TNAG-2685-FCO40-3886-Hong-Kong-Her-Majesty-s-Overseas-Civil-Service-(HMOCS)-poli-1993 — Page 11

FAN-LEES 19:00

PAUL FIFOOT

0372723755

P.05/08

(III) The exception referred to in (II) above is that under Hong Kong law, the sums taken for calculating pensionable emoluments may be reduced in consequence of disciplinary proceedings (see e.g. the proviso to regulation 18(1) of the Pensions Regulations made under Cap 89). It is conceivable that in such cases they might be reduced below 1992 levels. If so, those figures, not the 1992 figures, should be used for the purpose of the Scheme. The proviso to (A)(i) so provides.

Section 3(B): (I) The difference between the two alternatives in this subsection is that the first makes no provision for reducing the pension which has been granted, all of which is safeguarded and hence constitutes the multiplier for the safeguard, whereas the second provides for a notional commutation, the safeguard only applying to a notional reduced pension. The latter would bring past pensions into accord with the proposals for future pensions if you accept my suggestion of a notional commutation.

(II) Since there is no reduction of the initial calculation of the pension comparable to reducing the officer's emoluments to 1992 levels, I have not added the RPI as an element in the UKPB. It is not, therefore, taken into account as an element in the multiplier, though it features, for a different purpose, in section 4(1).

(III) Which of the alternative conversion rates (set out in each of the principal alternatives) do you intend to adopt ? The former could be more advantageous to the pensioner, and more logical.

Section 3(C) and (D): There are two particular

considerations to be borne in mind as regards dependants' pensions:

i) as I understand it, pensions are granted on the basis of the pensionable emoluments of the husband/father. Therefore, if it is considered that it is necessary to stabilize salaries of officers at 1992 levels for officers' own pensions (and compensation), it follows that similar provision needs to be made in respect of future dependants'