TNAG-2270-FCO40-3269-Hong-Kong-Her-Majesty-s-Overseas-Civil-Service-(HMOCS)-poli-1991 — Page 19

CONFIDENTIAL

FM HONG KONG

HKB 233/1

CONFIDENTIAL

TO PRIORITY FCO

TELNO 3941

OF 2804O5Z DECEMBER 91

(AMENDED TELNO 28/12)

INFO ROUTINE PEKING, UKREP JLG HONG KONG

FROM GOVERNOR

247)

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seen, thaNOLIAN 4151

M

1. Mr Cox 3. Mr Stone of

2

This has only just

only just come

to me. It's rather old but I don't think you've seen it.

Entys

・på pts (Annex)

Qu

15/1

PERSONAL FOR BURNS, AUSS.

PEKING: PERSONAL FOR AMBASSADOR. UKREP JLG HONG KONG: PERSONAL FOR GALSWORTHY.

ANNER B. (240

YOUR TELNO 2181: HMOCS MATTERS.

WE HAVE NOW HAD AN OPPORTUNITY TO CONSIDER THE POINTS RAISED IN TUR. WHILE THEY DO NOT COME AS ANY GREAT SURPRISE IT IS

DISAPPOINTING THAT THE POINT MADE BY EVERYBODY HERE WHICH THOSE CONCERNED MADE A GREAT EFFORT TO PUT CLEARLY AND OBJECTIVELY, APPEAR TO HAVE FALLEN ON DEAF EARS.

CAPITALISATION PROPOSAL.

2.

THE TREASURY'S BELIEF THAT THEIR PROPOSAL IS BOTH TECHNICALLY FEASIBLE AND FINANCIALLY AFFORDABLE CONTINUES TO IGNORE THE POLITICAL REALITIES IN HONG KONG. THE SCHEME IS TECHNICALLY FEASIBLE ONLY IF EXCO WOULD BE PREPARED TO AGREE TO A HIGHLY DIVISIVE ARRANGEMENT WHICH WOULD HAVE WIDESPREAD REPERCUSSIONS BOTH WITHIN THE CIVIL SERVICE AND IN HONG KONG GENERALLY. IT IS MY CONSIDERED JUDGEMENT THAT THEY WOULD NOT/NOT BE PREPARED TO GIVE THIS ENDORSEMENT. SIMILARLY THE SCHEME IS FINANCIALLY AFFORDABLE ONLY IF LEGCO WOULD AGREE TO VOTE THE NECESSARY FUNDS. AGAIN IT IS MY CONSIDERED JUDGEMENT AND THAT OF ALL MY ADVISERS THAT, WITH A DIVISIVE SCHEME OF THE SORT ENVISAGED, LEGCO COULD NOT/NOT VOTE THE FUNDS. THERE SEEMS LITTLE POINT IN PURSUING A SCHEME WHICH MAY HANG TOGETHER AS A THEORETICAL CONSTRUCT BUT WOULD BE IMPOSSIBLE TO IMPLEMENT IN PRACTICE.

3. AS TO PUTTING THE PROPOSAL TO THE CHINESE, THIS REQUIRES VERY CAREFUL CONSIDERATION OF THE POSSIBLE CONSEQUENCES. IRRESPECTIVE OF THE COSTS INVOLVED, WE SEE IT AS INCONCEIVABLE THAT THE CHINESE SHOULD PUT THEIR NAME TO A SCHEME WHICH PROVIDED PROTECTION FOR THE PENSIONS ONLY OF A SMALL GROUP OF EXPATRIATES. EVEN TO APPROACH THEM ON THIS ISSUE COULD ONLY SERVE TO HEIGHTEN THEIR EXISTING SUSPICIONS OF BRITISH INTENTIONS.

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CONFIDENTIAL