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84/1 aef1.mr/sr/9.16.9
(iii) an
explanation of how you have calculated the maximum and probable costs of the compensation incentive scheme you
propose and the incidence of those costs from 1997 onwards.
On the sterling safeguard issue, there are two questions which
arise:
whose pensions would the sterling safeguard apply serving officers or HMOCS pensioners as well?
(i)
to
(ii)
-
could you let us see details of the calculation of the maximum cost of providing a sterling safeguard on HMOCS pensions and the incidence of costs over time?
Similarly, on the SPOS proposals, it would be helpful to see details of what the costs of the change would be if the value of the Hong Kong dollar fell against the pound. What would be the maximum annual cost if the Hong Kong dollar became worthless? And what would be the incidence of costs across the years.
I am sure that you will appreciate that given the very large potential costs of your proposals, we need to be certain that the implications for public expenditure have been calculated as precisely as possible. This is, of course, difficult given the contingent nature of some of your proposals. I should also note, that my request for this further information does not mean that we have accepted the principle of the proposals you have put forward (indeed, I have to say I am not at all persuaded at this stage by the arguments for any form of therefore wish to explore (including those involving the liabilities to HMG).
sterling guarantees). We will with you alternative approaches transfer of assets as well as
Could I suggest that, when you have provided us with the further information I have requested above, it may be appropriate for to meet to go over some of the issues involved?
us
Your sincerely
Jamie Dutimer
JE MORTIMER
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