CONFIDENTIAL
4
The HMOCS Association will argue strongly for a pension safeguard at HK$13.76: £1. Although their final position is likely to depend upon the acceptability of the overall package including compensation and general right to retirement, they will stress that the HK$13.76 rate can be justified as an average in 1991, that there is no basis for penalising HMOCS
4. officers who have served in Hong Kong by setting an
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artificially adverse rate and that the level of salaries
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should not be the issue. But Chris Patten and I conclude that
MOIGAOSL
IC
16:1 would be a reasonable compromise as part of the right package. He does not believe that we could impose a more
adverse rate.
VAL BE
Compensation
29.
.
5.
You reasonably asked about the objective we were seeking to achieve with our revised compensation proposal,
particularly given a right to retire for HMOCS officers on transfer of sovereignty. Our initial proposal was designed to provide a measure of compensation and incentive to officers to encourage them to work in Hong Kong both up to and for some years after 1997. However, in the first round of consultations, the HMOCS Association rejected this approach. They argued strongly that it was not, in line with previous schemes, and that it would in effect force officers to continue serving under Chinese sovereignty to earn
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+
compensation to which they were entitled. The Association have said they will not accept anything less than a scheme on
traditional lines.
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F
6. Our revised compensation proposal (Option C in the paper) meets these points. Under this scheme officers will have to be prepared to work to the hand-over date to benefit from the scheme. It is thus designed to retain their services until
CONFIDENTIAL