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Mr Murray

PS/Lord Goronwy-Roberts

CONFIDENTIAL

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HKK 013/4

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HONG KONG : GOVERNORS SPEECH TO THE LEGISLATIVE COUNCIL

1. We have now received the full text of the speech which Sir

Murray MacLehose made to the Legislative Council on 11 October.

As the Governor foreshadowed in his telegram number 1173, the principle theme of the speech was the development of Hong Kong at the end of the '70's and into the '80's: this took up the whole of the second half of the speech. We have compared the main proposals in this part of the speech with those set out in the Governor's letter of 4 July to Mr McLaren and have found

that them entirely consistent, except on some points, notably hous- ing, they even show a slight improvement.

2. In setting out these proposals, the Governor has acceded to our request to include an indication of their cost (the Minister may recall that our purpose in asking for this was in order to establish a clear link between the policy proposals in the LegCo speech and the financial proposals in the annual budget speech and in particular to underline the primacy of the former). It is significant that the proposals involve an average increase in expenditure over the next six years equal to that achieved

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over the past six years: the speech is thus a public commitment that there will be no tailing-off in the social development of Hong Kong at least until the mid-'80's, though the Governor does envisage that by then Hong Kong will have been lifted "on to a

plateau on which the same sort of massive effort of change will

no longer be necessary"

3. In the first half of the speech, the Governor reviewed the past year and considered the prospects for the immediate future. We have already seen the sections on the Police, ICAC and Sino-

British relations. Other points of interest to emerge include the following:

CONFIDENTIAL

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