TNAG-0541-FCO40-636-Strength-of-garrison-in-Hong-Kong-1975 — Page 77

CONFIDENTIAL

5. THERE APPEARS TO BE SOME MISUNDERSTANDING OVER THE REVALUATION PROCEDURES WHICH WE HAVE IN MIND. IF THE CONTRIBUTION IS TO REPRESENT THE AGREED PROPORTION OF GARRISON COST, THEN EACH YEAR'S CONTRIBUTION MUST BE RELATED (APPROXIMATELY) TO THE OUT-TURN PRICES OF THAT YEAR AS REFLECTED IN THE MOVEMENT OF THE CHOSEN INDICES. THIS REQUIRES THAT EACH YEAR'S CONTRIBUTION 1S REVALUED DURING THE COURSE OF THE YEAR IN WHICH IT IS MADE. PARA 3 OF OUR

DRAFT MEMORANDUM OF UNDERSTANDING ALLOWS FOR THIS WHEREAS YOURS DOES

NOT.

J

CALLAGHAN

FILES

HKTO

COPIES

то

(4)

MR ABRA HAM,

DSG, MOD

DEFENCE D

SIR D. WATSON

MR WILFORD

MR MALE

MR THOMSON"

MR THORP FI (AIR). MOD

1

MR HANS FORD. HM TREASURY

2.

CONFIDENTIAL