§ Mr. Stokesasked the Secretary of State for Defence what rate of local overseas allowance is payable to Service personnel in the Falkland Islands task force; on what basis this rate is determined; and what indications were given to the personnel concerned about the rate of allowance that was likely to be paid.
§ Mr. BlakerLocal overseas allowance is a tax-free allowance paid to members of the Armed Forces to meet the essential extra costs of serving overseas in normal conditions. It is not intended to compensate for arduous or dangerous conditions of service, which are factors taken into account in the assessment of forces pay. The rate of LOA payable on any RN ship is that appropriate to the last foreign port at which shore leave was taken. Under the usual rules those who sail from the United Kingdom—the majority of the present task force, including soldiers embarked on troop ships—would have received no LOA; the minority who sailed from the Mediterranean or who happened to be able to take leave at Ascension Island would have received LOA of between £1 and about £5 a day.
To avoid the obvious unfairness of such a situation it was decided to pay a standard rate of LOA of £1 a day to all Service personnel in the task force. This is a rough average of what various Service men in the force would otherwise have received. The objective was not to cut costs, and the overall cost of implementing the change is expected to be greater than the cost of applying the previous rules.
The task force was told of the standard rate on 16 April.