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be a compulsory one as a result of which the lower income brackets, Who now had PA cover without having to contribute, would be seen
be subsidising the higher income groups. He added that perhaps the main push for this compulsory contributory element had stemmed from the UK where the Government took the line that unemployment insurance should be contributory and not draw on general evenue. In Hong Kong, there was a general indication that the Community thought differently.
In conclusion, H E said that he would use the opportunity of his coming trip to the UK to discuss this further with Mr. Heppell. He asked S for SS to draft him a letter to Mr. Heppell on this and agreed to send Mr. Hurst a copy of this, as well as the conclusions of those discussions.
b. Disputes in the Civil Service
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Mr. Hurst said hat during his stay he had met with many of the junior echelons of Government, including the various staff associations and in particular the steno-audio typists. His impression was that the major frustrations of the junior staff arose from the bureaucratic structure of departments and that their salary levels as well as welfare depended on the attitudes of their Heads of Department in their negotiations with Civil Service Branch. Mr. Hurst wondered whether there was any possibility of establishing a direct channel between staff associations and the Central Government body or in fact whether there was any need to set up a central arbitration body on UK lines such as the Civil Service Tribunal? In reply to H E he also said that the crux of the problem appeared not so much to be the general level of salaries but the gradings of certain posts, and where they were slotted in the master pay scale.
He
CS explained that the routine method of dealing with staff disputes over salaries was generally effective. agreed with Mr. Hurst that in particular cases as those currently creating public attention, special negotiation methods might have to be adopted. On the other hand, he had strong reservations against setting up a permanent body to arbitrate in salary disputes as this would cease to work once the labour force became familiar with the body of arbitrators available. Secondly, it would lead to
a chain reaction among other groups of Government staff as they would have nothing to lose in pushing everything to arbitration. HE informed Mr. Hurst that Professor Turner was being consulted on this particular point and his reply must be awaited before the
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