In reply to telegram 189 to Dominions Office. 
I have read your 189 and previous telegrams. You will, I am sure, realise that I have not yet had time to make myself fully conversant with this question  but as the matter is urgent I am sending you the view which I take as at present advised.
You may rest assured that we at this end fully appreciate the tremendous effort which Australia has made, not only in the field but in provision of base facilities for British and United States forces. We are fully conscious of the great strain imposed on your economy by the continued demands of the Japanese war. We have, however, hitherto assumed that the simplest way of tackling the problem of maintenance of the British Pacific Fleet is first to ask Australia for what is wanted and then to try to make up from our own depleted resources whatever Australia cannot provide. We welcome assurance of further assistance to the extent of your capacity and realise very clearly that your resources are not inexhaustible. I will reply separately about the question of pilots for the Naval Air Arm which you particularly mentioned in your 133.  The last two lines of paragraph 7(a) of your telegram 174  suggest that there is no sound strategical reason for increasing the striking power of the British Pacific Fleet, we cannot share this view. Both we and the Americans consider that its maximum deployment is required if the war against Japan is to be finished as quickly as possible. Without the works in the supplementary programme, our plan to have two British fighting task forces would be frustrated because the second could not be supported and we could probably not maintain even the intensity of operations achieved hitherto. This particularly true of works for the support of air operations, but the camp for dockyard ratings is also essential to material maintenance of the fleet. Timing of the supplementary works described in JAPSC/22/45C  is important if reinforcement of the British Pacific Fleet is to become effective as soon as other considerations allow. Apart from strategy, you will appreciate the political importance to the British Commonwealth of Nations of deploying the maximum possible British strength in the Pacific.
Your suggestion in paragraph 7(c)1 regarding the use of airstrips in forward area has already been examined. The following factors have forced us to concentrate our facilities in Australia:
(1) There will be no intermediate base with airstrips developed in time to meet the planned expansion of the British Pacific Fleet.
(2) The climate in New Guinea is not suitable for rehabilitation, reforming and training of reserve carrier air groups comprising aircrews back from prolonged intensive operations which would have to be accommodated there if they could not go to Australia.
(3) Apart from the climate, shortage of administrative logistic support necessitates concentration of training facilities.
Dispersal would increase administrative overheads beyond our resources.
(4) It would be impossible to develop the necessary facilities for mobile naval air bases on bare landing strips in time.
We have also already done our utmost on the suggestion in your paragraph 7(d)(ii) that the United States should help with releases and with facilities in forward areas and are satisfied that our difficulties would not be met by a further approach to the United States authorities.
I earnestly beg you to consider the following proposal which seems to us to offer the only chance of reconciling the needs of the British Pacific Fleet with your manpower, etc. resources. There are in Australia, or on the way, 3,000 Royal Marine engineers who are equipped and trained for constructional work. These are a mobile force intended for work in forward areas but until the need arises to send them forward, the Commander-in-Chief has been authorised, subject to your concurrence, to use them in Australia for naval works. By using them on this basis would it not be possible to meet essential Royal Navy requirements without material detriment to your own needs. Will you authorise your officers to examine the possibilities in detail with Admiral Fraser. Some review of priorities might also help in the critical period up to October.
The Royal Marine engineers would be used as far as possible in self contained units so as to avoid problems arising from civil and uniformed labour working side by side.