TNAG-2430-FCO40-3532-Hong-Kong-Her-Majesty-s-Overseas-Civil-Service-(HMOCS)-poli-1992 — Page 19

CONFIDENTIAL

will make a difference.

Compensation is based on age, salary and length of service. Compensation increases for each year

of service until 10 years have been reached- and until the

proposed cap, £120,000, on the compensation is reached. Since

there are now less than 5 years to July 1997 were we not to

count bought back service it would hit officers only now transferring to pensionable status.

5. Our Legal Consultant has advised that previous schemes in other territories going to independence did not expressly exclude such service as counting, but that the arrangements for changing from contract to pensionable terms, especially as regards the Judiciary, are undoubtedly far more generous in Hong Kong than elsewhere. Such transfers in other territories

are likely to have been fewer and earlier. Although precedent would point to allowing the buying back of service, we have been careful to present the scheme we are now promulgating as unique and tailored to meet Hong Kong's circumstances.

could, if we wish, exclude such service.

6.

The case against permitting bought back service to count is primarily threefold:

We

(i) These officers cannot argue that they have suffered a loss

of expectation of career as HMOCS officers: they now know

exactly where they stand;

(ii) All the officers (except some 25 prominent members of the Judiciary) have had over 7 years to change to pensionable terms: the fact they did not do so earlier suggests they were waiting to see what would give them most gain;

(iii) It could add £3- 4 million to the compensation bill (although the actual sum is likely to be less than this as the majority of officers switching from contract to pensionable service do not buy back service).

buy.back.ADM

SLM

CONFIDENTIAL

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