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CONFIDENTIAL
para 4 of the draft enclosed with your minute): in the first instance he has given this statement in confidence to
Sir David Ford in order to allow us time to brief the
Chinese before the decision becomes public. We shall
arrange this briefing as quickly as possible and are glad to agree to your officials' request that we clear with them the lines of the briefing beforehand. Meanwhile I put the Chinese Foreign Minister on notice during my talks with him
on 9 March, that we would be approaching them shortly.
8. As for the details of the proposed compensation/
incentive scheme, my officials have confirmed that they
valued the meeting with your officials on 28 February, at
which a number of helpful suggestions were discussed. It
remains our view that the maximum sum payable should be
calculated on the basis indicated in my minute of
26 February, but we shall reflect further on whether it is
right to put that to HMOCS officers at the beginning of the consultation process. We are also looking further at the possibility of a different phasing of the payments, both in
terms of whether they offer the most cost-effective way of meeting our objectives and in terms of how we negotiate with the HMOCS Association in Hong Kong. Finally, we are exploring an interesting idea which your officials raised for devising arrangements which would discourage (even if we could not prevent) officers at present on contract terms from taking up their right to enrol as HMOCS officers. This could also have a bearing on the potential maximum cost of any contingent liability which OD (K) subsequently agrees for sterling safeguards for HMOCS officers.
9.
I am grateful for your agreement that your officials should continue to assist us where they can in refining our
proposals. We shall want to take up this offer and in any
case will keep your officials closely informed of our thinking and of the consultation process with the HMOCS
officers.
JIFABG/4
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