While in London, I have had discussions with Mr. Churchill and his advisers about the Australian war effort, with particular reference to the demands likely to be made on Australia when United Kingdom Forces come into the war against Japan in strength, following the defeat of Germany.
2. For some months the Australian Government has been seeking to re-balance the Australian war effort in order to remove certain stresses and strains which have arisen from the extensive call-up of manpower after the outbreak of war with Japan, when the A.I.F.
was still in the Middle East. The return of the A.I.F. and the arrival of United States Forces gave rise to extensive demands for food and other requirements and a re-adjustment of manpower has been necessary to provide for these needs and to sustain the level of activity in a number of basic industries on which the Australian direct military effort ultimately depends. This process is not yet complete, but in conjunction with it, it will also be necessary to provide for the contribution which Australia might be able to make towards the supply and maintenance of United Kingdom Forces which may be based on Australia in the future.
3. While I have been seeking information as to the broad basis which should govern the Policy of the Australian Government in this direction, I have emphasized that the Government and people of Australia are anxious that the strength of the fighting forces shall not be permitted to fall below a certain minimum point. Mr.
Churchill and I have reached agreement  on these strengths and the level at which food production should be maintained for exports to Britain. As Australia is in a sphere of American strategic responsibility, Mr. Churchill also agreed that I should discuss the matter in Washington.
4. Had circumstances permitted, I would naturally have discussed this matter with you first. As this was not possible, I went ahead with my discussions with the Combined Chiefs of Staff and I am glad to say that, thanks to their cordial co-operation and their understanding of our position, a satisfactory conclusion has been reached.
5. I enclose for your information copies of.- (i) The Memorandum submitted to the Combined Chiefs of Staff 
(ii) Their reply.