TNAG-2100-FCO40-2989-HM-Overseas-Civil-Service-(HMOCS)-policy-matters-1990 — Page 49

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remitted overseas

at the rate against sterling in force at independence. The burdens thus imposed on the successor governments in effect to pay sterling pensions have been largely removed by the pensions take-over programmes.

or

10. The sterling value of Hong Kong pensions

at risk now, SO

there is pressure

from pensioners' associations to introduce a

sterling safeguard immediately. The pressure will intensify as 1997 approaches if HMG makes no move to take over the pensions concerned. Given that this is part of the standard package for HMOCS it is not

open to HMG to argue that such a safeguard is unnecessary unjustified. On worst case assumptions, i.e. i f the Hong Kong dollar became worthless, the cost to HMG would

be the sterling

value of pensions and

paid by Hong Kong, which is currently 10.5 million

Our aim should therefore be to

the Hong Kong (later the SAR)

(It should be recognised that,

enter into arrangements

increases

per year.

whereby

Government accept this

this obligation.

it

if we failed to achieve this aim, there would be pressure on HMG to

meet this obligation, and in the last resort, since HMG has me t

elsewhere, such pressure would be very difficult to resist. If it

did become necessary for HMG to meet the obligation, it could do SO by manipulating the pension supplement payable from UK funds, for

which HMOCS pensioners are already eligible. Nevertheless such

pressure should be strongly resisted.)

I t is recommended that officials should study further how such a scheme might operate, and that we should start discussions with the Hong Kong government about it. In the meantime the public line should be that we are aware of

the precedents, and that our aim will be to see comparable arrangements made for HMOCS officers in Hong Kong.

SHOULD MINISTERS BE READY TO REAFFIRM THE EARLIER UNDERTAKING TO THE

EFFECT THAT HMG WOULD PAY LOAN ADVANCES IN LIEU OF PENSIONS TO HMOCS

IN THE EVENT OF A PENSIONS DEFAULT BY THE SAR GOVERNMENT AFTER 1997?

11.

In 1964, in response to anxieties about the security of pensions payable to overseas officers by independent government, the Secretary for Technical Cooperation, the then Mr

then Mr Robert Carr, gave an assurance to Sir James Robertson, president of the Overseas

Service Pensioners' Assocation (OSPA),

aside in the event of a default. This

that HMG

assurance

would not stand

was reaffirmed in

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