TNAG-0266-FCO40-302-Responsibility-of-UK-for-colonial-expatriate-pensions-of-Hon-1972 — Page 35

10

R

CYPHER/CAT A

REF.

sent

ADVANDR

карс

"He LEPAD

Hell yong Kong reipt Mr. Wilford 3

TO FOREIGN AND COMMONWEALTH OFFICE

IMMEDIATE HONG KONG

TELEGRAM NUMBER 78

3 FEBRUARY 1976

CONFIDENTIAL

PERSONAL

YOUR TELEGRAMS 52 AND 67.

OVERSEAS PENSIONS POLICY.

Advisory

3

(Lux)

RECEIVED IN

REGISTRY No.51

-S/EB 1970

AKK 18

1841

WITH REGARD TO THE PROPOSALS IN PARAGRAPH 2, (A) AND (B) DO NOT

DIRECTLY CONCERN THIS GOVERNMENT. IT IS CONSIDERED HOWEVER THAT

THE ADOPTION OF (B) AND THE EXCLUSION OF (C) WOULD BE ONLY TOO READILY MISUNDERSTOOD BY THE SERVICE HERE, THE SIGNIFICANCE OF THE

Exec/we CHANGE FROM AN EXECUTIVE TO AN ADVISORY PUBLIC SERVICES COMMISSION

BEING A PURELY ARBITRARY YARDSTICK FOR DETERMINING THE PART OF

CONSTITUTIONAL ADVANCE AT WHICH A COMPENSATION SCHEME BECOMES

APPROPRIATE.

2. TWO TECHNICAL PROBLEMS AT LEAST WOULD ARISE:

(A) LIABILITY TO U.K. TAX. AT PRESENT PENSIONERS PAY U.K. TAX ONLY ON PENSIONS REMITTED TO THE U.K. AND THEN ONLY IF RESIDENT.

ALL PENSIONERS PAY HONG KONG TAX.

(B) CURRENCY. APART FROM PENSIONS PAYABLE TO CERTAIN OFFICERS WHO HAVE RETAINED AN OPTION TO STERLING OR HONG KONG DOLLAR PENSIONS, ALL PENSIONS ARE PAYABLE IN HONG KONG DOLLARS.

3. THE ASSOCIATION OF EUROPEAN CIVIL SERVANTS HOWEVER WOULD PROBABLY PRESS THE MATTER OF THE U.K. ACCEPTING THE LIABILITY OR GUARANTEEING THE SECURITY OF H.K. PENSIONS FOR THE FUTURE. THEY HAVE RAISED THIS FROM TIME TO TIME IN THE PAST AND IT IS KNOWN THAT THEY WILL RAISE THIS WITH THE HMOCS ADVISOR WHEN HE VISITS HONG KONG, WHILE INFORMAL ASSURANCES HAVE BEEN GIVEN IN THE PAST, AND MOST OFFICERS WOULD PLACE TRUST IN HMG IF THE SOURCE OF HONG KONG PENSIONS WAS CUT OFF AT SOME FUTURE DATE, THE AECS WOULD FEEL THEMSELVES BOUND TO PRESS FOR SOME FORMAL GUARANTEE OF SECURITY OF HONG KONG PENSIONS SHOULD THESE CIRCUMSTANCES ARISE.