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4.

I MUST ALSO EXPLAIN THAT BEFORE HMG WERE ASKED FOR THEIR VIEW OF A FIGURE OF £8.5 MILLION FOR THE CONTRIBUTION THEY HAD BEEN THINKING IN TERMS OF A SUBSTANTIALLY LARGER SUM: BUT THAT TAKING INTO ACCOUNT THE OTHER FINANCIAL COMMITMENTS FACING HONG KONG THEY WERE PREPARED TO ACCEPT £8.5 MILLION AS THE MINIMUM CONTRIBUTION TO WHICH THEY COULD REASONABLY AGREE. THIS REMAINS THE POSITION, NEVERTHELESS, IF YOU HAVE ANY SUGGESTIONS TO MAKE WHICH MIGHT ACHIEVE AN EQUIVALENT CONTRIBUTION PERHAPS BY A DIFFERENT APPROACH TO THE PROBLEM, I HOPE YOU WILL FEEL FREE TO ADVANCE THEM. I CAN ASSURE YOU THAT WE WOULD GIVE THEM VERY CAREFUL STUDY. 5. OUR VIEWS ON THE OTHER POINTS WHICH YOU HAVE RAISED WITH SIR

DAVID TRENCH ARE CONTAINED IN THE ANNEX ATTACHED TO THIS MESSAGE. ENDS.

DOUGLAS-HOME

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IR D J J BRACK TREASURY

MR A F THORPE FI(AIR) 2MOD

MR RJ SMITH DOE LAMBETH BRIDGE HOUSE MR P D NAIRNE MOD ·

IR R GEDLING TREASURY

MR E STRETTON DOE LAMBETH BRIDGE HOUSE MR FH GWYNN MOD

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SIR L MONSON

SIR S TOMLINSON BOTTOMLEY

IR

IR WILFORD

MR DA SCOTT IR ROSE

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