CONFIDENTIAL
14010
MDHOAN
6
WHERE HE HAS TO COMMENT ON STERLING SAFEGUARDS AND ON WHETHER HMG ARE STILL CONSIDERING ACTION ON THIS FRONT. HMOCS OFFICERS WOULD WANT TO PRESS HIM HARD ON THIS. WE HAVE PREVIOUSLY TALKED GENERALLY ABOUT CONSIDERING ''ARRANGEMENTS' FOR HMOCS OFFICERS: BUT WE CANNOT AT PRESENT SAY WHETHER WE ARE CONSIDERING ANY ARRANGEMENTS FOR THEM OTHER THAN THE COMPENSATION/INCENTIVE SCHEME. IT MIGHT THEREFORE BE BEST IF ANY SHORT STATEMENT WERE MADE IN THE FORM OF A BRIEF LETTER, PERHAPS TO SIR D FORD, TO GIVE US A LITTLE MORE TIME TO RESOLVE WITH THE TREASURY HOW WE WILL ANSWER QUESTIONS ON STERLING SAFEGUARDS.
3. YOU WILL WISH TO TAKE THE GOVERNOR'S AND PERHAPS
MR GALSWORTHY'S ADVICE ON WHETHER SUCH A STATEMENT CAN SAFELY BE MADE BEFORE WE BRIEF THE CHINESE. AS SEEN FROM HERE, THE KEY REQUIREMENT IS TO BRIEF THEM BEFORE OPENING THE CONSULTATIONS IN HONG KONG. WE SHALL ALSO NEED TO THINK CAREFULLY ABOUT WHAT WE SAY TO THE CHINESE ON STERLING SAFEGUARDS WHILE THE ISSUE
REMAINS UNRESOLVED HERE.
HURD
YYYY
G
MAIN
29
HKD
FED
NEWS D
RMD
PS/LORD CAITHNESS
NNNN
DISTRIBUTION
29
SIR J COLES
MR BURNS
LEGAL ADVISERS//MISS BROOKS
ODA//MR KERBY
ODA//MR FISH