TNAG-0544-FCO40-639-Strength-of-garrison-in-Hong-Kong-1975 — Page 17

i

hi..

CONII DEENTIAL

i

BACKGROUND NOTE

1.

THE COSTS OF THE HONG KONG GARRISON

It was announced to the House on 3 December 1974 in the

Defence Secretary's statement on the Defence Review and subsequently in the Defence White Paper (Cmnd 5976) that, although the main emphasis of our defence effort must in future be on our contribution

to NATO, we recognised that we must continue to maintain forces in the dependent territories, including Hong Kong. It was made clear that in Hong Kong we intended to make some reductions in personnel and would be seeking from the Hong Kong Government, a larger share of the cost of our forces when the present cost-sharing agreement, which expires in March 1976, was renegotiated. The garrison at the time

of the Defence Review comprised 5 infantry battalions (2 of them Gurkha battalions), an artillery regiment and an armoured reconnaissance aquadron, engineers, a naval frigate and patrol craft and an RAF helicopter squadron.

2.

Following discussions at official level both Governments agreed that as an interim measure some reductions in the size of the garrison could be made under the terms of the existing agreement. It was accordingly announced in March 1975 that the garrison would be reduced by the withdrawal of the artillery regiment (less one battery) and the armoured reconnaissance squadron: and that economies would be made in locally enlisted and UK personnel of all 3 Services. At September 1975 prices, the remaining garrison was estimated to cost about $50 million a year, compared with £65 million for the garrison before the Defence Review. Under the current financial agreement Hong Kong's contribution to the cost of the garrison amounts to about £81 million

a year on average.

3. Further discussions between officials paved the way for high level negotiations between the two Governments in Hong Kong from 28 October to 1 November 1975 in which the Minister of State for Defence represented HMG. In the course of the negotiations the Minister of State took the opportunity of explaining HMG's position to the Unofficial members of the Hong Kong Executive and Legislative Councils, as well as negotiating formally with the Governor and his

The negotiations were based on the acceptance by both

advisers.

/Governments