1. The Palestine ad hoc Committee made considerable progress yesterday in debate on reports of two Sub-Committees referred to in my UN.1150 Assembly 173 and preceding telegrams. A report of Sub-Committee One was submitted with certain changes to bring proposals into conformity with United Kingdom declaration of November 20 in particular the desire of the Mandatory Power not to hand over authority direct either to Jews or Arabs but only to the proposed United Nations Commission and also to decide for itself the date of termination of Mandate and withdrawal of troops and for that purpose to retain all necessary measures to protect the lines of communication and ensure the safety of troops in the areas under Military Occupation.
2. On the whole the United Kingdom wishes on these and related points have been substantially met in the plan of Sub-Committee One. Naturally the United Kingdom would have preferred the presence in Palestine of United Nations Military Force to enforce a settlement but it has been obvious from the beginning that this is out of the question. However it is pointed out that the absence of military means to enforce any positive plan applies equally to the proposals of both Sub-Committees.
3. There are now three alternative courses before the Assembly- (A) Proposals of Sub-Committee number One. These are substantially the recommendations of the majority of UNSCOP as elaborated by a Sub-Committee of nine which now unanimously supports them, including the United States, U.S.S.R. and Canada. An important feature of the plan is that it contains safeguards in respect of Jerusalem, guaranteeing international control and full protection of holy places. It contains also safeguards for protection of Christian interests generally in both Jewish and Arab States.
(B) The proposals of Sub-Committee Two. These imply control of the whole of Palestine by the Arabs with the consequence among others that Jewish immigration will be immediately eliminated. The plan provides for no implementation in the sense of enforcement any more than does plan number one. From the point of view of the United Nations the plan departs considerably from that of Sub- Committee One in that it makes no provision at all for United Nations supervision in the process of setting up self-governing institutions.
(C) The refusal or inability of the Assembly to offer any solution at all, either because of the rejection of both plans or failure to support one by a majority of less than two thirds. 
4. Of all three alternatives the third is the worst as it would say in effect to Jews and Arabs 'British Forces are leaving Palestine. The United Nations, although responsible for international peace and security and although the United Kingdom Government has asked for its recommendations offers no solution and you must fight the matter out.' This third result is quite likely to be brought about by abstentions in the final vote. New Zealand among others has announced the possibility of abstaining but arguments used by this group are open to criticism on the ground that while emphasising the absence of enforcement provisions in the plan of Sub-Committee One (which in any case New Zealand supports in principle) they overlook the corresponding absence of such provision in the Arab plan which as a result of a deficient vote in the Assembly would thus lead to violence and disorder. Under Sub-Committee One plan as amended the proposed Commission will receive its functions from the Assembly and carry them out according to the recommendations of the Assembly while being also under the general supervision of the Security Council.
In other words both Assembly and Security Council jurisdictions are exercisable. There has been some legal argument about the extent of the Assembly's powers in entrusting functions of the kind proposed to the Commission but it is pointed out that the case of the Korean Commission is somewhat analogous. In any event the Assembly will almost certainly refuse to follow the Arab resolution for reference of certain questions to the International Court especially as most of them are not legal questions at all but questions of a political and historical nature.
5. In all the circumstances a course of abstention in the vote is the worst to follow as it would tend to lead to a situation of abdicated responsibility on the part of United Nations. The plan of Sub-Committee Two was emphatically rejected by UNSCOP and has no chance of acceptance. As regards plan One the UNSCOP majority never regarded this as a plan for partition pure and simple and it has been emphasised again here that the plan provides as a[n] essential and indispensable part for arrangements for Economic Union. These imply a scheme for Quasi-Federation in which substantial administrative and legislative powers are lodged in the Central Economic Board which would have exclusive authority over Customs, Currency, Communications and allocation of Revenues.
On the other hand the scheme would set up separate political units with autonomous powers in the fields of Foreign Relations, Defence and Immigration. The whole arrangement thus set up could gradually lead to a close interlocking of the two States and could even compel in due course developments trending towards Federalism.
6. In view of these reasons and the situation in the ad hoc Committee, which has been the most difficult Committee of the Assembly, and in the handling of which the Minister has repeatedly had to take the initiative, it is practically impossible for the Minister to avoid taking part in the vote, which could come very quickly, and supporting the plan of partition plus Economic Union as it seems to offer the best of difficult alternatives in the circumstances existing. It must be added however that it appears doubtful whether two thirds majority will be obtained in the plenary session.