CONFIDENTIAL
6. It is very difficult to assess what arrangement should be recommended, given the sometimes conflicting interests of the officers themselves, the Hong Kong Government and the UK taxpayer. I list below some of the Options together with my comment:
I.
II.
PRESS AHEAD WITH THE SCHEME AS PROPOSED
Arguments in favour
It would be the least cost solution as far as HMG is concerned.
Arguments against
The HMOCS officers would react very badly and mount a strong campaign against it.
Given Hong Kong salary levels and the scarcity of alternative employment possibilities, we can assume that those who felt obliged to leave in 1997, would do so out of strongly held principles which would arouse considerable public sympathy.
There is no safeguard for the value of HMOCS pensions.
Even if the scheme helped achieve the objective of continuity, it would be on the basis of coercion and in terms of good administration this could have the opposite effect to that which we intend.
THE SCHEME AS PROPOSED COUPLED WITH A STERLING SAFEGUARD AND A REVISION OF THE SPOS ARRANGEMENTS
Arguments in favour
This would satisfy a major concern of past and present HMOCS officers by guaranteeing that their pensions will continue to be paid, and to have a reasonable value.
Those wishing to stay would at least be assured that they would ultimately benefit from continued service.
The arrangement could be much more readily defended in the UK.
If, as hoped, the Hong Kong dollar remains stable, it would still represent a low cost solution to HMG.
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