CONFIDENTIAL

4.

On the timing of the production of this year's

report and the period to be covered we could follow one of two options:

(a)

repeat the pattern of last year and present the

report to Parliament at the end of the year,

covering a one-year period up to the end of

October 1986.

(b)

5.

move towards a pattern of annual reports, each covering a calendar year. This year's report, like the first, would cover a period a little

longer than a year (November 1985 to the end of

1986). It would be presented early in 1987.

Thereafter

rhythm.

there would be a tidy annual

The principal reason why the first report covered

the period to the end of

end of October 1985 was So that this

would end with the opening of

of the LEGCO session in Hong

Kong. This arrangement had been agreed at a time when it

was envisaged that the report would essentially consist of

the Governor's opening address to LEGCO. The idea was

subsequently dropped on the grounds that the Governor's

address would not be appropriate as a report from the

report

tailored

to

Parliament's

Secretary of State to Parliament. We opted instead for a

self-contained

requirements, while keeping to the earlier agreed

timetable.

6.

There is however no compelling reason to stick to

the October-October period. I think it would make more

sense to move towards reports corresponding to calendar

years. The Governor has been consulted on this point and agrees. I therefore suggest that we adopt option (b)

above.

CONFIDENTIAL

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