TNAG-2675-FCO40-3872-Hong-Kong-garrison-withdrawal-plan-1993 — Page 84

GOVERMENT HOUSE HONG KONG.

WED 14 APR 98 09:37

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PG.08

ACTION COPY

TAB A

006176

the

Stanley

Ballu?

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FM FCO

TO IMMEDIATE HONG KONG

TELNO 293

OF 261816Z MARCH 93

INFO IMMEDIATE PEKING, UKREP JIG HONG KONG

PERSONAL FOR PS/GH FROM RICKETTS, HKD

YOUR TELNO 429: HONG KONG: GARRISON WITHDRAWAL

1. I SHOULD LET YOU KNOW WHERE THINGS STAND ON THE POINTS RAISED IN YOUR TUR.

2. MR RIFKIND'S LETTER TO THE GOVERNOR COVERING A COPY OF THE

WE UNDERSTAND MOD'S OUTLINE POLICY PAPER HAS NOT YET ISSUED.

THAT THIS IS BECAUSE MR HAMILTON HAS INTERVENED TO ASK THE MOD STAFFS TO CONSIDER A MORE RADICAL OPTION INVOLVING THE EARLY WITHDRAWAL OF ONE BATTALION IN ORDER TO HELP EASE THE PRESSURE ON BRITISH FORCES ARISING FROM BOSNIA COMMITMENTS, MR RIFKIND HAS ASKED FOR MORE DETAILS OF THIS IDEA AND ITS IMPLICATIONS BEFORE WRITING TO THE GOVERNOR. WE HAVE URGED THE MOD TO GET SOMETHING TO THE GOVERNOR WELL IN ADVANCE OF HIS MEETING WITH MR RIFKIND ON 15 APRIL. BUT IT WILL INEVITABLY TAKE A LITTLE TIME FOR MOD TO

I THINK DIGEST THIS LATEST IDEA IN EVEN A PRELIMINARY WAY. THEREFORE THAT YOU SHOULD NOT EXPECT TO RECEIVE MR RIFKIND'S LETTER BEFORE THE GOVERNOR'S ARRIVAL IN LONDON (BUT I HOPE IT CAN BE EXTRACTED SOON AFTER THAT).

3.

THE IDEA OF A MORE RADICAL PRUNING OF THE GARRISON OVER A SHORT PERIOD WOULD OBVIOUSLY HELP WITH COSTS IN DUE COURSE, ALTHOUGH IT IS NOT YET CLEAR THAT IT COULD YIELD SAVINGS IN FY 93/94. IT WOULD ALSO, OF COURSE, RAISE WIDER ISSUES WHICH MINISTERS AND THE GOVERNOR WOULD NEED TO CONSIDER, PERHAPS IN OPD (K). I WANTED TO ALERT YOU TO THIS DEVELOPMENT EARLY ON, I WOULD BE GRATEFUL IF YOU DID NOT REFLECT KNOWLEDGE OF IT BACK TO THE MOD, FOR THE SAKE OF OUR WORKING RELATIONSHIP WITH THEM.

4.

BUT

MEANWHILE, SIR T DAUNT HAS, AS PROMISED, BEEN PURSUING THE QUESTION OF COSTS. HE TACKLED THE VICE-CHIEF OF DEFENCE STAFF ON THE NEED TO SHOW A DECLINING TREND IN OVERALL COSTS STARTING FROM FY 93/94, AND ON THE NEED FOR MUCH GREATER TRANSPARENCY IN MOD'S DISCUSSIONS WITH HKG.

5. VCDS NOMINATED THE UNDER-SECRETARY DEALING WITH FINANCE IN THE MOD, MR BRACE, TO FOLLOW-UP IN MORE DETAIL. SIR T DAUNT AND I HAD A SESSION WITH HIM TODAY. SIR T DAUNT EMPHASISED AGAIN THE TWO POINTS ABOUT DECLINING COSTS AND TRANSPARENCY, AND RAISED THE SPECIFIC EXAMPLES OF SPECTACULAR EXPENDITURE WHICH YOU HAD CITED (THE VISITORS AND THE CARS). IN RESPONSE, BRACE REITERATED POINTS ALREADY MADE BY MR RIFKIND AND SIR C FRANCE TO THE GOVERNOR. BUT WE DETECTED SOME PROGRESS ON A NUMBER OF FRONTS:

THE MOU FINANCE PEOPLE HAVE NOW HOISTED IN THE IMPORTANCE IN HONG KONG OF SHOWING A DECLINING TREND IN COSTS. THEY SEEM TO BE

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