TNAG-0309-FCO40-345-Contributions-of-Hong-Kong-for-costs-of-maintaining-military-1971 — Page 36

Secretary of State

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(7)

HONG KONG DEFENCE CONTRIBUTION

I agree that the Chancellor of the Exchequer seems bound to

support Lord Carrington.

2. I hope that you will nevertheless fight strongly for

£7.5 million (Annex I). Because it is closer to the Unofficials

offer than to £8.5 million there is a sporting chance that they

(the Unofficials) will accept it. I am sure they will continue to argue if £8.0

million (Annex II) is proposed.

3. If DOPC insist on £8 million then I think the Governor must

be instructed that HM Government are prepared to authorise him to

use his reserve powers to force £8 million through. If contrary

to expectation you get approval from DOPC for £7.5 million the

instructions on reserve powers will of course be the same.

4. If it becomes clear to the Governor in trying to get agreement

for £8 million that all his unofficials in ExCo will resign he will

no doubt report back and DOPC will have to think again. But I

would not be in favour of giving the Governor discretionary

instructions if the Cabinet decision is for £8 million. If the

same thing should happen for £7.5 million we should have to bite

on the bullet and push ahead.

13 July 1971

c.c.

Mr. Royle

PUS

tím tum hilfan

KM Wilford

We should not forget that £0.5 million is 0.025% of the Annual Defence Bridger.

Sir S Tomlinson

Sir S Crawford

Defence Dept. HK Dept.

SECRET