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One point I must pick up is that of UK
relativities. In none of the 42 previous cases in other territories was account taken of relative salary and pension differences between HMOCS and UK civil servants. In all cases HMOCS officers were provided with a safeguard which protected the full value of their pension. To seek now to introduce and apply a new principle of strict UK comparability to Hong Kong HMOCs alone is completely unacceptable. What possible justification is there for this? The proposals put forward by the Foreign Secretary are already substantially less generous than they would be by reference to the treatment of HMOCS staff in every previous case.
Sterling Safeguard
We have explained at length why the Hong Kong Government is politically unable to capitalise and transfer HMOCS pensions. I believe that this point has been accepted by all parties concerned. Suffice it to say that even if we are able to find a way of partially funding local Hong Kong Civil Service pensions, this will not provide a solution for HMOCs officers.
6.
I have the following specific comments on points concerning Sterling safeguards :
A
The Supplementary Pensions for overseas Service (SPOS) arrangements do not provide any real exchange rate protection to Hong Kong HMOCS officers who have retired since 1977. (They did so before 1977 when the rules were changed.) This is precisely why the ODA has now proposed a change to SPOS arrangements whereby exchange rate gains and losses are taken into account both ways.
A bit of HMOCS research is probably necessary before making bold statements about past cases. In many territories HMG took over the payment of HMOCS pensions as an aid measure because the territory was unable to pay either the pension or the pension plus increases at the agreed pension safeguard rate. In some cases HMG merely required the territory to undertake to provide a sterling pension safeguard at an agreed rate as a condition for independence or
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