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Summary Programme of Work and Budget 1967–771

- General

158. The Council noted the comprehensive reports and recommendations of the Programme and Finance Committees on the Summary Programme of Work and Budget 1976–77. Concern was, however, expressed that these important reports were not available before the Council session and that the Committees had not been provided by the Director-General with the necessary information on proposed new posts and upgradings which the Council had requested at its previous session they should carefully review. Although some information on posts and upgradings was provided to the Council only during its session, this was still in the form of proposals yet to be considered by the Director-General. The Council did not find this situation satisfactory.

159. The Council considered that, in preparing his proposals for the Summary Programme of Work and Budget, the Director-General had not taken adequate account of the recommendations of its Sixty-Fifth Session, in particular as regards concentration of existing as well as new resources on problems of food and agricultural production in developing countries, and a reduction of the budget to a level appreciably lower than $185 million.

160. There was general agreement on the need for a substantial programme increase, but considerable concern was expressed over the probable number of new posts and upgradings and among other things the capacity of FAO to absorb effectively a programme increase of the size proposed. In this connexion, there was a broadly based feeling that the main question was whether resources could be used effectively. It was also noted that the small programme increases approved in previous recent biennia had been largely negated by unforeseen cost increases.

- Budget Level

161. The Council noted that the reduction from the $185 million proposed to the Sixty-Fifth Session of the Council to the figure of $177 million in the Summary Budget had been achieved by $1 million in direct net programme cuts and $7 million by introducing an exceptional lapse factor of 25 percent on new posts. While the Council recognised that this exceptional lapse factor had been introduced primarily as a means of reducing the problem of absorptive capacity, and that its effect was to cut the budget level in 1976–77 by $7 million, it was concerned that it would allow the Organization to fill all approved posts during 1977, thus constituting an increased liability through a programme base of some $184 million for the 1978–79 biennium.

162. In the light of these considerations, the Council strongly expressed its view that an adequate and substantial programme increase for effective activities could be achieved within a less expansive and more realistic budget level. The Council considered that in any case, the interim proposals for new posts (totalling 260 professional and 366 general service excluding the proposed transfer of 41 existing posts financed by other funds) were excessive and must be reduced.

1 CL 66/2, CL 66/14, CL 66/INF/7, CL 66/INF/7-Sup.1, CL 66/PV/4, CL 66/PV/5, CL 66/PV/6, CL 66/PV/15, CL 66/PV/16, CL 66/PV/20.

163. After further discussion, the Council noted a statement by the Director-General that after taking all these views into account, he had it in mind to revise his proposals and reduce the budget to a level of $170 – $172 million including any programme adjustments and the additional cost increases (totalling $2.1 million) but excluding the unforeseeable variation in the dollar/lira exchange rate. Included in this proposal was the intention to reduce the number of proposed new posts by 20 percent.

164. In welcoming the response of the Director-General, Member Nations, generally, were not able to commit their Governments. However, the Council agreed that, whatever the level, it should be a firm one including all foreseeable expenditures. Indications given by various members for a budget ceiling ranged from $165 million “all inclusive”, to the last level mentioned by the Director-General. The majority of members agreed that the Council should advise the Director-General that his revised proposals should not exceed $170 million, as an “all inclusive” figure.

165. In this connexion it was felt that, since the average of the dollar/lira rate for the past six months had been around 630 lire to the dollar, the final programme proposals should be prepared to fit within a budget level of $170 million at 630 lire to the dollar. The Council noted that a budget level of around $170 million “all inclusive” would appear, at a dollar/lira rate of 630, to provide an increase over the 1974–75 programme level of around 23 percent in real terms.

- Programme Priorities

166. With regard to which programmes should receive lower increases, the Council felt that the recommendations of the World Food Conference and the decision of the UN General Assembly which sought the achievement of a new International Economic Order should be fully borne in mind. It reiterated the need to concentrate primarily on programmes which would have a direct impact on increasing food production in developing countries and generally agreed with the recommendations of the Programme and Finance Committees, with some reservations which in some cases suggested higher increases. The Council also stressed the need to maintain a balance among the technical and socio-economic activities of the Organization.1 The Council agreed that the Director-General should review the programmes in the light of the recommendations of the Programme and Finance Committees, and the Council's discussions at the present session.

- New Posts2

167. On the question of new posts, the Council thought that their number was still too great. Some members considered that the increase in the number of posts should be proportionately less in the higher grades. The Council requested the Director-General to submit full details of his final proposals on new posts and upgradings to the Programme and Finance Committees at their Autumn sessions for their careful scrutiny and recommendations.

- National Institutions

168. In this connexion, the Council considered that the problems of food and agricultural development could not be solved merely by adding more staff to regional offices, Departments and Divisions; but rather, at the present stage, through strengthening national institutions, particularly those in developing countries by increased use of their resources for reasons of efficiency in the interest of both the developing countries themselves and the Organization. This would not necessarily be more expensive than staff at Headquarters and in any case would in some respects be more beneficial to member countries and to the Organization. There was some support for the idea of an unprogrammed reserve to be used for this purpose.

169. The Council noted that many current and proposed activities were already being carried out in cooperation with national institutions and that fuller information on these and other possible uses would be provided in due course to the Programme and Finance Committees and reported to the Council together with the Committees' recommendations.

1 See para 301 below.
2 The representatives of Member Nations in Africa and Asia stated that their regions were not satisfactorily represented on the FAO Secretariat.

170. The Council also considered the need for an evaluation of ongoing programmes and the utilization of existing staff and endorsed the intention of the Programme Committee to consider this at a future session.

- Decentralization

171. The Council generally appreciated the measures already taken by the Director-General further to decentralize FAO's activities. Some members concurred with the Director-General's approach that greater delegation of decision-making authority should accompany the decentralization of staff and financial resources and they requested fuller and faster progress in this direction coupled with reducing requirements at Headquarters.

172. There was however general support for the view that decentralization could not consist solely of strengthening Regional Offices. It should include delegation to the country level, and should also involve the increased use of national institutions. The Council recognized that this was a complex matter and welcomed the intention of the Programme and Finance Committees to start considering it in their Autumn Sessions.

- Continuation of Summary Programme of Work and Budget

173. The Council noted that the submission of a Summary Programme of Work and Budget was not in conformity with the General Rules of the Organization, which provide, in Rule XXIV-2 (a) (i), that the Council should examine “the draft Programme of Work and Budget and Supplementary estimates submitted by the Director-General for the following financial period” and, in Rule XXV, that during the session convened in the second year of the biennium, not less than 120 days prior to the regular session of the Conference, “the Council shall in particular” examine and discuss the draft Programme of Work and Budget.

174. The Council recalled that it had decided that a summary rather than a full draft of the Programme of Work and Budget should be circulated to Member Nations and submitted to the Programme and Finance Committees and to the June Council session in the Conference year and that this innovation was welcomed by the Conference. The Council decided to continue this practice and accordingly requested the CCLM to consider amendment of the existing relevant rules.

175. The Council stressed however that in future the Summary Programme of Work and Budget should be accompanied by more detailed information on the departmental/divisional implications and proposed changes in posts in relation to the programme proposals.

AGRIS (International Information System for the Agricultural Sciences and Technology)1

176. The Council had before it CL 66/12, the comments of the Programme and Finance Committees (CL 66/2, paras 2.134 and 2.135), and supplementary information on input costs. It appreciated the progress achieved in implementing this system and, with respect to Level I, particularly the issuance on schedule since January 1975 of the monthly worldwide bibliography, Agrindex, and related magnetic tape services. It also noted information provided in CL 66/12 and the supplementary information on input costs made available to it.

177. The Council was reminded that central processing costs for AGRIS Level I in 1975 were mainly covered by extra-budgetary resources, but that from 1976 they would be covered by Regular Programme Funds.

178. The Council recalled the agreement reached at the Seventeenth Conference Session that the AGRIS project should continue its operations, progressively enlarging its initially limited coverage as more contributions and experience were gained, so as to allow for an evaluation of the system by independent experts whose conclusions should be submitted to the Nineteenth Conference Session in 1977.

1 CL 66/2, CL 66/12, CL 66/INF/9.

179. The Council recalled that AGRIS met one of the essential functions of the Organization as defined in Article I-1 of the Constitution, and urged that the actions already taken to provide training courses and seminars for the development of agricultural information services, particularly those designed to meet the needs of developing countries, should be continued and strengthened.

180. As regards the development of specialized information networks (AGRIS Level II), the Council confirmed its understanding that this part of the AGRIS programme was expected to be carried out mainly through cooperation among existing information/documentation centres and with support from extra-budgetary resources.

181. The Council noted the establishment by the Director-General of the new Panel of Experts on AGRIS, to advise him on technical and policy matters relating to the continued development of the system. Specific questions such as distribution and pricing policies for Agrindex, and the AGRIS tape service, would be considered by the Panel whose recommendations would be transmitted to the governing bodies by the Director-General.

182. The Council was informed that the report “A New U.N. Structure for Global Economic Cooperation” (E/AC 62/9) prepared at the request of UN General Assembly Resolution 3343 (17 December 1974) by a group of experts nominated by governments and appointed by the Secretary-General, had cited (paras 151 and 152) the AGRIS system as an example of the “satisfactory results … being obtained in the operation of agency information system with specific objectives”.

Proposed World Conference on Agrarian Reform and Rural Development1

183. The proposal for holding a World Conference on Agrarian Reform and Rural Development in 1978 came before the Sixty-Sixth Council Session as a result of a decision taken at the Sixty-Fourth Council Session. The subject had also been discussed at the Third Session of the Committee on Agriculture and at the Twenty-Eighth Session of the Programme Committee, which considered that it was for the Council to decide whether a Conference as proposed should be held.

184. The Council recognized that agrarian reform and rural development were a continuing and dynamic process which should develop with full respect for the political sovereignty of the countries concerned. It also agreed that the exchange and evaluation of recent experiences at country, regional and global level were of importance both for the member countries' socio-economic progress and also in FAO's programme of work.

185. Although some members felt that the regional, or even sub-regional, approach would be more positive, the majority of members agreed in principle to the holding of the Conference. The Council requested the Director-General to approach U.N., ILO, the World Bank and other interested agencies with a view to recommending that they should cosponsor and support FAO's initiative in holding this Conference. It decided further that the Director-General should report to the next Council Session on progress concerning preparatory work for holding the Conference, particularly with regard to contacts with prospective cosponsors, the timing of the Conference and the Agenda.

Review of FAO Statutory Bodies2

186. The Council noted with approval that the Director-General had abolished the following five panels of experts which were no longer active:

(a) Panel of Experts on Animal Husbandry Education
(b) Panel of Experts on Fish Utilization
(c) FAO/WHO Panel of Experts on Milk Quality
(d) FAO/OIE Panel of Experts on Tick-Borne Diseases of Livestock
(e) FAO/WHO Panel of Experts on Veterinary Education

1 CL 66/2, CL 66/13, CL 66/PV/17, CL 66/PV/18. See also para. 53 above.
2 CL 66/2, CL 66/PV/17.

187. The Council endorsed the recommendation of the Programme Committee that the following Article VI-2 body should be abolished:

(f) Joint FAO/UNICEF Policy Committee.

188. The Council expressed the wish that the Director-General should give consideration to reducing the number and frequency of sessions of statutory bodies. It also stressed that the establishment of panels of experts should make it possible to undertake consultations by correspondence rather than by convening experts.

Programme Adjustments 1974–751

189. The Council noted the Programme and Finance Committees' reports on the transfer of a D-1 post into the Office of the Assistant Director-General, Economic and Social Policy Department, to coordinate the information gathering activities of the Department, and approved the transfer.

Other Budgetary Questions

- UNDP Agency Overhead Costs2

190. The Council noted that the rate of reimbursement for support costs to executing agencies had been increased from 13 percent to 14 percent on actual project costs with retroactive effect from 1 January 1974. The Council further noted the view of the UNDP Governing Council that the 14 percent rate of reimbursement represented 12 percent for non-technical backstopping and 2 percent for project formulation, although this was not at present the approved practice in FAO.

191. The Council noted that agreement in principle had been reached between the Administrator of UNDP and the Director-General on the repayment of part of the “overdrawings” which had arisen as a result of a change in the method of calculation of overhead costs by UNDP as from 1 January 1972. Under this agreement, FAO would repay $2 775 130 over a period of five years starting on 1 January 1976, while UNDP would write off the balance of some $2.2 million originally part of the UNDP's claim against FAO.

192. As regards the Director-General's proposal that the repayments of the overdrawings of approximately $500 000 per annum would be provided for as a first charge against income from the 14 percent overhead percentage paid in 1976 and following years, the Council was concerned about the possibility that the Regular Programme would in effect have to bear the cost of the repayments as part of the amount of its support to field programmes not covered from the rate of agency cost reimbursement.

193. After explanation from the Director-General, the Council approved the agreement made by the Director-General and the Administrator, on the understanding that the repayments of $500 000 per annum to the UNDP would be met from economies in the use of overhead income.

- Extra-Budgetary Activities1

194. The Council noted the sharp increase in Trust Fund activities in recent years and the impact of this growth on the Regular Programme. The Council recognized, however, that many Trust Funds complemented Regular Programme activities.

195. Some members urged that in view of the costs involved, FAO should implement Trust Fund projects other than emergency operations only if they required a high level of sophisticated technology or otherwise supplemented Regular Programme activities.

1 CL 66/2.
2 CL 66/2, CL 66/33.

196. In view of the continuing increase in the volume of Trust Fund activities, the Council requested the Programme and Finance Committees to review the application of the Organization's policies in regard to the acceptance of funds-in-trust and report to the Council.

197. The Council considered that it would be desirable to present in the Programme of Work and Budget a closer link between the Regular Programme and Trust Fund activities, and that this aspect should be borne in mind in the development of the format of the Programme of Work and Budget for 1978–79.

- Annual Report of Budgetary Performance to Member Nations1

198. The Council noted the Annual Report for 1974 as attached to the Report of the Thirty-Fourth Session of the Finance Committee.

199. It endorsed the Finance Committee's concern that some between-chapter transfers had been effected soon after the 1974–75 Programme of Work and Budget had been approved by the Conference. The Council also took note of the fact that, owing to favourable exchange rate developments, an amount of $2.66 million had accrued in 1974 which had been carried forward into 1975 and was included in the unobligated balance for the biennium. 2

Financial Position of the Organization

- Status of Contributions and Contributions in Arrears

200. The Committee noted that the status of contributions at 11 June 1975 was as follows:

 Total outstanding at 1 January 1975 Received Balance outstanding at 11 June 1975
 $ $ $
Current 1975 contributions53 618 440.41 19 774 144.33 33 844 296.083
Arrears of contributions 3 016 713.59   1 421 023.65   1 595 689.943
Instalments to be paid in 1976 and future years in settlement of arrears    125 364.09 -     125 364.09
 56 760 518.09 21 195 167.98 35 565 350.11

3 See Appendix E.

201. The Council noted with concern that amounts payable by Haiti and Paraguay in accordance with Conference Resolutions 25/71 and 26/71 respectively were overdue. In these Resolutions, the Conference had accepted the proposal of each Member that it liquidate its arrears of contributions over a ten-year period while at the same time paying its current contributions in the year of assessment.

202. The Council appealed to these Member Nations to remit the amounts overdue, $14,698 and $41,174 respectively, as soon as possible.

203. The Council further noted that as the arrears of the Central African Republic, Chad, the Dominican Republic, Mauritania, Nicaragua and the Yemen Arab Republic exceeded the contributions due from them for the two preceding calendar years, they risked losing their vote at the forthcoming Session of the Conference in accordance with Article III-4 of the Constitution. The Council appealed to these Member Nations to regularize their positions at the earliest possible date.

204. The Council, recognizing the importance to the Organization of receiving contributions when due, called on all Member Nations to settle promptly all amounts presently outstanding.

1 CL 66/2.
2 See para. 206 below.

- Progress Report on the Use of Expected Savings from Currency Fluctuations1

205. The Council was informed that current estimates of the financial situation in 1975 showed that there might be a gap of about $8.3 million between expenditures and budgetary allotments, mainly arising from unbudgeted inflationary costs in 1975.

206. On the other hand, the following funds were available:

Suspense Account (element for unbudgeted inflationary costs)$2 000 000
Currency Savings 1974:Reserve$   500 000  
 Balance 2 160 000 2 660 000
Estimated currency savings 1975 at Lira 625 - US $1 1 580 000
    $6 240 000

207. The Council noted that in order to achieve savings of at least $2.1 million to cover the estimated gap, the Director-General had already implemented the following measures:

  1. All 1974 net savings had been retained and pooled;

  2. No additional financial obligations were to be undertaken in 1975;

  3. Programme savings in 1975 were to be maximized;

  4. A mid-year review to be undertaken of known and expected developments as a basis for decision on what further necessary measures, if any, should be taken.

208. The Council expressed its concern with the situation. It agreed with the steps already taken by the Director-General, and urged him to continue these as far as necessary, and to report to the Finance Committee in detail in the Autumn of 1975 on the results of his efforts.

Scale of Contributions2

- Study on the Basis of the FAO Scale of Contributions

209. The Seventeenth Session of the Conference had requested the Finance Committee “to undertake a study of the effects on the contributions assessed on Member Nations, and on the budget of the Organization, arising out of fluctuations in the rates of the monetary unit used by the Organization in the preparation of its budget” and had agreed that the Committee “should as far as possible, taking into account the study outlined above, the Gross National Product of Member Nations, the assessment criteria presently used by the United Nations Committee on Contributions, and the role and responsibilities of FAO, 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. This study should in no case modify the decision adopted by U.N. General Assembly Resolution 2961 D (XXVII) in which the minimum contribution of developing nations was reduced from 0.04 percent to 0.02 percent.” 3

1 CL 66/2.
2 CL 66/2, CL 66/PV/17.
3 C 73/REP paras 325– 326.

210. The Council noted with appreciation the very thorough and detailed study made by the Finance Committee in response to the request of the Conference, which it considered fulfilled that request. The Council generally concurred with the Committee's findings and decided to transmit the Committee's report on this study 1 to the Conference. Some members, however, expressed strong reservations concerning these findings and reserved their right to raise the fundamental issue at the time of the Conference.

- FAO Scale of Contributions 1976–77

211. The Council at the same time proposed that the Conference adopt for 1976–77 the Scale of Contributions given in Appendix G to this Report (which is the same as the Scale adopted for 1974–75, both being derived directly from the United Nations Scale of Assessments for 1974–76), subject to any adjustments that might arise from the admission of new Members at the Eighteenth Conference Session.

212. The Council accordingly recommended the following draft resolution for adoption by the Conference:




Having noted the recommendations of the Sixty-Sixth Session of the Council,

1. Decides to adopt for use in 1976–77 the Scale of Contributions set out in Appendix G, which is derived directly from the United Nations Scale of Assessments as in force in 1975.

Other Financial Questions2

- Integration of the Credit Union in FAO

213. The Council reviewed the recommendation of the Finance Committee that the FAO Credit Union be integrated in FAO as proposed by the Director-General.

214. The Council noted that the Credit Union had been formed with the approval of the Director-General in 1954 and now had some 3,000 members and assets equivalent to approximately $8 million. It agreed that the Credit Union was fulfilling a real need and service to the Organization in providing credit and saving facilities for FAO staff. It further agreed that, in line with modern personnel management, a large Organization such as FAO should be in a position to encourage and assist the creation and continuation of such a staff welfare institution.

215. The Council recognized the need to give the Credit Union legal personality and that this could be done by integrating it in FAO; other means of obtaining legal status having been found impracticable.

1 See Appendix F.
2 CL 66/2.

216. Having considered the Report of the Finance Committee on the question of integration, and noting that the Organization and its Member Nations were adequately safeguarded against any financial implication, the Council concurred with the recommendation of the Finance Committee that the Credit Union be integrated in FAO, subject to the Committee on Constitutional and Legal Matters (CCLM) reviewing the legal and constitutional aspects. With the foregoing proviso, the Council accordingly recommended the following draft resolution for adoption by the Conference:




Noting that a Credit Union has for some time made a considerable contribution to the general welfare of FAO staff members by providing them with a convenient means of saving and a source of credit,

Noting further that it was desirable for the legal status of the Credit Union to be clarified and that this could best be achieved by making the Credit Union an integral part of FAO,

Having examined the recommendations made by the Council at its Sixty-Sixth Session,

1. Decides that the Credit Union shall become an integral part of FAO provided that:

  1. the Credit Union's funds and net assets shall be placed in a special account to be administered separately from all other funds and assets administered by FAO;

  2. all costs incurred in the operation of the Credit Union and any financial liabilities, including bad debt and losses, arising out of the Credit Union's activities shall be chargeable to the Credit Union's funds and assets;

  3. the Statutes of the Credit Union contain provisions safeguarding the position of the Organization as set forth in the Annex to this Resolution.

2. Authorizes the Director-General to make the detailed arrangements for the operation of the Credit Union as an integral part of FAO and to approve the Statutes of the Credit Union, and amendments thereto, that are consistent with this Resolution.

Annex to Resolution . …/75

1. All amendments to the Statutes shall require the approval of the Director-General;

2. The Director-General shall be represented on the Board of Directors of the Credit Union. The Director-General's representative shall have the right of requiring deferment of the implementation of any decision taken by the Board of Directors when, in his opinion, such decision contravened regulations, rules, policies or procedures of the Organization. The Director-General would make a determination on the implementation of such decisions;

3. The Director-General shall have the right to order corrective action, within a period specified by him, if he considers that the Credit Union was conducting its affairs in a manner that adversely affected the interests of the Organization. In the absence of such corrective action, the Director-General shall be empowered to appoint a liquidator to wind up the affairs of the Credit Union;

4. The accounts of the Credit Union shall be subject to external and internal audit in the manner prescribed by the Financial Regulations of the Organization, and the audited accounts shall be submitted to the Director-General and be made available to the Finance Committee for such action as deemed appropriate.

- Level of the Working Capital Fund

217. The Council noted that the Finance Committee had endorsed the Director-General's proposal that the authorized level of the Working Capital Fund be increased from $4.5 million to $6.5 million as of 1 January 1976, and that the authority to advance reimbursable loans for certain emergency needs should be increased.

218. After discussion of the probable emergency needs and certain financial aspects, in particular the possible need for some form of Suspense Account in 1976–77 to guard against currency fluctuations and/or unbudgeted inflationary costs, the Council decided to reconsider the matter at its Sixty-Seventh Session.

- Compensation Plan Reserve Fund: Actuarial Survey

219. The Council noted that the Finance Committee had recommended the Director-General's proposal to adopt the Consulting Actuary's recommendations concerning funding and coverage of the Compensation Plan Reserve Fund.

220. The Council endorsed this recommendation and noted that the Autumn 1976 Finance Committee Session would review the operation of the Compensation Plan in relation to the recognition of commuting accidents as service-incurred for all staff, rather than for field staff only as in the past.

- Headquarters Accommodation1

221. The Council noted the need to negotiate an extension to the contract for the rental of Building F. The lease was due to expire on 31 December 1976; Building D was not expected to become available until 1978 and would not in any case accommodate all staff at present in Building F.

222. Moreover, there was currently a need for at least 100 extra rooms to accommodate increased staff during the current biennium, including the Secretariat of the World Food Council, the International Fertilizer Supply Scheme, the World Food Programme and other programme activities, including extra-budgetary programmes. The Council was informed that the World Food Programme and the extra-budgetary programmes contributed appropriately towards the premises expenditure.

223. In view of the information provided on current space shortages, and bearing in mind the extra commitments which could reasonably be expected to arise for 1976–77, the Council endorsed the recommendation of the Finance Committee to accept the Director-General's proposal to enter into a contract to rent additional premises situated in the vicinity of Building F from 1 July (or 1 August) 1975 through 31 December 1977.

224. The Council was informed that these premises would accommodate approximately 450 staff and that the annual cost for the rent, maintenance and servicing of such premises was approximately $1 374 000 plus non-recurring installation costs of approximately $190 000.

225. The Council expressed its appreciation of the generosity of the Italian Government in providing the Headquarters buildings and a special contribution in recent years to offset building costs. It was glad to note that the study of longer-term needs for Headquarters accommodation, and the possibility of the Organization constructing or purchasing accommodation for its increased needs, would be undertaken as suggested by the Finance Committee.

1 CL 66/PV/17, CL 66/PV/18.

- Salaries of Senior Staff1

226. The Council considered, in the light of the increase in Professional Salaries approved by the UN General Assembly from 1 January 1975, the question of an appropriate adjustment to the salaries of the Director-General and of the Deputy Director-General.

227. The Council then recommended the following draft resolution for adoption by the Conference:




Having noted that the UN General Assembly decided to increase the salaries of Professional, Director and Assistant Director-General categories by 6 percent effective 1 January 1975, that the FAO Council had decided to adjust those salaries accordingly, and that the FAO Conference had not considered such a development at its session of November 1973,

1. Authorizes that the annual salary of the Director-General be retroactively adjusted from 1 January 1975 to the following amounts: net salary US $44 000, gross equivalent US $74 800, Post Adjustment for one class amounts to US $1 760 at dependency rate or US $1 173 at single rate.

228. The Council also adopted the following resolution:

Resolution 3/66



Having noted that the UN General Assembly decided to increase the salaries of Professional, Director and Assistant Director-General categories by 6 percent effective 1 January 1975 and that the Council had decided to adjust those salaries accordingly,

1. Authorizes that the annual salary of the Deputy Director-General be retroactively adjusted from 1 January 1975 to the following amounts: net salary US $36 625, gross equivalent US $60 050, Post Adjustment for one class amounts to US $1 465 at dependency rate or US $977 at single rate.

229. The Council noted the observation of the Finance Committee that the application of uniform percentage increases led, through the course of time, to the widening of differentials between staff at junior and senior levels, which might have serious consequences on salary structure. The Council therefore endorsed the recommendation of the Finance Committee that the matter should be brought to the attention of the new International Civil Service Commission with a request to consider it in the course of its forthcoming review of the UN Salary Structure.

- European Commission for the Control of Foot-and-Mouth Disease

230. The Council noted the administrative budgets for 1975 and 1976 and the special budget for 1975 of the European Commission for the Control of Foot-and-Mouth Disease, as approved by the Thirty-First Session of the Commission (April 1975) and reviewed by the Thirty-Fourth Finance Committee Session.

1 CL 66/LIM/3, CL 66/PV/17.

- Appointment of External Auditor1

231. The Council agreed to re-appoint the Comptroller and Auditor-General of the United Kingdom for a further period of two years commencing with the accounts for the year 1976, and accordingly adopted the following resolution:

Resolution 4/66



Noting that the Finance Committee recommends the re-appointment of the Comptroller and Auditor-General of the United Kingdom as External Auditor of the Organization,

Recognizing the effective services of the External Auditor,

1. Decides to re-appoint the Comptroller and Auditor-General of the United Kingdom as External Auditor of the Organization for a further period of two years commencing with the audit of accounts for the year 1976.

Implementation of Rationalization Proposals

232. The Council decided to take no decision at this point in time on the Director-General's proposals concerning the implementation of rationalization proposals. 2

233. With regard to the Agricultural Operations Division, the Council noted that the Finance Committee intended to review at a future session the questions of project delivery and the handling of certain administrative functions which had been acquired from the Financial Services Division.

Personnel Questions

- Staff/Management Relations3

234. The Council recalled that at its Sixty-Fourth Session 3 it had authorized the conduct of a new salary survey. It had further decided that this survey should be conducted on the basis of Methodology to be agreed between the Director-General and the staff and that this Methodology should be subject to prior examination by the Finance Committee to ensure its conformity with the policy guidelines established by the Council. The Council noted the Report of the Thirty-Third Finance Committee Session, which had carried out this examination of the Methodology and approved it as the basis for the conduct of the salary survey. The Finance Committee had at the same time appointed an independent observer, Mr. G. Weill of France, to be present throughout the survey and to make an independent report.

235. The Council was informed that, in accordance with the Methodology, a joint Survey Board had been established in February 1975 to conduct the survey. The Board had submitted its report through the Director-General to the Finance Committee at the end of April. The Finance Committee had examined the recommendations of the Board in detail at its Thirty-Fourth Session and had submitted to the Council in its report its recommendation on General Service salaries and allowances.

1 CL 66/2, CL 66/PV/17.
2 CL 66/2 paras 1.18–1.19, 1.25–1.27, 2.148 and 3.230–3.236, CL 66/PV/17.
3 CL 66/2, CL 66/PV/18.

236. At the outset the Council expressed its satisfaction that it was able on this occasion to consider recommendations from the Finance Committee on General Service salaries that enjoyed the support of all parties. The Council was aware that no survey of General Service salaries had met with any general approval since 1964 and endorsed the view expressed by the Finance Committee that a settlement of the General Service salary question was urgently needed for the sake of the Organization.

237. The Council accordingly approved the recommendation of the Finance Committee that the Board's findings be accepted. Specifically, the Council decided that:

(a) Salary Schedule - A revised General Service salary schedule as given in Appendix H to this report be introduced with effect from 1 February 1975 and that the wage index be rebased at 100 for February 1975.

(b) Separation Payments Scheme - With effect from 1 January 1975 a separation payments scheme should be established; payment under this scheme would be one twelfth (1/12th) of the net salary over the last year for each year of service; years of service for this purpose would count from 1 January 1975 only.

(c) Family Allowances - Revised rates of family allowances be established with effect from 1 February 1975 as follows:

dependent spouse:Lit. 174 000 per annum
each dependent child:Lit. 151 000 per annum

(d) Method of revision of General Service salary scale between surveys - In future a gross scale as given in Appendix H be maintained and the application of the 5 per cent adjustment for each movement of the salary index be applied to this gross scale; the revised gross scale resulting therefrom be reduced to net by the application of taxation procedures established in the Methodology for the conduct of the survey. In this manner recognition would be given to the progressive incidence of taxation payable on increasing outside salaries.

238. In arriving at these decisions the Council was fully aware of and endorsed the reservations of the Finance Committee as set out in the report of its Thirty-Fourth Session. With respect to these reservations, the Council agreed on the following points:

(a) Separation Payments Scheme. A full review of the alternative methods of budgeting of this scheme and of the long-term and short-term financial implications should be made and submitted before the details of the implementation of this scheme were determined. The results of this review should be submitted to the Thirty-Fifth Finance Committee Session. The Council authorized the Committee to take the decision on the details of implementation on its behalf. The Council further decided that any staff members leaving the Organization before the results of this review would receive separation payment for the period 1 January 1975 to the date of separation; payments for this interim period would be made from existing provisions for staff costs.

(b) Method of revision of General Service salary scale between surveys - The Director-General should study the effects of the application of percentage increases to the scales for each movement of the salary index. In particular, this study should review the tendency for percentage increases to give rise in time to undue increases in the differential between bottom and top; the results of this study to be reported to the Thirty-Fifth Finance Committee Session.

(c) Methodology of the salary survey - The various other reservations expressed by the Finance Committee concerning the Methodology employed to be studied by the Director-General with a view to making appropriate revisions to the Methodology prior to the next salary survey.

239. The Council paid particular attention to the views expressed by the Finance Committee with respect to the Guiding Principles. It noted that these Guiding Principles had not been subject to any fundamental revision since they had been introduced in the early 1950's. The Council accordingly approved the request of the Finance Committee to the Director-General for a thorough review of the rules governing the determination of General Service salaries. It recognized that the Guiding Principles were a matter within the Common System and suggested that the review of them might best be undertaken at an inter-agency level by the International Civil Service Commission.

240. The Council noted that it had spent a very considerable amount of its time in recent Sessions on the question of General Service salaries and related matters. The present agreement would mean that no further salary survey should be necessary for two or three years and it expressed the hope that by that time the review of the Guiding Principles would have been undertaken and that the Council's own involvement in future could be limited to consideration of broad policy issues.

241. In concluding its debate on this subject, the Council noted the concern of the Finance Committee that there had been a concentration on the level of salaries and fringe benefits and that the important element of productivity had been ignored. The Council concurred with the view of the Finance Committee that, because of the nature and objectives of the Organization, there must be a greater emphasis on productivity and efficiency at all levels in FAO and requested that the current programme of staff evaluation as it pertained to quantity and quality of output should be intensified.

- Progress Report on the International Civil Service Commission1

242. The Council noted that the United Nations General Assembly at its Twenty-Ninth Session had adopted the Statute of the International Civil Service Commission and that the Director-General had conveyed to the Secretary-General of the United Nations and to the Chairman of the Commission the Organization's acceptance of the Commission in accordance with Conference Resolution 17/73. It also noted the composition of the Commission as decided by the General Assembly, and that it would meet twice annually at least for 1976 and 1977.

243. The Council was informed that the Commission had held its first meeting in New York in May 1975 and would commence the review of the UN salary system at its August 1975 meeting in Geneva. It noted the Director-General's invitation to the Commission to meet in Rome.

- Junior Professional Career Training Programme2

244. The Council noted that the Programme Committee had made an in-depth evaluation of the FAO Internship Programme and agreed that the Programme should be continued as recommended in the Committee's Report.

245. The Council requested that a further evaluation be made, beginning with the 1974 programme, and be presented in the second half of the next biennium to the Programme Committee. This evaluation should include the contributions made and positions held by interns on return to their home countries after completion of the Programme, as well as the operation of the professional course, especially with regard to choice of lecturers, facilities provided to interns and other related matters.

246. The Council further requested that the present practice of encouraging interns to return to their countries upon completion of the Programme be continued; that efforts continue to be made to link the theoretical training with practical assignments;and that where possible, trainees be assigned to their own regions for field experience.

1 CL 66/31.
2 CL 66/2, CL 66/11, CL 66/PV/18.

- Dependency Allowances

247. The Council noted the Finance Committee's review of the justification for the payment of dependency allowances for working spouses and the conclusion reached by the Committee that no change in policy be made until the International Civil Service Commission had had the opportunity to review the matter.

248. The Council also noted that the Finance Committee had agreed with the Director-General's recommendation that eligibility level for spouse allowance in respect of Professional staff be in future based on G-1 step I of the General Service salary scale in New York.

- Language Allowances

249. The Council noted that the Finance Committee had reviewed the Organization's policy on language allowances and had requested the Director-General to report further to the Committee's Spring 1976 session. The Council agreed with the Committee's view that eligibility in principle be based on use rather than on knowledge of the language.

- Education Grant

250. The Council was informed that Staff Regulation 301.0331 as at present worded had caused inequities for the first year of schooling solely by a child's date of birth occurring a few days before or after the date the scholastic year began in a particular school.

251. The Council concurred with the Finance Committee's recommendation and approved the following amended Staff Regulation:

“301.0331. Eligibility for payment of the grant shall begin with the child's fifth birthday and shall continue until the end of the scholastic year in which the child's twenty-first birthday occurs.”

- Future Policy for Conversion of Fixed-Term Contracts to Permanent1

252. The Council recalled that it had requested the Finance Committee to undertake a detailed review of the question of conversion of appointments from fixed-term to permanent and to make recommendations.

1 CL 64/REP paras. 288–291, CL 66/PV/18.

253. The Council approved the recommendations of the Finance Committee that:

  1. Current and future posts should be classified according to whether they were (i) continuing; (ii) continuing but to be filled only on a fixed term basis; (iii) or non-continuing; and the result should be entered in the Programme of Work and Budget.

  2. The Director-General's proposals for ensuring that the type of appointment and career plans of staff members were consistent with the type of post occupied should be approved subject to the amendments suggested by the Committee, namely that:

    1. the use of the term “permanent” be discontinued and replaced by “continuing”;

    2. appointees to continuing posts be granted a continuing appointment at the outset with an initial one year probationary period, except that external candidates who retained their return rights would be appointed only on a fixed term basis; the implementation of this latter recommendation (i.e. concerning secondment) should not take place until the Finance Committee had had an opportunity to review the matter further at its Autumn 1975 Session and submit it to the Council for approval. In the meantime, no decisions should be taken that might involve any discrimination among employees;

    3. appointees to posts under para. 253(a)(ii) above be offered fixed term appointments only; although this did not preclude the possibility of a staff member holding a continuing appointment being on such a post as part of a career plan;

    4. no specific service requirement be placed on the granting of Programme Appointments to field staff within the overall limit of 15 percent.

  3. The conversion of staff members to a continuing appointment be based on a careful evaluation of the incumbents' ability and potential and consistent with the criteria established by the Director-General. The operation of the policies and practices in (a) and
  4. above be reviewed by the Committee after four years and during this period the Director-General report annually to the Committee's Spring Sessions, starting in 1976, on the numbers of staff in each category. In this respect, the Committee had noted that there was at present no consistency of practice within the Common System and a review after four years would enable the Organization to take into consideration any developments that had taken place in other agencies.

254. The Council noted that according to the above criteria for classifying personnel 71 percent of the posts currently in existence belonged to the permanent category.

255. The Council requested that when the Finance Committee reviewed the policy regarding the appointment of external candidates with return rights, while due consideration be given to the need for countries to be able to recall in particular cases their nationals for service in their own countries, the policy should not result in any discrimination against individual employees.

256. The Council stressed the importance of rotation (in particular the need to give country representatives the opportunity to serve periodically at Headquarters and Regional Offices) and noted that some 11 percent of the posts categorized as continuing but to be filled only on a fixed term basis were for rotational purposes.

257. With respect to the change in nomenclature from “permanent” to “continuing” the Council authorized the Director-General to make the necessary editiorial changes in the Staff Regulations.

- Employment of Women

258. The Council noted the report of the Finance Committee on the steps taken by the Organization to encourage the recruitment of women to Professional posts and to facilitate the promotion of women in senior posts.

259. The Council endorsed the Finance Committee's recommendation and approved the following amended Staff Regulations, effective 1 January 1975 and aiming to ensure equal treatment for married female and married male staff members:

“301.07 Travel and Removal Expenses

301.071 Subject to the conditions and definitions prescribed by the Director-General, the Organization shall, in appropriate cases, pay the travel expenses of staff members, their spouses and dependent children.

301.16 Repatriation Grant 301.162 The amount of the grant shall be proportionate to the length of service with the Organization, as follows:

Years of service away from home countryStaff member with neither a spouse nor dependent child at time of separationStaff member with a spouse or dependent child at a time of separation
Upon completion of (years)(Weeks of net base salary)(Weeks of net base salary)
  1  2  4
  2  4  8
  3  510
  4  612
  5  714
  6  816
  7  918

260. The Council endorsed the Finance Committee's recommendation and approved the following new Staff Regulation effective 1 January 1975 which would ensure that where a staff member or a staff member's spouse had an entitlement for the same purpose from an external source, the staff members would not receive double payments:

“301.073 The Director-General may withhold, in full or in part, any payment of travel or related expenses for a staff member's immediate family provided for under the provisions of the FAO Manual, if a payment for the same purpose is received for the family from a source external to the Organization.”

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