CONFIDENTIAL
were employed by, and gave services to, the British Government in a British Colony, whose terms of service were governed largely by Colonial Regulations.
We, the Kenya Government, wish to assure the British Government that our Government is not idly repudiating its responsibilities. Pressure from our Parliament and, for that matter, general public opinion leave the Kenya Government no alternative but to make known the facts for consideration by the British Government.
Kenya feels
sure that there are means of approaching this matter and achieving an agreed solution by negotiation acceptable to the two Governments whereby Kenya can satisfy public demands, which is most important at this stage of Kenya's development, and can, at the same time, honourably fulfil its debt obligations by offsetting, or abating, loan repayments, together with the cost of pensions, against Aid income.
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11. Kenya's view is known to and shared by the government of Uganda. If Britain could not reach an agreement with Kenya default by that country would undoubtedly be followed by default by Uganda and the East African Community. Defaults elsewhere in the world could certainly not be ruled out but in East Africa alone HG would have no option but to pick up an additional pensions bill of about £3.7m per year and would gain no credit in African eyes from doing so in such circumstances.
12. Alongside developments in Africa the body of opinion in the United Kingdom which also believes that Britain should assume responsibility for meeting the cost of pensions earned before independence has gained strength in the last year. This is evidenced by the increased activity of the pensions lobby in Parliament (including very recent Questions in the House), the views expressed in the deliberations of the Select Committee on Overseas Aid at its meeting on 7th July 1969, a flow of informed articles and correspondence in the press, and for instance by statements in the manifesto "Power to End Poverty" of the
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CONFIDENTIAL
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