TNAG-0309-FCO40-345-Contributions-of-Hong-Kong-for-costs-of-maintaining-military-1971 — Page 78

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10.

(a)

would in fact be completely responsible for

all maintenance and minor works over the

period of the agreement, no matter what the

cost.

There could be virement in capital

expenditure as between one year and another

(but not between capital and recurrent

expenditure).

Certain features of the above proposals deserve

special attention:

(1) they cover a period of seven years; the

Governor attaches importance to this longer

period as being a selling point in

(2)

presenting the proposals to his unofficial

advisers.

the Hong Kong Government would accept

responsibility for meeting the whole of the

cost of the capital works programme over the

seven year period (this brings the total

estimated cost of that programme up to

£19.6 million); and if capital works costs

rose during the period they would accept all

such costs up to an increase of 50%. The

Governor is taking a calculated risk here;

if costs rose substantially but without

reaching the 50% mark, then Her Majesty's

Government would gain very substantially from

the arrangement.

(3)

there could not be virement as between

capital and recurrent expenditure (for

which the Ministry of Defence have pressed as

/a safeguard

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