S
CONFIDENTIAL
Redacted
Junder FOI
exemption 27(1)
E
5.
Following the MOD team's abortive discussions in Hong Kong earlier this month, the Governor has written to Sir Michael Quinlan to confirm his understanding of what had been agreed at their meeting on 7 December.
According to
the Governor's account, Sir Michael Quinlan suggested that it should be possible to devise a formula whereby the overall contributions to be paid by each side would remain the same, but advance payments would be made by the HKG in order to overcome the MOD's cash flow problems. According to the MOD's account, however, Sir Michael Quinlan made clear that MOD Ministers wanted to get some real cash benefit out of the arrangement. We understand from MOD officials that Sir M Quinlan's position has hardened since that meeting. He proposes to reply to the Governor early in the New Year after consulting MOD Ministers.
As the two sides are still some way apart, I think it would be helpful if Lord Caithness could speak to
6.
Mr Archie Hamilton, the MOD Minister responsible for this subject, early in the New Year.
note after the Christmas break.
We will submit a speaking
ARR
AR Paul
SIPANJ/2
CONFIDENTIAL