TNAG-0182-FCO40-218-Defence-contributions-1969 — Page 147

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When the Ministry of Defence considered this matter in May 1968 they stated that if a Hunter force was stationed in Hong Kong it would also be necessary to provide part of an R.A.F. Regiment Squadron to protect the associated ground installations. However, Headquarters, Far East Air Force, have since reviewed this require- ment and now take the view that it will not in fact be necessary to station R.A.F. Regiment personnel in the Colony solely because of the presence of the Hunters there. This has naturally helped to keep costs down.

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6. The figure of £335,000 does not include any element in respect of the capital cost of the eight aircraft. The Ministry of Defenco have stated that were the aircraft not needed for Hong Kong, they would, in 1970, become surplus to our requirements and in the normal course would be sold back to Hasker Siddeley for refurbishment and resale to overseas customero, There is, apperantly a great demand abroad at the present time for second-hand imters (e.g. from Singapore) and we are under constant political pressure to make them available from R.A.P. sources. The Ministry of Defence estimate that they would receive from Hawker Siddeley a total of £300,000 (and not £280,000 as stated in the enclosed report) for the eight aircraft. However, rather more than half of this sum would have to be paid over to the United States Government under off-shore purchase arrangements; but the balance of about £140,000 would be recovered by the Ministry; and stationing the Hunters in Hong Kong would mean that Defence votes would forego this sum unless reimbursed.

7. The Ministry propose that the Hunter detachment should be established in Hong Kong in March 1970, the date when the liunter Squadron in F.F.A.F. is due to disband. The aircraft would then be simply redeployed from Singapore to Hong Kong and the expanse of returning them to the United Kingdom and of subsequently flying others out to Hong Kong would thus be avoided. To give effent to this arrangement, however, they say that a decision will have to be taken by the spring of this year on the question of meeting the coats of the imit: this would allow F.E.A.F. sufficient time to select the aircraft for Hong Kong and to get the necessary servicing and refurbishment carried out. (The feasibility study mentioned that any F.5.A.F. aircraft would require part reconditioning, which would involve some 7,500 man-hours and take up to five months to completo).

8. In sending us the enclosed Report, the inistry of Defence stated that the Chiefs of Staff had reiterated their stipulation that the costs of the detachment should not be borne by the defence budget. They are accordingly looking to us to meet the costs and have asked us what arrangements we envisage to reimburse them both for the actual operating costs of the unit and for the net capital amount that they would otherwise receive by selling the aircraft back to Hawker Siddelay. By their reference to "actual" running costs, we assume that they are covering thenad vos againat any possibility that the actual costs might exceed the estimated costs as set out in the enclosed report. They have thus hit the ball firmly into our court and we need to consult with you on the next step.

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