CONFIDENTIAL
waiver of the loans with effect from 1 April 1971.
The logic of these
oposals appears to be inescapable and it is in any case unlikely that
governments would continue to repay once HMG accepted responsibility for recurrent pensions. A decision to waive the loan repayments need not be
regarded as damaging the principle of the sanctity of loans because the
decision would follow from a deliberate change in policy on pensions.
51. Details of compensation and commutation loans are given in Appendix II.
ADMINISTRATION OF A NEW POLICY
52. If only for staffing reasons the ODM could not implement the proposed new policy immediately. 1st April 1971 has been chosen as the possible commencing date because that is also the day on which new supplementation
(OSAS) agreements should replace the current schemes which come to an end in
March 1971.
53. Legislation.
The provisions of the Overseas Aid Act, 1966 are adequate
for the purpose of permitting the Minister of Overseas Development to reimburse overseas governments the total amounts of their payments to expatriate pensioners for pre-independence service and the Minister would propose to proceed in this way in the first instance. However pressure would soon grow for HMG to take over responsibility for paying individual pensioners and in many ways this would be more satisfactory even though the process of concluding agreements with the various overseas governments would take time and enabling legislation would be needed to give the Minister the necessary powers. She proposes that she should seek such legislation at an early convenient opportunity.
54. Because of the position just described the staffing consequences of the proposed new policy cannot be stated with accuracy. So long as the policy was implemented simply by annual reimbursement of the overseas governments no additional staff would be required for the Pensions Branch of ODM. If on the other hand it became necessary to contemplate the direct payment of individual pensioners by about 1973, the preparatory work would include consultations with
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