TNAG-0310-FCO40-346-Contributions-of-Hong-Kong-for-costs-of-maintaining-military-1971 — Page 69

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the value of £15 million (including, for example, Whitfield Barracks) and this figure of £15 million is to be compared with the £20 million we paid over the four years of the previous period. I cannot say with complete certitude how much land we shall get back as a result of the capital works programme planned under this new agreement, but it appears likely that the Services will, in due course, be able to release some 520 acres at Lymeun, in the New Territories and along Chatham Road and Argyle Street.

It is very

difficult to estimate how much this land might be worth to us in either financial or social terms but it will represent a very considerable offset against what we shall be paying out. It would, therefore, be a misconception to regard the contribution payable in kind and in cash under the new Agreement as an unqualified gift to Her Majesty's Government.

An annual average level of expenditure of

£8 million is less than one-third of the cost to British taxpayers of maintaining a garrison here, which will average around £28 million a year (including capital works). This figure of £8 million is probably a smaller proportion of the total annual cost than we contributed under the last agreement. Of this total annual cost of £28 million it has been estimated that the direct economic benefit to Hong Kong is also of the order of £8 million a year making the agreement in a sense neutral in its effect. That is to say,

it can be said that the defence contribution will be offset by the value to Hong Kong of the military presence in the Colony; and we surely ought not to expect to make a profit, as it were, from having a garrison here.

Finally, honourable Members may wish to note the increase from £5 million a year to £8 million a year in relation to the increase in General Revenue between 1967-68 and 1971-72. Total estimated revenue for the year 1967-68 was $1,886 million of which the annual contribution of

£5 million even at an exchange rate of

$14.54 to the pound sterling represented 3.9%. Revenue for the current financial year is estimated at $3,118 million, of which an annual contribution of £8 million represents 3.7%. At the moment, we cannot claim that the contribution is not

However, I should remind honourable

within our means.

/Members...