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paras
Ndeed]
ate not
Specified]
(a) to introduce traditional arrangements whereby officers
can retire in 1997 with full payment of pension
guaranteed by the successor government;
(b) for the Hong Kong Government to pay to HMG a capitalised
sum representing HMOCS pension entitlements for service up to a given date, and for HMG then to pay the
pensions;
(c) to introduce a scheme whereby HMOCS members (and other
civil servants) can take out a commercial loan against
their pension entitlements;
(d) for HMG to accept a contingent liability that if the
Hong Kong dollar/sterling exchange rate drops below a
certain value, HMG will make up the difference;
(e) to make a firm decision not to introduce a safeguard
scheme at all;
(f) to delay a decision on safeguards until much nearer
1997.
Each of these options is explained in more detail in Annex
D. Their political and financial consequences are
considered below.
Traditional Scheme (a)
10. This is what HMOCS members are seeking, but it would be
very expensive and would ensure that almost all HMOCS
officers would leave. As most HMOCS officers would be
likely to take advantage of the scheme, the cost could approach its maximum £150 million. It would also be hard
to reconcile with our commitments under the Joint
Declaration to work for Hong Kong's prosperity and stability
and for a smooth transition in 1997. Local officers, who
have shown the same loyalty to the Crown, would react
angrily to a scheme which led to an expatriate exodus in
1997, leaving them alone to face the change of sovereignty.
It could be difficult to explain to Parliament why we were prepared to commit up to £150 million on a group of civil servants who are already well paid by UK standards and given
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