From: A. F. Thorp OBE,

SECRET

Head of F1(Air)

MINISTRY OF DEFENCE Main Building, Whitehall, LONDON S.W.1

Telephone: WHItehall 7022, ext. 7189

Our reference: Head of F1(Air)/9036 Your reference:

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(31)

132

A. W. Gaminara Esq

Hong Kong Department

Foreign and Commonwealth Office

Room 247

King Charles Street

LONDON SW1

Keen

Каска Maminain

Hong Kong Defence Contribution

* ED IN REGISTRY No.51

16 AUG 1971

[Akk 10/9

13 August 1971

Thank you for the revised draft reply to Hong Kong telegram (126) a 528 taking account also of the Governor's latest telegram 549.

2.

I have the following comments to offer:-

a) The second sentence of paragraph 2 is not altogether

logical in my view. The £8M in the last two years is not inconsistent with the remainder of that scheme. In other words it is just as unreasonable to have figures as low as £7.5M in the fourth and fifth years. Could we not make our point as effectively by saying "Moreover any scheme over 7 years would be expected to produce a larger variation than £1M between the first year and the last to take account of rising costs over the longer period".

b) I would like to see an expansion of paragraph 3 which would go in at the end of the second sentence and the third sentence would then start a new paragraph 4. Despite what we have said previously and only as recently as paragraph 5(a) of telegram 553 I think we should stress

I would there- once again the logic of the HMG argument. fore suggest the following addition:-

"What we are anxious you should make clear is that all along HMG has seen no justification for the Colony not contributing at least as great a proportion of overall garrison costs in 1971/72 as was agreed in 1966 in

There is moreover no respect of costs for 1967/68. evidence that this would in any way be an unfair burden on the Colony. Nevertheless we have finally felt disposed to accept a little less than parity in the form of an average of £8M for five years but this is as far

SBORET

/as

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