TNAG-2101-FCO40-2990-HM-Overseas-Civil-Service-(HMOCS)-policy-matters-1990 — Page 3

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6

(c)

On

the

other

considered.

present

proposals were still being If after study, any changes to pension

arrangements

were

contemplated which would have implications for the future SARG, these would be discussed with the Chinese side.

23 July 1990, the Secretary for the Civil Service had an informal discussion with Ambassador Guo FENGMIN on civil service matters generally. Again, the Chinese side showed considerable interest in the subject of civil service pensions, and renewed their request for a briefing.

Briefing for the Chinese

+7

We propose to hold a comprehensive briefing for the Chinese on civil service pension arrangements, to explain the current system in general, the proposals received from staff for better pension safeguards and our initial assessments of them. We would also take the opportunity to discuss with them the modifications to the existing arrangements which we plan to introduce.

8

The briefing would cover the following

(a)

(b)

The New Pension Scheme (NPS): the NPS was discussed in JLG in 1986 before its introduction in 1987. We believe the Chinese would welcome a situation report on the scheme. Moreover, this provides an opportunity to reassure them that the implementation of the NPS has not presented any problems and that our prediction that it would not adversely affect the stability of the civil service has proved correct. We shall also provide the Chinese side with a forecast of pensions expenditure up to and beyond 1997, which they have requested;

Pension Safeguards: we propose to explain in more detail the various staff suggestions for improved pension safeguards and our initial assessments of them. However, we do not intend to offer

any conclusive observations at this stage, except to rule out funding, because none of the proposals can be pursued in the short term due to resource limitations. We would say that we need more time to study in-depth the implications of the various options and that we will consult the Chinese in good time on proposals with implications for the

any SARG.

CONFIDENTIAL