CONFIDENTIAL

Defence

4. I recommend that the Secretary of State should send a minute to the Secretary of State setting out all of our chief

I submit a draft.

concerns.

RH Smith

RH Smith

1.

While the case for continuing our out of area defence efforts has always been respectable and in some cases strong I do not think that the MOD or No 10 will find it convincing if we appear simply to be defending all existing arrangements, at a time when the defence budget is being cut savagely in real terms. For this reason, I doubt whether the draft minute to the Defence Secretary will serve its purpose. We need to offer the Defence Secretary some idea of the economies which we would be prepared to see out of area if priority defence activities are to be maintained. In my judgement, we will have to be ready to go further than a minor slimming in Cyprus and a reduction of the Armilla Patrol from three ships to two.

2. The Secretary of State may feel that it would be worth discussing these issues before finalising his minute to the Defence Secretary.

Cohen Cadden

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PJ Goulden

10 July 1991

CONFIDENTIAL

Mistime My light

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