TNAG-2050-FCO40-2920-Visits-by-Lord-Caithness--Minister-of-State-for-Foreign-and--1990 — Page 40

Pa

Foreign and Commonwealth Office

HKB 026/34

RECEIVED

2 1 NOV 1990

DESK OFFICER

INDEX

London SW1A 2AH

Der

PA

M

Fany,

15 November 1990

Lord Caithness has asked me to thank you for your letter of 20 September about various issues of concern to your members. Lord Caithness was glad to have had the opportunity to meet you and other representatives of the Model Scale I Staff Consultative Council during his visit to Hong Kong and to hear your views at first hand.

You express concern about security of pensions. The payment of pensions is now a statutory charge of general revenue. As you point out, the Joint Declaration (which is a binding international agreement) contains very clear assurances about the continued payment of pensions after 1997. These provisions are fully reflected in the Basic Law. There is no reason to believe that this undertaking will not be honoured by the future Hong Kong SAR Government. Pensions payments represent only a very small percentage of annual recurrent expenditure and the Hong Kong Government has every confidence that all future pensions payments can be met.

Nevertheless, I know that the Hong Kong Government are considering whether any further measures can be taken to address the concerns expressed by your members and other civil service staff associations. While full funding of pensions has been ruled out for financial reasons, careful consideration is being given to other possibilities, including partial funding of pensions, higher commutation of pensions and the establishment of a provident fund.

You also express concern about the Chinese attitude to the nationality package. We shall continue to discuss this issue with the Chinese Government. As we have made clear many times, our only aim is to provide assurances to keep people in Hong Kong who are of crucial importance to maintaining its

Mr Fung Siu-ming

Staff Side Chairman

Model Scale 1 Staff Consultative Council

Room 137 CGO East Wing

Lower Albert Road

Hong Kong

/stability

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