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aspects of the proposals and ask that our points should be reconsidered. Incidentally, Mr Heppell, the Assistant Secretary in the DHSS, who has been in Hong Kong since April and has been instrumental in drawing up the proposals in the draft Exco memorandum, is returning to London next month. The department and the OLA intend to debrief him and we may then learn more.
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A.F. Milton
D F Milton
Hong Kong & General Department
2 September 1977
1. I am not convinced that Mr Milton's submission represents the best way of going about a dialogue with Hong Kong, which is What we need to embark on in this whole field of social welfare.
Mr-Walsh-(Deputy-OLA) Mr-Hull--(Economists-Dept)
To begin with, I think we are on bad ground in asserting that the existing proposals are still defective in a number of ways. What is defective is the whole social welfare plan, for the broad reasons spelled out in Lord Goronwy-Roberts' telegram at Flag D. In sum, the difference between our view and the Governor's is that he believes - on professional advice - that there should be a step by step approach to this problem, whereas we believe that the process must be speeded up, even if this involves more radical or far-reaching proposals, in order to push on towards the goal of an extended social security programme by the end of 1980.
2. To argue with the Governor on whether or not the new measures involve a considerable addition to expenditure is really sterile. What we shall need to assert in due course is that there is plenty of money still available for the next steps towards a comprehensive programme which we hope the Governor will promote as soon as the present proposals are through EXCO.
3. This, to me, is the nub of the affair. Sir M MacLehose " has said that the proposal "lays a sound and comprehensive basis on which to build". This being so, we should aim to secure from him as soon as administratively possible a considered view on unemployment benefit based on entitlement, and on retirement benefits and on when drafting for these two measures can be
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