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152046,
MDLOA 4675
WITH IMMEDIATE PAYMENT OF PENSION, A KEY MATTER TO BE TAKEN INTO ACCOUNT WILL BE THE EFFECT THIS WOULD HAVE ON LOCAL OFFICERS: THEIR REACTION WOULD NO DOUBT BE INFLUENCED BY WHETHER OR NOT HKG IS ABLE TO ANNOUNCE ANY SCHEME FOR PENSIONS GENERALLY.
(B) CIVIL SERVICE MORALE HAS AN OBVIOUS BEARING ON OUR ABILITY
TO FULFIL OUR RESPONSIBILITIES FOR HONG KONG'S GOVERNMENT UP TO 30 JUNE 1997 AND TO MEET OUR OBJECTIVES OF MAXIMUM CONTINUITY IN THE PUBLIC SERVICE THEREAFTER AND A SMOOTH TRANSITION. THE REPRESENTATIONS WE HAVE RECEIVED RECENTLY FROM HMOCS OFFICERS, EVEN ALLOWING FOR EXAGGERATION OR HISTRIONICS, SUGGEST A WORRYING DEGREE OF UNCERTAINTY AND UNHAPPINESS ABOUT THE FUTURE, PARTICULARLY AMONG POLICE OFFICERS. WE DO NOT HAVE MUCH FEEL HERE FOR THE STATE OF MORALE IN THE CIVIL SERVICE MORE GENERALLY, BUT WE IMAGINE THAT PENSION SAFEGUARDS COULD BE AN ISSUE ON WHICH MANY OTHER FRUSTRATIONS COULD FOCUS.
(C) THERE IS ALSO A STRONG CHINA DIMENSION. WE NEED CHINESE COOPERATION IN A NUMBER OF AREAS IF WE ARE TO MAXIMISE CIVIL
SERVICE CONTINUITY THROUGH 1997. THE CHINESE HAVE SUPPORTED THE PROPOSAL FOR A SET-ASIDE FUND OF HKD 15 BN FOR CIVIL SERVANT PENSIONS: THEY MAY FEEL THAT SOME OF THE ARGUMENTS WE USED AGAINST THIS NOTION AT JLG XX NO LONGER CARRY AS MUCH WEIGHT AS
THEY DID THEN. IF WE WERE ABLE TO RETURN TO THE CHINESE NOT WITH A REJECTION OF THE PROPOSAL BUT WITH A RADICAL ADAPTATION OF IT, IN A WAY WHICH YOU JUDGED MADE POLITICAL AND ECONOMIC SENSE, IT MIGHT PUT US IN AN ADVANTAGEOUS NEGOTIATING POSITION, EG TO ARGUE FOR FURTHER CHINESE ACTIONS TO PROVIDE REASSURANCE TO THE CIVIL SERVICE. IS IT ENTIRELY FANCIFUL TO ENVISAGE DISCUSSING ALL THIS IN TANDEM WITH OPENING DISCUSSIONS ABOUT
FUTURE PRINCIPAL OFFICIALS AND THE SELECTION OF THE CHIEF EXECUTIVE? COULD DISCUSSION OF SOME USE OF THE HONG KONG RESERVES FOR CIVIL SERVICE PENSIONS FUNDING PROVIDE AN OPPORTUNITY TO TACKLE THE CHINESE ABOUT RELEASE OF FUNDS FROM
THE SARG LAND FUND TO SUPPORT PUBLIC WORKS PROJECTS IN HONG KONG
BEFORE 1997?
4.
WE AGREE THAT OF THE OPTIONS THAT HAVE BEEN DISCUSSED, THE MOST PROMISING, OR LEAST UNPROMISING, SEEMS TO BE A PARTIAL FUNDING PROPOSAL. WE SHOULD WELCOME MORE INFORMATION ABOUT THE
ONE YEAR ROLL-FORWARD PENSION RESERVE FUND MENTIONED IN PARA 6 OF YOUR TELNO 1139. BUT, FROM WHAT WE UNDERSTAND OF IT SO FAR, WE ARE INCLINED TO AGREE THAT IT MIGHT OFFER TOO LITTLE PROTECTION TO BE WORTH WHILE.
WE WONDER HOWEVER WHETHER SOME
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