SEORET

5. Our major difficulty is over the starting amount of the

contribution. I am sure you appreciate that in the context of

the public expenditure discussions here, and the particular

problems of the cost of Defence, Ministers will want to be

to expect.

(yet

satisfied that the amount offered is as much as it is reasonable

Yet your proposal, when account is taken of increased

costs, is not more than the share originally provided by the

present agreement. It is a long way short of meeting the object

that the Colony should pay for its own internal security In

the light of the relative prosperity of Hong Kong it would be

difficult to persuade Ministers who are under such severe pressure

on their own programmes, both civil and military, that the Colony

should not make a larger contribution.

6.

have

Before any submission is made to Ministers we therefore feel

it is incumbent upon us to ask you to look again at the offer you

made and to consider whether by any means the Colony's contribution

might be made more telling.

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SECRET

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