CONFIDENTIAL
ANNEX C
MEMORANDUM OF UNDERSTANDING
HONG KONG DEFENCE CONTRIBUTION 1971-76
1. This Memorandum of Understanding embodies arrangements which have been agreed to by Her Majesty's Government and the Hong Kong Government.
2.
During the five financial years beginning with 1971/72, the Hong Kong Government will make a defence contribution at the average rate of £8 million per annum. This contribution will be
made up as follows (figures in £ million):
Year
Cash Contribution
Maintenance
and
Total
Burhanette 10 PE A
Capital Works
Minor Works
1971-72
2.4
2.9
2.2
7.5
1972-73
2.4
2.9
2.2
7.5
1973-74
2.4
3.4
2.2
8.0
1974-75
2.4
3.9
2.2
8.5
1975-76
2.4
3.9
2.2
8.5
Totals
12.0
17.0
11.0
40.0
3.
The following conditions are attached to the contribution:-
(i)
(11)
the contribution will be subject to review at any time:
a.
D
C.
if the costs of capital works at April 1971 prices increase or decrease by 50 per cent or more, or
if there is an increase or decrease in the size of the garrison by more than one major army unit or equivalent, or
if the economy of Hong Kong suffers such a serious adverse change that the continued payment of a contribution at this level can be shown to be an unreasonable burden on the Colony's finances.
The annual figure of £2.2 million for maintenance and minor works is a notional figure only. The Hong Kong Government will be responsible for all maintenance and minor works over the period of the agreement no matter what the cost may be.
Cl
CONFIDENTIAL
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