TNAG-0043-FCO40-79-Future-Sovereignty-of-Hong-Kong-Defence-Review-Working-Party-1968 — Page 74

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commitment were abandoned: for example, it might be possible to make

savings in transport aircraft, roulement units and infrastructure.

total cost of the Hong Kong commitment should if possible be set out in broad terms in the paper, although it was not suggested that it should influence a decision on the retention of the commitment.

However, the

Ministry of Defence would require a considerable time to assess the full cost of the commitment. The Ministry of Defence would, however, study

the total cost further.

(e) In their preliminary costings the Ministry of Defence had not taken into account any possible contribution from the Hong Kong Government after the end of the present agreement. If a reasonable contribution were forthcoming from the Hong Kong Government, they should be able to find the forces proposed from within their budgetary target. This should be made clear in the paper.

(f) The Treasury considered that, if the Hong Kong Government could be persuaded to increase their contribution substantially, the Defence Budget target might be capable of some reduction.

(g) The Hong Kong Government would not understand the reason for asking them to increase their contribution from £5 million a year to £14 million. It was difficult to sustain the distinction between forces for internal

security and those for frontier defence; the paper should also state with greater clarity that under present policies the defence budget would bear the cost of forces and facilities retained both for general United Kingdom defence purposes (e.g. the intelligence facilities) and for the external defence of the Colony itself. A more productive approach to the Hong Kong Government might be to say that in general a colony was responsible for meeting the costs of its own defence, subject to its ability to pay. It was desirable to obtain from Hong Kong the full budgetary cost of the forces provided for internal security purposes rather than the foreign exchange costs as agreed in the past. However, the Hong Kong Government were not likely to respond favourably at present to requests for a substantial increase in their contribution, although their attitude might be different in two or three years' time, when we would be on the point of withdrawal from Singapore and Malaysia.

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