TNAG-2596-FCO40-3784-Appointment-of-Chris-Patten-as-new-Governor-of-Hong-Kong--Ap-1992 — Page 6

CONFIDENTIAL

PRIME MINISTER'S WORKING DINNER WITH MR PATTEN

544BKS

Her Majesty's Overseas Civil Service (HMOCS)

Have meeting with Michael Portillo and Chris Patten this

week to discuss. Crucial we give Chris a good hand to play:

cannot afford a breakdown of morale in the top civil service

or police.

- Need to resolve this before Chris leaves for Hong Kong.

Figures not large (£8m per year for 5 or 6 years from 1997

for compensation; contingent liability to top up pensions but only if HK$ collapsed).

May need to seek Prime Minister's intervention to overcome

Treasury opposition.

Airport

-

First round of talks unlikely to produce result. Few months' delay in project unwelcome but not disastrous. important not to pay Chinese price in terms of advance

commitments from Chris Patten.

More

Chinese likely to remain unsettled until they can get the

measure of the new Governor.

Political Development in Hong Kong

-

Convinced Chris Patten right to create more open,

accessible style: to look again at ExCo's role: and to build

up new bodies between ExCo and LegCo as a means of putting Martin Lee and Co into prominent advisory positions without bringing onto ExCo.

- On electoral issues, have tried to lower expectations of early decisions. Chris Patten will want to put thoughts to

us. I have a meeting with the Chinese Foreign Minister in

late September. Take a first look in Cabinet Committee

before that? Then Chris could say something publicly in his October LegCo speech.

MVSAGZ/1

SLM

CONFIDENTIAL