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I am grateful for the minutes by Mrs Barnes Jones and Mr Morris. I have the following comments on outstanding points:

Cost Savings. I have no difficulty with most of the additional changes to the design, over and above the deletion of one floor agreed in the Steering Committee. But I am a bit unhappy about the proposal that the link between the Consulate-General building and the British Council should be eliminated. This would re-introduce a design weakness which we thought we had overcome. Is it inevitable that the link should go? Would the cost savings be significantly reduced if the link is retained? I should be grateful to know the arguments;

(ii) The British Council contribution to extra building

costs. It seems to me entirely justifiable that the British Council should be asked to make a contribution to the extra building costs. Presumably they have an estates budget, even if it is not of a size to permit a fully proportionate contribution. I am attracted by the equal misery idea in your manuscript minute;

(iii) Further submission. I agree that OED should be

encouraged to get on with the submission, so that it should go up to Mr Goodlad before his visit to Croydon. I hope it would be possible to clear this submission between departments without holding a meeting of the Steering Committee for the purpose.

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I attach a minute by Mrs Barnes Jones recording an OED meeting on the new Consulate-General building which she attended on 10 February. I have the following comments:

para 4: The cuts which Mr Bertram is now proposing go somewhat beyond the remit of the Steering Committee, which did not specifically approve the loss of one more flat (in addition to the one lost by deleting a floor) nor the removal of the link between the two buildings. But I do not think it should be necessary to reconvene the Committee for this purpose. However, if Farrells' revised costings (which OED were expecting this week) point to the need for further cuts, I think the Committee should be consulted.

para 8: The background to this paragraph is that RMD believe that the British Council should contribute to the extra building costs. Mr Bertram has said that the BC have no capital funds of their own, and we know that they are reluctant to pay rent (partly) on the grounds that the PES bid is a joint FCO/BC one. But as OED are now proposing to find all the post-cuts budget shortfall from FCO resources, (with the Treasury picking up the exchange rate difference) it could reasonably be argued that the BC should also make a proportionate contribution to the extra costs; (perhaps this might be an annual rent equivalent to the interest payments on one third of OED's contribution over the life of the lease:- as a rough indication, a ball park figure for £1million over 50 years might be £64,000 pa.

para 9/footnote: I do not see why OED wish to defer submitting on these matters until after Mr Goodlad's visit to their Croydon offices (on 24 February). It seems to me that the submission would equip the Minister to make the best use of any discussion of our building during his visit, and in any case we need to press on without further delay.

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BACKGROUND INFORMATION ON SOME OF THE MATTERS THAT MIGHT ARISE WHEN MR.GOODLAD MEETS THE NEW DIRECTOR-GENERAL OF THE COUNCIL.

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genway 40-OPERATION IN THE CHINA REGION.

formal meeting.

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THESE MATTERS ARE OF THE HIGHEST IMPORTANCE TO US. THE FOLLOWING MAY BE HELPFUL FOR BRIEFING:

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(A) NEW CONSULATE IN CANTON.

THE NEWS IN FCO TELNO 38 TO ABIDJAN COULD ENABLE THE COUNCIL TO PREPARE TO SET UP QUICKLY. THEY ARE READY TO GO AND HAVE EXCELLENT PROPOSALS.

(B) ENGLISH LANGUAGE.

I HAVE MANY TIMES REFERRED TO THE IMPORTANCE OF THE STAR TV/BBC LINK-UP AND THE COUNCIL HAVE WORKED UP A DRAFT PILOT PROJECT IN SOUTHERN CHINA, 'LOOKING FORWARD', PROVIDING ENGLISH FOR BUSINESS PURPOSES. WE UNDERSTAND A NUMBER OF UNIVERSITIES ACROSS THE BORDER NOW BROADCAST THE BBC ACROSS THEIR CAMPUSES, REGARDLESS OF CHINESE REGULATIONS.

overtaken. David Love (T2 (C) ig hove this pawa

11 MARCH CONFERENCE IN LONDON.

THE COUNCIL SHOULD BE GIVEN A SLOT. DR.BLACKELL OF THE COUNCIL MAY WISH TO GIVE A SHORT PRESENTATION. THEIR WORK IS

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