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Review of the Draft Programme of Work and Budget, 1970–71

92. The Council heard introductory statements by the Director-General, the Deputy Director-General and the Chairmen of the Programme and Finance Committees concerning the draft Programme of Work and Budget for 1970–71. 1 It expressed appreciation for the detailed and thorough review of the Director-General's proposals carried out by the Programme and Finance Committees. 2

93. The Council also received clarification from the Director-General on several important policy issues. The Council recognized that the Director-General's basic approach and programme proposals were in line with the recommendation of the “FAO Reorganization Plan - Joint Report by the Director-General and the Ad Hoc Committee on Organization”, as approved by the Council at its Fifty-First Session. The Programme of Work reflected in particular the changing needs of developing countries. It was clear, precise and well presented; the format was a great improvement over previous biennia, particularly the various summary tables and the Explanatory Notes. The Council appreciated the separate annexes to the Programme of Work and Budget for Meetings and Publications which enabled revisions to be made for the Conference and subsequent issuance as separate documents. The Council, however, expressed its concern and regret that it had not received the Programme of Work and Budget in time for detailed review.

94. The Director-General had originally proposed in his Programme of Work and Budget for 1970–71, a budget of $73 460 000 which represented an increase of $12 964 000 or 21,4 percent, over the 1968–69 Approved Budget, after adding withdrawals from the Working Capital Fund as estimated at $635 000 in C 69/3. Taking into consideration the recommendations by the Programme and Finance Committees to reduce Travel by $100 000, General Operating Expenses by $100 000 and the provision for loss on exchange by $35 000, and revised arrangements with UNDP for cost-sharing of Country Representatives, the Director-General submitted revised estimates in Document C 69/3-Add.1. The 1970–71 Budget Estimates, as revised, would be $71 325 000 representing an increase of $10 979 000, or 18.2 percent, over the 1968–69 Budget as adjusted by estimated withdrawals from the Working Capital Fund of $485 000. This increase is broken down into $5 964 000 for Mandatory Increases and $5 015 000 for Programme Expansion.

95. The Council noted that the amount to be assessed against Member Nations, after deduction of the estimated amount from Miscellaneous Income and the amount estimated to be received from UNDP/TA as a lump-sum contribution to FAO, would amount to $64 745 000, representing an increase of $9 905 000, or 18.1 percent, over the amount assessed for 1968–69. The Council noted that the amount deducted for the items stated above included an increase of $500 000 in the estimates for Miscellaneous Income, recommended by the Finance Committee.

96. The Council noted that for the first time in the preparation of biennial budgets by FAO, the Director-General had applied the principle of “full budgeting” by including in the Reserve Chapter X provisions for an expected Professional Staff Post Adjustment and General Service Wage Increase with related Common Staff Costs, which would not become effective before sometime in the middle of the first year of the biennium. By doing so, FAO would be following the policy to which the Consultative Committee on Administrative Questions (CCAQ) agreed, following the recommendations of the Ad Hoc Committee of Experts. This principle represents “the concept of budgeting in which the estimates include provision for all increases or decreases in prices and salaries that can be foreseen or that result from the projection of trends through the entire period covered by the estimates.” The Council approved the proposed change in budgetary policy as desirable, since the change should relieve the Organization of some of the financial pressures in 1970–71 which it had been facing in the past largely as a result of not providing in the budget estimates for the full cost of expected increases.

97. The revised amount for Mandatory Increases was $5 964 000, representing an increase of 9.9 percent, over the 1968–69 Budget as adjusted by withdrawals from the Working Capital Fund of $485 000. The Council took note of the Programme and Finance Committees' analysis which included within the term “mandatory” not only those real cost increases which were strictly of a “mandatory” nature, but also those which were a consequence of past directives of the Council or the Conference, or approved cost-sharing arrangements with other Organizations in the United Nations system.

98. The Council agreed with the recommendations of the Programme and Finance Committees that the Programme of Work and Budget as presented by the Director-General and approved by the Conference should be considered first priority for implementation and that additional proposals recommended by the Conference (subject to the Director-General finding savings) should not be considered before the first year of the biennium was over so that only genuine saving which developed in the first year could, if necessary, be used to fund such proposals. A few members felt, however, that a more flexible approach should be taken and that it should be left to the Director-General to decide what proposals could be implemented during the first year.

99. The Council considered that it was important to bear in mind that because of redeployment of staff and resources as a result of the reorganization, and also of the requirements of budget presentation, the provisions in some chapters showed an apparent reduction (due to transfer of funds to other chapters), whereas in fact total provision in the budget as a whole for the activities relating to these chapters in most cases showed an increase and in no case would there be a decrease in programme activities.

100. The Council noted that the programme expansions were in the five areas of concentration: High-Yielding Varieties, Filling the Protein Gap, War on Waste, Mobilization of Human Resources for Rural Development, and Earning and Saving of Foreign Exchange; in investment assistance; in strengthening regional and country activities (including Country Representatives and joint divisions with Regional Economic Commissions); agricultural development planning; and overall policy-making and programme direction (particularly in strengthening the Development Department). The Council noted with satisfaction that the Programme of Work and Budget reflected the new strategy, and felt that it would contribute more effectively to the agricultural development of the developing countries by concentrating FAO's resources in fields of action with maximum impact.

101. Some members, however, felt that there should have been greater concentration and indications of “priority within priorities.” For example, with regard to high-yielding varieties, it was felt that certain problems deserved special attention such as seed production and multiplication, and to filling the protein gap, work on the eradication of certain insects which prevented many countries from taking advantage of their resources for the production of livestock.

102. Many members felt that the highest priority should have been given to the mobilization of human resources for rural development and mention was made of the need for greater emphasis on agrarian reform, agricultural education and training and general improvement of rural populations so that they could make a much more effective contribution to the general agricultural and economic development of their countries.

103. It was suggested that the Codex Alimentarius Commission request the Codex Committee on Meat and Meat Products and/or the Codex Committee on Food Hygiene or other appropriate subsidiary bodies of the Commission to elaborate, as a matter of urgency, codes of practice and hygiene standards for the slaughter of animals and the preparation and refrigeration of meat. The Council noted the statement by the Deputy Director-General that the Secretariat recognized the importance of this problem and would take the matter up with the Codex Alimentarius Commission and, if it should appear necessary to convene a session of the joint FAO/WHO Expert Committee on Meat Hygiene, an endeavour would be made to find the necessary savings to finance such a session. Such codes of practice and standards would be submitted to Member Nations for approval and acceptance, respectively.

104. The Council welcomed the proposed additional resources for the investment assistance programme under the Joint FAO/IBRD Cooperative Programme and the Bank's interest in financing agricultural projects, and opening new credit lines for activities such as land reform and social development. It also stressed the importance it attached to the investment orientation in FAO. While some members expressed some concern that this Programme might continue to expand rapidly thus causing a continued rapid increase in FAO's financial obligations, others however considered that the role of the Programme (and of the Investment Centre activities) should be still further heightened thus gradually shifting emphasis from abstract studies to implementation of concrete action. Several other members felt that the Programme should attempt to exert greater influence on the World Bank to approve loans more quickly than at present; though they recognized that the final decision rested with the Bank, they hoped that the joint activities of the two institutions would lead to acceleration of lending. Most members felt that cooperation with the Area Development Banks should be accelerated. They also pointed to the desirability of closer cooperation with private banks. The view was also expressed that the Programme activities were limited in certain regions, and needed to be further strengthened.

1 C 69/3, C 69/3-Sup.1 and 2, C 69/3-Add.1
2 CL 52/3

Country Representatives

105. The Council recalled that the Conference at its Fourteenth Session had felt that the strengthening of FAO Representation at the country level was an integral part of the reorganization aiming at improving field activities. Most delegations to the Conference had favoured financing Country Representatives through the UNDP to the extent possible, but some had favoured their appointment exclusively under the Regular Programme. The Conference decided that where full-time Country Representatives were needed they should be appointed as promptly as feasible, chiefly financed from UNDP, with overall responsibility for FAO programmes within their respective countries. Subsequently, the Director-General had discussed possible cost-sharing arrangements with the Administrator of the UNDP, but these had not been agreed; the Director-General had, therefore, originally proposed that full provision should be made in the FAO budget for 55 Country Representatives in 1970–71.

106. The Council noted that the Programme and Finance Committees had reviewed this proposal and, with the exception of two members, had agreed with it. The Committees, however, recommended that the Director-General reopen negotiations with the Administrator of the UNDP with a view to arriving at a mutually acceptable cost-sharing arrangement, since a very considerable part of the work of the Country Representatives will consist of furthering UNDP activities at the country level and that it would, therefore, be logical to obtain the necessary financial support from that Agency. Following this recommendation, the Director-General had held a series of discussions and exchanged correspondence with the Administrator of the UNDP. 1 As a result of these discussions, the Director-General had reduced his budget proposals for financing Country Representatives by $1 900 000; the revised arrangement would provide for only 27 Senior Agricultural Advisers/FAO Country Representatives, to be financed under the Regular Programme and the UNDP would continue to finance 28 of these posts. The Council noted that the revised estimates provided $252 000 for work to be performed by UNDP-financed Country Representatives in carrying out activities directly related to FAO, which would include travel and transport costs, supplements to local staff and hospitality.

107. Some members felt strongly that the Director-General's original proposal that all 55 Country Representatives should be fully financed by FAO should have been maintained. A few members felt that the present arrangements should have been maintained or extended, and that the Country Representatives should continue to be financed entirely by the UNDP. Most members while of the opinion that all 55 Country Representatives should be under the control of and fully financed by FAO, were nevertheles ready to accept the Director-General's revised proposal as an interim solution which could be revised in the future. The view was expressed that Country Representatives would consider themselves responsible to whichever Agency paid them, but others considered that this would not be necessarily so. The view was expressed that irrespective of who paid for the Senior Agricultural Advisers/FAO Country Representatives, every effort should be made to ensure that they should be primarily responsible to FAO.

108. Most members agreed that the Director-General's revised proposals, in accordance with his latest agreement with the UNDP, should be accepted as an interim arrangement and that the matter should be reviewed during the course of 1970 on the lines proposed, taking into account any relevant recommendations made in the Jackson Capacity Study and the report of the Pearson Commission. In this way, it should be possible for the Director-General and the Administrator of the UNDP to make a joint recommendation on a unified system of financing, which could come into effect from the beginning of 1972. The Council recommended that the Director-General review the interim arrangements, keeping it informed as to how these were working.

109. The Council noted the proposed modifications in the Regional Offices which would provide for a streamlined and more closely integrated staff, with an emphasis on quality rather than quantity and for greatly increased authority and responsibilities for the Regional Representatives some members expressed the view that the level of the post of Regional Representatives should be equal for all regions, namely that of Assistant Director-General, and requested therefore the Director-General that efforts should be made to this effect as soon as possible. Budget provision for all of the associated regional officers would be transferred to the Regional Offices from the Technical and Economic Divisions at Headquarters. Although 46 regional posts were proposed to be abolished, resources from 12 of them would be utilized to finance 12 additional posts in the regions, in order to provide each Regional Office with a corps of appropriate technical officers representing various disciplines. The Sub-Regional Offices proposed for abolition would be transformed into Country Representatives Offices. Some members stressed the desirability of strengthening activities in the regions, giving the necessary staff to the Regional Offices and the Country Representatives' Offices in accordance with the recommendations of the Regional Conferences.

110. The Council was in agreement with the Director-General's proposals for the reorganization of FAO, including the proposed abolition of specific Headquarters and Regional posts to provide resources for partially financing Country Representatives and higher-priority associated regional officers posts; the strengthening of the Development Department for planning, programming and coordinating of all FAO activities; the elevation of the Forestry Division to a full Department and the expansion of the Fisheries Department. It also approved the Director-General's proposal that the Office of the Coordinator, FFHC, should remain within the Office of the Director-General, rather than be transferred to the OGAI as had been recommended by the Ad Hoc Committee on Organization and approved by the Council at its Fifty-First Session.

111. Some members expressed concern at the increase in the number of posts for 1970–71, and especially those at the P-5 and D-1 level. However, as a result of the Director-General's revised proposals, the increase in the number of posts would be somewhat smaller than originally proposed: the number of new Professional posts proposed would be 53 rather than 81 (including 13 D-1s and 24 P-5s, of which 5 D-1s and 22 P-5s would be for Country Representatives) and the number of new General Service posts would be 62 (of which 27 for Country Representatives Offices) rather than 90. The total of new posts would be reduced from 171 to 115. The Council also noted that there would be a reduction of 11 posts at the P-3 and P-4 levels and that the 37 additional posts proposed at the P-2 level (which included posts to be established at the P-1/P-2 level and which although budgeted at the P-2 level might be filled at the P-1 level) would remain unchanged under the revised proposal of the Director-General.

112. The Council noted that the Consultants Funds which were now included in Divisional budget estimates were proposed to be transferred to a central Consultants Fund in the budget of the Director-General's Office. This Fund amounted to $654 250, including travel. The Director-General expected that as a result of central management and a more efficient use, it would be possible to meet the basic needs of the divisions for the use of consultans and in addition to provide for advisory missions and assistance to countries. The Council was in agreement with the proposal to establish a Consultans Fund of $750 000 for the Regional Offices ($200 000 for Africa, $200 000 for Asia and the Far East, $200 000 for Latin America, $125 000 for Near East and $25 000 for Europe) and that half of this amount in the developing regions would be utilised for work in connexion with the Area Development Banks.

113. Most members supported the Programme of Work and Budget level of $71 325 000 proposed by the Director-General, including provision for the interim agreement with the Administrator of the United Nations Development Programme concerning the financing of Country Representatives. Some members felt that the substantive Programme of Work did not sufficiently reflect the policies necessary in present circumstances. Others felt that certain additions and adjustments were desirable. A few members expressed the view that the proposed increase in the Budget was too high, and that the necessary substantive activities could be accomodated within a total of $68.8 million. Several members, while generally supporting the proposed Programme of Work and Budget level of $71 325 000, felt that savings might well be found, for example in relation to provision for meetings, hospitality, any economies proposed by the Management Consultants, General Service posts, and the Reserve Chapter, and that the Director-General should review the question of saving and adjustments in consultation with the Finance Committee.

1 c 69/3-Add. 1

114. Bearing these and other views in mind, the Council adopted the following resolution, several members reserving their position or stating their disagreement with regard to the level of the Budget and in one case to the resolution as a whole:

Resolution 2/52



Being aware of its responsibility to make recommendations to the Conference on policy issues regarding the Draft Programme of Work and Budget submitted by the Director-General for the following financial period;

Being aware also of the expanded effort necessary if the problems of food and agriculture of the world are to be solved, and of the important role of FAO in this effort;

Recognizing the need of Member Governments to maintain a reasonable balance between the funds they must devote to their national programmes and those they allocate for work through international organizations;

Recommends to the Conference that the level of the Budget for 1970–71, including provision for the interim agreement between the Director-General and the Administrator of the United Nations Development Programme concerning the financing of the fifty-five Senior Agricultural Advisers/FAO Country Representatives, should be $71 325 000, subject to any savings which may be proposed by the Director-General in consultation with the Finance Committee.

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