TNAG-2101-FCO40-2990-HM-Overseas-Civil-Service-(HMOCS)-policy-matters-1990 — Page 79

CONFIDENTIAL

5.

Mr Rayson said that in this case, HMG's commitment came

from expectations that had been built up. He asked what the

consequences would be if expectations were not met. Mr Fish

said that if expectations were not met, there would be a

strong parliamentary challenge. There were a good number of

MPS sympathetic in the matter who would be aware that HMG

was reneging on its commitments. Pressure was already increasing from existing pensioners to do something about

the decreasing value of their pensions. If the exchange rate worsened or continued at its present rate, there would

further decline in the value of pensions. Mr Kerby added that the heaviest pressure would come if HMG was found to make no provision for HMOCS members in Hong Kong. Mr Shipley pointed out that Ministers had specifically said that Hong Kong would not be treated differently from other

DTS; they had accepted that the issues on the change of

sovereignty were the same.

be a

6. Mr Rew questioned the statement in Hong Kong telno 3287

about HMG having been always committed to the preservation

of HMOCS pensions in sterling terms. Mr Fish said that there was commitment to preserving the value of pensions,

but that there had been no commitment about the form that

this would take.

7. Mr Rayson asked if HMG's exact obligations to members of HMOCS could be established and if it could be agreed that there was no commitment to any guarantee on safeguarding of pensions. Mr Kerby said that there was no legally binding commitment but there was an overwhelming political

commitment to protect members of HMOCS a downward movement

of the exchange rate would be catastrophic for HMOCs

pensioners if sterling safeguards were not provided.

JL6AAK/3

CONFIDENTIAL