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resources from the export industries and the level of activity which the construction industry could support without unacceptable escalation of costs.

c) Half to three-quarters of Parliamentary questions were being asked for the record by friends of Hong Kong and might be giving a false impression that Parliamentary interest was greater than it really was. The most important pressure on Ministers was extra-Parliamentary and the most powerful body involved was the TUC.

a) Mr. Cortazzi said that no-one in the UK expected problems to be solved overnight but the aim should be to achieve a gradual increase in the level of public expenditure to support an improvement of social programmes of sufficient degree to enable Ministers to show progress each year.

Progress was also essential in the field of labour legislation.

e)

Comparison of Hong Kong conditions should not be with the UK but with the best of comparable standards in Asia, eg., those in Singapore. Steps had to be taken to ensure that at least comparison was reasonably favourable in these terms if UK goodwill was to be retained.

f)

Mr. Cortazzi would be happy to see HK officials of Secretary level and above who wished to call on him in the FCO.

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