TNAG-2419-FCO40-3521-Hong-Kong-Her-Majesty-s-Overseas-Civil-Service-(HMOCS)-poli-1992 — Page 206

FCS/92/047

CHIEF SECRETARY

CONFIDENTIAL

HILD

PS Thored Continen PSTBUS

Sir J. Coles

Mr Burns

1.

NVL

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2712

Mr Stone Miss Willigan's

226/2

Pa

Mi Muir

Adv.

Mr Kerty, ODA Miss Brooks, Legal Adn biz Grimes 20/21

Hong Kong: HMOCS

Thank you for your letter of 24 February.

2. We agree that compensation/incentive arrangements for Hong Kong HMOCS officers should be announced soon, and in good time for the officers concerned to take them into account before June (when they have to choose whether or not to opt for a new Hong Kong pensions scheme); and that there is inequity in the way in which the SPOS arrangements operate at present in respect of Hong Kong HMOCS pensioners.

3. However, I am disappointed that you should seek to make progress on these two points conditional on my agreement that HMG should wash their hands of the standing commitments to safeguard the sterling value of HMOCS officers' pensions after the change of sovereignty. That is not acceptable. First, as far as compensation is concerned, it would mean rowing back from what was agreed between John Major and Geoffrey Howe in 1988: developments since then, notably Tiananmen, have only strengthened the concerns of HMOCS officers. Second, it is not tenable to argue that sterling safeguards are solely a matter for the Hong Kong Government (HKG), and that if HKG are unable to provide them, or a substitute for them, then that is a matter of indifference

to HMG.

TUGABK/1

CONFIDENTIAL