--11-MAY-'93 TUE 17:25: ID:
DRAFT
P04408
FAR NUA
HEST P00
CONFIDENTIAL
From: P F Owen
Date: 11 May 1993
cc
Sir Robin Butler Mr Lyne
SECRETARY OF STATE FOR FOREIGN AND COMMONWEALTH AFFAIRS
CHIEF SECRETARY, TREASURY
HONG KONG: ARRANGEMENTS FOR MEMBERS OF
HER MAJESTY'S OVERSEAS CIVIL SERVICE
1. The Prime Minister's private secretary asked Sir Robin Butler to arrange for the Cabinet Office to undertake work with officials of the departments concerned to clarify the issues relevant to a decision on arrangements for compensation and pensions for Her Majesty's Overseas Civil Servants (HMOCS) in Hong Kong and recommend an appropriate solution.
2. The attached paper briefly describes the background and sets out the respective positions of
positions of the Treasury and the Foreign
Office.
3. In essence, both departments are agreed that compensation for loss of prospects and the Foreign Secretary's protection and safeguarding of the value of pensions should be provided to HMOCS staff following the transfer of Hong Kong. There are relatively minor differences over the design of the schemes; the main dispute is over the level of payments. The Treasury note that remuneration in Hong Kong is roughly twice that in the UK and argue that payments which fully reflect this differential
unnecessary.
The FCO believe that payments should follow precedent, by taking full account of actual remuneration.
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