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Mr. Chairman,

I am very glad to welcome members of the Council to this Fifty-Ninth Session.

I must begin to-day with a brief report on a few of the most important aspects of world agriculture at this time. For the situation, with nearly two years of the Second Development Decade gone, is now becoming critical in several places.

In a number of statements in the course of this year - most notably at the Economic and Social Council in the summer and then at the five Regional Conferences - I called attention to the disquieting state of agricultural production in the developing countries. As against the now familiar target of a four percent average annual increase for the Second Development Decade, the developing world as a whole in 1971 only managed an increase of between one and two percent.

I deplored this figure not only for itself but also as the sign of a possible and, if verified, an extremely alarming trend. Not only did it fall far short of the four percent target in the very first year of the Second Development Decade, but, as I tried to point out with some vigour, if it represented the development of a trend for production to continue falling short of the target, then this could well wreck the entire Strategy for the Decade. I said that it was therefore clear that urgent measures were necessary to prevent such a trend from setting in. I made no specific forecast for 1972, although I remarked that we had no evidence to make us believe that the four percent target would be reached this year.

We now have preliminary estimates for 1972. Although they are of course subject to some revision, this is the first time that we have been able to produce such comprehensive estimates for a current year. And, Mr. Chairman, they indicate that the rate of increase in agricultural production in the developing countries was no better than in 1971 - between one and two percent.

This is extremely serious. One can regard the failure of a single year as exceptional. But two failures in successive years - especially at the outset of a comparatively short and crucial period such as this Decade on which so many hopes have been pinned - cannot be shrugged off as a temporary misfortune. And, as I have also pointed out before, the average target for the Decade can no longer be reached unless the shortfall in early years is compensated for by later successes correspondingly above the target level. To say the least, this will require an effort almost without precedent in recent years.

A breakdown of the preliminary 1972 figures among the four developing Regions reveals one immediate threat comparable in seriousness to that of the general trend. While, happily, there was some recovery over 1971 in Latin America and a good year in the Near East with a rise in production of between six and seven percent, the situation elsewhere is very different. The African figures indicate no increase over 1971, but they are still somewhat tentative and will probably turn out more favourably later on. What is really disturbing is the situation in the Far East - that most sensitive Region by reason of its vastness and its vulnerability - where production appears to have actually fallen by anything up to one percentage point. A grim irony is added to gloom by the fact that the Far East is also of course the Region where the Green Revolution has so far had its widest success.

The main cause of this critical reverse appears to have been nature itself. Drought and floods in several countries, notably India and the Philippines, have damaged prospects for cereals and other crops. This fact only serves to sharpen anxiety. For the situation now is that next year's harvest will largely determine whether or not the Region will be faced, yet again, with a food crisis.

This leads me to mention the results of the recent arrangements under which the Soviet Union is buying very large quantities of grain from the United States and some other countries, which has been a major event in the market situation. With stocks of grain in the major producing countries of the developed world coming down to a lower level than has been the case for a number of years, it is vital that these countries should ensure that they have sufficient reserves to provide assistance as they have done so handsomely in the past at times of widespread disaster in developing countries. Let me say at once that I am not anticipating any such disaster. Moreover, the reserve stocks in the major producing countries of the developed world, even at the lower level, are still large enough to take care of any crisis that can at present be envisaged. And in addition some of the developing countries in the Far East have their own reserve stocks, although they are already drawing on these. What I am concerned to do now is to point out to countries concerned - both developed and developing - that the present situation in Asia and the Far East shows that they cannot afford to relax their vigilance in maintaining sufficient reserves against the possibility of an evil day.

These, then, are the main points about the general situation of food and agriculture in the world which I felt I must mention to-day.

I should now, Mr. Chairman, like to deal with the principal events on FAO's calendar in what has been an exceedingly busy year.

In the first place, there were two major United Nations conferences this year in which we participated actively. In the spring, UNCTAD III took place in Santiago. I cannot profess to have been elated by the results of this Conference. Nor, I think, were the developing countries. Indeed, I feel that UNCTAD III provided a test for the strength of the commitments toward a more equitable pattern of international economic relations which countries accepted in adopting the International Strategy for the Second Development Decade. And that, to a considerable extent, this test was failed.

However, I should not like to be too gloomy. Some positive results did emerge from Santiago. Probably the most important was the agreement that the developing countries should participate in negotiations - such as those on monetary reform and in GATT - hitherto reserved for high-income countries, notably the 1973 GATT trade negotiations. I shall have a little more to say on FAO's future relations with UNCTAD and GATT when I come to our work on international agricultural adjustment.

The second major United Nations conference this year was the one on the Human Environment in Stockholm in June. The almost continuous daylight in that city at the time of the year may perhaps be regarded as symbolic of the fact that this Conference was a much brighter affair in terms of positive outcome. The Action Plan adopted by the Conference is a very farsighted document and we shall give our full support to its implementation. Indeed, we have a heavy responsibility since more than one-third of the substantive recommendations contained in the Plan are addressed to FAO or mention FAO among the addressees. As you may know, the Second Committee of the General Assembly has recommended the establishment of a 58-member Environmental Governing Council to whom it has referred the Declaration on Human Environment and the Plan of Action. It has also recommended the creation of a small Secretariat, a Voluntary Fund and an Inter-Agency Coordinating Board.

This year was also of course a year of Regional Conference. For the first time in my term of office, I was able to attend all five, a somewhat exhausting experience but an immensely rewarding one. I regard the Regional Conferences as vital roots through which our tree of policy is nourished and made to grow. By the nature of things, they tend to look at policy in an almost exclusively regional context. But on this occasion I was glad to note that they did so much more than in the past in terms of programme content rather than individual country needs. Even if their approach to priorities was not as specific as I would have liked, it has given us a very good idea of regional aspirations and wishes.

Another series of meetings this year were those of the four Standing Committees of the Council with open membership - the Committee on Agriculture, the Committee on Fisheries, the Committee on Forestry and the Committee on Commodity Problems. Two of these - the Committee on Agriculture and the Committee on Forestry - in fact held their first sessions this year. The four Committees provided valuable guidance on a number of important problems from a technical and global point of view. Again, however, the results of their discussions of priorities were rather inconclusive.

One other meeting in the course of the year deserves special mention. This was the Seventh World Forestry Congress held, as on past occasions, under the aegis of FAO and convened this time by the Government of Argentina. No less than 2 200 participants from 85 countries gathered last month in Buenos Aires, among them delegations from the People's Republic of China and the Soviet Union. From accounts that have reached me subsequently, this was one of the most successful World Forestry Congresses yet held in the series. On behalf of FAO, I would like to ask the distinguished representative of Argentina to convey to his Government our warm and sincere thanks for having acted as host to this extremely important international meeting.

Reverting to the question of reviewing FAO's priorities, which I have mentioned in the context of the Regional Conferences and the four Council Committees, I would now like to refer to one other happening - or rather sequence of happenings - in the Organization this year. This was our own review of priorities. I decided on such a review at the beginning of the year and for two reasons. Firstly, I had in mind echoes of some discussions at the Conference last November, when it had been suggested that FAO was trying to do too much and spreading its limited resources too thin. If this were true - and I may say that we have sometimes felt it to be so ourselves - then clearly some action needed to be taken by way of reviewing our priorities and, if necessary, switching resources from activities of lower priority to those with higher and more urgent claim. Secondly, at the same time as my ideas on this were maturing, we found ourselves entering on the serious financial crisis which has hit us this year as a result of changes in currency rates and the acceleration of general inflationary pressures. I thus decided that we could wait no longer in taking action.

My first step was to set up a Group on Objectives and Policies - what came to be known, in the unlovely but snappy vernacular of our times, as the Think Tank. Composed of some thirty members of the staff from all over the Organization and at varying professional grades, it came up with a number of useful long-term suggestions. I submitted the Report of the Think Tank to the entire staff. I then established a number of policy groups at senior adviser level and asked them to translate the suggestions of the Think Tank and comments received from the staff into practical terms, and also to further re-assess our priorities. This led in part to a certain amount of readjustment of activities and redeployment of staff as spelled out in the document “Streamlining FAO” which is before the Council.

I will have more to say in a little while about the contents of this document and our priorities generally. For the moment, I am only concerned to outline the broad nature of the action which I took in response to the need for a strong and immediate sharpening of priorities against a background of rumblings announcing the threat of a financial landslide. And this leads me to two related points.

Firstly, the Programme and Finance Committees at a joint meeting last month stated - and I quote their Report - that “they felt that in principle the Committees and Council should have been consulted about the major changes involved. They recognized however that in the circumstances of the financial situation, the Director-General felt obliged to take immediate action.”

I fully accept this statement. I myself would have preferred to act on the basis of consultations. Unfortunately, as I have already observed, there was simply not the time. If I had not acted promptly - both to ward off the immediate financial peril and, to some extent as part of this, to redress priorities - our present situation would now be considerably worse. Let me, however, repeat one thing that I told the Programme and Finance Committees last month. Everything that I have done by way of redeployment can, if the Council so wishes, be undone, except, I am sorry to say, for the savings I have made. Nevertheless I hope that the Council will accept the conclusion of the Programme Committee last month, which - and I quote again - “recommended to the Council that it support the Director-General's proposals as a practicable means of alleviating the difficult and complex situation faced by the Organization.”

My second point is to record, briefly but sincerely, my appreciation to the FAO staff for the cooperative spirit they have shown throughout the various stages of this whole exercise this year.

Mr. Chairman, the priorities for FAO in the near future and in the medium-term will derive to a very large extent from facts and events I have so far described - crucial aspects of the world food and agriculture situation and the progressive refinement of our approach to them in meetings such as those of the Regional Conferences and the Council Committees and through our own review of priorities in the Secretariat. All the factors involved then have to be filtered through our detailed mechanisms for building up our programme and finally brought together in the Programme of Work and Budget for the next biennium and in the Medium-Term Plan.

What, then, are FAO's main priorities? I will high-light just a few of them which have become increasingly important in the course of the year.

On the technical side there is agricultural research in and for the developing countries. Here, I will first report briefly about progress in the Consultative Group on International Agricultural Research which, as you will recall, FAO co-sponsors with the World Bank and UNDP. In the course of the year, the Group agreed to support two new major research centres, one the International Crops Research Institute for the Semi-Arid Tropics in India and the other the International Potato Centre in Peru. With the original four Centres that the Group was supporting, the total resources involved have risen from under $10 million at the end of last year to a commitment of $24 million for 1973.

Various other schemes are under active consideration in the Group. These include additional support for further research on animal production in Africa, for the research needs of the Near East and Latin America and for research on rain-fed cropping systems and multiple cropping in Asia. The Technical Advisory Committee of the Group has also recommended the establishment of a world network for the collection, conservation and evaluation of plant genetic resources. I regard this network for genetic resources as particularly important. Unless additional efforts are devoted to work on these resources, it will be difficult to keep up the momentum of crop improvement achieved in recent years as exemplified by the Green Revolution, and at the same time serious disease outbreaks such as have occurred recently in corn, coffee and rice will prove increasingly hard to counter. It is envisaged that FAO would act as the central coordinating body, which would of course imply the allocation of additional Regular Programme resources for this purpose, but which it is hoped would lead to very much more in the way of extra-budgetary resources being made available for the network. So far as FAO is concerned, I intend to make appropriate provision in the next Programme of Work and Budget.

As you know, some developing countries were represented in the Group this year for the first time. Their presence, together with that of FAO, is most valuable both as regards policy guidance for research priorities in the developing countries and by way of strenthening the links between the international centres and the countries they are serving. And this in turn is extremely important in ensuring that the Consultative Group truly reflects the key research interests of the developing countries themselves.

I should not like to give the impression that FAO's activities connected with research are exclusively concerned with those of the Consultative Group. We are placing increasing emphasis on efforts designed to strengthen the capability of the developing countries to carry out their own research. These efforts include such things as the CARIS project, training schemes, seminars and workshops and an attempt to build up coordinated research networks involving groups of countries of which the West Africa Rice Development Association is at present a good example. Such activities are vital. The developing countries need to be helped to take advantage of internationally-sponsored efforts such as those of the Consultative Group. And, perhaps even more vital, they need to equip themselves to be able to carry out their own research on the wide variety of problems which are not covered by the international centres as at present in existence or foreseen. Thus, while we regard the Consultative Group as an essential instrument in promoting agricultural research in the developing countries, FAO's own activities in pursuit of this objective go considerably beyond this.

Turning now to priorities on the economic side, most of our main concerns are bound up with the question of international agricultural adjustment. I spoke at some length to the Conference last year on the subject of adjustment, so that I will not go over the basic principles again. But I would like to report, as I did to the Regional Conferences, that we have now completed our study on agricultural adjustment problems in the developed countries the so-called Geneva Study. This was in fact presented to the European Regional Conference in September, where it had a generally favourable reception. One of the things I would like to stress to-day, however, is that, whatever needs to be done by the developed countries, adjustment is as much a matter for the developing ones. The object of our present studies, principally in preparation for the 1973 Conference, is indeed to relate the problems and possibilities in both categories of countries to one another, in a broad framework of world agricultural development. I must repeat that important adjustments are needed in the developed countries - in the structure of their agricultural sector and of course in the reduction of trade barriers to allow in more agricultural imports from the developing countries. Moreover, the developed countries should show more understanding of the need for the developing countries to expand their agro-allied industries, and should take this need into account when drawing up their own policies for their own related agro-allied industries. The developing countries for their part need to explore further possibilities of intra-regional trade, to which more and more importance is being attached, as has been shown, for example, in the Regional Conferences. They also need to pay special attention to diversification and, as regards their competitiveness in markets in the developed world, to matters such as the quality, processing and marketing of export products.

Another of our chief interests on the economic side - our support for commodity discussions - is also becoming increasingly bound up with our own work on adjustment. For it is our hope that these discussions will more and more be conducted against a background picture of possible alternative flows of exports from developing countries as a result of adjustment policies. We are examining these alternatives both in quantitative terms and in terms of commodity composition.

In all this we shall be working in ever-closer partnership with UNCTAD and GATT, providing them with information and analyses which will, I hope and believe, help to make the negotiations in those bodies on agricultural matters more meaningful and productive by reason of being more securely based on actual facts, trends and reasonable possibilities. This is particularly important with critical new multilateral trade consultations and negotiations not far distant, in connection with which the CCP has already stressed the need for an active and effective contribution by FAO. The CCP has also emphasized, in relation to commodity consultations proposed in an UNCTAD III Resolution, that the existing intergovernmental groups sponsored by FAO ought to be used to the maximum extent possible as the fora for such consultations.

I have now dealt with technical and economic priorities. Then there are the social. Our views here have been clarified and consolidated to an appreciable extent during the year by the work of the Think Tank. In its Report, it recalled that one of the broad purposes of the Organization, as set forth in the Preamble to the Constitution, was “bettering the condition of rural populations”, but maintained that this purpose had so far been relatively neglected. It recommended that FAO, in equipping itself to face the problems of the developing countries in the 1970's, should view them in the framework of this basic purpose. This implied recognition of the fact that rural development was not a matter of simply increasing food production, improving agricultural technology, promoting commodity trade and so forth, but that these and other objectives affecting the rural sector must be absorbed into a much wider context aimed at the well-being of rural communities as a whole. In short, what we now know as integrated rural development.

The social factors involved in integrated rural development are only too well-known. I have stressed them many times. An attack on rural unemployment and underemployment is clearly one. Agrarian reform, as a measure of dealing with economic and social inequality, is another. A great deal more - a very great deal more - needs to be done, and done urgently, about both these matters. They are among our highest priorities. Another social factor to which we are paying increasing attention, particularly since the Resolution of the last Conference on the protein problem, is the demonstrably pressing need to make national food and nutrition policies an integral part of economic and social planning. And we also have a growing programme of activities financed by the United Nations Population Fund to strengthen our work to promote better family living.

A priority which has acquired almost spectacular new importance this year, with the Stockholm Conference, is the environment. Of course, as I have frequently been at pains to point out, it is not all that new for FAO. By the nature of our responsibilities, we have constantly been in contact with environmental problems over the years. For example, as early as 1959, FAO started work on promoting the safe use of pesticides in order to reduce the risk of contaminating the environment.

In this general context, I would like to stress the importance of our activities under what we have called the War on Waste, and particularly the aspect of it dealing with the control of diseases and pests for plants and animals.

Another vital factor is of course the prevention of post-harvest losses - in storage, for example, in packaging, in transport and finally in the home. These losses are among the most serious causes of waste. As I have had occasion to remark before, to produce food and then allow it to be lost is worse than not producing it at all.

I would like to close this list of FAO's priorities by referring to one which cuts across the entire board. This is the development of a much sharper and fuller country focus than we have had in the past. It will be achieved in two ways. Firstly, we are designing a better country information system which would make it possible to bring together, as and when required, the mass of information relating to individual countries which is held at different points within the Organization. I say “as and when required”, since the system would in fact remain decentralized. Secondly, and of more potential significance, there is the idea of country perspective studies which has already aroused great interest when I mentioned it at the various Regional Conferences. Essentially, these studies will examine the agricultural development problems and possibilities of individual countries in a long-term perspective, including the likely effects of alternative policy approaches. They are designed to help countries achieve better agricultural planning and agricultural development and also assist them in identifying their needs for foreign aid in the agricultural sector. At the same time, they will put FAO in a better position to advise donor countries on agricultural development requirements - taking account of course of UNDP country programming. In addition, they will provide realistic inputs for our regional and global studies and help in identifying priorities for our Regular Programme.

I should stress that these studies will be prepared in close consultation with the governments of the countries concerned. Indeed, one of the main objects of the exercise is to bring about a more meaningful policy dialogue between FAO and governments. Finally I should say that all substantive divisions within the Organization will contribute to these studies, the focal leadership being exercised by our new Policy Analysis Division which, as part of the rationalization of the Headquarters structure carried out this year, has been created mainly from elements of the former Economic Analysis Division and the former Policy Advisory Bureau.

Mr. Chairman, this rationalization of the Headquarters structure is one of the matters dealt with in what is the most important document before the Council on current policy, administrative and financial developments in the Organization. This is “Streamlining FAO” document CL 59/25 - which I referred to earlier. It covers several of the matters I have already dealt with. And I should now like to comment briefly on a few of the other matters with which it is concerned.

In the first place, there is this question of the readjustment of the Headquarters structure, the advisability of which emerged as a consequence of our review of priorities, as I mentioned earlier. The creation of the new Policy Analysis Division is the most visible manifestation of centralizing responsibilities for the coordination of FAO analysis on all aspects of agricultural policy in one Department - the Economic and Social Policy Department, as it is now to be called. A further manifestation of this, in response to the high priority which our governing bodies have placed on the mobilization of human resources, is the strengthening of the policy work of the Rural Institutions Division, which is now to be renamed the Human Resources and Institutions Division. For the other structural readjustments, generally of lesser significance, I would refer members of the Council to the document “Streamlining FAO” itself.

The next matter is the whole financial situation. I do not want to belabour this, but merely to concentrate on the essential points. Briefly, due to changes in currency rates and the acceleration of cost increases which I referred to earlier on, we have had to absorb unbudgeted costs for the biennium now estimated at $6.5 million. This we have done without recourse to the Working Capital Fund, which we are holding in reserve. I might add that, fortunately, the previously-looming danger that the deficit would be increased by the fact of our largest contributor not paying its full contribution for the current biennium has now disappeared. For the details of the measures employed in absorbing the unbudgeted costs - freezing of posts and so forth - I would again refer members of the Council to the document rather than take up their time by spelling them out now.

What I would like to draw attention to is the fact that, in addition to economies on costs, our economy measures have meant cuts in the programme. This has been done on the basis of a lengthy, strenuous and painstaking effort to eliminate activities of lower priority in favour of those with a higher one. And these two facts in turn lead me on to the Programme of Work and Budget for 1974–75.

What we are attempting, Mr. Chairman, under pressure of the financial squeeze and in the consequent light of our best judgement on priorities, is to produce a Programme of Work and Budget which is as lean financially and as muscular in programme content as present circumstances both demand and permit.

Having said this, I need to point to one or two of the implications. Since we are now applying about as tight a financial rein as is possible consistent with an effective programme, it simply will not be possible for us to absorb cost increases in the next biennium as we have done this time without causing really serious damage to the programme. I should not like anybody to be in any doubt about this. Indeed, I believe that the facts of the situation are being increasingly appreciated in their true light. With regard to methods for meeting unbudgeted costs in the future, the Finance Committee at its recent session made a number of helpful suggestions which are now before the Council for consideration and which I hope will form a basis for measures to tackle the problem.

A further implication of the present and foreseeable situation, both as regards priorities and finance, is that our approach to the next Programme of Work and Budget also requires a considerable degree of flexibility. Quite obviously, it is necessary that I have the advice and guidance of the Council in preparing it. But I do hope that I shall be left with the amount of flexibility, with regard to both substantive and financial aspects, that an administrator needs in circumstances such as those now facing us.

This leads me up toward the question of the budget level for 1974–75. But, before I deal with this, I would like to round off my reference to issues mentioned in “Streamlining FAO”, by commenting on two for which no solution is proposed in that document.

The first is the question of our field operations. Several proposals have been made in recent months for re-organizing these. But the matter is of course a highly complex one which needs to be worked out very carefully. I have therefore, as you may have noted, established a Field Programme Review Board under the chairmanship of Mr. Yriart, the new Assistant Director-General in charge of our Development Department, to direct the study of measures to improve project delivery and execution and to provide a continuing review of the field programe, its problems and the policies guiding it. This of course is in addition to the steps we have already taken to adapt ourselves to the new UNDP methods of operation.

Secondly, there is the question of the future role and functions of the Regional Offices. We have received in the course of the last few months the detailed consultant's report prepared by Mr. Terver after his retirement as Deputy Director-General, Development Department. There has been a series of debates at all the Regional Conferences, the findings of which in summary form are also before you. The matter has been considered by the Programme and Finance Committees. Finally, I have held a meeting here last week with all our Headquarters ADGs and all our Regional Representatives - as well as the Deputy Director-General of course -to consider the contributions received from various sources, to examine again all aspects of the problem as it affects governments and the Secretariat (in Rome, in the Regional Offices and in individual countries) and to evolve a set of recommendations for consideration by the Council. I will be submitting separately my suggestions to the Council in this connection.

I wish to emphasize that I am not expecting the Council to make a series of major decisions at its present session. This would obviously be impossible in the time available, since there will be no opportunity for the governments represented in this body to study my suggestions and work out carefully considered positions. I am looking rather for a general orientation from the Council to guide my preparation of the next Programme of Work and Budget. The question will come up again here when my proposed Programme is considered in 1973.

To-day I wish to make only the following points. The resources of the Regional Offices and the resources of Headquarters must be considered together as components of a single FAO programme. What matters is the content of the Programme itself and the efficiency with which it is carried out. I cannot accept the implications of certain past attitudes of governments, some pressing for reductions in the size of Regional Offices in order to achieve financial savings, others pressing for an increase, on the premise that the size of a Regional office is the index of FAO's relevance to the Region concerned. In my view and the view of all my senior advisers, our programme must be looked at as an integral whole, but at the same time must become more attuned to the aspirations and expressed needs of the developing countries which are its chief beneficiaries. In particular the resources available in Headquarters must be harnessed more directly than in the past to needs and problems that find expression at the regional level, and the resources of the Regional Offices must be coupled more effectively with those available from Rome. New programming and management techniques and a much more flexible approach will be needed to achieve these aims in future years.

I come now, Mr. Chairman, to the preliminary indication of the budget level for 1974–75 that it is my responsibility to give the Council at this present session. It is, as I say, only a preliminary indication. And the best estimate I can at present arrive at is around $99 million.

This is subject to a few unknown factors, of which the most important is the situation regarding our Country Representatives, who as you know have come to form an essential element of our work in the field. Now there are signs, however, that UNDP may wish to discontinue the present arrangement under which, as you also know, UNDP pays two-thirds of the cost of the Country Representatives. Should that happen, we should of course be obliged to absorb this two-thirds which would cost about $5 million for the biennium.

For present purposes, however, let us keep to the figure of around $99 million. I realize that the first reaction of the Council will be to try and compare this with the figure for the present biennium. I would urge you not to do this until you have all the figures at your disposal, for the situation as regards the present biennium is a rather complicated one. From the overall figure for 1972–73 as approved by the Conference, you have to deduct the technical assistance portion, add the unbudgeted cost increases and currency losses which the Organization is having to absorb and take account of the reorientation to higher priorities some of which I have undertaken in 1972–73 in advance of 1974–75. In view of these factors, there is more than one base level in the present biennium with which to compare the figure I have indicated as the budget level for the next. I will present the full facts and the various comparisons that can be made in the Programme of Work and Budget itself. Only then will it be possible to have a really meaningful discussion on the subject.

I would, however, like to refer once again in this context to two general points which I have mentioned earlier. Firstly, the rigorous economy measures we have undertaken, in particular in reducing the establishment. Without these measures, not only would the situation in the present biennium have been disastrous, but we would have lost the opportunity to gain flexibility in the use of resources in 1974–75.

Secondly, there is our elimination of low priority activities and concentration on ones with high priority. My main purpose in drawing up the programme for 1974–75, as I have indicated, is to produce one which is most effective in real terms at the lowest possible cost. I believe that this can be done within the figure I have mentioned.

I have now, Mr. Chairman, come to the end of my remarks to-day. I am afraid that they have been somewhat long. However, as you will have realized, there are on this occasion a large number of complex issues which the Council has to consider and which I could scarcely have dealt with more briefly. I now look forward with keen interest to the Council's discussions and to their outcome.

Thank you.

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