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of breach of faith since officers are not bound to
opt for the new salary conditions.
I agree that it is undesirable, if it can be
avoided, to leave officers in doubt as to the sterling
value of their pensions, and for this reason C.S.D.
would support 'X' in the Governor's telegram if the
Finance Department and Treasury see no objection.
There are, of course, several objections which
Treasury may raise. In the first place, Hong Kong
officers have received a proportionately greater
increase in their salaries in consequence of the high
cost of living than officers in many other Colonies.
This gives them a decided advantage in pensions over
their colleagues from other Colonies, and it leaves
some margin by which their pensions could be reduced
without causing them undue hardship. Secondly,
pensioners would most certainly have a grievance if the
Hong Kong dollar appreciated in terms of the pound
sterling and, if officers are given the option
proposed by the Governor, it should be irrevocable
since, otherwise, they would get the best of both
worlds. Thirdly, in the present uncertain state of
things, Treasury may take the view that Government
ought not to commit themselves to guaranteeing a fixed
rate of exchange for this purpose for a period of
from twenty to thirty years to come. Finally, there
is no exact precedent.
I agree that it is essential that some assurance
should be given that will set the minds of the Hong Kong
/officers