Your cablegram 130 of 28th April, participation of Portugal in operations for recapture of Portuguese Timor. 
1. The Government's Service advisers have made the following observations:-
(a) The war effort is still in a state of disequilibrium and this disequilibrium would be further increased by the acceptance of additional commitments such as the one under consideration.
(b) At the present time, the resources of Australia are strained to such an extent that the greatest difficulty is being experienced in maintaining the strengths of the Australian Services and providing their requirements.
(c) The requirements of the Royal Navy are increasing, and it will be a difficult matter to provide the further assistance that will be sought.
(d) Any commitment accepted for the Portuguese should not be allowed to prejudice in any way the maintenance of the strengths of the Australian forces or the meeting of the requirements of the Australian forces or the Royal Navy. 
2. The Government's policy on Allied commitments as stated to Parliament by the Acting Prime Minister is:
'It has been made clear from the start that there are considerable limitations on Australia's capacity to accept additional commitments for the maintenance of forces from Australian sources of manpower and materials. It is a vital importance to other Governments that we should not make promises which we cannot fulfil. It is of equal importance to the Commonwealth that it should not undertake commitments which are beyond the capacity of its resources to provide.
It is the duty of the Production Executive to consider Allied proposals in relation to other aspects of the war effort in order to assess the capacity to provide them. To guard against the neutralisation of the measures being taken to establish equilibrium in the war effort the Production Executive has been requested to fix ceilings for the Allied commitments that can be undertaken.' 
3. The Government has given full consideration to the proposal that 4,000 Portuguese troops should be received, trained and maintained in Australia to participate in the liberation of Timor, but it is averse to undertaking a further commitment to provide requirements for this force, having regard to existing commitments on Australian resources.