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148
For discussion
on 31st August 1971
XCS(71)12
Copy No....of 25
MEMORANDUM FOR EXECUTIVE COUNCIL
Introduction
DEFENCE CONTRIBUTION
A
B
C
Memorandum XCS(71) 3 of the 26th January 1971 was put to Executive Council on the 9th Feburary 1971. After setting out the back- ground against which the future defence contribution had to be considered, it invited Honourable Members to advise whether an offer be made to contribute £8.5 million annually for five years, subject to certain conditions and to the provision of the necessary funds by the Finance Committee of the Legislative Council in due course, A copy of it is attached at Annex A.
2
Unofficial Members argued that so large an increase over the present rate of £5 million a year would for many reasons be unacceptable. After discussion, formal consideration of the memorandum was deferred; but it was agreed that certain action should be taken. Accordingly:
3
B
(a) the Secretary of State was asked whether an offer of £8,5 million annually for five years would be accepted, if made. He replied that it was the very minimum to which Ministers could reasonably agree, having hoped for substantially more. Full details of his reply were passed on in a letter sent on the 18th February 1971 to the Administrative Secre- tary, UMELCO Office: A copy of it is attached as Annex B;
(b)
a memorandum setting out the views of Unofficial Members was submitted on the 27th February 1971, for transmission to HM Govern- ment, under cover of a letter from the Admin- istrative Secretary. Copies of the letter and the memorandum are attached at Annex C.
The memorandum was duly transmitted, as requested. It led to some further exchanges over the following three months. These cul- minated in a letter of the 27th May 1971 which intimated that the majority of the Unofficial Members of Executive Council were prepared to recommend the making of a voluntary token contribution; but they considered that the maximum which Hong Kong could afford was £7 million a year for each of the next seven years, making a total of £49 million over the period. This was subject to two provisos:
(a) that of the £49 million, not less than £17 million should be spent on capital works, and not less than £15,4 million on main- tenance, in Hong Kong;
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