TNAG-2424-FCO40-3526-Hong-Kong-Her-Majesty-s-Overseas-Civil-Service-(HMOCS)-poli-1992 — Page 32

SECRET

072472

MDLOA! 278

NO QUESTION OF HMG'S OFFERING TO INTERVENE TO RELIEVE THE

HKG/SARG OF ITS OBLIGATION TO PAY HMOCS PENSIONS.

4. BOTH IN THIS CONTEXT AND MORE GENERALLY, MINISTERS ASKED

ABOUT THE IMPACT OF THE PROPOSED HMOCS ARRANGEMENTS ON THE MORALE OF LOCAL CIVIL SERVANTS. MINISTERS NOTED THAT THESE LOCAL OFFICERS TOO WERE WORRIED ABOUT THE SECURITY OF THEIR PENSIONS, AND THEY WERE ATTRACTED BY THE SUGGESTION THAT IT MIGHT BE POSSIBLE TO ENVISAGE INITIATING A PARTIAL FUNDING OF HONG KONG PUBLIC SERVICE PENSIONS AND THAT THE CHINESE MIGHT WELCOME THIS TOO. THEY NOTED THAT YOU AND YOUR ADVISERS HAD SO FAR SEEN DIFFICULTIES WITH THIS OPTION, BUT WOULD BE GRATEFUL IF YOU COULD GIVE FURTHER THOUGHT TO IT (EG ON THE LINES SET OUT IN OUR TELNO 737) AND LET US KNOW HOW YOU SEE THE POSSIBILITIES. THEY WOULD ALSO WELCOME THE VIEWS OF SIR R MCLAREN AND MR GALSWORTHY ON THE LIKELY CHINESE ATTITUDE TO SOME SUCH PARTIAL FUNDING PROPOSAL.

5. MINISTERS ALSO WONDERED WHETHER LOCAL OFFICERS MIGHT BE LESS RESENTFUL OF THE HMOCS ARRANGEMENTS IF THE HKG WERE (FOR BROADER REASONS) SOON TO ANNOUNCE A FURTHER DEVELOPMENT OF ITS LOCALISATION POLICY. CLEARLY THIS WOULD REQUIRE PRIOR CONSULTATION WITH THE CHINESE, BUT WE SHOULD BE GRATEFUL TO KNOW IF YOU HAVE CONSIDERED THIS POSSIBILITY.

HURD

YYYY

MAIN

41

.HER MAJESTY'S OVERSEAS

.CIVIL SERVICE RESTRICTED

HKD

LEGAL ADVISERS//MISS BROOKS FED

NEWS D

RAD//MR WYE

RMD

NNNN

DISTRIBUTION

41

OVERSEA PENSIONS/ODA//MR FISH

PS

PS/MR GOODLAD

PS/MR PATTEN

PS/PUS

SIR J COLES

MR HUM

MR KERBY