FC 102/19

Finance Committee

1. The following is submitted for the action of the Finance Committee, as required under General Rule XXVII 7, which provides that "the Finance Committee shall assist the Council in exercising control over the financial administration of the Organization and shall have, in particular, the following function:

"(j) to keep under review the Scale of Contributions and to submit recommendations to the Council regarding any modification of such scale."

2. The practice of the Organization to derive its Scale of Contributions directly from the United Nations Scale of Assessments has always been followed since 1955, when the Eighth Session of the Conference (November 1955) adopted the following Resolution:

THE CONFERENCE

Having noted the report of the Working Party on the Scale of Contributions as well as the recommendations of the Twenty-first Session of the Council;

Considering that the United Nations Committee on Contributions is the most qualified body for assessing Member Governments' ability to pay as well as all the other factors entering in the computation of an equitable scale of contributions;

Adopts the recommendation of the Council;

Decides that the FAO Scale of Contributions will in future be derived directly from the United Nations Scale of Assessments as in force during the calendar year of the Conference Session, and will be applicable to the two following fiscal years...

3. The Seventeenth Session of the Conference (November 1973) requested the Finance Committee to:

"submit to the Council, with a view to consideration by the Eighteenth Session of the Conference, a report which could serve as a basis for discussing whether or not FAO's Scale of Contributions should continue to be derived from the prevailing scale of assessments of the United Nations"

4. The Eighteenth Session of the Conference (November 1975), having reviewed "the very thorough and detailed study" made by the Committee, concluded that it would be appropriate to continue to derive the FAO Scale from that of the United Nations.

5. The Twenty-second Session of the Conference (November 1983), noting the reservations expressed by several members regarding the criteria on which the current UN Scale had been based, concurred, nevertheless, with the view of the Council at its Eighty-third Session (June 1983), that the UN Committee on Contributions was the most qualified body for assessing Member Nation's real ability to pay. The Conference also agreed with the observations of the Council that departure from the practice of deriving the FAO Scale directly from the UN Scale would lead to duplication of the work of the UN Committee on Contributions, would have undesirable repercussions throughout the UN System and would lead to Governing Bodies of FAO dedicating an inordinate amount of time on this administrative matter in efforts to develop a viable alternative.

6. Appended hereto is the proposed FAO Scale of Contributions for the years 2004 and 2005, which, in accordance with the foregoing, has been derived directly from the United Nations Scale of Assessments approved for the year 2003, as established by General Assembly Resolution 55/5B adopted on 22 December 2000.

7. Since the total of the UN assessment rates of Members of the United Nations which are not Members of FAO exceed the total of those of Members of FAO which are not Members of the United Nations, the UN assessment rate of each FAO Member Nation, with the exception of those to which the minimum and maximum rates are applicable, must be increased, pro rata, in order to arrive at an FAO Scale of Contributions adding up to a full 100 percent.

8. An enabling Resolution for adoption of the Scale by the Conference is as follows:

THE CONFERENCE

Having noted the recommendations of the Hundred and twenty-fourth Session of the Council;

Confirming that as in the past, FAO should follow the United Nations Scale of Assessments subject to adaptation for the different membership of FAO;

Decides that the FAO Scale of Contributions for 2004-05 should be derived directly from the United Nations Scale of Assessments in force during 2003;

Adopts for use in 2004 and 2005 the Scale as set out in Appendix of this report.

^a Derived directly from the UN Scale of Assessments for 2001-2003 as adopted by General Assembly Resolution 55/5B of 22 December 2000.