SECRET
XCX(93)54
January 1994. However news of this is likely to leak out sooner or later. It is likely that any news of a Sterling pension safeguard and SPOS revision for HMOCS officers will attract attention. It is fortunate in this context that HKG has recently announced the establishment of a pension reserve fund. However the HMOCS arrangements will further stimulate local staff pressure for an even more substantial sum to be set aside for the fund.
23
There may also be some criticism that HMG is looking after HMOCS officers to the detriment of local staff and the HKG/SARG. The arrangements for retirement and immediate payment of pensions may be portrayed as an additional cost to the HKG/SARG and as an incentive to HMOCS staff to leave, raising the possibility of a last minute exodus of overseas officers. This could stimulate calls for faster localisation in the period between now and 1996, in order to mitigate the effects of any possible exodus of overseas staff in 1996/97.
24
Other local staff, particularly some Police Officers, are likely to try to claim parity of treatment with HMOCS officers on the grounds that there is a change of employer for both sets of staff.
25
Still others may welcome the HMOCS package because of the very significant boost it will give to localisation. Indeed it is a positive aspect of the scheme that it should provide some encouragement to promising local staff to stay in Government on account of the enhanced promotion prospects.
LIKELY REACTION OF HMOCS OFFICERS
26
Whilst the HMOCS Association and individual HMOCS officers can be expected to welcome decisions by HMG to take this subject forward and put an offer on the table for consultation, they will be very disappointed that the package does not meet their expectations by reference to HMOCS arrangements in other Dependent Territories. They will be disappointed that the compensation cap of £120,000 at 1992 prices is less generous than it would be if HMG followed strict relativity with compensation caps elsewhere. They will be extremely annoyed about the offer of a Sterling pension safeguard at a rate of HK$21:£1 and will argue for use of the current exchange rate, or at the very worst, a rate of HK$16:£1 being the historical lowest actual rate since 1945. They and existing Hong Kong HMOCS pensioners should however welcome the proposed SPOS revision. The younger HMOCS officers will also welcome the general right to retirement provisions contained in the General Compensation Scheme.
Executive Council