taking into account the heavy future financial
commitments facing Hong Kong, HMG were ready to
accept £8.5 million as the very minimum
contribution to which they could reasonably
agree; this is particularly the case since
(despite the fact that the new agreement would
be for five years) such a contribution would do
no more than restore the situation (as regards
the proportion of total costs which it would
represent) which obtained when the current
contribution was negotiated in 1966. Moreover
a very substantial proportion of the expenditure
would be local expenditure of direct and lasting
benefit to Hong Kong.
Copies to:
Mr Wilford
Mr T J BRACK,
Treasury.
Mr A F THORPE F.1(AIR),
Room 0257, M.O.D. (Main Building).
2. Your paragraph 10. We see no objection to
the principle contained in this proposal but we
could accept it only if the principle applied to-
those works not xceeding £3 million in value in
any one year whic..
identified as construetions
which under the terme of the new agreement would
become the property of the Hong Kong Government
However
if no longer required by HMG There will
Λ
could well
Capital
-undoubtedly be less than £3 million of such works.
in some years and in those years we would expect
the balance to be made up in cash. In other
words, if the £3 million were represented in
kind it would have to be done in such a way as to
provide no bar to virement with the recurrent
element of the contribution.
Mr R J Smith
D.Q.E.,
Lambeth Bridge House.
(8430) Dd,033246 600m 9/66 G.W.B.Ltd. Gp.963
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