TNAG-0543-FCO40-638-Strength-of-garrison-in-Hong-Kong-1975 — Page 83

SECRET

SECRET - UK EYES A

CELLOR OF

CHANCE

THE

EXCHE

UK EYES A

In the light of what you say I would, however, prepared to agree that, after making every effort to secure 75%, you should have discretion to explore informally the Hong Kong Government's attitude to a graduated scheme on the basis of Option A in your letter; if necessary, this could be made more generous by deferring the full 75% contribution to the third year of the agreement. But I do not think you should table an open offer on these lines unless it would clearly bring agreement. If not, you should then refer back to London with your assessment of the situation; indeed a reference back - without breaking off the talks could be tactically useful.

I should add that, if in the event it is not possible to obtain the full 75% from the outset, this must in my view mean that alternative savings would have to be found as part of the measures to bring the Defence Budget down to whatever ceilings are eventually set for the years after 1976-77.

I hope you will feel that what I have said is sufficiently helpful to enable you to seek OPD's clearance on the basis I have suggested.

Dein

(Denis Healey)

SEODET

:

UK EYES A