fate through the abolition of the Quota. Moreover, since
Ministers have approved the introduction of income tax for
St Helenians working on Ascension Island, the loss of the
Quota combined with this new tax would be seen as unfair and
oppressive. Over the proposed 5 year period of phasing out
the Quota the cumulative total cost to the Island is
estimated at about £300,000 through unemployment payments
and lost remittances from the UK. Thereafter the annual
cost could be around £100,000. These are costs which HMG
will have to offset.
4. If, therefore, we agree that proposals as they now stand, we shall suffer political difficulty (and possibly unrest) on St Helena and budgetary costs. This points to treating St Helena differently.
BAGAFJ/9