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112
8
MDHOAN
COMPENSATION PROPOSAL BEFORE EASTER AND TO MAKING DECISIONS ON STERLING SAFEGUARDS AND SPOS WITHIN THREE MONTHS. (TREASURY OFFICIALS RECENTLY AGREED TO LORD CAITHNESS' TELLING AN MP THAT ''WE APPRECIATE HMOCS OFFICERS' NEED TO KNOW WELL BEFORE THE END *OF JUNE 1992 WHAT ARRANGEMENTS WILL BE PUT IN PLACE
·
BUT IT
NOW SEEMS THEY WILL SEEK TO USE THIS DEADLINE AS A WAY OF SQUEEZING US TO ACCEPT THAT HMG SHOULD ACCEPT NO REPEAT NO CONTINGENT LIABILITY FOR STERLING SAFEGUARDS.) IF, HOWEVER, THE CHIEF SECRETARY REJECTS THIS PROPOSAL, THE NEXT STEP WOULD BE DISCUSSION IN OD(K), BUT THE PROSPECTS FOR ARRANGING THIS BEFORE THE ELECTION MUST BE SLIM.
4.
MEANWHILE, WE ARE TO HAVE FURTHER DISCUSSIONS WITH TREASURY OFFICIALS ON 28 FEBURARY ABOUT THE COMMERCIAL LOAN OPTION AND ABOUT THE DETAILS OF THE COMPENSATION PROPOSAL (WHERE THEY CONTINUE TO FAVOUR SOME SORT OF TARGETING).
HURD
YYYY
ΜΑΙΝ
32
LIMITED
HKD
FED
NEWS D
DISTRIBUTION
35
RMD
PS/LORD CAITHNESS
SIR J COLES
MR BURNS
ADDITIONAL
3
MR J V KERBY, ODA
MR D FISH, ODA
MISS BROOKS, LEGAL ADVISERS
NNNN
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