CONFIDE TIAL
cluding other dependent territories
could lead to considerable political
difficulties with the colony. (Hong
Kong's expatriate pensions liability is
only £650,00 a year and is not an open-ended commitment.)
As a fallback position, the F.C.0.
could acceptaan arrangement whereby
independent territories in which the
Public Service Commission had become
executive (e.g., Banamas, Bermuda and,
possibly snortly, Fiji) would be included
in the takeover, while in the case of
the others we would agree to take account
...
of their expenditure on expatriate
pensions in assessing their needs for
development aid - this would in any case
exclude Hong Kong.
(iii) Southern Yemen. A separate, but
related, problem under discussion is the
position with regard to Southern Yemeni
indigenous pensioners. The O.D.. has
declined to include these pensioners in
their current proposals and the F.C.O.
are therefore pressing this case separately
geared as it is to the special circum-
1
stances of Southern Yemen's independence.
A payer un this subject is at Annex
CONFIDENTIAL
/(iv)
NOTHING TO BE WRITTEN IN THIS MARGIN