TNAG-2097-FCO40-2986-HM-Overseas-Civil-Service-(HMOCS)-general-correspondence-1990 — Page 32

ODE 18-77

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recent changes; and for the majority of Hong Kong pensioners (1150 out Of 1800) the highly beneficial pre-1976 SPOS arrangements.

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You make a valid point about tax and other expatriate benefits and the ability to generate savings. But I would prefer to limit the arguments to the pensions position. For example, the point about Hong Kong salaries could be challenged unless related specifically to the enhanced pension benefits which these salaries generate. Large overseas salaries could well have limited value if the cost of living is high. You know better than I whether this is the case in Hong Kong, but given the reaction to our previous statements, I do think we need to be ultra-careful how we tell people that they are doing very well. However, when we are talking about expatriates retiring to the UK, it is entirely legitimate to make comparisons with UK counterparts because we are clearly comparing like with like

and, of course, UK pensions increase legislation treats both group the same.

8.

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Finally, you asked about your SPOS paragraph. I suggest a redraft as

follows:

"I should perhaps point out that the purpose of SPOS is to top up the sterling value of the locally awarded increases paid to former Colonial Civil Servants to the same level as the increases paid on an equivalent UK public service pension. SPOS 15 not designed to supplement any shortfall in the sterling value of the basic pension. I appreciate that the position for retired Hong Kong HMOCS members is different from most other retired HMOCS members in that the pensions of the former are not linked to sterling. But, we are satisfied that the existing arrangements for determining the level of topping up payments in respect of Hong Kong pensions reflect the underlying intentions of the SPOS scheme. Such are kept under review but I have to say that there are no immediate plans for change."

matters

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DS FISH

Overseas Pensions Department

9 November 1990

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CLOL LO CCCM. UTUAL

CUBONITAO..

KOU CO