This would have the advantage, from Hong Kong's point of view,
of avoiding too sudden an increase in the cost to them of a reduced
force.
Questions for consideration
8.
The first question, therefore, is do Ministers agree that, among
other options, a study should now be made with Hong Kong officials
of the full security and political implications of a garrison
costing about £35M, on the basis that such a garrison might form
an element of a compromise agreement with Hong Kong.
9.
But, whether such a garrison were acceptable or not, there will
still be a gap between Ministers' desire that Hong Kong should pay
three-quarters of the cost and the Governor's figure of £17M, which
would be about half the cost of a £35M garrison and rather less than
half the cost of the £40M garrison.
10. If therefore we do not succeed in getting llong Kong to bear
three-quarters of the cost, would Ministers consider, in the light
of their conclusions at OPD(74) 15th Meeting, that an attempt should
be made to bridge the gap? For example -
(a) by increasing both the UK and Hong Kong offers, eg to
one-third and two-thirds of the cost (£121 and £23M respectively
for a £35M force, or £13M and £27M for a £40M force); or
(b) by increasing the proportion paid by the Hong Kong
· Government over a period of an Agreement lasting say 5-7 years
SECRET
A - 5
UK EYES A
SECRET UK EYES A