CONFIDENTIAL

wisdom of proceeding. The secondment scheme would be likely to

give me a central role in the allocation of citizenship places which I would not have in any other element of the package, and

the discretionary powers which I would need would open up the

scope for challenge by way of judicial review in the UK. The

necessary enabling provisions would also complicate the drafting

of the Bill. I would, therefore, prefer not to proceed with the

secondment scheme.

5. However, I know that the Foreign Secretary is concerned

about the implications of dropping the proposal now that it has

been announced. He and I will discuss the issues further, and

I hope that we will be

be able

able to reach an agreement on a

recommendation to put to OD (K) at the meeting on 15 March.

THE SELECTION SCHEME

6. If the approved secondment scheme is dropped, the selection scheme will have four components:

a)

b)

c)

d)

a General Allocation Scheme (GAS) covering broad

Occupational groups across the public and private sectors and based on a points system;

a Key Entrepreneurs Scheme (KES) under which the

Governor may recommend for citizenship selected

entrepreneurs the extent of whose investments and the

numbers they employ make them invaluable to Hong Kong;

a Disciplined Services Scheme (DSS) based on a points system; and

be

a Sensitive Services Scheme (SSS) under which persons

occupying particularly sensitive posts would

nominated for citizenship.

CONFIDENTIAL

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