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MATTER COULD BE REGULARISED BY LEGISLATIVE AMENDMENT, WHICH
COULD IF NECESSARY BE RETROSPECTIVE. IF THE LEGCO REFUSED TO
COOPERATE SUCH LEGISLATION COULD BE ADOPTED BY ORDER IN COUNCIL
UNDER THE POWERS RESERVED TO THE CROWN.
9. THE PROPOSED TRANSFER FROM THE EXCHANGE FUND TO GENERAL REVENUE ACCOUNT DOES NOT APPEAR TO RAISE ANY LEGAL OR FINANCIAL
PROBLEMS.
10.
EXCO WILL MEET ON THE MORNING OF 12 OCTOBER. THE IDEA IS
TO IMPLEMENT THE MEASURES AFTER MARKETS CLOSE FOR A LONG
WEEKEND ON THE EVENING OF 13 OCTOBER. IF THE SECRETARY OF STATE'
SUPPORT NEEDS TO BE SOUGHT BY THE GOVERNOR, THIS WILL BE DURING
12 OCTOBER.
11. THE INITIAL VIEW HERE IS THAT IT WOULD BE RIGHT, IN THE
EVENT THAT THE GOVERNOR DECIDES TO ACT DESPITE EXCO'S OPPOSITION,
TO BACK HIM UP. THIS MIGHT TAKE THE FORM OF AUTHORITY TO THE
GOVERNOR TO INFORM EXCO THAT THE BRITISH GOVERNMENT HAVE
CONFIDENCE IN HIS JUDGEMENT. IF THIS STEP IS TO BE TAKEN, WE
WILL WANT TO BE SURE THAT AT LEAST THE PRIME MINISTER AND
CHANCELLOR ARE CONTENT BEFORE A FINAL DECISION IS TAKEN.
ARE WARNING THEIR OFFICES ACCORDINGLY.
12. IF WE PROCEED AS IN PARAGRAPH 11 ABOVE, IT WILL BE
CLEAR THAT HMG HAVE GIVEN THEIR APPROVAL TO THE SCHEME
AND PARLIAMENTARY AND OTHER QUESTIONS WILL BE ANSWERED
ACCORDINGLY. IF, ON THE OTHER HAND, EXCO AGREE WITH THE
SCHEME
WE
THE IMMEDIATE PROBLEM WILL BE LESS BUT THERE MAY
STILL BE PARLIAMENTARY INTEREST (ESPECIALLY IF THE SCHEME SUB-
SEQUENTLY GOES WRONG). MINISTERS MAY BE ASKED AS TO WHETHER OR NOT
THEY GAVE THE SCHEME THEIR APPROVAL. WE THEREFORE NEED
CONSCIOUSLY TO DECIDE WHETHER TO PUT OURSELVES IN A POSITION
WHERE WE WOULD ANSWER SUCH A QUESTION IN THE AFFIRMATIVE,
OR WHETHER TO TAKE THE VIEW THAT WE REGARDED THIS AS A
MATTER FOR THE HONG KONG GOVERNMENT ON WHICH HMG AS SUCH
WAS NOT CALLED UPON TO TAKE A VIEW. THESE ARE THE TWO ENDS OF THE
SPECTRUM. THE DEPARTMENT ARE CONSIDERING WHAT FORM OF WORDS THE
SECRETARY OF STATE MIGHT MOST HELPFULLY AND ACURATELY USE IN
PRACTICE.
ноше
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HD/HKD
PS
PS/MR LUCE
PS/PUS
MR GIFFARD
MR DONALD
COPIES TO
MR BURROWS LEGAL ADVISER
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