ifl.rb/Oct 93/22.10.1
Contingent Liability
RESTRICTED
8. The text also raise an issue
Solicitor's clear advice is that
this
-
for the Treasury: Treasury
despite our efforts to avoid
taken together they constitute an assurance by the UK
Government that it stands behind Hong Kong's obligations pre July
1997. We are very unlikely to be able to secure changes to avoid
as this would require changing both the detail of the texts
and the structure of the package.
this,
9. The size of the liability is greater than we originally
thought: around 3.5m at todays exchange rates (35m HK Dollars).
Hong Kong's original estimates of £100,000
£200,000 did not
include staff costs or the cost of deposits on booking halls etc.
The last time the meetings were held out of Washington in Thailand
in 1991, the total cost was $19m (£12.5m). As the bulk of costs
is incurred at the time of the meetings, the Hong Kong estimate
of costs pre-July 1997 in the region of £3.5m looks reasonable.
Hong Kong's financial strength makes it very unlikely that the
liability would ever crystalise.
10. We have no statutory cover for taking on such a liability,
however, and as a liability over £100,000
it would need to be
reported to Parliament by way of a Treasury Minute. Such Minutes
not unusual; Departments lay about 10-15 a year. They are almost
always uncontroversial. They do not require Parliamentary
approval, but Members need to be given 14 working days in which to
object. Any objections, which can take the form of an Early Day