Kuala Lumpur, 17 February 1965
417. Top Secret Austeo
Central Government’s Relations with Singapore
As you know, there has been a serious deterioration in Singapore’s relations with the Central Government since the P.A.P. contested elections in the Malayan Peninsula last year.1 For some time, it has been evident that events have been leading towards three possibilities:
(a) agreement by the P.A.P. to restrict its political efforts to Singapore, at least until after the next elections;
(b) modification of the present constitutional arrangements between Singapore and the Central Government;
(c) sharpening of communal tensions and eventually communal conflict.
2. I have been optimistic about Malaysia’s future, if for no other reason than that the Malayans and Lee Kuan Yew have no alternative but to make it work and I have been doing what I can privately to promote the idea of a political truce between Kuala Lumpur and Singapore. I was encouraged on my recent visit to Sarawak to find that the Deputy Chief Minister there, James Wong, was also trying to persuade Lee Kuan Yew of this. Now, however, it is clear that the stage has been passed where the Tunku and Lee would consider a truce. Instead, they have reached an informal agreement to revise Singapore’s relationship with the Central Government by amending the Constitution. So far, the talks have been held in great secrecy and only a few members of the Federal Cabinet such as Razak, Ismail and Tan Siew Sin are aware of them. Because of the internal security aspects, Dato Fenner has also been taken into confidence and consulted by Ismail. I was first told of the plan by Razak, but I have also spoken about it since with the others.
3. As the proposals now stand, Malaysia would continue as a Federation but with far reaching changes for Singapore—
(a) The Central Government would retain responsibility for foreign affairs, defence and certain aspects of internal security, especially those associated with defence. Singapore would otherwise become self-governing.
(b) Progress towards a common market for Malaysia would continue based on a financial agreement between the Central Government and Singapore. (I would expect Lee Kuan Yew to succeed in driving a hard bargain on this.)
(c) As Singapore would not be represented in the Central Parliament there would be a new top level body, in which Singapore would be represented, to consider major policy matters of common interest: for example, in fields of foreign affairs and defence.
(d) There would also be machinery and programmes for harmonisation aimed at Singapore’s eventual participation in a genuine Federation.
4. Lee has insisted that under the new arrangements he would have to be responsible for raising and organising defence units in Singapore but has agreed that these units could be made available for Malaysia’s defence with the Central Government taking responsibility for policy.
5. There has been a good deal of uncertainty about internal security. Fenner’s advice was that the Central Government could not afford to hand over responsibility for internal security to Singapore but Lee has been insisting that he must control the Singapore police. As indicated above, the compromise is likely to be a division of internal security so that law and order within Singapore would be a state responsibility while intelligence and security for the defence of Malaysia would rest with the Central Government. This dividing line might well be difficult to draw but Ismail hopes Lee will agree to discuss the problem rationally with Fenner who has no axe to grind especially as he will only be staying on in Malaysia until the end of this year.
6. Lee and the Malayans realise that presentation of the proposed changes will be delicate, especially in view of confrontation. Lee has suggested and the Malayans have agreed that the British must be kept out of the picture at this stage as they would almost certainly want to interfere and could destroy any prospects of a successful arrangement.
7. I can, of course, see all the difficulties in the proposals and am not yet convinced that the new arrangements will make relations between Singapore and the Central Government much easier. But something has to be tried and I believe it would be unwise on our part to seek to interfere in such a delicate internal problem. I also believe the Malaysians are right in insisting that they have to solve this problem for themselves. However, I should welcome any comments you may have as I may be able to exercise a marginal influence without appearing to interfere.
8. The above proposals are known only to very few [ matter omitted ].2 I should be grateful if you would have the department bear this in mind when distributing this telegram.
[NAA: A11536,18]
1 See footnote 5, Document 169.
2 Remainder of this sentence has been expunged.