The Hong Kong (Overseas Public Servants) (Pension Supplements) Order 1996

Made: 15th May 1996

Laid before Parliament: 29th May 1996

Coming into force: 1st July 1996

At the Court at Buckingham Palace, the 15th day of May 1996 Present, The Queen’s Most Excellent Majesty in Council

Her Majesty, in exercise of the powers conferred upon Her by section 4 of the Hong Kong (Overseas Public Servants) Act 1996[^f00001] and all other powers enabling Her in that behalf, is pleased, by and with the advice of Her Privy Council, to order, and it is hereby ordered, as follows:—

Citation and commencement

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• (1) This Order may be cited as the Hong Kong (Overseas Public Servants) (Pension Supplements) Order 1996.

• (2) This Order shall come into force on 1st July 1996.

Interpretation

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• (1) In this Order (including the Schedule):

“specified officer” means:

• (a) a person who, during his service or a part of his service in Hong Kong, is or was a member of Her Majesty’s Overseas Civil Service (hereinafter referred to as “HMOCS”) or Her Majesty’s Overseas Judiciary;

• (b) a person who is or was a judge in Hong Kong (that is to say, a judge of the Supreme Court or a judge of the District Court) or magistrate who, during his service in Hong Kong, was informed in writing by or on behalf of the Secretary of State that he would be treated as a member of HMOCS;

• (c) a member of any of the Services listed in the Schedule to the Special Regulations made by the Secretary of State for HMOCS and published in the White Paper The Reorganisation of the Colonial Service, Colonial 306, who prior, to 1st October 1954, held a pensionable office on pensionable terms in the service of Hong Kong;

• (d) an expatriate officer who, prior to the 19th July 1956, held a pensionable office on pensionable terms in the service of Hong Kong, being a person who is certified by the Secretary of State:

• (i) as having been selected or promoted to such office by, or with the approval of, the Secretary of State; or

• (ii) as having been recruited to such office through the Crown Agents for Overseas Governments and Administrations; or

• (iii) as having been recruited through other channels to such office in the service of Hong Kong for which a normal channel of recruitment was either through the Colonial Office or the Crown Agents,

other than an officer whose application for membership of HMOCS has been refused;

• “basic pension” and “basic Hong Kong pension” mean: the pension first awarded to a specified officer with effect from the date of his retirement and calculated by reference to his emoluments, or which would have been so awarded had it commenced on that date; or, if the pension is deferred, the amount that would have been awarded as so calculated had the pension commenced on the date of his retirement; in the case of a pension in respect of the services of any person other than the pensioner, the pension first awarded, without in either case, any addition or increases howsoever awarded (whether or not included in the amount of the original award);

• “death gratuity” has the meaning ascribed to it in the relevant law;

• “Hong Kong” means the Colony of Hong Kong or the Hong Kong Special Administrative Region, and references to service in or of Hong Kong, and the Government of Hong Kong, refer respectively to service in, and the Government of, the Colony or the Special Administrative Region;

• “gratuity” means a lump sum paid under a relevant law as a gratuity, together with a reduced pension, in lieu of a full pension, or as a death gratuity; and this Order shall be construed in respect of a death gratuity as if the deceased officer were entitled to the death gratuity and the gratuity were payable at a place appointed by his legal personal representatives;

• “pension” means a pension (including an injury pension), whether full, reduced or deferred, which is granted under a relevant law;

• “pensioner” means a specified officer, or a dependant of a specified officer, who is in receipt of a pension;

• “relevant law” means: the Pensions Ordinance[^f00002]; the Pension Benefits Ordinance[^f00003]; the Pension Benefits (Judicial Officers) Ordinance[^f00004]; the Police Officers (Special Cases) Pensions Ordinance[^f00005]; the Widows and Orphans Pension Ordinance[^f00006]; the Surviving Spouses’ and Children’s Pensions Ordinance[^f00007], of Hong Kong (and the regulations made under those ordinances), including any law amending such a law up to the date on which this Order comes into force, and any other law of Hong Kong recognised by the Secretary of State for the purposes of this Order;

• “relevant law”, in relation to any pensioner or person entitled to a gratuity means the relevant law under which he is granted, or is entitled to, such benefit.

• (2) Where any calculation is to be made under this Order in accordance with the relevant law and that relevant law is amended after the coming into force of this Order by a law other than a law recognised for the purposes of this Order by the Secretary of State, the calculation shall be made in accordance with the relevant law as if it had not been so amended.

• (3) Nothing in paragraph (2) applies to the determination of the actual pension income of a pensioner or the determination of an actual gratuity, and in relation to such determination, the definition of relevant law in paragraph (1) shall be read as if the words “up to the date on which this Order comes into force and any other law of Hong Kong recognised by the Secretary of State for the purposes of this Order” were omitted.

Benefits falling within this Order

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This Order applies to:

• (a) pensions awarded to specified officers and their dependants under a relevant law;

• (b) a gratuity payable to a specified officer or to which a specified officer is entitled under a relevant law,

and the Order will have effect in respect of payments of such a pension or gratuity due after the coming into force of this Order:

• Provided that where the Secretary of State is satisfied that a payment in respect of a pension or a gratuity is or may be made within the area comprising Hong Kong, the People’s Republic of China and Macao, and that no corresponding payment (less any sum paid under the law of Hong Kong in tax in respect of such pension or gratuity) is made by or on behalf of the person entitled thereto to a place outside that area, he may declare that this Order shall not apply to that pension or gratuity until he is subsequently satisfied that payments in respect of that pension or gratuity, or such corresponding payments, are made to a place outside that area.

Determination of notional Hong Kong pension and actual pension income in sterling

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• (1) The provisions of Parts I and II of the Schedule to this Order shall apply for calculating and determining the notional Hong Kong pension of pensioners and the sterling value of such notional pension for the purposes of this Order. If a pensioner is entitled to more than one pension under the relevant laws, a separate calculation and determination shall be made in respect of each pension.

• (2) For the purposes of this Order, the actual pension income for any month of a pensioner in respect of a Hong Kong pension is the sum of:

• (a) one twelfth of the sterling value of the basic pension; and

• (b) the sterling value of any increases on the basic pension received in respect of that month under the law of Hong Kong; and

• (c) the amount of any pension supplement payable during that month under any regulations made under section 11 of the Pensions (Increase) Act 1971[^f00008], as from time to time in force, in respect of the basic pension,

and pro rata for any part of a month. If any payment is made otherwise than in sterling, the sterling value of the basic pension and any such increase will be determined using the middle rate of exchange of the official exchange market between the Hong Kong dollar and sterling on the fifteenth day of the month in question.

Provision for supplementation of pension

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If, in any month, the actual pension income of a pensioner in respect of a Hong Kong pension to which this Order applies is less than the sterling value of the pensioner’s notional Hong Kong pension, the pensioner shall be entitled to a supplementary payment in sterling of the difference between the two. Where a pension is payable in respect of only a part of a month, the notional Hong Kong pension shall be calculated on the same basis, and any supplementary payment shall be the difference between the two.

Suspension or variation of payment of pensions

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This Order applies only to pensions for the time being in payment and, accordingly:

• (a) no supplementary payment shall be made when a pension is deferred under the relevant law or ceases, or during a period when it is suspended; and

• (b) in the event of a pension being reduced or otherwise varied in accordance with the relevant law, the notional Hong Kong pension shall be recalculated and redetermined as the same proportion of the notional Hong Kong pension as originally determined as the reduced pension or pension as varied bears to the original basic pension.

Determination of sterling values of notional Hong Kong gratuity and of actual gratuity

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• (1) The provisions of Parts I and III of the Schedule to this Order shall apply for calculating and determining the notional Hong Kong gratuity in respect of a specified officer who exercises an option under the relevant law to be paid a gratuity and a reduced pension, the notional Hong Kong gratuity in respect of a death gratuity payable in respect of a specified officer, and the sterling value of such gratuities.

• (2) For the purposes of this Order, the actual gratuity of, or payable in respect of, a specified officer will be the sum of the sterling value of the gratuity (and any increases granted under the relevant law), at the exchange rate in force on the day the gratuity is paid, and any supplement payable in respect of the gratuity under any regulations made under section 11 of the Pensions Increase Act 1971.

• (3) In the event of there being any change in matters to be taken into account in calculating a notional Hong Kong gratuity between the registration of such gratuity under article 9 of this Order and the payment of the actual gratuity, the notional Hong Kong gratuity will be recalculated and redetermined.

Provision for supplementation of gratuity

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If the actual gratuity paid to, or in respect of, a specified officer is less than the sterling value of the notional Hong Kong gratuity of that officer, he shall be entitled to a supplementary payment in sterling of the difference between the two.

Registration of notional Hong Kong benefits and provision of information

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• (1) In order to qualify for supplementary payments under this Order, a pensioner shall provide the Secretary of State:

• (a) with such information as will enable the Secretary of State to calculate and register that pensioner’s notional Hong Kong pension:

• (i) in the case of a pension awarded before the coming into force of this Order, within six months of its coming into force;

• (ii) in the case of a pension awarded after the coming into force of this Order, within three months of the grant of such pension,

or within such longer period as the Secretary of State may allow;

• (b) with such other information, within such period as the Secretary of State may require, as will enable the Secretary of State to verify the payments made to the pensioner under the law of Hong Kong in respect of his pension, the place of such payments and any corresponding payments, and any changes made in respect of his pension, and to determine the amount of any supplementary payment.

• (2) In order to qualify for a supplementary payment under his Order in respect of a gratuity, a specified officer or, as the case may be, his legal personal representatives shall provide the Secretary of State:

• (a) with such information as will enable the Secretary of State to determine whether the Order applies to the gratuity, to calculate and register that officer’s notional Hong Kong gratuity and, if any change occurs in the matters taken for calculation of the gratuity since so informing the Secretary of State, of any such change;

• (b) with such other information as will enable the Secretary of State to determine the amount of any supplementary payment.

• (3) No supplementary payment shall be made under this Order except in respect of a registered notional Hong Kong pension or a registered notional Hong Kong gratuity, and the Secretary of State may withhold any supplementary payment unless he is satisfied that he has been correctly informed of all pertinent information as regards a pension or gratuity and the payments made under the law of Hong Kong in respect of the pension or gratuity.

Overpayments

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• (1) In any case where an increase to a pension under the law of Hong Kong which may be taken into account in determining any supplementary payment payable under this Order is granted or revised with retrospective effect, such supplementary payment will be revised accordingly with similar effect and any overpayment to the pensioner as a result may be recovered from him by deduction from any supplementary payments subsequently payable or otherwise.

• (2) Where any overpayment has not been recovered within three months of notification, no further supplementary payments shall be made to the pensioner until the amount of the overpayment has been recovered.

Secretary of State to decide all questions of interpretation of the Order

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Any question relating to the interpretation of this Order, including any question as to who is a member of HMOCS, Her Majesty’s Overseas Judiciary or otherwise eligible as a specified officer and what shall be deemed to be the salary point and grade as at 1st January 1992 of a grade established or existing before or after that date, may be determined by the Secretary of State.

THE SCHEDULE

PART I — GENERAL PROVISIONS

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In this Schedule:

• “pensionable emoluments” (except in the expression notional Hong Kong pensionable emoluments), “public service”, “other public service” and “Scheduled Government” have the meanings respectively ascribed to them in the relevant law;

• “service in the Group” means service under the Government of Hong Kong and under a Scheduled Government or Governments;

• “the mixed service formula” means the following calculation: determine the pension which would be payable under the relevant law in respect of the notional Hong Kong pensionable emoluments as if the officer’s service had been wholly under the Government of Hong Kong; determine: the aggregate amount of the officer’s actual pensionable emoluments during his service under the Government of Hong Kong; and the aggregate amount of his actual pensionable emoluments throughout his service in the Group; the pension payable on the notional Hong Kong pensionable emoluments in respect of the officer’s Hong Kong Service will bear the same proportion to the amount determined in paragraph (a) of this definition as the amount determined in paragraph (b)(i) bears to the amount determined in paragraph (b)(ii);

• “relevant Pensions Increase (Review) Order” in respect of any year, means the Order (if any) made under section 59 of the Social Security Pensions Act 1975[^f00009], as from time to time in force, which has effect in respect of that year.

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• (1) Where, in calculating the sterling value of a specified officer’s notional Hong Kong pension, provision is made in this Schedule for increasing any sum by a percentage increase rate obtained from a Pensions Increase (Review) Order or in accordance with section 1 or an order made under section 2 of the Pensions (Increase) Act 1971 and the calculation is to be made at any time between the officer’s retiring under the age of fifty five years and his attaining that age, no such increase shall be made:

• (a) in respect of any such Order made subsequent to the date of his retirement;

• (b) or, as the case may be, for any period to which the said section 1, or any order made under the said section 2, applies

if that period falls within the period between the officer so retiring and his attaining the age of fifty five, unless the Secretary of State is satisfied that the officer is permanently incapacitated by physical or mental infirmity from engaging in any regular full-time employment. When the officer has attained the age of fifty five, subsequent calculations shall take account of Orders or periods excluded by the foregoing provisions of this paragraph as well as any relevant earlier or future Orders.

• (2) Nothing in this paragraph applies to the calculation of the sterling value of a deceased specified officer’s notional Hong Kong pension where such calculation is made for the purposes of calculating a dependant’s notional Hong Kong pension.

PART II — RULES FOR CALCULATING AND DETERMINING A NOTIONAL HONG KONG PENSION AND ITS STERLING VALUE

Head A: Specified officers who are awarded a pension, or entitled to a deferred pension, under a relevant law on their retirement from the service of Hong Kong before or after the coming into force of this Order and who have no other pensionable public service

To calculate the sterling value of the officer’s notional Hong Kong pension:

• (a) Identify the officer’s salary point and allowances appropriate to his substantive grade at the date taken into account to determine his basic pension under the relevant law;

• (b) Determine the salary point and allowances appropriate to the salary point of that grade on 1st January 1992; this will produce the officer’s notional Hong Kong pensionable emoluments;

• (c)

• (i) Calculate, in accordance with the relevant law, the officer’s pension on the notional Hong Kong pensionable emoluments; and

• (ii) If the officer commuted or commutes any part of his Hong Kong pension, or his pension has been or is reduced by an appropriate authority under the relevant law, calculate, in accordance with the relevant law, the reduced pension on the notional Hong Kong pensionable emoluments as if the like proportion had been commuted of, or the like reduction made in, a pension as calculated in paragraph (c)(i) in respect of the notional Hong Kong pensionable emoluments;

• (d) Divide the pension or reduced pension as calculated in paragraph (c)(i) or (c)(ii), as appropriate, by 21; the resulting sum will be denominated in pounds sterling;

• (e) Save as provided in paragraph 2 of Part I of this Schedule, increase the sum obtained at paragraph (d) of this Head in April of each year up to the date on which a calculation is to be made to determine whether a supplementary payment is payable under paragraph 5 of this Order by the appropriate percentage increase rate obtained from the relevant Pensions Increase (Review) Order, as if the sum so obtained were a pension beginning on the 8th April 1991;

• (f) The sum obtained in paragraph (d) of this Head as increased in accordance with paragraph (e), so far as the latter is applicable, is the sterling value of the pensioner’s notional Hong Kong pension;

• (g) Divide the sterling value of the pensioner’s notional Hong Kong pension by 12 to obtain the monthly rate of such sterling value.

Head B: Specified officers who are awarded a pension, or entitled to a deferred pension, under a relevant law on their retirement from the service of Hong Kong before or after the coming into force of this Order and who have other pensionable service under a Scheduled Government

Interpretation of Head B:In paragraph (g) of this Head:

Head C: Specified officers who retire before the coming into force of this Order from United Kingdom service who, on such retirement, are awarded a pension under a relevant law of Hong Kong in respect of their service in Hong Kong

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In this Head, “overseas government service pension” means a pension in respect of other public service not being service under the Government of the United Kingdom.

Head D: Specified officers who retire on or after the coming into force of this Order from United Kingdom service who, on such retirement, are awarded a pension under a relevant law of Hong Kong in respect of their service in Hong Kong

Head E: Specified officers who, having resigned from United Kingdom service before the coming into force of this Order with a preserved pension entitlement under United Kingdom law, are, after the coming into force of this Order, awarded a deferred pension under a relevant law of Hong Kong in respect of their service in Hong Kong

Head F: Specified officers who retired before the coming into force of this Order from the service of a Scheduled Government (other than the Government of the United Kingdom) who, on such retirement, are awarded a pension or entitled to a deferred pension under a relevant law of Hong Kong in respect of their service in Hong Kong

Head G: Specified officers who retired before the coming into force of this Order from other public service in Hong Kong who, on retirement, are awarded a pension, or entitled to a deferred pension, under a relevant law in respect of their service in Hong Kong

Head H: Specified officers who are entitled to a pension under the Police Officers (Special Cases) Pensions Ordinance

Head I: Spouses and children who, being dependants of specified officers who die in service or after being granted a pension in respect of their service in Hong Kong, have been or are themselves granted a pension under the Surviving Spouses’ and Children’s Pensions Ordinance

Interpretation of Head H2:

Head J: Widows and children who, being dependants of specified officers who die in service or after being granted a pension in respect of their service in Hong Kong, have been or are themselves granted a pension under the Widows and Orphans Pension Ordinance

Head K: Dependants of specified officers who are awarded a pension under, and in the circumstances prescribed in, section 18 of the Pensions Ordinance, section 19 of the Pension Benefit Ordinance or section 20 of the Pension Benefit (Judicial Officers) Ordinance

PART III — RULES FOR CALCULATING AND DETERMINING A NOTIONAL HONG KONG GRATUITY AND ITS STERLING VALUE

Head L: Specified officers who retire from the service of the Government of Hong Kong with no other pensionable public service and who elect to commute part of their Hong Kong pension for a gratuity

To calculate the sterling value of an officer’s notional Hong Kong gratuity:

• (a) Calculate the officer’s unreduced notional Hong Kong pension in accordance with HeadA, paragraphs (a), (b), (c) (i), (d) and (e);

• (b) Apply the provisions of the relevant law to the unreduced notional Hong Kong pension to calculate the gratuity in accordance with the option exercised by the officer as if it were the pension to be taken for the purpose under the relevant law;

• (c) The sum obtained at paragraph (b) of this Head is the sterling value of the officer’s notional Hong Kong gratuity.

Head M: Specified officers who retire from the service of the Government of Hong Kong with other pensionable service under a Scheduled Government and who elect to commute part of their Hong Kong pension for a gratuity

Head N: Specified officers who retire from the service of the United Kingdom Government and elect to commute part of their Hong Kong pension for a gratuity

Head O: Death Gratuity

Signed

N. H. Nicholls — Clerk of the Privy Council

Explanatory note

(This note is not part of the Order)

This Order provides for the making of certain supplementary payments to overseas public servants and their dependants if their income from Hong Kong service or dependant’s pensions, or if the value of pensionable officers’ gratuities, is reduced as a consequence of a significant fall in the exchange rate between the Hong Kong dollar and the pound sterling.

The Order applies to pensions awarded, whether before or after the commencement of the Order, under the four Hong Kong ordinances applicable to service or injury pensions and the two further ordinances applicable to dependants’ pensions and to gratuities payable after the Order comes into force. The Ordinances are defined in article 2 as “relevant laws”.

In the case of public servants pensions and pensions based on the extent of an officer’s public service, the amounts protected by this Order are designed to be broadly comparable with pensions and gratuities paid to United Kingdom public servants. This is provided for by articles 4 and 7 and the various Heads in the Schedule, the latter of which prescribe rules for determining sterling values of a “notional Hong Kong pension” and a “notional Hong Kong gratuity”. The rules provide for updating the sterling value of the notional Hong Kong pension or gratuity in line with the United Kingdom Retail Price Index. Articles 5 and 8 provide that if the actual monthly income of a pensioner, or the actual amount of a relevant gratuity, falls below the notional pension or gratuity, the pensioner or person entitled to the gratuity will be entitled to a supplementary payment in sterling of the difference between the two.

The rules for determining the notional pensions and gratuities in the Heads of the Schedule take account of the different circumstances in which pensions and gratuities may be awarded under Hong Kong law, whether on retirement after pensionable service solely in Hong Kong or after mixed service with other public services.

Footnotes

[^f00001]: 1996 c. 2.

[^f00002]: Laws of Hong Kong, Cap 89.

[^f00003]: Laws of Hong Kong, Cap 99.

[^f00004]: Laws of Hong Kong, Cap 401.

[^f00005]: Laws of Hong Kong, Cap 257.

[^f00006]: Laws of Hong Kong, Cap 94.

[^f00007]: Laws of Hong Kong, Cap 79.

[^f00008]: 1971 c. 56.

[^f00009]: 1975 c. 60.

[^f00010]: S.I. 1995/238.