SECRET

SECRET

FM HONG KONG

TO IMMEDIATE FCO

TELNO 925

OF 300645Z MARCH 92

HKA 233/1

INFO PRIORITY PEKING, UKREP JLG HONG KONG

la

184)

036006

·MDHIAN 8616

3013

TOP COPY

Q DIST?

152

PERSONAL FOR RICKETTS, HKD, FROM GOVERNOR

(153

155

158

162)

157

(16!

YRTELNOS 543, 544, 547, 548, 551, 559 AND 560: HMOCS

COMPENSATION/INCENTIVE SCHEME: DRAFT STATEMENT FOR CONSULTATIONS

1. WE HAVE CONSIDERED CAREFULLY YOUR SUGGESTED CONSULTATION

TACTICS IN FIRST TUR AND REVISED DRAFT STATEMENT IN LAST TUR AND THINK THEY ARE GENERALLY ALONG THE RIGHT LINES. HOWEVER WE HAVE A NUMBER OF IMPORTANT GENERAL AND SPECIFIC POINTS.

2. WE AGREE THAT HMG SHOULD TRY TO GET MAXIMUM CREDIT FOR THE PROPOSAL AND THAT HMOCS OFFICERS SHOULD BE ENCOURAGED TO RESPOND POSITIVELY TO THE INDUCEMENT OFFERED TO CONTINUE IN SERVICE UP TO 1997 AND BEYOND. THE STATEMENT IN LORD CAITHNESS' LETTER THAT HMG INTEND TO INTRODUCE A COMPENSATION/INCENTIVE SCHEME AND COMMENCE

CONSULTATIONS SHORTLY HAS ALREADY GENERATED A LOT OF GOODWILL. IT

WOULD BE SENSIBLE TO FOLLOW UP AS SOON AS POSSIBLE.

3. WE SUGGEST THAT THE DETAILED STATEMENT SHOULD BE HANDED TO CARTLAND, WHO IS NOW THE DULY ELECTED CHAIRMAN OF THE HONG KONG HMOCS ASSOCIATION, ON ABOUT 10 APRIL BY AN ODA TEAM WHO WOULD THEREAFTER HOLD A FIRST EXPLANATORY MEETING WITH THE ASSOCIATION COMMITTEE. COPIES OF THE STATEMENT COULD THEN BE DISTRIBUTED LOCALLY TO ALL MEMBERS OF HMOCS. A FURTHER TEAM VISIT WOULD BE NECESSARY IN MAY TO HOLD DETAILED CONSULTATIONS.

4. WE SEE SIGNIFICANT ADVANTAGES IN THIS APPROACH.:

(A) IT WOULD GAIN GOODWILL FOR HMG AND CONVINCE HMOCS OFFICERS THAT MATTERS ARE BEING TAKEN FORWARD EXPEDITIOUSLY:

(B) IT WOULD HELP AVOID THE POSSIBILITY OF A CONFRONTATIONAL SITUATION FORESEEN IN FIRST TUR (PARA 4):

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