Lieutenant Colonel Dalley returned to Singapore after the war on 5 February 1947 by the Empress of Australia from England. He was met at the wharf by some former members of Dalforce who had served under him in the battle for Singapore. Dalley asked them to gather around him and he told them:

Many observers believed he was referring to the beginning of the Cold War (1945–90) and the rise of Communism after WWII as a result of the fundamentally different ideologies and interests between the Soviet Union and the West, which eventually spread to every part of the world. Thus, “Cold War”, as opposed to an “atomic hot war”, became a term used to indicate the struggle for the hearts and minds of the people between the competing political systems of Communism and Democracy. Essentially, in the Malayan archipelago and Indonesia in particular, this was emphasized to some extent by the power vacuum left by the sudden surrender of the Japanese at the end of WWII after the dropping of the two atomic bombs, but whether this is what Dalley had in mind when he spoke is unclear.

The long PIJ Supplements that Dalley wrote after his return to Malaya on “Malay and Indonesian Communists” and the “Indonesian Situation and Malaya” attached to the MSS Political Intelligence Journals nos. 5 and 10, which will be referred to later in this study, nevertheless confirm Dalley's growing awareness of the problems which MSS would have to face in dealing with the post-war security situation, including the long-standing threat posed to Malaya's security by Indonesian left-wing parties stirring up trouble with Malay left-wing parties to rise up against British colonialism in Malaya as the Indonesians had done against the Dutch in Indonesia.