CONFIDENTIAL
Our revised compensation proposal (Option C in the paper) meets these points. Under this scheme officers will have to
be prepared to work to the hand-over date to benefit from the
scheme. It is thus designed to retain their services until 1997. As regards the proposed cap, in previous schemes this affected few officers; in the case of Hong Kong, we estimate
that some 75% of officers remaining in 1997 would be affected.
Early Retirement
The right to retire before normal retirement date with full
payment of pension was a feature of all HMOCS compensation packages elsewhere. In previous cases, it was in the gift of
HMG, but in the case of Hong Kong it is a decision to be taken
by the Hong Kong Government. The HMOCS Association has asked
that officers be granted this right.
The Governor has to bear in mind the need to retain these
officers for as long as possible while avoiding a mass exodus in the last few months of British sovereignty. He has also to consider the effect of such arrangements on local officers in
Hong Kong and to ensure that he does not leave himself open to
Chinese criticisms that he is taking actions which would
disrupt a smooth transition in 1997. However, given the pressures from HMOCS officers in Hong Kong and the inclusion of a right to retire in all previous/schemes, he is prepared to consider an arrangement which would allow officers to apply
for early retirement as part of a package which he considers
to be equitable. We are sending to your officials a copy of a paper prepared by the Hong Kong Government on early retirement which sets out how this could be achieved.
If HKG offers HMOCS officers a general right to retirement, it
would reduce by about 30% HMG's contingent liability for
safeguarding pensions, given that those officers who chose to
retire would be eligible for smaller pensions and would
sos.let.SA
SLM
CONFIDENTIAL
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