HKS C64/1
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16 MAR 1981
DESK OFFICER INDEX
PA
@
Mr Watkins, Defence Department
DEFENCE COSTS
1.
Your circular minute of 20 February about the change of responsibility for certain defence costs refers to the incidence of charge for internal security operations in dependencies. Where do we now stand on the argument about 'full costs'? You will remember that during the long drawn out exchanges last year with MOD about the costs of the 1977 operation in Bermuda, FCO represen- tatives maintained the view that 'extra costs' rather than 'full costs' was the appropriate basis for the recovery of MOD expen- diture on such operations. We were told that the MOD intended to review the 1975 arrangements which had given rise to differing interpretations, and that they would be approaching the FCO on the matter at a high level. As far as I am aware, we have heard nothing further.
2 March 1981
cc:
Mr Clift, HKGD
R FR Deare
West Indian & Atlantic Department
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