The head of the Political Section in the Ministry of Foreign Affairs has spoken very informally but with some concern reference a conversation in Batavia between Ballard and Schuurman in which the former offered good offices and referred to the possibility of Australia becoming protecting power of the Indonesians. 
2. The Netherlands Government insist that the present action is only police measure as the sovereign power and that they are determined to respect the terms of Linggadjati. To  us their respect for legal verbiage that the greater part of the people outside the Communists including the Labour Party are supporting the Government. Anything suggesting outside interference with that action would at the moment be most keenly resented by the Government and the people. In addition the former are expect[ing] a complete breakdown of Republican organisation.
3. On my perhaps out of date knowledge of the local situation my anticipation has been a rapid military success followed by a long period of guerrilla warfare. It is in the latter period involving high expenditure and much destruction that the Dutch people will lose confidence and that the moment will come for good offices. If this is the case it is important to keep out of the ring until then. It has the added advantage of allowing time to show how the Republic Government stands up.