CONFIDENTIAL

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their way in. There was a scuffle during which five ICAC officers suffered minor contusions and abrasions and some minor

damage was done to windows and furniture. The group had dispersed by the time that a Police patrol arrived.

5. The Commissioner has ordered a full investigation to be carried out by a team from CID Headquarters and he, as well as representatives of both Chinese and European Inspectors' Associations, have condemned the actions of this small group.

6. I spoke to the Governor on the telephone on 1 November and

he told me that the Hong Kong Government would certainly permit

the formation of a Police Federation. This proposal had been

under favourable consideration for some time. In his opinion the best course for his Government to follow was to allow tempers

to cool and, apart from the CID investigation, he would not

expect any further open reaction by himself or from his Govern-

ment for some weeks.

7.

There has been little coverage in the press or television

in Great Britain. I attach three cuttings which have come to

our notice.

8. We shall continue to keep in touch with the Hong Kong Govern- ment over developments in this affair. However, I recommend that we should accept the Governor's advice and for the moment anyway play this in a low key. However, long-term consideration will have to be given to the continued activities of the ICAC

and their relationship to the Police, as well as to a possible need, which has already been discussed by the Overseas Police

Adviser, for strengthening the senior ranks of the Hong Kong Police Force. The incident was deplorable but in my view is best interpreted as a confirmation of Mr Cater's view of the widespread incidence of corruption inside the Police Force. Those Police Officers with guilty consciences are becoming more

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CONFIDENTIAL

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