For discussion
on 11th March 1975
SECRET
XCS(75)2
Copy No 4 of 60
MEMORANDUM FOR EXECUTIVE COUNCIL
1(2)
DEFENCE COSTS REVIEW
PA
As Honourable Members know, discussions are continuing with HMG about the future level of the Hong Kong garrison and the division of its cost between HMG and the Hong Kong Government.
2
The present round of talks is concerned with establishing the cost of different levels of garrison and their implications for security.
劭
18/3
3
When all the facts are available, the two Governments will have to decide what they are jointly prepared to pay for and what the division of financial responsibility should be. We are still some way from this decisive stage.
4
Meanwhile all concerned are agreed that a reduction in the level of the garrison can safely be made at least to 5 2/3 instead of the current 6 2/3 major units.
5
MHG has just informed us that the Ministry of Defence are anxious to make plans immediately for a reduction to 5 2/3, which would take place over the next year or 18 months. It would be without prejudice to the level of the garrison or the allocation of costs under the new Defence Agreement which will come into effect from 1st April 1976.
6
A reduction to 5 2/3 involves no security risk for the Colony. Nor would it trigger a review of the current Defence Costs Agreement, as would be the case if the reduction amounted to more than one major unit. The Government therefore sees no reason to object.
7
Since the decision to withdraw the equivalent of one major unit is sure to become known, the Ministry of Defence propose to make a brief announcement, on the lines of the Annex, shortly after the publication of the Defence White Paper, which is due on 19th March, with the object of preventing inaccurate speculation.
8
Honourable Members are asked to concur in the Govern- ment's view as outlined above.
(The Secretary for Security (Mr L.M. DAVIES) will attend before the Council for the discussion of this item).
7th March 1975 (SCR 5/62)
SECRET
COUNCIL CHAMBER