= 5
This will involve a substantial increase over our present
expenditure on defence, which is about $110 million in this financial year.
Nevertheless, we must keep this expenditure in proportion. In 1971/72,
when the current cost sharing agreement came into force, we were paying
for defence about 3.3% of our total expenditure. In 1976/77 under the
new agreement, our contribution will be less than 3%, and by the third year of the agreement (when we reach our maximum contribution) it will
still be less than 4%. These percentages must be compared with the 18%
of our total expenditure which is set aside for education in the present financial year, the 8% spent on medical services and the 11% allocated
to housing.
The additional charge on our finances gomes at a time when we
are only beginning to recover from the world recession. However, taking
into account the grave economic difficulties from which Britain is suffering
it would have been unrealistic to expect that we should not be called
upon to make a larger contribution to such an important commitment as
security.
And when we are trying to assess the reasonableness of the
agreement, we should not overlook the areas of very valuable land which
are to be returned to the Government. These will become available for
redevelopment and will be of great benefit to the community, both financially
and in terms of the amenities which they will make available.
Of course, the agreement is not as favourable to Hong Kong as we
would have liked. Such agreements are seldom wholly satisfactory to
either of the parties to them. Nevertheless the vital factor is that it
guarantees that we shall continue to have an effective British garrison
of the highest quality.
Most important