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11.

If these arguments are unsuccessful

the attempt should be made to obtain the

agreement of the Committee to the cost of the

artillery units being met out of Service Votes,

on the same basis as the rest of the garrison.

(Any suggestion that the money should come from

any Vote other than Service Votes, because the

units are needed for "internal security",

should be resisted. The danger to security

in Hong Kong arises from the enemy outside the

gates.) If the cost is met from Service

Votes,the Secretary of State should indicate

that in the circumstances it seems reasonable to

assume that Hong Kong would agree to the

proposal at the beginning of paragraph 9 above.

The Service Departments claim that the Governor,

at the Defence Committee meeting on the 23rd

July, said that Hong Kong would be prepared to

continue its defence contribution of £1m. even

though the gafrison were reduced to six major

units. Whether this is so is not clear from the

minutes. But what is quite clear is that at

the same meeting the Governor made plain that

Hong Kong would not be prepared to increase the

contribution to cover the cost of the two extra

units.

12.

If the Defence Committee decides in

favour of the proposals in paragraph 4 of D(58)1 t

the Secretary of State may wish to warn the

Committee that, in the circumstances, the

continuation by the Hong Kong Government of its

defence contribution at £lm. a year will be open

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