CONFIDENTIAL
From: D C J Ball, Resources & Programmes (Army) MINISTRY OF DEFENCE, Room 4186
Main Building Whitehall London SW1A 2HB Telephone 01-218 9115 (Direct Dialling)
01-218 9000
(Switchboard)
Your reference
Gamla
Withdrawed
063/1
159
R Burton Esq
Hong Kong Department
Foreign & Commonwealth Office
Room WH305
Whitehall
London SW1
Our reference
D/RP (Army)/7/12
Date
15 October, 1993
Fear Ind
HONG KONG: COSTINGS
HÓA 063/
2000 1993
I promised when we spoke to let you see the costings which underlie the figures given by the Defence Secretary in his response to the Chancellor.
In
2.
As I mentioned, the figures come with a range of caveats. They are based around a snapshot of possible future numbers under the options, while detailed plans have continued to refine; they have not yet been tested through the formal process of costing by all the Budget Managers affected across the Department, but have been compiled centrally; and they do not necessarily match in detail the way that a costing would be prepared for DCA negotiations. particular, I understand that we probably would normally look for a contribution from HKG towards additional Gürkha redundancy costs, but these are shown simply as a cost to MOD. DCA negotiations also start from a different baseline to costings based on the defence programme for instance, MOD's internal programming may have assumed future changes not yet addressed in DCA negotiations. attached tables are all expressed in terms of variation from existing assumed provision in the MOD Long-Term Costing (LTC) programme.
3.
G
The
Nonetheless, they represent as good an assessment as we currently have of the net effect of the options on MOD. the gross cost (+) or saving (-) compared to existing provision in the defence programme. 'DCA' represents the corresponding receipt gained (-) or lost (+) to the defence budget. Thus for the UK battalion under the 'OPD (K)' option there is little effect on the
it is slightly less in the UK pay bill
but there is a lost
receipt of some £28M over three years.
4.
Malay
Please treat with appropriate caution - this is a piece of internal MOD calculation! But I hope it is helpful in bringing out the main reasons for our perception of the difference in value between the two options.
5.
I am sending a copy of this letter to Charles Gordon in Sec(0) (C) here.
You uncerly псели
Encl.
CONFIDENTIAL
Janisan
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