TNAG-0309-FCO40-345-Contributions-of-Hong-Kong-for-costs-of-maintaining-military-1971 — Page 79

11.

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a safeguard against possible cuts in their

capital works programme) because this.

would virtually mean giving the military

authorities a blank cheque.

The entire

proposals are based on the estimates of

capital costs provided by the Ministry of

provided

Defence (see Appendix to attached Annex)

Λ

and they must therefore stand by those

estimates.

The Treasury and the Ministry of Defence are

very reluctant to support the Governor's proposals.

Their main arguments are:

(a) A contribution of £7.5 million per annum

would be less, in terms of the proportion

that it would represent of the total

estimated annual costs of the garrison

(£26.4 million) than was the previous

contribution negotiated in 1966

(£5 million against total annual costs of

£16 million).

(16) Hong Kong could well afford to pay a

contribution of £8.5 million per annum

(and over a period of seven instead of

$

five years an even higher figure might

reasonably be expected). It benefits

appreciably, both economically and in

terms of public confidence, from the

presence of the garrison and there seems

no reason why the United Kingdom tax

payer should be expected to subsidise the

people of Hong Kong whose rate of

taxation is much lower than that in this

country.

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