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022430
MDHOAN 1897
OFFICER'S MAXIMUM POSSIBLE ENTITLEMENT THE SCHEME SHOULD USE ACTUARIAL FACTORS ABATED BY A PROPORTION TO BE DECIDED AFTER CONSULTATION WITH REPRESENTATIVES OF HMOCS OFFICERS. DIFFERENT ACTUARIAL FACTORS WOULD APPLY TO OFFICERS ON THE OLD AND NEW PENSION SCHEMES AND TO JUDICIAL OFFICERS, WHO HAVE A LATER RETIREMENT AGE. HOWEVER THE SCHEME SHOULD NOT IN OUR VIEW BE AS GENEROUS AS THE PRESENT HONG KONG GOVERNMENT LIMITED COMPENSATION SCHEME FOR SUPERSEDED OFFICERS.'' OUR INITIAL IS THAT THE SHORTER FORMULATION IS PREFERABLE: WE ARE USING YOUR LIMITED SCHEME AS THE BASIS BECAUSE IT EXISTS ALREADY AND HAS A RING OF FAIRNESS. BUT AS IMPLIED IN PARA 5 ABOVE, THE USE OF PRECISE ACTUARIAL FACTORS HAS NO REAL LOGIC IN COMPENSATING FOR LOSS OF THE SECRETARY OF STATE'S PROTECTION. WE ALSO ASSUME
THAT IT WOULD BE TACTICALLY UNWISE TO SUGGEST WE MIGHT OFFER LESS THAN YOUR LIMITED SCHEME.
VIEW
9. IN PARAGRAPH 6, ON THE QUESTION OF PHASING PAYMENTS, AS YOU KNOW WE HAVE ENVISAGED THAT 20 PERCENT OF THE MAXIMUM POSSIBLE ENTITLEMENT SHOULD BE PAYABLE IN 1997, IN ORDER TO GIVE HMOCS MEMBERS AN INCENTIVE TO STAY BEYOND 1997 AND TO HELP THEM GET OVER THE PSYCHOLOGICAL BARRIER OF 1997, WITH 10 PERCENT PAYABLE ANNUALLY THEREAFTER. THERE HAS BEEN SOME DEBATE HERE ABOUT WHETHER THE FIRST PAYMENT SHOULD BE MADE ON 1
YOU JUDGED THAT A 20
JULY 1997 OR LATER. WE ARE AWARE THAT IN AUGUST 1990
PER CENT PAYMENT IN 1997 MIGHT ENCOURAGE PEOPLE TO STAY UP TO 1997. BUT IN ORDER TO GIVE HMOCS MEMBERS AN INCENTIVE TO STAY BEYOND 1997, WE WONDER WHETHER THE FIRST PAYMENT SHOULD BE MADE UP TO A YEAR AFTER 1 JULY 1997.
10. WE ARE GRATEFUL TO YOU (YOUR TELNO 845) FOR AGREEING TO KEEP US INFORMED ON YOUR THINKING ON THE 30 JUNE DEADLINE. THE DEADLINE HAS BEEN USEFUL IN FORCING THE PACE HERE, AND IS LIKELY TO REMAIN SO IN COMING WEEKS, BUT IT COULD ALSO BE A LIABILITY:. IF WE CANNOT REACH ANY AGREEMENT ON STERLING SAFEGUARDS BEFORE THEN - AND THIS SEEMS THE MOST LIKELY SCENARIO - THEN WE WOULD BE FORCING CONTRACT OFFICERS TO MAKE A DECISION UNDER VERY DIFFICULT CIRCUMSTANCES. THIS COULD GAIN THEM CONSIDERABLE PARLIAMENTARY AND PERHAPS EVEN JUDICIAL SYMPATHY HERE. IT WOULD ALSO BE UNFORTUNATE IF THE DEADLINE WERE USED HERE AS A LEVER TO FORCE THROUGH AN EARLY DECISION, ONLY FOR HKG SHORTLY AFTERWARDS TO COME TO THE CONCLUSION THAT AN EXTENSION WAS NECESSARY FOR OTHER REASONS.
11. ONCE CONSULTATIONS BEGIN WE SHALL NEED TO RESPOND TO HMOCS
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