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TO PRIORITY HONG KONG TELNO. 923 OF 25 OCTOBER. 1974 ·
DEFENCE REVIEW.
Dinfille PIA
then Pla
1. FOLLOWING IS A DRAFT NOTE OF MEETING BETWEEN YOUR TEAM AND
MINISTRY OF DEFENCE ON 23 OCTOBER. GRATEFUL FOR ANY COMMENTS
AND AMENDMENTS.
HONG KONG : TERMS OF A NEW DEFENCE COSTS AGREEMENT.
NOTE OF A MEETING HELD IN ACDS(POL)'S ROOM M O D WEDNESDAY,
23 OCTOBER 1974 AT 1530.
THOSE PRESENT: MR J.D. BRYARS, AUS(GS) (IN THE CHAIR)
REPRESENTATIVES OF HONG KONG GOVERNMENT AND OF
CBF HONG KONG
28/10
REPRESENTATIVES OF FCO, ACDS(POL), ARMY DEPARTMENT, NAVY DEPARTMENT AND DEFENCE SECRETARIAT.
THE PURPOSE OF THE MEETING WAS AS SET OUT IN PARAGRAPH 3 OF THE
GOVERNOR OF HONG KONG'S TELEGRAM 189915A TO F C O VIZ.
''TO MAKE SURE THAT WE ARE WORKING FROM THE SAME BASIS OF COSTS, AND HAVE A JOINT LOOK AT ITS IMPLICATIONS FOR 1976/77 AND AFTER
AT A GIVEN FORCE LEVEL. } } THE HONG KONG TEAM STATED THEIR
OBJECTIVE AS TO CLARIFY THE FIGUREWORK, NOT TO NEGOTIATE: BUT
THEY EMPHASISED THEIR WEED TO HAVE AS SOON AS POSSIBLE FOR
PURPOSES OF BUDGETARY PLANNING A FIRM FIGURE FOR THE DEFENCE CONTRIBUTION IN 1976/77, WHICH WOULD ALSO BE PRESENTABLE IN HONG KONG AS A FAIR DEMAND RELATED TO AN ADEQUATE GARRISON.
2. IN CLARIFICATION THE FOLLOWING POINTS WERE MADE :-
(A) THE FIGURE OF C31M WAS THE ESTIMATED COST OF THE REDUCED
GARRISON IN A REPRESENTATIVE YEAR, AFTER THE REDUCTION HAD BEEN ACHIEVED: IN PRACTICE, ESTIMATED COSTS WOULD VARY SOMEWHAT FROM
YEAR TO YEAR.
(B) THE FIGURE OF £31M WAS AT 1974 LONG TERM COSTING PRICES, THAT 13 AT THE PRICE LEVEL OF SEPTEMBER 1973: AN UPDATING OF THE FIGURE TO SEPTEMBER 1974 PRICES (THE PRICE BASIS FOR UK DEFENCE ESTIMATES 1975/76) WAS NOT YET AVAILABLE. THE INDICATIONS WERE THAT UPDATING MIGHT SHOW AN INCREASE OF 15-20%.
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