TNAG-0546-FCO40-641-Strength-of-garrison-in-Hong-Kong-1975 — Page 164

FCO40 Hong Kong Department Records 聯邦事務部香港部檔案 All

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ANNEX B

DEFENCE COSTS AGREEMENT 1976

MEMORANDUM OF UNDERSTANDING

Whereas the United Kingdom Government has confirmed its con- tinued commitment to the integrity and security of Hong Kong and whereas the United Kingdom Government and the Hong Kong Government have agreed on the size, composition and cost of the garrison for Hong Kong and the con- tribution to that cost to be made by the Hong Kong Government and whereas the United Kingdom Government has confirmed that reinforcement of the garrison can be effected should circumstances so require now therefore the United Kingdom Government and the Hong Kong Government have agreed as follows :-

A

1.

The size, composition and cost of the garrison for which this Agreement provides are set out in Annex A,

2.

The Hong Kong Government will contribute to the cost of the garrison in the following manner:-

From 1st April 1976 to 31st March 1977 From 1st April 1977 to 31st March 1978 From 1st April 1978 t.

50%

622% 75%

The increases in the Hong Kong Government contribution from 50% to 622% and from 62% to 75% are conditional on the United Kingdom Government releasing land at Kai Tak and Victoria Earracks respectively in accordance with paragraph 10(a) and Part I of Annex C. In the event of delay in meeting the release dates the situation will be reviewed by the two governments and if the reasons for the delay are the responsibility of the United Kingdom Government, instalments of the Hong Kong Government contribution will be payable at the previous level until the release of the land is completed.

3.

This Agreement shall run for a period of seven years in the first instance and shall be renewed on the same terms for further periods of five years thereafter unless either government gives notice a year before the end of any such period that it wishes to vary the terms.

4.

The cost of the garrison is based on price levels at September 1975, The Hong Kong Government contribution as provided for in paragraph 2, will, after setting off the U. K. Government's share of expenditure on works services in the manner described in paragraph 6 be paid by quarterly instalments on the last day of each quarter of the financial year, with adjustments for changes in the price levels ruling in Hong Kong and the United Kingdom being made as follows. Before each quarterly payment becomes due, a calculation will be agreed between the Hong Kong and U, K. Governments of the changes necessary to adjust each of the separate components of the cost of the garrison (other

G.F. 316

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