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of boat people selected for resettlement in the UK. UNHCR already has ambitious targets for improving educational standards in refugee schools. These include higher English standards. The draft lays particular stress on the measures that will be taken to enhance the potential of the candidates for resettlement to adapt to life in this country.

5. The draft has been discussed extensively with the Home Office and also with officials in the Department of the Environment and the Treasury. The Home Office have had to ensure that the reception facilities will be able to cope with an increased flow: this will necessitate additional funds (grant in aid to the Voluntary Agencies B2 and training bodies of £ million). DOE officials are concerned

about the strain that a new intake would impose on housing in the affected parts of the country: the point is covered in paragraph 11 of the draft. The Treasury have requested a more detailed evaluation of the resource implications of a new commitment (eg social security payments and other benefits) and a more precise definition of what we hope to achieve by way of commitments from others. These points have been covered in paragraphs 12 and 5. The draft sets out the political case for a new resettlement in terms with which the Secretary of State is already familiar.

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6. If the Secretary of State or the Home Secretary have any comments on the draft, it should be possible to take account of those direct contacts between Private offices. I suggest that the minute once agreed, should be finalised in the FCO, signed by the Secretary of State, and sent to the Home Office for Mr Hurd's signature. The Home Office would be content with this.

ARPanc

AR PAUL

1.

When I was in Hong Kong last week, the Governor pointed out that the LEGCO debate on his address at the opening of the 1988/89 Session had included a number of calls for the UK to do more on the resettle- ment front and that public attention was once more focussing on this aspect. He hoped that we would be able to make an early announcement of an additional UK commitment. I agree that the political case for this is strong: the longer an announcement is delayed, the more it will appear that it has been dragged out of us by Hong Kong pressure and the less credit we shall get.

2. The draft minute to No 10 seems to me to make the right points. Those in paragraphs 9-11 seek to deal with some of the Prime Minister's known concerns. Since the draft is the result of lengthy consultations with the Home Office and is also being submitted to the Home Secretary, I have not made detailed drafting suggestions.

/But

CONFIDENTIAL

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