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SECRET

SECRET

FM FCO

TO PRIORITY HONG KONG

TELNO 494

OF 13110OZ MARCH 92

1713

INFO PRIORITY PEKING, UKREP JLG HONG KONG

132

TOP COPY

Q DIST?

175576

MDLOAN 0325

нка 23311

PERSONAL FOR GOVERNOR.

1/5

OUR TELNO 474 HMOCS: COMPENSATION/INCENTIVE SCHEME

1.

YOU SHOULD BE AWARE, IN CASE THIS IS NOT ALREADY CLEAR FROM PREVIOUS TELEGRAMS, THAT THE TREASURY HAVE STILL NOT/NOT APPROVED THE DETAILS OF OUR COMPENSATION PROPOSAL. WE HAVE MANAGED TO SEE OFF SOME OF THEIR ARGUMENTS AND HOPE TO BE ABLE TO IMPROVE OUR NEGOTIATING POSITION BY A COST-EFFECTIVE SOLUTION TO THE PROBLEM OF CONTRACT OFFICERS, BUT THEY HAVE SO FAR GIVEN NO COMMITMENT TO SUPPORT ANY OF THE DETAILS OF WHAT WE ENVISAGE. WE ARE COMMITTED (AT MINISTERIAL LEVEL) TO KEEPING TREASURY OFFICIALS CLOSELY INFORMED AS WE REFINE OUR OPENING POSITION FOR THE CONSULATATION WITH HONG KONG HMOCS OFFICERS AND AS THOSE CONSULTATIONS PROCEED. DECISIONS WILL HAVE TO BE TAKEN WHEN THE OUTCOME OF THOSE CONSULTATIANS IS CLEAR

2.

WE SHALL BE IN TOUCH SOON WITH OUR IDEAS, AND TO SEEK YOUR ADVICE ABOUT HOW WE HANDLE THE CONSULTATIONS WITH HMOCS OFFICERS.

HURD

YYYY

DISTRIBUTION

20

MAIN

20

HKD

FED

RMD

PS/LORD CAITHNESS

SIR J COLES

MR BURNS

MR KIRBY

MR FISH

LEGAL ADVISERS//MISS BROOKS

NNNN

PAGE 1 SECRET

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