CO_968_583_DEFENCE_OF_HONG_KONG_1957_1959 — Page 42

A

228

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is what the Governor asks for in paragraph 4 i.e. an assurance of the Secretary of State's (or is it Mr. Melville's?) strongest support in resisting such claims. But the Secretary of State's strongest support is not a thing that we can ask other Departments or other Ministers to join with us in assuring the Governor of. We must, I am afraid, recognise (as the Governor has done) that there is no hope of securing agreement quickly that such claims will not be pressed by the Service Departments. Therefore, it seems to me, what we

should go for now is the agreement of Defence Committee based (if we can get it) on a recommendation from Mr. Radice's working party, that Hong Kong's having borne the cost of these units is a factor which will be borne in mind in any negotiations there may be regarding these Service lands.

I have put in with these papers FED 82/454/01 because at X/ of (85) thereon there is the clear statement of the chairman of a Chiefs of Staff Committee meeting held on 20th February this year to the effect that, "The Chiefs of Staff view was that this force (a garrison of six major units) was insufficient even for dealing with subversion and infiltration, under certain conditions, and could not defend the Colony against open aggression for the 48 hours or more needed before any American nuclear weapons could be brought to bear." It is this sort of statement, taken with the recognition by the Chiefs of Staff that the promotion of disorder in Hong Kong is the most likely form of attack by the external enemy, which constitutes the moral basis for our case for saying that the U.K., not Hong Kong, ought to be paying for these units. And it is that moral basis which, no doubt, enabled the Secretary of State to persuade Defence Committee to invite the Chancellor of the Exchequer to consider whether some offer could be made to the Hong Kong Government in respect of the War Department land in return for a Hong Kong Government undertaking to meet the additional costs involved in any increase in the Army garrison over six major units.

| Wallen

6th May, 1958.

w.o.(chalk may s10 - 16/Aad/0071 (F))-6-5-58

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Mr. Melville.

I. Radice & to

I have spoken to Mr.Phelps of the Treasury, and despite the response of the War Office in (228) he is not disposed to allow us to go ahead on the basis of paragraph 4 of the telegram at (226). The Treasury feel that to allow us to go ahead on this basis would amount to an implicit acceptance of the Governor's arguments about the basis of compensation, and this they do not feel able to do. He has accordingly fixed a meeting for Wednesday of next week at which the views of officials will again be deployed, with a view presumably to reporting to Defence Committee as instructed in (205) on this file.

I think that in the circumstances I would be inclined to go a little further than Mr. Wallace has suggested above and to try to get

Defence Committee to accept the basis for reprovisioning

compensation which the Governor has set out.

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When