aefl.rw/docs/6.5.11
replace explanatory section with: "Safeguard costs would be offset by savings to HMG in years when the HK$'s value is above the safeguard trigger. Scheme would
operate administratively by HMG paying individual pensions at a fixed rate from funds provided by HKG/
SARG.";
delete paragraph under "Potential annual cost" and replace with table (as for the other options);
add at end of advantage (a): "reducing HMG's potential cost"; insert "initially" after "HMG" in advantage (b);
add a new advantage (e): "Presentational advantage of
protecting pensions. at а higher level for the same
overall cost";
(a)
with "and
have" in
of being
replace second sentence in disadvantage
could attract criticism"; delete "would
disadvantage (b) and replace with "at risk
pressed".
Options F and G and Early Retirement
These are all sub-components of the substantive options (A to E) which have the attraction of reducing the liabilities we would need to safeguard (they would not displace the need for a
safeguard). They should therefore be presented called options.
as such and not
Underwriting the non-commutable part of the pension only needs to relate to the assumption that we would require officers qualifying
for the safeguard to cmmute their maximum sum immediately on
retirement.
The section on a private sector scheme needs to be redrafted in
light of the letter from Chris Elston at the Bank of England, which I copied to you. It could also, if there is time, take on board any further feedback from Hong Kong (especially something on an indicative price for such a facility). It is ironic given the