TNAG-1668-FCO40-2317-Future-of-Hong-Kong-continuity-of-administration-civil-serv-1987 — Page 122

I can see that, for serving officers, it is probably necessary to carry across the large contingent liability on abolition of office etc to the new pension scheme. Without such a provision, it would be argued that the reduction in the actual liability would be much less because fewer serving officers would transfer to the new scheme. However, it is possible to reduce the contingent liability on abolition office etc significantly in respect of new employees after 1 April 1987. This could be done by making the pension granted to an officer to whom subsection 1(d) and l(g) of clause 11 applies a deferred pension unless he is a serving officer, and limiting the award of additional pension on abolition of office or compulsory retirement to serving officers.

I have the following further comments:

Page 9, 10 "Retirement Age" Manuscript amendment

In trying to see behind the special treatment of Scheduled Officers in the new scheme, I think the logic is that where the Head of their Department wants them out before age 60 they should be credited with a proportion of the service they would have completed by age 60. It seems to me that, where someone appointed after the effective date leaves the service before the age at which the Head of his Department would want him to leave, his deferred pension should be payable at 60.

Clause 9

It is difficult to make an authorative comment on this without seeing the terms of the circular issued by the Secretary for the Civil Service under Section 8(1). However it seems to me that if there is a period of several years during which an officer can opt to transfer to the new scheme at any time and he has not done so when he dies, then it should be assumed that he would not have been going to do so. Otherwise, no one is going to opt until the last moment or just before he leaves service if earlier. Without a speedy identification of who is going to transfer, at least among those who have the option to retire before 30 June 1997 under the existing scheme, it will not be possible to produce accurate estimates of pension costs in the run-up to 30 June 1997.

Clause 10(3), page 17

It may be that it is intended that Scheduled Officers appointed in the future should be able to retire voluntarily at age 50, i.e. 10 years earlier than anyone else appointed in the future. If not, then the wording should be something like "Provided that a Scheduled Officer who is also a Serving Officer"

Cont'd/