CONFIDENTIAL
E (NI) decided that while BS's proposal for continuing Smith's Dock, and switching 1500 men from merchant to
naval at Swan Hunter could be accepted, BS's strategy for increasing employment and throughput at the main
merchant yards was not acceptable. Officials were asked to agree the new financial limits for BS. BS have not yet been told of this decision pending Treasury agreement on the financial limits and the new tranche of Intervention Fund after July 1983 but it
is hoped that we shall be in a position to tell Mr
Atkinson in confidence on 3 March and consult the Commission
quickly thereafter. Once the Commission's initial views.
are obtained, it will be possible to announce future
financial support for BS, probably before Easter.