Value
2.5
2.6
2.7
The pensions of overseas officers are payable in Hong Kong dollars and the value on conversion to sterling is dependent on the rate of exchange applicable at the time of each monthly payment. In addition, members of HMOCS may receive a supplementary pension (SPOS) which is intended to maintain the real value of the pension in the United Kingdom, although it does not in practice do so for reasons explained in para. 3.
The inability of SPOS to maintain the real value of earned pensions can only be overcome by the introduction of а guaranteed rate of exchange for conversion purposes.
The problem is well illustrated by wide fluctuations in the value of the Hong Kong dollar, which is pegged to the U.S. as against sterling.
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In reply to a Parliamentary Question (10th February 1988) Mr. David Mellor said that, whilst it is acknowledged by that sterling safeguards have normally been negotiated behalf of HMOCS members immediately before constitutional change, it would be a significant departure from previous practice to contemplate such arrangements at this stage, and that HMG has no plans to
do so. This Association considers the circumstances of the transfer of Hong Kong's administration are, so significantly different from previous practice as to justify the early introduction. of sterling safeguards.
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