DEFENCE CONTRIBUTION
Brief No 10
BACKGROUND
1. The question of Hong Kong's contribution towards the costs
of the Colony's garrison during the period 1971-76 was settled
in October 1971 after prolonged and difficult negotiations
which have left a certain legacy of ill-feeling in the Colony.
The matter may therefore be raised with the Secretary of State
by the unofficial members of the Executive and Legislative
Councils.
2. The defence contribution has always been a sensitive issue
in our relations with Hong Kong since the Colony has been the
only one to have made regular and substantial payments towards
the costs of its own defence. Unofficial members have been
prone to argue that defence is an Imperial responsibility and
that the Colony should not be expected to pay for it when so
much needs to be done to provide better living standards and
improve social services.
3.
During the period 1967-71 Hong Kong made an annual contribution
of £14 million plus a special additional annual contribution of
£34 million towards the local costs of the garrison (which were
assessed at £9-10 million out of a total annual cost of some £16 million).
4. Under the recently negotiated Defence Contribution
Agreement, which runs from April 1971 to March 1976, the Colony
has reluctantly agreed to make an annual contribution of £8
million towards the costs of its garrison which in the current
financial year total approximately £26 million. This contribution
is made up of £2.4 million per annum in cash plus a total of
£17 million spread over five years for the provision of
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