could do about it.
FCO/ODA Scheme (d)
CONFIDENTIAL
rate not
Specified]
15.
-
This would fall well short of what HMOCS members are
expecting. They would in particular be strongly opposed to the likely safeguard rate. But it would give them a degree of certainty that their pensions would not become worthless
even if the Hong Kong dollar collapsed. The costs of the
scheme cannot be predicted they could be zero if the Hong
Kong dollar stayed stronger than the safeguard rate or they
could amount to several hundred million pounds if it became
worthless. While the scheme would be divisive to a certain
extent in the Civil Service, the Governor is satisfied that
it should be possible to contain this by pointing out that
HMG were paying, pursuant to their past undertakings to
HMOCS members.
Decision not to offer a Scheme (e)
16. This would require a Ministerial decision that Hong
Kong HMOCS officers
should not be offered a safeguard scheme at the expense of
the UK tax payer. It may risk an
exodus of HMOCS from
Hong Kong before 1997, with the consequences noted above for
our ability to administer Hong Kong effectively. HMOCS officers would no doubt also bring pressure to bear on HMG through Parliament and the media. Such a campaign would
highlight their lack of confidence in the guarantees
contained in the Joint Declaration: this would be damaging
in Hong Kong and internationally and would further
antagonise Peking. An exodus would face HKG with the decision of whether they could do more to encourage key
HMOCS officers, eg in the Police Force, to stay: for example by raising salaries or improving other conditions of
service. However, HMG could not be certain of escaping all
costs, if they were to adopt this approach. If the Hong
Kong dollar were to collapse, or if the SARG were to stop
NC3AAV/7
CONFIDENTIAL
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