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In discussion it was pointed out that success had been achieved in attaining the previous target for defence expenditure of £2,000 million by 1969-70 at 1964 prices, even taking into account the recent increases of
pay for the armed forces, as early as 1965-66, and maintaining a somewhat lower expenditure in 1966-67 and 1967-68. It was urged that in consider-
ing further reductions we should take into account the fact that the
capability of our forces in Germany was already inadequate to meet their
tasks; and that the stationing of forces in Australia which was
contemplated was admittedly largely for political reasons. While it was
necessary to achieve a reduction in our forces to a level which was within
the capacity of the economy to bear, serious damage was being done to cur
interests in Europe, Africa and Asia by a reduction of forces which was incompatible with the military tasks which were involved. By this course and still more by proposing further reductions we were denying ourselves
any influence in the course of events in these areas,
•
On the other hand, there was general agreement in the Committee that
the basis of the current proposals was that our military commitments should
be reduced to a level which was within the military capacity of our forces
and that in the nature of defence policy it was appropriate that our military
posture should be governed by political objectives. In these circumstances,
there was a wide measure of support for the proposals put forward by the Defence Secretary. It was, however, suggested that the adoption of these proposals as the basis of discussions during the forthcoming months with our
allies would effectively preclude the possibility of the Government later
taking a decision to withdraw wholly from the Far East and to maintain no
military presence in Australia. A study of this course had been
commissioned by the Committee in its initial discussion of the range to be
covered by the further defence studies and it was desirable that this
alternative course should be fully considered, on the basis of a detailed
appreciation of its implications, before a final decision was taken.
the other hand, it was urged that this country was bound in honour to give
military support to Australia and New Zealand if they were attacked. Our
obligations to do so did not derive solely from a series of recent
Ministerial statements, including statements made with the full collective
approval of their colleagues by members of the present Administration.
While those statements must in any event be honoured, our obligations
derived from the whole course of British history over the last fifty years
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