SECRET
this extraneous problem.
WORK ON BORDER FOSTS (OPER TION "HIGHLAND BONNET")
5.
The other outstanding item involves a sum of £20,691 spent by the Services on stores required for refurbishing certain border posts in connection with the 1967 disturbances. This has been the subject of correspondence between Hong Kong and ourselves resting with Jeaffreson's letter to Michael Laird One of 5 February 1971.
PROPOSALS
6.
Since the beginning of this year we have had considerable inter-Departmental discussions in an attempt to resolve these outstanding issues. After the fullest consultation in Whitehall therefore we should now like to propose the following solution.
7.
As to the Snake Fence, neither the Hong Kong Government nor the MCD dispute that the fence was built on the instructions of the Governor in order to stop land incursions of all kinds into the Colony, and that at the time of its building such incursions might be aggressive or might be made by refugees seeking to immigrate illegally. This dispute therefore centres on which kind of incursion the fence was primarily or predominantly designed to prevent. As you will be aware, the accepted principle is that the cost of internal security operations and local defence is the financial responsibility, and should be the first charge on the budget, of a territory. ince illegal immigration was a threat at the time and the fence clearly assisted to counter this, it seems right that at least part of the cost of the fence should fall on the Hong Kong Government. On the other hand, we have been able to obtain acceptance in whitehall of the view that since external military aggression was also felt to be threatened and UK forces were there to meet the threat, and since the fence countered this threat too, part of the cost should fall on UK Defence votes.
In all the circumstances werthink that it would not be unreasonable to share the total cost equally between the two Governments and we suggest that the total cost of the fence should be divided into two equal parts. Since the total cost was 173,340 for materials and some 69,000 for labour and compensation, this would mean that the Ministry of Defence should bear 121,170 of the disputed sum and the liong Kong Government 52,170 (ie 121,170 less the 69,000 you have already spent).
8.
9: with regard to the "Highland Bonnet" claim, in porrview the arguments on each side are pretty evenly balanced although in all honesty we do feel that to draw a distinction between "Highland Bonnet" and "Spring Clean" rather savours of hair splitting.
/However
SLORET
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