RESTRICTED
DT to pay FCO the element in their estimates for Governors'
گیا
T
emoluments as we do where a DS officer is in post).
4.
•
If we were also to take financial responsibility for leave passages, I calculate that this would cost the FCO about £6,000
per annum. The additional costs of taking over the salaries and allowances (subject to my comments in paragraph 5 below) would be about £12,000 per annum, assuming a continued contribution from
the Territories.
5. The stumbling blocks to such a change would be the four self-sufficient Territories. No Governor of Hong Kong (for example) would accept a DS1 salary and allowances unless the latter were pitched high enough to compensate him for the inescapable fact that he would be subject to UK tax, whereas as things now stand only Hong Kong tax (maximum 15%) is payable. The same applies to Bermuda and the Caymans and could, to a lesser extent to Gibraltar. Thus the FCO might find itself having to find in excess of £100,000 per annum merely to compendate for UK tax. This seems quite
unnecessary where the Territories are quite prepared to pay their
Governors well.
6. I should be grateful for your views. When I have them I shall
ask PPD and Finance Department whether there are any snags from their points of view and we shall then be in a position to decide whether or not to proceed.
8 May 1978
cc Mrs Gregory
for information
粤
Mr Quantrill
2
N F GREEN
Hong Kong & General Dept
K272
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