TNAG-0254-FCO40-290-Contributions-of-Hong-Kong-for-costs-of-maintaining-military-1971 — Page 53

SECRET

6. Our relations with Hong Kong are if

anything somewhat worse now than they were

at that time and in the event it is what the

Governor can persuade his unofficial advisers

to accept which will determine the new rate

of contribution. I accordingly attach a

revised draft letter to the Governor with a

covering draft to Mr. Gwynn.//Irrespective of

irrespecti

what line it is decided to take, the

following passages in the MOD's own draft

letter call for comment:

Paragraph 3(a): Last three lines

Although it would be as well for the

point at paragraph 2(a) of the record to be

clarified, it seems unlikely that the

Governor envisages that the capital element

in his offer of £8 million would be reduced

in any year if the amount spent on capital

works during that year were less than the

£2 million (or whatever lesser figure is

agreed upon) to be earmarked for capital works

For presentational reasons in Hong Kong the

Governor is anxious to show that a proportion

of the contribution would be spent on bricks

and mortar which would become the property

of the Hong Kong Government when no longer

required by HMG. Moreover, under the

existing agreement, virement between the

capital and recurrent elements of the

contribution is permitted by agreement between

HMG and the Hong Kong Government. There is

no reason to suppose that the Governor wishes

to depart from that arrangement in the new

agreement.

Paragraph 3(b): Last two lines

I suggest the omission of the words

"and will the Colony's share fall outside

NOTHING TO BE WRITTEN IN THIS MARGIN

/the......