41

RESTRICTED LOCSEN

124665

MDADAN 3797

REINVIGORATING THE BILATERAL RELATIONSHIP. HOWEVER, A COMBINATION OF FACTORS HAS MEANT THAT WE ARE NOW SENDING SIGNALS WHICH

UNDERMINE OUR PROTESTATIONS OF CONTINUING MAJOR INTEREST IN

AUSTRALIA:

THE FLOW OF BRITISH MINISTERIAL VISITORS HAS ALL BUT DRIED UP.

MAY HAVE JUST ONE THIS YEAR.

WE

-

OUR RESPONSE TO SENATOR EVANS'S PROPOSAL FOR A BRITISH-AUSTRALIAN TRADE AND INVESTMENT CONFERENCE HAS BEEN ONLY LUKEWARM.

WE HAVE REDUCED THE NUMBER OF PLACES SET ASIDE FOR AUSTRALIANS AT

THE RCDS.

WE ARE CUTTING THE AIR ADVISER POST HERE.

IS

WE STILL OWE THE AUSTRALIANS A CONSIDERED RESPONSE TO THEIR APPROACH LAST NOVEMBER (NINE MONTHS AGO) ON MARALINGA. THERE LITTLE SIGN THAT OUR RESPONSE IS IMMINENT. WHEN IT COMES, IT MAY WELL BE UNPALATABLE TO THE AUSTRALIANS.

5. AGAINST THIS BACKGROUND, A DECISION TO RESTRICT THE EXISTING WHM SCHEME, WHICH IS PARTICULARLY POPULAR HERE, IS BOUND TO GENERATE PUBLIC CRITICISM, WHETHER OR NOT A MORE RESTRICTIVE BRITISH SCHEME EXACTLY RECIPROCATES AUSTRALIAN PRACTICE. SUCH A CHANGE WOULD ALSO BE SEEN IN GOVERNMENT AND ELSEWHERE AS FURTHER

EVIDENCE OF DECLINING BRITISH INTEREST IN AUSTRALIA.

6-

WE UNDERSTAND THE HO WISH TO INTRODUCE A NO-SWITCHING RULE LINKED TO MANDATORY PRIOR EC. WE WOULD HAVE LITTLE DIFFICULTY PRESENTING SUCH CHANGES HERE AS THEY WOULD MIRROR AUSTRALIAN PRACTICE AND (MORE IMPORTANTLY) WOULD HAVE LITTLE PRACTICAL EFFECT ON THE FLOW OF AUSTRALIAN WHMS. THUS, IT IS NOT THESE PROPOSALS WHICH CAUSE OUR CONCERN, BUT THE PROPOSED REDUCTION IN THE ELIGIBLE CATEGORIES AND DURATION OF STAY. WE HOPE THE HO CAN BE PERSUADED TO RECONSIDER THESE ELEMENTS OF THEIR PROPOSALS. WOULD NOT THE PRINCIPLE HO OBJECTIVES BE MET BY SIMPLY INTRODUCING MANDATORY PRIOR EC PLUS 'NO-SWITCHING'? AS SEEN FROM HERE, THIS WOULD ACHIEVE MOST DOMESTIC (AND EUROPEAN COMMUNITY RELATED) OBJECTIVES WITHOUT DAMAGING OUR BILATERAL INTERESTS.

7.

IF, NOTWITHSTANDING THE ABOVE, MINISTERS DECIDE TO ACCEPT THE FULL HO PROPOSALS, IT WILL BE IMPORTANT TO WARN THE AUSTRALIAN AUTHORITIES OF OUR INTENTIONS BEFORE ANY PUBLIC ANNOUNCEMENT IS

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