SECRET
7. The Governor accepts that Hong Kong's contribution,
whatever its amount, should be adjusted annually for changes
in pay and price levels during the period of the next
Agreement.
Courses open
8.
The Governor's advice leaves four courses open:-
X (a) The course decided on by the Committee on 9 september:
To plan for the reduced garrison costing £40M and, despite the Governor's advice,
to continge to press Hong Kong to contribute 75% of the cost
with an
ascalation clusa
شد
wriked to the
B
وبلند Cant
i.e. £30M. This would conform with the minimum
to meet the end.com
comitme it defence requirement and with the decision taken by
the Committee on 9 September on the proportionate
contributions of the UK and Hong Kong.
M
-
But, if the be likely to be
**
Governor's advice is correct, it could damage Hong
res acted by
Horng fo Kong's economy and might have to be imposed upon
Lod
Abeing
1
the Hong-Kong Government. Such a step would be the How how overmey fro
tat without constitutional precedent and could put our
relations with Hong Kong under severe strain.
(b) The course favoured by the Governors.
to plan for the reduced garrison costing £40M sind
per you!
to accept a Hong Kong contribution of £17M. i.e.
wakati ma in
little more than 40%-This would conform with the
1.40
Th
of
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yone
minimum defence requirement and would not incréase
Ko-Ko "Contibula
more the 40% Hong Kong's economic difficulties to a eritical
maa
ì
iny...
extent. But Hong Kong's contribution would fall far
endged
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short of the-proportion previously decided upon, by
bahseen shy and at 75% could be. the-Dommitter { the difference (£65M in all over an
Agreement lasting five years) would have to be found within the severely reduced Lefence budget). Shione
Kong have pointed to the benefit received by the UK
pares 6