9.

The Governor attaches considerable importance to retaining a

helicopter capability because of the nature of the terrain and the

vulnerability of the road system both in the country side and in

the city.

Nevertheless, some saving in support costs would be

possible. Costs 7

Works Services

10.

A saving of £0.5 million could be made in works services at

present running at about [£

Meeting the Cost

11.

million a year.

The Governor considers that it would be impossible in practice

to get the Hong Kong Government to meet the whole cost of the

minimum forces necessary, and that it would be politically

dangerous for him to put such a proposition to the Executive Council.

He points out that the large and necessary programmes of social

betterment which he has introduced will place the budget in

substantial deficit even after further tax: increases and recourse to

borrowing. He also emphasises that any indication that the

United Kingdom was not prepared to pay part of the costs of

maintaining internal security in Hong Kong would lead to the

assumption there, and in China, that we were losing interest in

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