1. Reference Dominions Office No. 393  and your No.  , Australian Government has reconsidered whole question. Very recently the War Department, Washington, consulted General MacArthur direct asking whether in view of his original recommendation he might now reconsider inclusion of these pilots and divers as part of future exchanges. Chief-of-Staff gave various reasons including point that proposed exchanges offer only method of furnishing medicines and relief supplies to our prisoners held by Japan.
2. The paraphrase of the reply of General MacArthur was as follows:- 'I am irrevocably opposed to the return to Japan of the Japanese divers now held by the Australian Government as internees. These divers would undoubtedly prove to be of the greatest value to those elements of the Japanese Navy now conducting operations in waters of this combat area. Such hydrographic charts as are available are entirely inadequate for navigation and therefore the total information in the hands of these men, which they acquired prior to the war, would present to the commanders of the Japanese Navy knowledge of navigation far superior to that which our own naval forces possess. The fact that the Japanese Government insists so strongly on the return of these men is a clear indication of the extreme value that it places on these pilots and divers. All the members of the Australian Government who are cognizant of this matter and all others who have knowledge of the facts are in complete agreement with me. No more serious or greater mistake could be made by the Government of the United States than to give support to the Japanese Government in the position which it holds in this affair. I reiterate my previous statements in this case and I warn with the utmost gravity if these pilots and divers are returned that the result will be greatly to increase the Japanese potential power with a consequent increase of losses to our own forces. 
3. In circumstances Australian Government cannot possibly alter its prior decision? Please advise United Kingdom Government accordingly.