement in terminal benefits had been resolved to their satisfaction. This may mean that, in Singapore, where Government had asked us to see to it that non-citizens aro discharged first, we shall be unable to finalise procedures until we had got the vexed, but important, question of gratuities out of the way.

To this end, MOD (Army) had been sent a detailed analysis of current good-cmployer practice in both the public and privato sectors of orployment in Singapore and Malaysia, and sono improvenient had been recommended in the amount to be paid on redundancy. pointed out that although it has not been our practice hitherto to differentiate between normal retirement and redundancy there was ample evidence that in this part of the world, severance pay, or compensation for loss of employment was paid when a nen vas declared redundant. In Singapore the Services Unions (and there were four of then) had demanded for redundant staff six weeks pay for each year of service: the War Department Civilian Staff Association who represent all OD and IPBW staffs in Malaysia wanted a minimum of eight weeks pay. The going-rate in Singapore was four weeks, in Malaysia it worked out at about five, IR STARLING said that discussions were to be held on 25th April 1967 when the Services would be confronted by representatives of the Unions in Singapore. The presence of the Secretary of State in Singapore may reduce the chances of an immediate settlement. Jo had cuthority to concede the good employer rates in Singapore and Malaysia for unestablished employees, but Unioïïs may demand more if the extent of the redundancy in short term was greater than was expected. He understood that the Prime Minister of Singapore would inform the Secretary of State that the Unions in Singapore wanted improved gratuities. Unless agreement on their Unions' demands for higher retrenchment gratuitios could be. reached, labour relations would deteriorate rapidly as the present known redundancies came to be implemented, and the possibility of industrial action on this issue alone could not be ruled out. He did not think that the Unions in Singapore would worry unduly about the Government's wish that the old concept of 'first in, last out' should be disregarded in favour of non-citizens being discharged first. The difficulty would be to avoid political repercussions across the Causeway as fifteen per cent of employees held work permits:

of these, about fifty per cent ero Indians and Pakistanis, forty per cent are Malays and the remainder mainly Chinese. It was believed that many of the Indians would, in the event, volunteer to go first and they they would go home.

The Chinese may well fend for themselves or become citizens, but the Malays might well decide to cross the Causeway into ilaya when they realise that there is little hope of their being given work permits when they leave our service. This would, of course, add to the burden in Halaya and could lead to ill-fooling and, possibly, to counter-neasures against non-Malaysian citizens there. The problem would be aggravated with the discharge of locally enlisted personnel: there were nearly 4,500 of these in Singapore and the great majority of then were Malays. If what was plommed resulted in a substantial reduction in the number of civilians employed by the Services in Singapore and Malaysia by approximately 10,000 during the next three or four years, the effect on the coonony could be disastrous.

The

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/unemployment