The allowance negotiated via BALPA is nothing to do with the tax free portion of per deims/duty pay.
The BALPA agreement is for expenses such as dry cleaning of uniforms, purchase of shoes, flight bags, BALPA subs, etc etc.
The normal tax free element of duty pay is for daily expenses such as meals, phone calls, travel expenses etc.
I am not sure, but it may also have something to do with the fact that we are often out of the country while we earn it.
One previous company i was with deducted a portion of tax from duty pay while working within the UK, but any night stops abroad earned a tax free payment. This was agreed with the tax man.
If this guy gets away with this, it will make quite an impact on the take home pay of those concerned.