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SECRET
ANNEX II
CONSULTATION AND DECISIONS
1. Ministers have undertaken to consult fully with our Allies where their interests are directly involved. Excert for the visit by the Minister of State in the Ministry of Defence to our partners in the five Fower Defence Arrangement, there has so far, in accordance with Ministerial wishes, been no consultation. We consider below first the importance of consultation to our interests, then the process by which it might be carried out, and finally the effect it may have upon Ministers' decisions.
2.
The importance of full and timely consultation with ATO cannot. be over-emphasised: Apart from the fact that we have obligations to submit our proposals to the NATO militery authorities and to consult about them in the North Atlantic Council, it is very much in our interest to do this in the most effective way. On the ore hand it is the best way to mitigate the inevitable damage which vill be done to our standing within the Alliance as a result of defence cuts. On the other it is an essential part of the long term process of maintaining the cohesiveness and improving the effici:ncy of NATO in political circumstances in several countries which are unfavourable to adecuate defence spending. The importance which our Allies attach to full and timely consultation has recently been underlined by the reception given to the Danish and Dutch proposals for reductions in their contributions to NATO. Reductions in the British defence effort will naturally be still more si nificant and it is inevitable that our Allies should see such reductions as
potentially impairing their own security. In addition, several of our Allies are under similar pressures to reduce their defence efforts, and our cuts, depending upon their nature and scope, could have a triggering effect on their decisions. In particular the Americans are under strong domestic pressure to reduce their forces in Europe. Dr Schlesinger has put us on notice that rajor British reductions, particularly if they involved cuts in BAOR, would certainly be followed by US withdrawals. The security of the Alliance depends ultimately upon the credibility of the American guarantee and if this is not to be endangered the Europeans must be seen to be pulling their weight. During the Alliance Summit meeting on 26 June, President Nixon renewed his former pledge that
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