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be told that it is possible to reach a figure of £31m. if we reduce to 5 major units and keep the frigate. But he should be left in no doubt that this is the absolute minimum and that the only further front line saving that we could support would be the withdrawal of the frigate.
6. I should stress, however, that we would expect the Hong Kong Government to pay 75% of the actual cost over the five-year period. The figure of £31m. quoted has been produced on an "annual average cost" basis, but I have set in hand a detailed exercise to estimate the costs for the five years from 1976/77 onwards
on a year-by-year basis, taking into account such planned changes as the introduction of new patrol craft.
7. Finally, there is the question of timing. In Howard Smith's sub-committee this morning we discussed the Governor's suggestion that nothing should be said to the Executive Council until May 1975. There was a general feeling that we could not avoid some reference to the proposed changes in force levels when we
our Defence Review decisions as a whole in a White Paper, probably in March 1975. As John Thomson will have told you, we felt that the Governor should be consulted urgently about the implications of this for the timing and form of his first approach to the Executive Council.
I am copying this letter to Howard Smith, John Thomson, and Frank Hall.
8.
Yous
ee
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السلك
A. P. HOCKADAY.
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