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you might have Following on from what the Chairman has said, and my comments Saulthingy at the last AGM, I saw the Chief Secretary recently in Hong Kong 'to learn that at last proposals had been put to HMG by the HKG for the protection of pensions paid to HK-UK pensioners. But let me pick up the story in sequence.
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The Chairman's delegation to the FCO last August had the effect of focussing attention both in London and Hong Kong on the need to resolve the impasse of responsibility for the solution to the pension problem. As the Chairman has said, both HMG and HKG now accept that there is a problem and that it is up to HKG to make proposals which are acceptable to HMG/and, I might add, HK-UK pensioners.
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A number of us led by Sir Philip Haddon Cave/took the opportunity of a visit to London by the Chief Secretary last November/to meet him to discuss the situation. We put it to the CS very frankly/that OSPA had been assured by Lord Caithness, the Minister of State with particular responsibilities for Hong Kong, that the question of the sterling value of HK pensions paid in the UK was under active consideration as a matter of priority,/and that we now wished to know precisely what was being considered.
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The Chief Secretary said that the base line for HMG's responsibility for the payment of pensions for dependent terriories had always been on default by the overseas territory/ or on independence/or change of status. Now the HKG and HMG were trying to devise a method by which HMG would take over responsibility for the payment of HK pensions in advance of 1997,/cover the exchange rate risk/and provide increases in line with UK inflation. His pensions officer,/the Deputy Secretary for the Civil Service,/ had been at the FCO that very morning discussing the problem.//
We said that those pensioners who retired after the 1976 changes to the SPOS arangements had taken substantial losses, particularly since 1983/when the HK/USD link had been adopted) which were now running at about 30% of the true value of pensions/with little or no relief from SPOS, and that they naturally expected some compensation for those losses. Moreover,/any take-over of HK pensions by HMG under the Overseas Pensions Act of 1973,/long advocated by OSPA,/should be at the personal exchange rates of pensioners on the dates of their retirement.
The Chief Secretary could not see HMG countenancing retrospective compensation/or anything but the current rate of exchange in a take-over,but we countered by saying that compensation was clearly the responsibility of the HKG/and that a take-over at current market rates in excess of personal exchange rates/would be to penalise HK-UK pensioners who had lost too much already. //
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