Vera Silva· Director of Benefits, Aurora Hospitality
Asked in Global & Mobility ·
I manage mobility for a university with a research institute in Ibadan and a teaching partnership in Lagos. We have 16 academic and technical staff seconded from the UK on a home-based approach with a cost-of-living allowance paid in naira for local spending.
Our data provider updates the index twice a year. Between updates this year, prices moved far faster than the index, and several staff showed me receipts suggesting their allowance bought about 60% of what it did in January.
Do others make interim adjustments between index updates, and on what evidence?
4 helpful · 3 insightful · 1 agree · 3 replies · 385 views · 5 following
Job Architecture Lead, Orchard & Vine
Check which exchange rate the index assumes. The allowance is designed to protect home-currency purchasing power, so if the naira fell and the allowance is set in sterling and converted at the current rate each month, much of the price rise is already compensated. Our problem turned out to be that payroll was converting at a rate fixed in January.
HR Business Partner, Meridian Health Systems
Head of Reward, Fairlead Shipping
I would be careful about adjusting on receipts. Assignee spending patterns include a lot of imported goods priced in hard currency, and people naturally bring the worst examples. We instead pay a larger share of the package in home currency and let them convert as needed, which removed most complaints.
