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From:
MHR Bertram, OED
Date:
11 November 1993
CC: Mr Wootton, RFD
110
1.
We
OED has given careful thought to your minute of 9 November to Alex Smith and its attached speaking note. are concerned, now that the proposed discussion with the Treasury would be likely to involve so many people and so much detail rather than the relatively informal approach earlier envisaged, that we may be laying ourselves too open to unnecessary and potentially unhelpful Treasury scrutiny of a matter that need not involve them in the detail.
2.
Our next objective with the Treasury is to gain their financial approval to the next project stage. In pursuit of this, Mr Smith will shortly be writing to Mr Marr in prescribed form, clearing his letter with HKD and RFD. The only reason that we can foresee for the Treasury delaying approval is if they choose to make their agreement to the BC's terms of occupation a pre-condition. They ought not to do so.
They are, however, more likely to do this if they have already been appraised at an earlier meeting of the chapter and verse of a relatively domestic squabble between the FCO and BC. Better now, in OED's view, for Mr Smith to include in his letter, after the main submission paragraphs:
recognition that the FCO should not in principle subsidise BC, as Treasury have earlier pointed out;
resumé of earlier understanding about PES bid;
nevertheless, summary of current discussions with BC. (BC accept running cost, including rent, outgoings of not less than at present, so that they would not make savings: BC will be occupying more space than at present: FCO accept that, although co-location is in wider HMG interests, it could pose some risk for BC in early years: seeking a formula satisfactory to both FCO and BC, and to Treasury, to incorporate in provisional Memorandum of Terms of Occupation (MTO));
offer to show draft MTO (which will not take effect for 2 years yet) to Treasury in due course;
SC2299.COL
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