TNAG-0545-FCO40-640-Strength-of-garrison-in-Hong-Kong-1975 — Page 57

GR 275

IMMEDIATE

CONFIDENTIAL

*. 51

(418

425

CYPHER/CAT A

FM HONG KONG 040700Z

4 DEC 1975

CONFIDENTIAL

никю

TO IMMEDIATE F C O TELNO 1223 OF 4 DECEMBER

1.

FOR O'KEEFFE.

PLEASE PASS FOLLOWING TO DAVIES FROM WIGGHAM.

DEFENCE COSTS AGREEMENT FCO TELNO 931 OF 3 DECEMBER.

YOUR PARAGRAPH 1. THE PLAN ''C'' FOR SHAM SHUI PO YOU TOOK WITH YOU IS INCORRECT. THE FINANCIAL SECRETARY IS BRINGING TWO

COPIES OF THE CORRECT VERSION, SHOWING THE AMENDED AREA EDGED

BLUE TOTALLING APPROXIMATELY 28.01 ACRES.

2. YOUR PARAGRAPH 2. PWD CONFIRM THAT, IN THEIR EXPERIENCE, THREE

YEARS IS OPTIMUM PERIOD. SUCH A CONTRACT IS NORMALLY REVIEWED EVERY

TWELVE MONTHS WHEN RATES MAY BE ADJUSTED IN ACCORDANCE WITH

MOVEMENTS IN PWD BUILDING COST INDEX.

3. YOUR PARAGRAPH 3. THE WORD 'BALANCE' AS QUOTED DOES NOT (REPEAT NOT) EXCLUDE COMMITED BUT UNSPENT FUNDS. BOTH JENNEY AND PWD ADVISE THAT SUCH FUNDS ARE, THROUGH THE APPLICATION OF WAGES AND FLUCTUATION CLAUSES, JUST AS SUBJECT TO ADJUSTMENT IN LIGHT OF BUILDING COST

INDEX AS UNCOMMITTED FUNDS.

4. YOUR PARAGRAPH 4. STATEMENT OF FINANCIAL PROCEDURES: GOUGH WAS

INVOLVED IN DRAFTING BUT WHEN PRESSED FELT THAT IT SHOULD BE

CLEARED BY OTHERS ALSO E.G. COMMAND SECRETARY. UNFORTUNATELY FARRER

IS STILL AWAY. IN ANY CASE, GOUGH IS UNCERTAIN ABOUT NEED FOR

INCLUSION OF APPENDIX REFERRED TO IN PARAGRAPH 21 OF THE DRAFT,

SINCE HE SEES THIS AS DEPENDENT ON OUTCOME OF DISCUSSIONS ON REVIEW

PROVISIONS WITH MOD. WE FEEL IT MUST BE INCLUDED AS OFFICIAL BASE

DOCUMENT FOR ANY REVIEW. THE LATEST TABLE OF MANPOWER STRENGTHS AND COSTS, HANDED TO US BY JONES, STILL QUOTES 457. WE SHALL, OF COURSE, NEED AN UPDATED VERSION FOR PROPOSED APPENDIX.

CONFIDENTIAL

15. GOUGH ALSO