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prices and exchange rates: HKG would pay this to HMG.
4.
This issue is linked to the so called Carr-Robertson
assurance. In 1968 Sir Reginald Prentice, the Minister for
Overseas Development, told the House of Commons that the
assurance "does not amount to a formal commitment to pay loan advances (in leiu of pensions) if there has been a
default, but it has been understood since by OSPA and by the
British Government that this would in effect happen if there
was a default." We have been expecting for some time for
OSPA or an HMOCS members to ask us outright whether HMG will
abide by the Carr-Robertson assurance. This has not occured
but to refuse to restate the assurance would amount to
saying that we no longer felt ourselves tied by it. In 1985 Ministers agreed that if asked we would give the assurance.
5.
In order to safeguard ourselves against the possibility of having to pay loan advances should the Hong Kong SARG default on payment pensions to HMOCS members, an option open to us is to try to seek the Hong Kong Government's agreement
to make over to us the capitalised value of HMOCS pensions
before 1997. The value of the capitalised pensions would in current prices be considerably more than £210 million.
6. At that time Sir G Howe concluded that the heavy balance of argument was against taking early action on this question but that it should be looked at again perhaps in about 1990. The Prime Minister noted that it was proposed to review this matter in 1990 but regretted that it appeared not to be possible for the present Hong Kong Government to set up an arrangement which would go some way to funding the estimated
A B capitalised value. I attach relevant extracts from Sir G
Howe's minute and the Prime Minister's response.
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