I think Bristol_Rob that rather than being exclusive to REME, at the time that arrow meant simply "War Office" - i.e. any part of the Army (what would be the MoD today). But DON'T please quote me on that - in my RAF apprenticeship, which started in 1961 some of our workshop tools had a very similar-looking arrow on them - as someone has already said, the military very often had the "If it ain't broke done fix/renew it" approach.
And as someone has also already said "one forty eigth" is still today a common scale for all sorts of models (inc. trains, cars, aircraft, etc), as is "one seventy second" and "one thirty second" - one inch on the model equals seventy two inches on the real thing and one inch on the model equals thirty two inches on the real thing - respectively. You can buy many kits and finished models in those scales today, especially scale model plastic kits.