TNAG-2097-FCO40-2986-HM-Overseas-Civil-Service-(HMOCS)-general-correspondence-1990 — Page 103

could be considered but it may be thought unlikely to be attractive to the Chinese. A combination of paragraphs 6(1) and 6(2) of Colonial 306 results in this protection extending to continuous pensionable service both before and after 1997.

Colonial 306 does not make any provision for what steps HMG might or would take as regards persons who are members of HMOCS on 30 June 1997:-

4.

(a) if the successor government defaulted on an agreement to

secure pensions;

(b) if the value of their pensions were to drop.

Members of HMOCS have no direct rights or entitlements in either contingency though they may have expectations as regards (a) from earlier precedents. An issue, in the context of Mr McIntyre's question, is whether such provision as HMG might make is likely:-

(a) to discriminate between those members of HMOCS who do not

serve after 1997 and those who continue to serve, to the disadvantage of the latter;

(b) to discriminate between the element of a pension gained

before 1997 and that gained afterwards, to the disadvantage of the latter.

What are the precedents? What policy options are being considered?

5. Expectations as regards SPOS cannot be derived from Colonial 306 or Cmnd 1193. Provision for SPOS is made in the Pensions

(Increases) Act 1971 and the regulations made under it. Section 11 of the Act is an enabling provision which permits the making of regulations authorising the payment by HMG of supplements as regards pensions in respect of service under the government of an overseas territory by a person who was at any time a member of HMOCS. "Overseas territory" would include the SAR; and, therefore, section 11 would permit the making of regulations for the benefit of members of HMOCS in Hong Kong who elected to serve the SAR. However, the regulations do not apply in exactly the same way in respect of pensions from different territories - in particular individual provision may need to be made for determining the exchange rate for the purposes of calculation. More important is the fact that, although the Act is such that future service in the SAR would, as the regulations are now drafted, be covered, the enabling character of the Act permits HMG to decide what regulations to make in any particular case. Accordingly it would be possible so to amend the regulations, eg to exclude the SAR, if for any reason it was decided that the UK

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