2.
UK public service pensions. If your service pensions were treated separately for SPOS purposes, your pension entitlement in its
tirety would be greater than that of a UK public service pensioner with the same level of basic pension.
Pt This is reasonable and
accords with the principle of equality of treatment.
5. Section 11(4) of the Act states that the supplements which may be authorised by regulation should be of such amounts which, when account is taken of any increase or supplement payable by an overseas government and any other additions to the value of those pensions, appear to the Secretary of State to correspond as nearly as may be with the increases payable to public service pensioners in UK under Part I of the Act. Under Part I Section 2(6) of the Act, the increases in the rate of pension that may be provided for are to be calculated by reference to the basic rate of the pension.
6. The Act does not specify how pensions designated and paid in foreign currencies should be converted into sterling. This is covered by Regulation 17. Regulation 17(1) as amended by the 1977 amendment states that whenever, for the purpose of ascertaining any supplement payable, it is necessary to convert into sterling a basic pension initially payable in a currency other than sterling, the rate of exchange to be taken for the purpose of any such conversion shall be the rate of exchange between that currency and sterling on the last day of a person's service. Thus, my Hong Kong basic pension of HK$122,304.00 was converted to sterling on 3 August 1987 at the rate of £1 = HK$12.4305 to give £9,839.02. This is my basic UK equivalent pension to be used by the ODA to calculate supplements to my Hong Kong pension as referred to in Section 2(6) of the Act. This is a fair and reasonable way of establishing a sterling equivalent of the basic pension designated in HK dollars.
$7.
7. According to the ODA, and I have no reason to doubt their interpretation, Regulation 17(1) also requires them to convert the monthly payments of my Hong Kong basic pension into sterling at the same historical rate that applied on the last day of my service. Thus, in calculating the supplement due they assume that I will still Des get £9,839.02 from my HK basic pension. This requirement produces a false result because exchange rates vary from month to month and in the year 1st April 1990 to 31st March 1991 a lower Hong Kong exchange rate against sterling meant that my HK basic pension of HK$122,304.00 was only £8,577.53. After aggregating my Hong Kong and Tanzanian pensions the ODA calculated from the Schedule to the Pensions (Increase) Annual Review Order that my total pension entitlement for 1990/91, including supplements, was £13,289.04. However, I actually received only £12,026.63 because of the application of Regulation 17(1) in converting my HK basic pension. The ODA argue that they are responsible only for topping-up, and protecting the sterling value of, any locally awarded increases and that it is not the intention to protect the basic pension against adverse exchange rate movements. They say that it is the responsibility of the Hong Kong Government to maintain the sterling value of the basic pension. I argued that the Hong Kong Government does not have this responsibility. There is no Public Officers' Agreement or other legal requirement for it to make good exchange rate shortfalls and, significantly, neither is there authority for it to claw back exchange rate surpluses if the rate moves in the favour of the pensioner. On the contrary, it is the ODA that has the authority to take account of these surpluses for the calculation of SPOS under Regulation 17(2). The Hong Kong Government like the British Government has an obligation to treat all its pensioners equally, whether home or overseas.