We have very carefully studied your letters of May 28th, 1947, and the memoranda attached to them about co-operation in British Commonwealth Defence and the future of the Joint Chiefs of Staff in Australia, and have been able to consult the Chief of the Imperial General Staff, who has had the advantage of recent and extensive talks with you on these subjects.
2. As to co-operation, I am very pleased to see that we are in agreement on the need for each Dominion to undertake the development of the defence aspect in regional areas in which they are directly concerned and on the means for achieving this. In general, we welcome your intimation that Australia is willing that its defence organisation should undertake the development of the defence aspect of matters relating to regional security in the Pacific in accordance with the principles and procedure outlined for the functioning of the Australian higher defence machinery. We assume that New Zealand must be a party to agreements to this end and that co-operation between you will develop under the provisions of the Australian - New Zealand Agreement. The extent of the responsibilities you feel able to undertake can no doubt be settled between us after further discussions.
3. We note that you wish to establish in London an accredited defence representative of the Australian Defence Department, Defence Committee and Chiefs of Staff, and to leave unchanged the existing Australian Service Representatives accredited to British Service Departments in London. This arrangement is quite acceptable to us since it suits your Governmental Defence Organisation, and we shall be glad to give your representative all facilities.
4. We entirely agree in principle with the comments in paragraph 12 of your memorandum about the procedure outlined for the use of the Australian Defence machinery, and we have discussed in considerable detail the most appropriate United Kingdom Service representation in Australia, and the organisation which will best serve both our Governments.
5. What we should like to propose, and it accords with your suggestions, can be briefly put as follows. There should be a single Head of the British Military Liaison Staff-probably of Rear-Admiral rank or equivalent-who will be served by a small inter-Service staff. The Head of the Liaison Staff will normally be the British representative to the Australian Governmental Committees you mention, and he will normally be the authority through and from whom will be conducted British Military Liaison business of a Joint Service nature. For reasons of economy, particularly in staff and of senior ranking officers, we wish to combine the responsibilities of a Chiefs of Staff Committee representative and a Service Representative. Thus, the Military Head of the Staff, with whom only the Australian authorities will normally deal, with his two lower ranked colleagues and advisers (of the rank of Air Commodore or Group Captain for the Royal Air Force and Colonel or Lieutenant Colonel for the Army) from the other two Services, will be the representatives of the British Chiefs of Staff Committee accredited to the Australian Defence Department, and the British Service Representatives to the Australian Service Departments. They must also bear responsibility as the British Military Advisers to the United Kingdom High Commissioner in Australia, a position, I understand, similar to your Defence Department Representation in London.
6. We entirely share your wish to cut down attendance at Committee Meetings, and have therefore nominated a single Senior Officer, the Chief of the Military Liaison Staff, as the normal spokesman for the three Chiefs of Staff Committee and Service representatives. By arrangement and according to the nature of the subject to be discussed, the Joint Service Representative could be accompanied or represented by other members of the Liaison Staff.
We suggest that this organisation should be reviewed in a year's time.
7. Turning to the future of the Joint Chiefs of Staff in Australia, we agree that J.C.O.S.A. should be dissolved as soon as practicable, and that you should undertake responsibility for B.C.O.F. We should thereafter retain our voice in determining the policy control of these forces, through the medium of the above proposed Service Liaison Staff in Australia. We assume that you will put this proposal to dissolve J.C.O.S.A. formally to the Governments of the other Commonwealth countries concerned. Once agreement has been reached on this, we will withdraw the United Kingdom element of J.C.O.S.A. and appoint Service Liaison Staffs which will be very much smaller and have entirely changed responsibilities. Our agreement to dissolve J.C.O.S.A. would, of course, largely meet the points raised in your letter of July 22nd, 1947. 
8. As soon as you have assumed control in B.C.O.F., it will be possible also for our representatives to get to work in consultation with yours on those problems which lie before us.
These appear to us to be:-
(a) The extent of responsibilities that the Australian Government is willing to undertake in matters relating to regional security in the Pacific;
(b) Measures for the protection and furtherance of Commonwealth interests in South East Asia;
(c) An implementation of the principle of joint responsibility of Commonwealth members for the protection of lines of communication between main support areas.
9. There are one or two other points in your proposals which are still being studied, and I shall write to you again.