§ 27. Mr. Colvinasked the Secretary of State for Defence what is the saving to the defence budget deriving from his proposed cuts in the local overseas allowances for the British Army of the Rhine.
§ Mr. FreemanLocal overseas allowance is a tax-free payment intended to compensate for the extra cost of serving overseas. It is examined annually to ensure that it continues to meet that objective. In Germany the 1987 examination demonstrated that the sums required to compensate service personnel for the extra costs were lower than in 1986. Accordingly, LOA in Germany will be reduced from 1 August 1987, providing savings of about £25 million in a full financial year.