TNAG-0476-FCO40-541-Strength-of-garrison-in-Hong-Kong-1974 — Page 65

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Merseyside as well as jeopardising the future of Yarrow on the

Upper Clyde. The warship cuts would also have repercussions for the supporting electronics contractors, many of whom would also be affected by the Army and Air Force proposals. The reductions in

the guided weapon programme would be particularly serious for Shorts

in Northern Ireland. The extent to which this manpower might be

redeployed in each of these areas is a matter which will not be

the subject of further studies between Departments.

Relation to Savings levels

108. The Critical level of capability has been worked out strictly

against military and strategic criteria. The savings on the LTC 74 costings that would result from the measures identified as necessary to reach this level of capability, should Ministers so decide,

would be as follows:-

£m

1978/9

1979/80 1983/4

Abandonment of National

Overseas Commitments (Option A1

107

110

103

Reduction in Specialist

Reinforcement Capability

(Option B1)

13

21

65

Additional measures to reach the

Critical level

361

485

578

Totals (rounded)

480

615

750

The relation of these total savings to the levels of expenditure

posed by Ministers is shown in Annexes F and G; broadly, the gap

between the Critical level and the First level is about £200m in 1978/9, falling to £150m in the later years to 1983/4. It can be

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