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PP F C O
OPPS 860
CYPHER/CAT A
FM HONG KONG 670755Z
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Kiag
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183
TO PRIORITY DT I TELNO CREDA 73 OF 7TH AUGUST, 1973. INFO ROUTINE FCO (FOR STUART MKIOD) E.C.C.D. (FOR COTTERILL).
FOR GLAVES-SMITH (OPG) FROM ASTON.
M.T.S.
1.M ACCORDING TO WILKINS TALKING TO ME IN CONFIDENCE DURING A LUNCHEON, THE DECISION TO STRETCH THE TIMETABLE WAS TAKEN ON INSISTENCE OF HIMSELF AND OTHER TECHNICIANS BECAUSE THEY COULD NOT SEE HOW A FAIR FIXED PRICE COULD BE ESTABLISHED WITHOUT MORE
INFORMATION. HE SAID THAT HITHERTOO THE 'POLITICAL SIDE RAD WANTED AN EARLY START (IE JANUARY 1974) AND A FIRM FIXED PRICE. THEY HAD NOW REALISED THEY COULD NOT HAVE BOTH WITH A CONSORTIUM APPROACH (HE IMPLIED THAT HE THOUGHT IT WOULD STILL HAVE BEEN POSSIBLE WITH A MULTI-CONTRACT APPROACH). REVISED TIMETABLE WAS THE SHORTEST PRACTICABLE TO GET A FIXED PRICE.
2.
ADAPTATION OF THE BRITISH GROUP PROPOSAL FOR TARGET PRICING WAS A POSSIBLE ALTERNATIVE BUT WOULD HAVE MMEANT A CONSTANT PROCESS OF NEGOTIATION AND CHECKING AND ADJUSTING WHICH WOULD HAVE BEEN TOO MUCH FOR THE PWD AND CONSULTANTS ON TOP OF EVERYTHING ELSE. ''WE WOULD NEVER BE FINISHED''. IT HAD, THEREFORE, BEEN REJECTED.
3. STEERING GROUP RECOGNISES THAT FURTHER QUESTIONS THEY WILL BE PUTTING TO THE VARIOUS CONSORTIA WILL BE ''HARD ON THEM BUT HOT UNFAIR' AND THAT CONSORTIA WILL BE INCONVENIENCED ''BUT WE HAVE TO THINK OF OUR INTEREST NOT THEIRS''. MAIN PURPOSE OF NEXT MEETINGS IS TO TELL CONSORTIA WHAT IS REQUIRED OF THEM, SEE IF THEY WILL PROCEED ON THAT BASIS AND WORK OUT THE PROCEDURE. HE PERSONALLY RECOGNISES THAT THE FURTHER PROCESSES NOV ENVISAGED WILL PUT ALL CONSORTIA TO CONSIDERABLE EXPENSE WITH NO GUARANTEE OF A CONTRACT AT THE END OF IT. HE THINKS THOUGHT WILL HAVE TO BE GIVEN