cst.ps/dr/22mp1.2
My Morris 4/2 Mr Whitney.
CONFIDENTIAL
CHIEF
TREASURY
SECRETARY TO THE]
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For urgent advice. I think the Forcin Secretary
sd. now write to set out
ow best care a
Treasury Chambers Parliament Street SWIP 3AG
071-270 5000
Fax 071-270 5456
The Rt Hon Douglas Hurd CBE MP
discussul
PS
Le PS/ Beroun Challen
Psing Goodland
Secretary of State for Foreign and Commonwealth Affairs PS IPUS
Foreign & Commonwealth Office King Charles Street
London
SW1A 2AH
Dear Hongles
HKA 233/1 RECE
68 FEE 1993 3 February 1993
CA
HONG KONG: HMOCS ARRANGEMENTS
18
Si J.com Mr.thes Mr. Kerby, ODA Special Advises
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4
I have seen a copy of the Governor's letter of 21 January to the Prime Minister.
2.
The letter contains some factual errors and misconceptions which are commented on further in the attached note. But I agree with the Governor that the technical issues have now been fully explored, and that the
way forward depends on political judgements.
3. The Governor sets
out the political considerations he perceives in Hong Kong. We must of course continue to take account of these.
that should not mean ignoring or adding unnecessarily to our difficulties here.
4.
But
Fiscal constraints already mean that we have had to keep a tight grip on UK public expenditure including curbs on spending in a number of priority areas. We need to think very carefully indeed about the extent to which we should add to public expenditure pressures on account of HMOCS officials, at a time of severe public sector pay restraint. The individuals in Hong Kong whose cause the Governor advocates are far from under-privileged. These people:
continue, on average, to be roughly twice as well off as their UK counterparts in terms of salary and pensions benefits;
will be eligible for compensation of up to £120,000 each if they remain in post for another 4 years;
will enjoy retirement benefits that will never fall below those of their UK counterparts;
2