- 32
COMPENSATION AND PUBLIC OFFICERS AGREEMENTS
21. In accordance with undertakings given by the British Govemment to Her Majesty's Oveseas Civil Service, a compensation scheme on the lines of the attached draft will be brought into force on Malaysia Day for entitled officers serving in the Bomeo States.
22. The compensation scheme should be brought into effect by an Order in Council, winchwill preserve the continuing nights under the scheme of an officer who is seconded to Federal Service within the Borneo States To all officers, other than those who may be required to retire. under procedures laid down in the scheme, compensation is to be paid by instalnients over a period of five years These capital payments are exempt from income tax in the United Kingdom The Order in Council should provide for a similar exemption from tax in the Bomoo States, and insofar as this may be necessary the Federal Government will secure that these payments (but not any interest payable on them) are exempt from tax under Federal law.
23. Certain features of the compensation scheme have special implications for the Federation—
24. Public Officers Agreements on the lines of the attached dratt should be concluded with the Federal and State Goverments to safeguard the conditions of service of overseas officers, and in particular their pensions. These Agreements should come into effect on Malaysia Day.
DESIGNATED CONTRACT OFFICERS
25. Over 100 contract officers from overseas are serving in Departments due to be Federalised The great majority of these are serving on contracts for a single tour. The Federal Government and the Borneo Governments wish to reassure these officers that the terms of theirexisting contracts will be observed and that they can expect to complete the full term of their contracts on secondment to the Federal Service but without liability to serve outside Borneo.
26. The terms of service of the small number of officers serving on long-term contract will also, of course, be observed. It appears likely that these officers too will complete the full term of their contracts and the Governments of North Bomeo and Sarawak are confident that this will prove to be the case II is however, desirable both as a protection for officers and a proper provision for Government that a regular procedure should be laid down for localising the posts of these officers if and when this becomes possible, similar to the procedure for localising the posts of pensionable overseas officers. This would involve a special payment to the officer to compensate for any premature termination of contract.
OFFICERS OTHER THAN DESIGNATED OFFICERS SERVING ON CERTAIN OVERSEAS TERMS
27. Some officers serving in the Borneo States, although not eligible for designation under the Overseas Service Aid Scheme and not in receipt of overseas inducement pay. have within certain limits been recognised as overseas officers, primarily by according them overseas passage Lerms. These officers will be treated in all respects as local officers, so that no question of the Borneanisation of their posts will arise and they will throughout their careers be equally eligible for promotion with local officers. Since the establishment of Malaysia is not to disturb existing conditions of service, they will continue while serving in the Bomeo States to enjoy their existing overseas passage terms on a personal basis unless they opt to surrender them at some future date as part of a generally favourable change to new conditions of service.
28. There are a small number of officers not eligible for designation under the Overseas Service Aid Scheme who are in receipt of overseas inducement pay from the Sarawak Government The Sarawak Government will consider whether some alternative offer of premature retirement terms should be made to them.
