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and 3 patrol craic, or of 5 patrol craft. The former would, on the assumption
the frigate would not be new, result in lower capital costs, but, because
of the increased manpower requirements, stores and engineering support required
by the frigate, be more expensive to run. While at this preliminary stage
in the Naval Staff studies, the order of whole-life costs of these two
options are unquantified, it is considered that an all-patrol craft solution
is likely to prove the cheaper of the two. For this reason it is assumed
that, while not finally rejecting the alternative, MOD will use for purposes
of illustration the order of capital and running cost resulting from the
procurement and operation of 5 patrol craft (although the precise number
of vessels and their detailed characteristics are not at this stage determined).
HONG KONG GOVERNMENT ATTITUDE AND INTENTIONS
13.
The Secretary for Security of the Hong Kong Government has already been
approached informally in order to ascertain the Hong Kong Government's
likely attitude to the replacement of the present patrol craft, and he has
discussed this with the Naval Staff and with US(GS) during a visit to London
in August. He made it clear that while the Hong Kong Government accepts
(and indeed supports) the continuing need for a Royal Navy presence in the
Colony's waters, they are concerned that any iew vessels should be as
inexpensive as possible, because they will be required to meet the major
part of the capital and running costs of the Squadron.
COSTS
14.
As will be clear from paragraphs 2 to 4, the procurement of any new
vessels to replace the existing patrol craft will occur within the timescale
of the existing DCA, even if the delivery of some of them and some residual expenditure
might not take place until after its termination in 1983. Although it
might have been possible to argue a case for the Hong Kong Government being
asked to pay the full costs of replacement vessels (especially if they were to
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