THE Government has urged Beijing to give early backing to draft financial support agreements for the Provisional Airport Authority (PAA) and the Mass Transit Railway Corporation (MTRC) to enable them to raise loans for projects as soon as possible. Responding to criticism by senior Chinese official Lu Ping of Britain's unwillingness to cap the level of debt, a government spokesman said: ''The capping of debt is not an issue and should be able to be resolved quickly in line with the Memorandum of Understanding.'' Mr Lu, director of the Hong Kong and Macau Affairs Office under the State Council, said on Tuesday night that the airport deadlock would never be broken if Britain kept creating new problems. He said China had accepted the outline of the Government's fourth financial package - in which the level of borrowing of the two corporations would be $23 billion - but the British side did not want to cap the debt. The head of the Chinese team of the Sino-British Airport Committee, Guo Fengmin, said in Beijing yesterday that British officials had yet to say ''definitely'' whether the total amount of debt would go beyond $23 billion. Government officials have said the debt would be difficult to cap because of fluctuating interest rates. But Mr Guo argued that the interest rate factor had been taken into account when the level of debt was agreed. Negotiators from both sides of the Airport Committee said at the end of a meeting in June that they were working on a draft agreement on the financial package. Chinese member Hu Houcheng said China had insisted that the level of debt should not exceed $23 billion, as agreed upon at the June meeting. He accused the British side of failing to put its promise into action. The government spokesman said: ''We have reached a common view on the main elements of that agreement, including the figures of $60.3 billion for equity and $23 billion for debt. ''Both sides are concerned that these figures should be adhered to as the projects go ahead, and our experts have been discussing how this can be reflected in the documents that will be agreed.'' (Cont'd from Page 1) Secretary for Treasury Donald Tsang Yam-kuen said the Government would be flexible on the issue of debt, but did not elaborate. He said: ''The most important task now is to have financial support agreements with the two corporations so that they can borrow money immediately.'' The spokesman maintained that ''we must not lose sight of the objective, which is to produce an agreement that will enable the PAA and MTRC to raise investments from the private sector in the form of loans and franchises''. ''This means that we must reach agreement on the two financial support agreements which deal with the airport and airport railway financing. ''The present discussions revolve around the primary objective and we await the Chinese side's response to the proposed draft documents, which have been with them for many months,'' the spokesman said. A source said the Chinese suspicion about figures reflected the lack of trust between the two sides. Without the financial support agreements, which spell out details such as the timetable of construction and borrowing from banks, officials said, the two corporations would find it hard to raise loans from the private sector. It is understood the British side has proposed a formal meeting to help remove the outstanding issues on airport financing.