TNAG-0310-FCO40-346-Contributions-of-Hong-Kong-for-costs-of-maintaining-military-1971 — Page 159

SECRET

5. THERE WAS AT ONE STAGE A DISPOSITION TO QUARREL WITH THE

CONDITION THAT THE ARRANGEMENT DE REVIEWED IF THE

COST OF

CAPITAL WORKS AT APRIL 1970 PRICES WERE TO GO UP OR DOWN BY

50 PERCENT OR MORE. THIS NEVER BECAME A STICKING POINT, BUT

I DID COMMENT THAT I THOUGHT IT POSSIBLE PRICES MIGHT DROP DURING

THE PERIOD FROM THEIR PRESENT HIGH LEVEL AND

THAT ANY REVIEW WOULD HAVE TO TAKE ACCOUNT OF PRICE LEVELS OVER

THE WHOLE PERIOD NOT OF LEVELS AT ANY PARTICULAR MOMENT.

•

THE FIRST HURDLE HAS THUS BEEN SUCCESSFULLY CLEARED.

1 AM NVERTHELESS STILL UNSURE THAT FINANCE COMMITTEE'S REACTION MAY BE. IT IS UNLIKELY TO BE AS RELAXED AS EXECUTIVE COUNCIL, BUT THE LATTER'S AGREEMENT WILL BE A HELP.

7. I NOW PROPOSE CIRCULATING COPIES OF THE EXECUTIVE COUNCIL

MEMORANDUM TO FINANCE COMMITTEE MEMBERS FOR THEIR INFORMATION.

THE UNOFFICIAL MEMBERS OF EXECUTIVE COUNCIL THEN WISH TO DISCUSS

THE WHOLE MATTER WITH THEIR COLLEAGUES ON THE LEGISLATIVE COUNCIL

PERHAPS ASKING FOR AN INFORMAL DISCUSSION WITH ME THEREAFTER: OR, ALTERNATIVELY, IF THEY ALL AGREE AMONGST THEMSELVES TO THE PROPOSALS, THESE CAN BE PUT OFFICIALLY TO THE FINANCE COMMITTEE WITHOUT FURTHER DELAY. PROVIDED THAT THE FINANCE COMMITTEE

EVENTUALLY APPROVES THE ARRANGEMENTS PROPOSED, I HAVE IT IN

MIND TO MAKE AN APPROPRIATE ANNOUNCEMENT IN LEGISLATIVE COUNCIL

MYSELF, PROBABLY ON 6 OCTOBER, IN AN ENDEAVOUR TO OBTAIN PUBLIC ACCEPTANCE. HOWEVER, THIS AND THE MOVES NECESSARY TO OBTAIN LEGISLATIVE COUNCIL FORMAL APPROVAL WITHOUT GIVING TIME AND OPPORTUNITY FOR PUBLIC OPPOSITION TO BECOME EMBARRASSINGLY VOCAL

REQUIRE FURTHER DECISIONS WHICH CANNOT WELL BE TAKEN UNTIL WE

KNOW WHAT FINANCE COMMITTEE'S ATTITUDE IS.

8.

I WOULD LIKE TO TAKE THE FIRST STEP OF CIRCULATING THE

EXECUTIVE COUNCIL MEMORANDUM TO FINANCE COMMITTEE MEMBERS

CERTAINLY NOT LATER THAN THURSDAY 2 SEPTEMBER. PLEASE CONFIRM

URGENTLY THAT YOU HAVE NO OBJECTION TO MY PROCEEDING AS I NOW

PROPOSE.

TRENCH

FILES

HKD

FED

SIR L MONSON MR ROSE

DEFENCE D

MR WILFORD

PPAD

ATD

CCD

PRIVATE SECRETARY

2

SECRET

ADDITIONAL DISTRIBUTION

HONG KONG DEFENCE COST