THERE were signs of light at the end of the tunnel last week, on the long and slow path towards putting relations with Beijing back on an even footing. Perhaps no more than a faint glimmer, but enough at least to point the way in which further improvements can be made. It would be easy to think otherwise. Certainly there were plenty of difficulties last week: from the last-minute wrangling over the precise remit of the budget talks in Beijing, to Hong Kong and Macau Affairs chief Lu Ping's official assertion that China should be allowed to have a say over next year's financial package. Yet such problems should not be allowed to obscure the positive side of the events of the past few days: which showed - more clearly than ever before - how Beijing now accepts that ethnic Chinese members of the Hong Kong Government should be allowed to negotiate directly with mainland counterparts, and has dropped its previous insistence that everything be done through British intermediaries. It was only two years ago that China refused adamantly to allow Hong Kong officials even to accompany former British ambassador to Beijing Sir Robin McLaren for talks on the 1994-95 polls. Even when they relented eventually, former Secretary for Constitutional Affairs Michael Sze Cho-cheung and his colleagues were allowed only to attend in the subsidiary role of advisers. Any attempt to suggest that local civil servants would be allowed actually to participate in such talks was attacked repeatedly by Beijing as yet another attempt to create the infamous 'three-legged stool'. But last week, in stark contrast, only mainland and Hong Kong officials were present as a session of Joint Liaison Group (JLG) experts hammered out the agreement which finally will allow the long-awaited Airport Authority bill to be introduced into the Legislative Council next month. New Airport Projects co-ordination director, Billy Lam Chung-lun and his colleagues were left to hold the fort as British JLG chiefs Hugh Davies and Alan Paul helped defuse the last-minute row over the budget talks. Once these problems over the budget negotiations were resolved, the British bowed out, again leaving the field free for Hong Kong civil servants to engage their mainland counterparts directly. Even Government House was left on the sidelines, as Financial Secretary-designate Donald Tsang Yam-kuen led a team of purely local officials to Beijing for the budget talks. For the first time since Chris Patten's arrival three years ago, it is beginning to be possible for local civil servants to bypass the Governor - and the hostility mention of his name invariably brings - and deal directly with the Chinese. Mr Patten might not feel particularly happy about that. 'Do you realise what you're letting yourself in for?' he reportedly warned Mr Tsang. To his credit, he has not tried to block such contacts - while Beijing also has shown admirable restraint in declining to revive its old rhetoric about 'three-legged stools'. That can only be to Hong Kong's benefit. Hopefully those local officials now being allowed to negotiate directly with mainland counterparts are the face of the future Special Administrative Region Government. Most want to stay beyond 1997. Some might be allowed to do so. Indeed, the more contact they are allowed with Beijing in the next two years, the more likely it is that will happen. For years, China refused to deal directly with them, insisting everything be conducted through British intermediaries. The fact it now is beginning to drop that needless requirement is the first hopeful sign in many years that the concept of Hong Kong people ruling Hong Kong might yet turn out to be more than rhetoric. To move further in this direction will require sacrifices on both sides. Mr Patten will have to accept being sidelined almost completely in handling of transitional issues, while Beijing will have to put old prejudices aside. But that is a price worth paying. Despite all the arguing, a small step was taken in the right direction last week.