19 May 1992

HKA 233

233/1

DESP-MH. 2011

Foreign & Commonwealth

Office

Mrs S D Brown

HM Treasury

Parliament Street London

SW1

Fear Sandra,

HONG KONG HMOCS

1.

London SWLA 2AH

315

In the final paragraph of my letter of 13 May, I mentioned Mr Goodlad's visit to Hong Kong from 24-28 May and our hope that we could agree before then the principle of a sterling safeguard for HMOCS pensions. As time moves on, however, we perhaps need to consider what he should say in Hong Kong if we are still in disagreement on this subject.

2.

It seems to us that in those circumstances the one helpful gesture Mr Goodlad could make towards HMOCS is procedural, ie to accept their proposal that we should first conclude our internal consideration of the sterling safeguard and then hold further consultations with them about both this and the compensation/incentive benefits scheme. This might help take a little heat out of the atmosphere, and we think we have nothing to lose: during the 7-11 May consultations, Nigel Cox and Dave Fish pressed the alternative possibility - that there would be no further opportunity for the Association to comment on the benefits proposal and still failed to elicit much detailed comment. The HMOCS officers have a reasonable claim to know about all we intend to offer them before commenting on individual items. And our legal advice is that even if the Cabinet decides not to provide a sterling safeguard, we should have to consult the Association before taking and promulgating a final decision.

-

3. I enclose a copy of our points to make. Could you please let me know by noon on Friday 22 May if you see any serious difficulty with them.

You ever,

PF Ricketts

Peter Ricketts

Hong Kong Department

CC:

D Fish Esq, ODA

D Rayson Esq, HM Treasury

K Woodfield Esq, HM Treasury

NESADC

JRB

CONFIDENTIAL

332

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