84.1b/nt1.20.11
HONG
KONG HMOCS:
ARRANGEMENTS
COMPENSATION/INCENTIVE
SCHEME AND PENSIONS
FCO,
ODA and Treasury officials have been considering further the suggestions of a compensation/incentive scheme and pensions arrangements for HMOCS. In particular, attention has focused on
possible ways of protecting HMOCS officer pensions from a
substantial decline in the value of the Honk Kong Dollar. Treasury colleagues have made it clear that
they are not in a
position to recommend to Treasury Ministers that the UK tax payer should be burdened with financial liabilities in respect
of Hong
Kong Government pensions without the transfer of related assets.
2.
As we see it, the next step must be to consider further the
scope for arrangements which involve the transfer of pension
liabilities and related assets from the Hong Kong Government to
the officers themselves, or to a financial institution
their
behalf, or to the UK in such a way as to meet the interests of all
concerned.
on
3.
We appreciate that you have considered this kind of proposition in principle before but that you did not, at that stage, consider that a scheme involving
the transfer of assets
could be devised in a way which would be acceptable to the HKG.
After further discussions here, however, we consider that the
way
forward rests in working up jointly, in a constructive and imaginative way, the details of arrangements which could be acceptable to both sides. It is important to emphasise that there is no prospect of making progress on questions relating to the
retention of HMOCS officers until this matter has been examined
satisfactorily.
4.
the
The Whitehall team could be ready to leave for Hong Kong in near future to discuss this. We would, of course, wish to arrange the visit in a way which was most convenient to you. envisage three or four days of intensive discussions involving the
We
Page 45Page 46