A
B
0Q
SECRET
5
contribute 75% to the capital costs of purchasing the
vessels; running costs were to be shared in accordance with
the DCA current at the time; and when the vessels were
withdrawn or sold, 75% of the market value was to be
credited to the Hong Kong Government. When the DCA was renegotiated in 1988, it was agreed after very acrimonious negotiations that the Hong Kong Government's share of all
recurrent costs should be reduced from 75% to 65%.
Consequently the Hong Kong Government currently fund 65% of the running costs of the 3 Patrol Vessels, with the MOD
funding 35%. As the total annual running costs are estimated at about £3.5 million, the MOD share is £1,225,000
a year, a very small sum in terms of the overall defence
budget.
The Case for a continued Naval Presence
•
The Hong Kong Government have argued strongly (with our
support) that there is both an operational and a political
case for the retention of the three Peacock Patrol Craft
until 1997:
The operational case rested on the fact that an appropriate and credible RoyaNavy capability is required to uphold Hong Kong's territorial integrity and to counter a possible erosion of Hong Kong's sea borders
by Chinese vessels. In the view of HQBF Hong Kong, such
incursions now seemed more likely and potentially more
confrontational than was the case when the Garrison
Withdrawal Plan was originally drawn up. As evidence of this they cited the increasing number of incidents (mostly in early mid 1990) when Chinese patrol vessels
had ignored instructions from MARPOL to stop.
The political case is twofold.
BATAJR/2
SECRET
Redacted Under FOI Exemption Sec 27(1)