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Option D:
Nobody is advocating this option at present, but it would be a slightly cheaper compromise than option C between our original proposals and what the HMOCS Association seek. However there is no real justification for using only half the traditional factors to calculate compensation, and we would come under very strong pressure to treat Hong Kong HMOCS officers in the same way as HMOCS officers elsewhere. Particularly since we have already put forward one unacceptable proposal, our next offer must be something to which we can stick: that means Option C.
II.
OPTIONS WITHOUT HMG FUNDING
These are included to make the paper comprehensive. The Treasury have long tried to argue that, if there is an HMOCS problem, it is Hong Kong's problem and Hong Kong should find the funds to deal with it. We have fully explored the possibilities, but in vain:
Option A:
This would be an abdication of responsibility, which could jeopardise our ability to administer and police Hong Kong effectively up to 1997, let alone achieve a smooth transition then. Private-sector insurance against political risk and exchange-rate fluctuations can only be limited, short-term and expensive.
Option B:
This would go against our history of developing institutions of responsible government, particularly regarding taxation and finance. It would cause a constitutional and political crisis in Hong Kong and a confrontation with China: whatever the logic of discharging before 1997 a post-1997 liability, this would be seen as cynical asset-stripping by HMG - a demonstration that our real interest in Hong Kong was in lining British pockets.
options.comm. 1.HMOCS
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