TNAG-2685-FCO40-3886-Hong-Kong-Her-Majesty-s-Overseas-Civil-Service-(HMOCS)-poli-1993 — Page 168

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4. The HMOCS Association will argue strongly for a pension safeguard at HK$13.76: £1.

Although their final position is

likely to depend upon the acceptability of the overall package

including compensation and general right to retirement, they

will stress that the HK$13.76 rate can be justified as an

average in 1991, that there is no basis for penalising HMOCS officers who have served in Hong Kong by setting an

artificially adverse rate and that the level of salaries

should not be the issue. But Chris Patten and I conclude that

16:1 would be a reasonable compromise as part of the right

package. He does not believe that we could impose a more

adverse rate.

Compensation

5.

You reasonably asked about the objective we were seeking to achieve with our revised compensation proposal,

particularly given a right to retire for HMOCS officers on transfer of sovereignty. Our initial proposal was designed to

provide a measure of compensation and incentive to officers to

encourage them to work in Hong Kong both up to and for some

years after 1997. However, in the first round of

consultations, the HMOCS Association rejected this approach.

They argued strongly that it was not in line with previous

schemes, and that it would in effect force officers to

continue serving under Chinese sovereignty to earn

compensation to which they were entitled. The Association

have said they will not accept anything less than a scheme on

traditional lines.

6. 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

6

CONFIDENTIAL