CAB148-30-Defence and Oversea Policy Committee Meetings Relating to 1967 Disturbances-1967 — Page 70

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this question; however, we could not altogether deny that NATO had an interest in it, and our best course, as recommended in the report by

officials, was to take the initiative in suggesting, if the Maltese wished to discuss this question during the negotiations, that a representative of

NATO might be invited to join the discussions on that subject in the

capacity of consultant and observer.

we

THE PRIME MINISTER, summing up the discussion on the conduct of negotiations with Dr. Olivier, said the Committee stressed the need to offer the minimum concession in respect of extending the defence run-down into a fifth year. We might if necessary offer to pay the full cost of compensation to Baileys provided it ensured immediate action by the Malta

Government to nationalise and develop the dockyard but not otherwise;

should not make Maltese agreement on action in respect of the dockyard an

essential part of the negotiations as a whole if they were otherwise satisfactory. We should offer no concession in respect of the unspent balances of aid (though we should recognise that Malta's needs might nake necessary some increase in the overall aid ceiling in later years); and

any involvement of NATO in the question of our capacity to defend Malta

should be on a consultative basis only. Subject to these points the

Committee approved the report by officials as the basis for negotiations

with Dr. Olivier, which it should be our ain to conclude as quickly as

possible.

The Committee

(3) Approved as a basis for the conduct of our negotiations

with Dr. Olivier the report by officials attached to OPD(67) 13 subject to the modifications indicated in the Prime Minister's summing up.

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