TNAG-2271-FCO40-3270-Hong-Kong-Her-Majesty-s-Overseas-Civil-Service-(HMOCS)-corr-1991 — Page 221

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HKG's

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the

What pensions are worth in real terms depends therefore on

correction for inflation in Hong Kong

taxation (withholding, income or remittance tax) in Hong Kong

calculation of SPOS Base Value

application of SPOS to correct for any higher rate of inflation in Britain

the exchange rate at the time of payment

the actual SPOS payment corrected for any exchange rate "improvement".

The calculation of the SPOS Base Value is at the rate applicable on actual date of retirement. A difference in this date of a few weeks can have a dramatic and permanent effect on the value, and hence on the actual amount of a pension as received in Britain in sterling.

The solutions are fairly simple. The first is an assured ΟΚ stabilised exchange rate. We are all HMOCS members, most of whom will be retiring to Britain (until recently we were not even allowed to remain in Hong Kong during vacation leave!), and it is no consolation that the US$ - HK$ link may

be stable when it is the £ sterling value that matters. OSPA representatives have suggested that this should be addressed by the Hong Kong Government. We disagree as,

unless all Hong Kong Government pensioners retiring overseas are to be afforded protection, it is to our HMOCS status (and to HMG) that we must look.

As

The second is a revamp of SPOS to remove its present inadequacies. noted above, including the Police we are talking about some 700 serving officers so neither the numbers nor the costs involved are large.

Finally, why should our concerns be addressed particularly at this time? We are committed to the future of the Territory but worries about our own financial future make it difficult to maintain morale despite our dedication. We feel that it is not only in the interests of Hong Kong but also HMG in the years leading up to 1997 that these should be addressed, and that this should be done as a matter of urgency.

of

We hope that you will help.

Yours sincerely,

fraham

L.R

Graham C.S. Smith

Chairman

Pensionable Service Committee