LE PRESIDENT: Comme vous le savez, nous avons convenu hier que, selon l'usage, le Comité de rédaction comprendrait au total 13 personnes dont le Président et que la répartition géographique déterminée par l'usage serait la suivante: deux représentants pour l'Afrique, deux pour l'Asie, deux pour le Proche-Orient, deux pour l'Amérique latine, un pour l'Asie/pays développés, deux pour l'Europe occidentale, 1 pour l'Europe orientale et 1 pour l'Amérique du Nord.
Les candidatures présentées jusqu'à présent sont au nombre de 14· La seule différence avec la répartition faite selon l'usage, c'est que l'Amérique du Nord aurait deux représentants au lieu d'un: les Etats-Unis d'Amérique et le Canada. Le Conseil accepte-t-il cette composition pour que nous puissions la rendre définitive?
José Ramón LOPEZ-PORTILLO ROMANO (México): En primer lugar, sobre esta cuestión que acaba usted de plantear, yo propuse y he pedido como Presidente del Comité de Redacción que se respete una tradición de equilibrio, de balance y también de limitación del tamaño del Comité de Redacción. Yo solicité a todas las regiones que se atengan a ello, que nos permitan evitar que, si se rompe esta regla, otras regiones desborden también su número, que eso es también la intención hasta donde yo he podido apreciar; ojalá podamos respetar el numero tradicional.
Gonzalo BULA HOYOS (Colombia): Sinceramente, espero que no vayamos a prolongar el debate sobre este asunto y que podamos entrar a discutir los temas de fondo. Según la lista que usted nos ha leído, todas las regiones se han adaptado a la constante histórica en la composición de los miembros del Comité de Redacción, salvo una. Yo creo, Sr. Presidente, que como el Comité de Redacción sólo se reunirá posiblemente mañana por la noche, para no forzar los acontecimientos y con espíritu flexible de comprensión podíamos dar todavía el día de hoy a los dos respetables países que integran la región de América del Norte, Estados Unidos y Canadá, ya que ellos son buenos vecinos y se entienden bien, para que tomen la decisión sobre cuál de los dos habrá de estar en el Comité y esto lo decidiremos al final de esta mañana o al final de la tarde de hoy.
Jacques POSIER (France): Je prends la parole simplement pour remercier M. Bula Hoyos de son intervention. C'est précisément dans le même sens que j'allais intervenir.
LE PRESIDENT: Si le Conseil est d'accord, nous allons laisser la question en instance jusqu'à la prochaine réunion ou, plus tard, la réunion de demain.
José Ramón LOPEZ-PORTILLO. ROMANO (Mexico): El día de ayer, en vista de que era tarde y de que usted hizo un magnífico resumen de los acontecimientos en torno al debate del tema 4, no me atreví a intervenir y a interrumpir el cierre de la sesión para hacer una aclaración a la Secretaría en relación a una interpretación que hicieron de la propuesta de varios países en torno al estudio que ya ha terminado-lo subrayo, que ya ha terminado-la FAO en relación a las empresas transnacionales y que ahora ha enviado al Comité de empresas nacionales de Nueva York.
La razón por la cual intervengo es porque se mencionó que tal estudio se presentaría de manera no oficial en la próxima reunión del Comité de Seguridad Alimentaria y yo no recuerdo a nadie que pidiera tal cosa. Yo solicité, igual que otros, que se presentara en el Comité de Sanidad Alimentaria, pero parece que no dije la palabra mágica o, por lo menos, no se interpretó así en inglés, y la palabra mágica es" que se incluya en el programa y calendario del Comité de Seguridad Alimentaria. Lo que yo digo ahora es, si esa palabra mágica tiene algún efecto claro y preciso, pues, entonces ahora la menciono, la subrayo, y esa es la solicitud que estábamos haciendo.
Esperamos que esto quede muy claro y, por tanto, se suprima la interpretación que le dio la Secretaría a nuestra palabras.
DEPUTY DIRECTOR-GENERAL: On the Secretariat side we had not understood that what the distinguished representative of Mexico was asking for was the inclusion of an item on trans-national corporations in the agenda of the next session of the Committee on Food Security. There is no difficulty at all about doing so. For the record, the rule is that any Member Nation may request the inclusion of an agenda item on the agenda of the Committee at least thirty days before the Committee meets. The Committee will be meeting next spring so we shall be happy to include the agenda Item requested by the Government of Mexico.
As for striking the reply from the record, I think the reply of yesterday was on the record. If there was any misunderstanding we apologise for it. However, I think the matter is entirely clear now and we shall go ahead as I have indicated.
(a) Budgetary and Cash Flow Forecast relating to the Programme of Work and Budget for 1986-87
(a) Perspectives budgétaires et situation de trésorerie: incidences possibles sur le Programme de travail et budget 1986-87
(a) Pronostico presupuestario y de flujo de fondos en relación con el Programa de Labores y Presupuesto para 1986-87
Atif Y. BUKHARI (Chairman, Finance Committee) (Original language Arabic): We have two reports from the Finance Committee. We have the report of the 57th Session which was held in Rome from 12th to 20th May 1986, and the report of the 58th Session of the finance Committee which took place from 22nd September to 2nd October 1986.
As per the agenda for today you are referred to certain paragraphs in these documents for discussion this morning, and the rest of the report will be reviewed later if you agree and if the Members of
the Council think that that is the best way of proceeding with our business, namely that we should most usefully follow the Order of the Day as given to us.
As for the report of the 57th Session of the Finance Committee, the matters for discussion refer to paragraphs 10 to 32. Paragraph 10 refers to the financial position of the Organization. This paragraph gives the results of 1984/85. Before I go over the content of those paragraphs, I should like to thank the FAO Secretariat for the information which has been supplied to the Finance Committee. We have never had any difficulties whatsoever in carrying out our dialogue with those representatives in the department of the FAO concerned with these matters.
Paragraph 10 deals with the financial position of the Organization: the out-turn, 1984/85 gives us figures which are to be understood as provisional because they were given to us in May at the time of the discussion which is herein reported upon.
Therefore, please understand that these figures are not definite. As you can see, the cash surplus is $34 758 000.
Paragraph 11 refers to the factors which have led to the generation of that cash surplus.
Paragraph 15 shows that at 31 December 1985 the cash balance of the Working Capital Fund amounted to $13 253 975.
Paragraph 16 first of all shows the status of contributions to the FAO budget. There is a comparative table, that is a comparison of the years 1985-1986. That is on page 4. The amounts outstanding at 12 May 1985 were also given to us. Consequently, amendments must be made to them because those figures are certainly not up to date.
If you turn to paragraph 17, current receipts, and the amounts outstanding in 1986, you will see a comparison for the four previous years, at the same date of course.
In paragraph 18 you will see a table which indicates the percentages of current assessments received. This is the usual presentation of these figures.
Paragraph 19 gives receipts to date of 1986 which were only $63 461 670, that is, almost 32 percent of the assessed contributions for 1986. Still on paragraph 19, you will observe that 105 member nations had made no payments for their 1986 assessment. Still on paragraph 19, there is a diagram of the percentages of current assessments received.
Paragraph 20 refers to the possibility of a shortfall. The situation is described in paragraphs 20-22 which refer to the position of the Organization in the future.
Moving to paragraph 25, the FAO indicated that the amount of shortfall in contribution of the largest contributor would be known only towards the end of 1986, which is why the members of the Committee felt at the time that it would be premature to make proposals to Council.
In paragraph 26, the Committee appealed most strongly to all Member Nations-and we meant all-to make a special effort to remit their outstanding contributions without further delay.
During its 57th Meeting, the Finance Committee examined a series of measures which could be implemented to try and settle this matter of delayed receipt of assessments. The question was again discussed at the 58th Meeting of the Finance Committee, in fact in this document we have indicated that the matter was going to be dealt with during the 58th Meeting.
Paragraphs 29 and 30 provide further information on the financial situation, and particularly on the Allocations for the Technical Cooperation Programme.
Paragraph 31 deals with the cash flow of the General Fund. At 31 March 1986 the balance for the 1986/87 biennium was $21. 5 million. In paragraph 32 we refer to the status of the Special Reserve Account, which is there for information. When it reviewed these matters, the Committee took note that the dollar exchange rate was 1 613 lira, whereas the exchange rate for the budget calculation was 1 760 lira to the dollar.
These are the paragraphs which require particular attention from Council this morning, and having introduced them I am here to answer any further points of information which you may care to raise.
LE PRESIDENT: Je remercie Le Président du Comité financier pour cette introduction au rapport de la situation financière de l'Organisation. Il a suggéré que nous pourrions l'examiner point par point
et, si le Conseil est d'accord, nous allons commencer par l'analyse de la situation financière de l'Organisation, aux paragraphes 10 à 15 de ce document.
Je pense donc, si le Conseil en convient, que nous pourrions commencer par ces paragraphes, qui traitent des résultats de l'exercice 1984-85. Puis nous passerions à l'étude des contributions et enfin aux mesures envisagées par le Comité financier.
James D. AITKEN (United Kingdom): The United Kingdom's statement will be in two parts. First, I should like to address the issues arising from the reports of the Finance Committee which have relevance to the Organization's financial position, and with your permission, Mr Chairman, this will be slightly broader than the paragraphs we have referred to earlier since we think these are relevant to the very important problems before us. Secondly, I should like to set out the position of my government on the proposals contained in document CL 90/23.
We have read the reports of the Finance Committee. with considerable interest. Once more we have to be grateful to the Committee for its guiding wisdom and the manner in which its work stimulates our desire to learn more about the issues which its reports bring before this Council meeting. The report gives us a rich menu. Time permits us the choice of only a few items at this meeting.
In any comment on the financial position of the Organization we must begin by endorsing the comments of the Committee in paragraph 24 of document CL 90/4 "that other Member Nations should not be called upon to compensate for the deficit caused by reduced payments by any contributor". At this point we should like to make our position on this very clear. In common with other members of the European Community my government takes the view that all member states should meet their financial obligations in full and promptly in accordance with the constitution.
Turning again to the report of the Finance Committee, we were, however, slightly surprised that in its consideration of the financial situation no mention was made by the Committee of what we take to be the very high level of liquidity in FAO which, according to the figures in the financial statement, stand at nearly $300 000 000. This is the amount of money that FAO has in liquid assets in the bank on short deposit or in cash. Of course, this amount is in addition to the working capital and other funds held by FAO, so there is a lot of money already in the Organization. We consider this high level of liquidity poses serious questions about the style of financial management within the Organization. These are questions which call for examination by the Committee, by Council and by Conference.
We were also surprised to see no mention of the very slow rate of disbursement on the Technical Cooperation Programme where again, according to the financial statement, only $26. 8 million was spent out of a budget appropriation of $72. 4 million-this is in the 1984/85 biennium-leaving $45 million to be rolled over into the 1986/87 biennium.
We would submit that these are significant items in any consideration of both the financial health and the financial management systems of the Organization, and they are factors which have to be taken into account when examining spending and income.
At the beginning of this session the Director-General referred to the fall in administrative costs and establishment costs. These falls are very commendable,-but when we look at the overall programme delivery costs, that is all the costs FAO incurs to deliver the programmes, including statistical programmes, the global information and early warning system as well as the Technical Cooperation Programme, we believe there is scope for further savings. We think that these further savings could, in fact, enable the Organization to live within the current financial provisions without the need to reduce any programmes. I think this is a very salient point. Normally, in these circumstances we would expect an agency to reduce its programmes when faced with a shortfall, but we believe in the case of FAO that the delivery costs and the liquidity of the Organization put it in a very fortunate position it can afford to live within its means and not reduce its programmes, and do so by saving on overheads.
We were very interested to read the information about the level of project support costs on page 13 of the Finance Committee's report. Since the exchange in Conference on administrative costs we have been examining the information contained in the Programme and Budget document. This is an FAO document C 85/3 which we all received at the last Conference and we find this document permits us to undertake a calculation of FAO's programme delivery costs. We have written to the Secretariat about this and, in the interests of transparency and to help with this discussion, we have given details to Council Members of our analysis of the real level of the FAO programme delivery costs. I should emphasise that these are calculations which have not been agreed with the Secretariat, but they are entirely based on FAO's own figures, and figures published in the Budget
Our analysis leads us to believe that the figures given in the Finance Committee Reports are a considerable underestimate of the true programme delivery costs i. e. the cost of FAO's operational activities whether they are in project or programme form. Our analysis based on FAO figures puts the overall cost of delivery for all programmes (that is the Regular Programme, UNDP and the Trust Fund) at over 36 percent of the delivered programme. The figures for the actual budgetary fund from the information contained in the Budget is approximately 14 percent, that is close to the maximum that the FAO can charge the UNDP and Trust Fund donors, but the figures for the Regular Programme appear to be 97 percent, in other words, if we are to believe the Budget on the Regular Programme it costs FAO 97 cents to spend a dollar! This cannot be correct and it does suggest to us that there is a greater element of cross-subsidy between the programmes than revealed in the figures put to the Finance Committee. The cost of delivering the Trust Fund Programme and the UNDP Programme has, in fact, been put to the Regular Programme. Even then, at over 36 percent of the overall level of programme delivery costs, we think the overhead costs in the FAO are far too high. We would expect that a reasonable level of costs would be in the region of 15 to 20 percent. In the face of the financial crisis we believe that it is of crucial importance that the Organization reduces its overheads and we believe that the time has now come for the question of programme delivery costs to be considered in depth by the Finance Committee and subsequently by the Council and Conference.
The question of transparency discussed by the Finance Committee is also relevant to this discussion. We are sure that the Committee is correct when it says that it is satisfied that such information, as it needed to fill its mandates, had been, and would continue to be, made available to it. In our dealings with the Secretariat we have found them extremely ready to supply us with information and at this point it would be appropriate particularly to thank Mr. Shah for the information that he has provided us with in terms of the documentation which is always made available to this Council. The problems in our experience stem from the nature of the information available in FAO itself. In our view there is a clear distinction between the nature of the information which is necessary for accounting purposes and the nature of financial information which is necessary if senior management is to manage the programme effectively. Unfortunaltely, our experience has been that such information is often unavailable within the FAO. It is not simply a question of transparency, it is a question of the absence of basic information necessary for senior management to manage programmes effectively. For almost a year now we have not been able to obtain information regarding spending under the Technical Cooperation Programme. We have obtained information of commitments, and this has its uses, but we have not been able to obtain information about hard cash transactions. Effective programme management requires information of hard cash transactions. Every day I know how much money I spend. I also know how much money I am obligated to spend. It seems sensible that FAO should have the same information. This does not appear to be available in FAO. Coupled with such issues as the auditors’ criticism regarding the purchase of word-processing equipment, and our own examination of delivery costs, its absence must raise grave reservations about the effectiveness of the financial and management information systems within the Agency.
In view of the considerable financial crisis faced by the Agency, we consider as a matter of urgency, the financial and management systems of the Organization should be subject to full scrutiny and consideration by Council in Conference.
Turning now to document CL 90/23 I would like to make the following observations on behalf of the United Kingdom. The estimated shortfall of budgetary contribution which is largely brought about by the present financial crisis is as a result of a default by a Member Nation. It must therefore be treated differently from the normal delayed payments which occur in every biennium. We believe that the Director-General must make further reductions in expenditure by imposing additional economies, postponements and transfers to other financing to deal with a realistically assessed shortfall. The shortfall cannot be bridged by recourse to the Working Capital Fund or by mortgaging the financial future of the Organization beyond the current biennium. We do not agree with any proposal that involves borrowing by the Agency. First and foremost, as the Director-General has already recognized, the Organization must seek significant administration economies borrowing ideas from other organizations which have already formulated strategies to face similar difficulties, for example, in the United Nations, in UNIDO and in Unesco.
To be more specific we invite attention to the potential for achieving further savings in the following areas of financial management and budget. There should be a once and for all tightening up of financial management systems to ensure that the Agency makes optimum use of the money it has. For example, more effective financial management would enable use to be made of the 300 million dollars shown as liquid assets on page 27 of document C 87/5. It must be noted that this amount is in addition to the special funds and as such there is no reason why it cannot be managed more effectively to reduce it to a more realistic level. Closer scrutiny is obviously needed of programme delivery costs. The budget appropriation for programme management in the Regular Programme in the 1986/87 biennium is for 209 million dollars, yet the proposed savings on page A. 9 CL 90/23 is only 59 000. This is relatively insignificant and there must be scope for a greater reduction. Similarly, savings of only 1.8 million dollars have been found from appropriation of 45 million dollars for FAO Representatives. Given the magnitude of this provision it does seem to my delegation that in the face of the financial pressures of the Organization it is necessary to seek greater economies here.
Document CL 90/23 is vague on the savings made in spending by Regional Offices yet the appropriation in the Budget for Regional Offices is nearly 38 million dollars. We would have expected far more specific treatment of this item.
Last but not least, the Technical Cooperation Programme. We appreciate the importance attached to this Programme and we believe that with improved financial management it should be possible to maintain the Programme and, at the same time, make a substantial contribution to the further economies which the present situation demands. We believe that this can be achieved by a more realistic approach to financial forecasting and better cash-flow management. It is clear from the financial statement that this Programme is slow spending. In 1983/84 on a 72 million dollar programme, 45 million dollars remained unspent at the end of the biennium. We have no reason to believe that this slow rate of spending will-not be repeated and compounded in the current biennium. Better management of the Programme would clearly ease the Organization's cash flow problems. The Secretariat should also identify sources of voluntary funding to fund TCP projects in the future so the momentum of the Programme can be maintained. We have already referred to the very high programme delivery costs associated with all FAO programmes. We remain convinced that there is further scope for savings in such items as field programme support, administration and common services.
To conclude, we believe that the economies proposed in CL 90/23 are a beginning, but they are not more than that. 16 million dollars is not a significant saving when we see that programme delivery costs amount to more than 200 million dollars on the Regular Programme alone. We think it is essential for the Director-General to come forward with additional savings. The Organization like all other parts of the UN system must adapt to the new financial realities. None of us can live beyond our resources and it would be irresponsible of this Council not to acknowledge this basic fact.
LE PRESIDENT: Je souhaiterais proposer au Conseil, s'il en convient, de scinder la discussion en deux points tel que l'a annoncé le calendrier: le point 12. 1 qui est la photographie de la situation actuelle et une autre discussion sur le 12. 1(a) c'est-à-dire "Perspectives budgétaires et questions de trésorerie". En d'autres termes, il s'agit du document CL 90/23, ainsi que ses suppléments 1 et 2, qui pourrait faire l'objet d'une analyse spécifique qui permettrait de clarifier les débats.
DEPUTY DIRECTOR-GENERAL: I do not want to infringe in any way on your ruling which will, I believe, permit the Council to have an orderly debate on a very complicated subject. Before hearing I would, nevertheless, like at this stage, if I may, to make one or two general comments on the statement by the United Kingdom, not dealing, however, specifically with the measures dealt with in document CL 90/23. He questioned, in the first place, the whole concept in the way of transparency. What he appeared to be saying was that the concept of transparency so far applied is not enough. If it is not enough, we would like to know how and in what way it is inadequate.
This was discussed, as he pointed out, in the Finance Committee. The Director-General has made every effort to provide the information requested by Member Governments and he is willing to provide systematically and on an across-the-board basis such information as may be required collectively by the organs of the Organization.
In more general terms also FAO has applied extremely prudent and careful managerial standards in the handling of its resources. Indeed, it is thanks to a very prudent approach in the management of resources that the management is not in a very much worse financial state now than it might have been.
There are one or two additional points of a somewhat more technical nature which may help the Council to appreciate the general background to the Finance Committee Report and the other related matters which will be coming up in the course of today and if you agree, Mr Chairman, perhaps Mr Shah could give one or two additional explanations without at this stage broaching the actual measures proposed under document CL 90/23.
LE PRESIDENT: Nous nous en tenons, par souci d'une analyse plus approfondie du document, au point 12. 1 et dans ce contexte je demande à M. Shah de bien vouloir nous fournir des explications complémentaires en guise d'introduction aux débats du Conseil.
V. J. SHAH (Director, Office of Programme, Budget and Evaluation): As desired by you and by the Deputy Director General may I at this stage respond only to two matters among those raised by the delegate of the United Kingdom. Firstly, I would like to deal with comments he offered on programme delivery costs in FAO. We have listened with attention to the points made by the delegate regarding his administration's assessment of programme delivery costs in FAO. It had been my personal pleasure to see the Permanent Representative of the United Kingdom and his advisor a few months ago when they came to discuss the subject with me. They requested clarifications on our Programme of Work and Budget document which my colleagues and I gave, and I appreciate his kind remarks on the matter.
We never heard a word more until the day before yesterday. Because it was then somewhat of a surprise to receive Mr Deare's letter to me of the 17th of November forwarding ODAs assessment and conclusions which I never had the opportunity to comment on. If I had had a chance to discuss the paper and the conclusions with its author, I would have been able to say in private rather than in public that it is based on faulty assumptions and therefore arrives at wrong conclusions.
The paper divides the bulk of our expenditure under the Regular Programme into two categories, the delivery programme and the programme delivery costs. Putting it in different words one would speak of our substantive output and our overhead. Now it is pretty clear that in the case of projects executed in the field what is a substantive output and what is the overhead. The delivery'programme and the programme delivery costs can be identified and measured without much controversy and in fact this is the information we regularly supply to the Finance Committee and which appears in its report. The output under a field project may be a laboratory, an irrigation scheme or a training institute. The overhead consists of the costs in Rome for technical and managerial and administrative services provided to the project. However it is much more difficult in the case of the Regular Programme to distinguish between the substantive output and the overhead. For instance, a large part of the delivery programme under the Regular Programme consists of publications drafted and produced in Rome. The dividing line between the programme cost of a publication and its overhead costs is much less obvious and consequently more difficult to define. Again, individual staff members may be devoting part of their time to substantive activities and part of it to activities that could be considered as overhead. It is perhape surprising that the British analysis has fallen into a number of basic errors in attempting to separate programme costs from delivery costs. The first series of mistakes is in counting as delivery costs our expenditure on activities which are actually substantive in output and let me give one or two examples. Programme 1. 3 Legal is counted entirely as a programme delivery cost. This includes the offices of the Legal Counsel and the legislation branch. Seventy percent of this programme consists of the work of the legislation branch which has a programme content dealing with agriculture, forestry and fisheries, legislation, advice to Member Nations on its formulation, on its application.
I am sure members of the Council will be personally acquainted with the substantive work done particularly in the field of water and fisheries legislation. Now, how can this be categorized as a programme delivery cost. The same can be said about our documentation systems like AGRIS which are counted as a programme delivery cost, and yet this is a technical programme with an output in publications, magnetic tapes, services provided to the member countries. They are certainly not overhead, or in the United Kingdom phraseology, programme delivery costs.
I could go right on through the United Kingdom analysis picking out parts of the Programme of Work and Budget which are actually substantive and which have been put down as overhead.
There is another series of fundamental errors in this analysis. Certain expenditures are common to both the Regular Programme and the Field Programme. The analysis has treated them entirely as a cost of delivering the Regular Programme. For instance, the full cost of our Assistant Directors-General, our Division Directors, our Regional Representatives is counted as a Regular Programme cost. Now as we all know they and their senior staff spend at least as much time on field activities as they do on Regular Programme activities. Even more striking is the fact that the full cost of the \FAO country offices is counted as if it were an overhead of the Regular Programme. Yet the functions and activities of these offices relate almost entirely to the support of projects in the field in our field activities.
Another major error is to put down the regional offices in their entirety as a programme delivery cost, in other words, as an overhead. However, as you well know, most of the activities of the regional offices are substantive in nature. There are technical officers working in the regional offices, visiting countries and working with them. These are programme activities and not an overhead·
I could continue but I fear that I might confuse the Council even more than it might have been confused already. I would merely like to add that I must emphatically reject the conclusion of the analysis that 49. 4 percent of the Regular Programme budget is the Regular Programme delivery cost. The true figure might be a fraction, maybe about one-third of what is alleged.
I would like to invite the authors of this paper, this analysis to come to Rome for a few days to sit down with me and my colleagues. In this way we could agree to methodologies and definitions and arrive at soundly based conclusions. If the objective is to compare FAO with other organizations and the United Kingdom's own bilateral programme we would be able to see the comparative figures for the United Kingdom bilateral aid programmes and for the other organizations with which a comparison was attempted to be made. As far as we know FAO compares very favourably with other institutions, both multilateral and bilateral.
In a broader context the United Kingdom analysis-calls for two things. The first is "for more detailed information", and I am quoting from this analysis, "for more detailed information to be given to member states on the calculation and allocation of such costs". The Director-General has said immediately, and the Deputy Director-General echoed his words and sentiments a few moments ago, the Director-General said also in his closing statement to the last session of the FAO Conference that he is willing to give any explanation that Member Nations want. All that is necessary for the members to agree on what is required; for instance, in the format of the Programme of Work and Budget document. Member Nations should also be aware of any extra cost involved in providing any additional information. This is surely a matter that needs to be discussed freely in a technical body such as the Programme Committee, the Finance Committee, before it comes to the Council. Some relevant issues were, in fact, discussed by the Finance Committee at its 57th Session in May under the heading "Transparency of FAO Activities" and attention has already been drawn to paragraphs 74 to 77 of the Finance Committee report which is before you.
In the second place the United Kingdom analysis calls for "A continued attempt by the secretariat to reduce delivery overheads". It is not necessary for me to summarize now all that we have done in the last ten years or all that we are doing now to achieve this objective. On this issue the paper, the analysis can only be described as preaching to the converted, or what is sometimes referred to in the United Kingdom as carrying coals to Newcastle.
I would now like to deal with the second subject of the Technical Cooperation Programme. Some fairly strong statements were made about the amount of the TCP appropriation which is alleged to be unutilized and for which the funds from 1984/85 have been carried over into the present biennium. To some it may be a little surprising but this subject is raised with such regularity because it was something which was considered not only by the Council but by the Finance Committee and by the Conference itself when the Technical Cooperation Programme was established in 1976.
In fact, the Conference amended the financial regulations of the Organizations to provide for the TCP funds to be available over two biennia. Why was this? It was quite simply because the TCP is a programme consisting of projects which are approved during the entire course of a biennium right up to the last day of 1985 in the case of the 1984-85 biennium, and these projects then had to be executed, implemented, and the related expenditures effected during 1986 and to some extent even in 1987. There has been complete transparency on this principle and on all the financial and accounting information related to it. What are the funds carried out from the TCP appropriation from one biennium to another? In 1976/77 they were 63 percent. There was a reason for it. The TCP was just starting. In fact the first projects were not approved until the end of 1976, so the percentage was fairly high: in 1978/79-42 percent, 1980/81, 1982/83-43 percent, 45 percent, always around the same order, in the case of 1984/85 the $15 million for the African Rehabilitation Programme for Africa in addition to the normal TCP provision, which was only approved in the spring of 1985.
If we are going to consider what is used and what is not used of the TCP appropriation let me share with the Council figures which were shared with the Finance Committee. If we take the 1984/85 appropriation of $56. 5 million, to which was added the $15 million, which raised it to $72. 5 million, those were the total funds available for the TCP in 1984/85. How much of that amount was approved for projects? It is the amount approved for projects, projects signed by member governments and signed on behalf of FAO, which constitute our commitments. The amount approved for projects at the end of 1985 was $72 290 000 out of $72 470 000. This does not strike me as an underutilisation of the TCP. Take the appropriation for the TCP for this biennium, $61. 4 million, how much has been approved so far from that appropriation for projects on the approved projects which have been signed and to which we are committed? As at the end of October, $30. 7 million, almost a good half by the end of October. How many requests are pending? There are 247 valid requests, not counting requests which are discarded because they do not meet the criteria of the TCP, and our resources permit us to approve only about 30 a month, whereas new requests come in at the rate of at least 45 a month.
I will with your permission stop there. I felt that the point raised was substantial enough that if it also raised questions in the minds of other Council members it may assist in providing this explanation at the outset.
James D. AITKEN (United Kingdom): Normally it has been my experience in FAO meetings that. interventions have been dealt with at the end of the debate. I am very grateful for the explanatory introduction by the Deputy Director-General and by Mr Shah and I hope that in this spirit you will permit me to reply immediately to their comments. In connection with Mr. Shah's comments about delivery costs, I would emphasise that all our figures have been taken from FAO's own published documents and that they have been distributed between the Regular Programme and the Extra-Budgetary Fund exactly in the way they are distributed in the budget document, so if there is any confusion, it is a confusion which must come from the presentation of that document.
To turn to specific items, Mr Shah said that we included legal costs and the costs of documentation as project delivery, when, in fact, these were substantive programmes. I am glad to hear this. This information is not in the budget document. Treating them all as substantive programmes still means’ that the delivery costs amount to over $270 million as these are relatively minor programmes. We appreciate the point about publications. This is why we did not include them at all as programme delivery costs.
Turning now to the question of the resident FAO representatives, we are very grateful to Mr Shah for his statement that resident representatives are deployed on the Field Programme under extra budgetary funds because, quoting from the budget, we see that the cost for resident representatives under extra budgetary funds is only $2. 6 million, while under the Regular Programme the cost for resident representatives is listed as $45 million. I understood from Mr Shah that within this $45 million the resident representatives are undertaking work in the Field Programmes. It would have been better if this had been made clear from the budget. This comes back to our original point that there is cross subsidy between the Regular Programme and the Field Programme and the extra budgetary funds. Mr Shah has confirmed this himself by his statement. My first comment on this would be that we hope that the budget document would correctly reflect this cross subsidy.
Turning to the TCP, I would simply say that we are very impressed by Mr Shah's presentation and his knowledge of the cash flow payment in the Programmes. Given this knowledge of the spending in the Programme that he displayed, we continue to be surprised that in the circumstances there is such a large roll-over. Our experience has been that normally financial managers are expected to keep the roll-over to a minumum. We are therefore very surprised, given this clear knowledge of the spending profile of the Programme, that so much money goes to another biennium. We are questioning not the level of the programme but the way it is managed.
John GLISTRUP (Denmark): I am getting slightly confused. I came here prepared to discuss Agenda Item 12.1 Financial Position of the Organization including Measures to Deal with Problems of Delayed Payment of Assessed Contributions, with a number of documents. I have listened very carefully to the intervention by the Chairman of the Finance Committee. I have listened to an interesting intervention by the United Kingdom. I have listened to a statement by the Deputy Director-General and Mr Shah commenting upon a document which is unknown to me.
Mr Chairman, may I request you to help us direct our debates in such a way that we can deal with this important issue in front of us. I was waiting to hear from the Secretariat on the measures to be taken in the difficult financial position that we have and I was prepared to comment on that.
LE PRESIDENT: En fait, un document annoncé par le délégué du Royaume-Uni a été distribué. 11 s'agit donc, si vous voulez une réponse, d'un document qui ne figurait pas parmi les documents du Conseil. Ce débat a quand même été utile mais-et je vous prie de m'excuser de cette interférence-j'insiste pour que l'on s'en tienne au point 12. 1. Par conséquent, je propose aux Membres du Conseil qui veulent intervenir de bien vouloir s'en tenir au point 12. 1, c'est-à-dire à l'intervention du Président du Comité financier.
Lorsque nous aurons épuisé ce point, nous passerons au point 12. 1a), à savoir les mesures à moyen terme ou les mesures proposées pour essayer d'améliorer la situation financière de l'Organisation.
Octavio Rainho da SILVA NEVES (Brazil): I cannot say as well that I enjoyed the private and bilateral exchange of views between Mr Shah and the United Kingdom representative on this question of programme delivery costs. I must recognise on the other hand that I enjoyed the quite excellent introduction that Mr Shah made of the TCP. But I agree with your views, Mr Chairman, that the
discussion was clearly out of order and that we should try to concentrate on the Agenda as it has been put to us. On the other hand, it is not exactly too easy to try to deal with the performance of the Agenda as it is. It is difficult to deal with the Report of Finance Committee without dealing to some extent, or to a large extent, it depends on the speaker, with the point raised in 12. 1(a), Budgetary and Cash Flow Forecast relating to the Programme of Work and Budget. I should like to go along with your ruling and to deal with the report of the Finance Committee in a broad context, and to deal later on with point (a) concerning the approach necessary to deal with the budgetary financial uncertainties.
My delegation deeply regrets that an important shortfall in the payment by a large contributor against its assessed contribution has brought insecurity to FAO and is leading the Organization towards a financial interbudgetary crisis. As has been said already, the worst features of the present situation are (a) the uncertainty that such a Member is not going to pay its full contribution due to FAO; and (b) the uncertainty regarding the timing and amounts of present and future payments by that Member.
In spite of severe economic and financial problems, a year ago developing countries gave their full support to the modest increase proposed by the Director-General in the Programme of Work and Budget for 1986-87 biennium and this was approved by the Conference. Therefore, it is with great concern that we envisage embarking now on a revision of the Programme of work whose approval resulted from a commitment of all Member Nations.
Returning to the main question envisaged in the report of the Finance Committe, I should like to say that shortfalls in the payments of contributions have occurred previously but where as a whole confined to the rules of international organizations and justified by economic conditions and currency costs in developing countries. However, shortfalls have never constituted a major problem to FAO activities as they have represented around 5 percent of each annual budget. For 1986-87 the delayed contributions from Members, other than the largest, are estimated not to depart in any significant way from the average of recent years, namely around US$20 million. This in itself is an extraordinary performance, given the financial uncertainties faced by developing countries and I should like to stress this point which we consider to be quite important.
Special cases of contributions to be paid in installments by less developed countries were previously authorised by the Conference. However, in our view the present situation is completely different because it relates to a very important amount of resources representing almost 72 percent of all delayed contributions in 1986. The 72 percent results also from a unilateral and arbitrary decision of a Member State and is the reflection of a political decision. Actually; if the debt contribution of that Member State is paid, the financial situation of the Organization will improve in relation to the situation over the five preceding years. The percentage of current assessments received in 1986 would then rise to 89. 84 percent, about 90 percent of the current contributions received, (the highest in many years) and, not about 65 percent as mentioned at page 3 of the document CL 90/LIM/1.
I should like to stress a point concerning the report of the Finance Committee, and this point in broad terms is that the liquidity crisis is not in itself attributable to the arrears or delayed payments by developed member countries or any other members. The crisis revolves around the financial decision by the main contributor regarding its contribution. Let us not disguise the issue.
Taking into account your ruling I will refrain now from commenting upon the proposals made to deal with the situation, and I shall ask your indulgence to speak later on concerning the specific proposals made by the Director-General as to the ways and means of eventually redressing the situation.
LE PRESIDENT: Je demande aux orateurs suivants de m'autoriser à donner la parole à M. Le Président du Comité financier, dans le cadre du point 12. 1, afin qu'il nous présente le document CL 90/17.
Atif Y. BUKHARI (Chairman, Finance Committee) (Original language Arabic): This document which we have-CL 90/17, is the latest report of the Finance Committee. It highlights the realities and the somewhat harsh truths which were less clear in previous meetings of the Finance Committee. This report (CL 90/17) therefore contains a certain number of points which were discussed and which are up before this Council for review. What we have to do is to look particularly at paragraphs 13 to 45, which are the paragraphs for particular attention this morning by Members of the Council. Other items will be contained in other points which we are called upon to examine.
Paragraph 13 refers to the financial position of the Organization and the status of contributions as it stood at the meeting. Some of the sums still outstanding on 25th September, which is the reference date, are large sums. For the period 1986 these are, I repeat, amounts which are quite considerable.
If you refer to paragraph 14 you will observe a table which gives the current status of contributions and amounts paid in during previous years. The percentages are given in the following tables. These sort of percentages are presented on a regular basis to highlight what was paid in January, February, March, April and so on up to the end of the year. In September (paragraph 15) we have in 1986-63. 35 percent; 1984-60. 66 percent; 1983-55 33 percent; and so on.
In paragraphs 18, 19 and 20 we have the statement of arrears which are in arrears status. In paragraph 18 you will note that there is reference to receipts of the Organization-US$9 841 273, a sum which is reasonably satisfactory as compared to what was paid in 1985 or in previous years.
In paragraph 20, once again the Committee as usual, appeals strongly to all Member Nations to match up to their financial responsibilities namely to pay in what is currently due and their arrears. The Member States must be fully aware of the difficult situation of the Organization in order to understand the strength of that appeal which is made to them.
I will stop at that paragraph and be ready to answer any questions which Members of Council may raise, if that would be satisfactory to you, or perhaps you would like me to continue with the presentation of the rest of the paragraphs in this document.
LE PRESIDENT: Si vous voulez bien nous le permettre, nous pourrions répondre également aux questions des Etats Membres du Conseil. Est-ce que vous êtes d'accord ou voulez-vous que je continue la présentation des documents et ce qu'il reste des paragraphes? Le. Conseil est saisi d'une proposition pour analyser ce rapport paragraphe par paragraphe ou dans son ensemble. Pourrions-nous, t pour gagner du temps, terminer l'exposé du document CL 90/17 et nous passerions ensuite la parole aux orateurs?
Joachim WINKEL (Germany, Federal. Republic of): On this point, you ask whether or not we are content that the Chairman of the Finance Committee should continue. I think that now there is confusion in the room. Do you consider your proposal to change the agenda as taken by the majority of the Council, and that we can follow this rule because with regard to our agenda I should like to draw your attention to the fact that we have already separated agenda item 12. 1. In our view we should not continue to separate the agenda items. We are prepared to bring everything together in our statement. The Danish and Brazilian delegates are of the same opinion.
LE PRESIDENT: Ma proposition était que le président du Comité financier termine la lecture du document CL 90/17. Sans plus. Terminons le CL 90/17 qui se trouve dans le point 12. 1. Après quoi, nous passerions la parole à M. Crowther qui lira le document qui reste toujours dans le calendrier du point 12. 1, à savoir CL 90/LIM/1. Nous aurions donc lu ou écouté tous les documents introductifs relatifs au point 12. 1 et nous passerions la parole aux orateurs sur le point 12. 1. Si le Conseil préfère que l'on fasse les deux en même temps, nous pouvons le faire. Si le Conseil décide que l'on lise le document CL 90/23 en même temps que le CL 90/17, nous sommes prêts à le faire sous le couvert d'un unique débat. Ce sera comme vous le désirez.
David Lawrence COUTTS (Australia): I should like to say that the Australian delegation is also getting a little confused. We would certainly prefer to hear the introductions to the document now from the Secretariat and then to have the opportunity to make a statement in a general way covering agenda items 12.1 and 12.1 (a). This would be much easier for us and, I suspect, for other delegations.
Humberto CARRION M. (Nicaragua): Deseo opinar, señor Presidente, sobre la consulta que usted hace al Consejo en relación con -- el modo de proceder. Estoy de acuerdo con el delegado que me ha precedido en el uso de la palabra en que se ha creado una confusión que, obviamente, es evitable. Si bien recuerdo, el haber dividido los temas, el 12, digamos, como el documento que nos ha presentado el Presidente del Comité de Finanzas, habla sido solicitado por la delegación del Reino Unido. El y su delegación han expuesto ya su punto y ha sido incluso aclarado éste por la Secretarla.
Creo que conviene en este caso, y además es inevitable, que nos centremos en el problema principal, el tema financiero que es la incertidumbre de la misma, ya que sería artificial e innecesario evitar llegar al punto concreto que está contenido en el documento 23.
LE PRESIDENT: Si vous le permettez, nous allons aborder le problème globalement avec le point 12. 1 Nous aurons la lecture du point 12 à concrétiser par le document 90/23 avec ses suppléments 1 et 2. Lorsque nous en aurons terminé, nous aborderons le débat.
Atif Y. BUKHARI (Chairman, Finance Committee) (Original language Arabic): I find it a little difficult to see where the misunderstanding is because the items which we have to deal with this morning particularly are from paragraphs 13 to 45 of this document. I did propose to subdivide these, but as Council seems to wish an overall presentation, I will go on.
The question which still requires introduction on these paragraphs is the measures examined by the Finance Committee to deal with delays in payment of contributions. We have dealt with these matters in previous sessions, and in the latest session of the Finance Committee, that is in September, we came back over this ground again and looked particularly at seven possible solutions-six alternatives if you like-which could help to see a way out of this impasse of assessments in arrears. These options were all put to Council, and three were particularly highlighted which we thought would be the best offered way to try and get out of the present situation. I refer you particularly to paragraph 31: "Notwithstanding the difficulties and complexities inherent in the alternatives, the Committee felt that it should continue to pursue this matter at a subsequent Session, focusing particularly, on solutions which respond to the following criteria. "
Three alternatives are listed. Council, therefore, will take decisions on the most judicious measures and refer them back to the Finance Committee, and if necessary to the General Conference. These solutions will serve to encourage member states to pay up their contributions. At least, that is what the Finance Committee thought. Of course, there is no punitive thinking here; it is a question of trying to provide encouragements, incentives, to the Member Nations to pay their contributions. The Committee also wish that these three alternatives should in no way harm the contributions of the Member Nations concerned.
I move on to paragraph 32 which introduces a section on Other Information on the Financial Position. It refers to the expenditure and obligations up to the time of that meeting-i. e. the September session of the Finance Committee.
In paragraph 34 we have a statement on the Cash Flow of the General Fund. You will see that we had $31. 5 million up to 31 August 1986-for the biennium 1986-87.
In paragraph 35 we make a statement on the status of the special reserve account. Again, up to 31 August the sum was $16. 8 million.
In paragraphs 36 and 37 we have a forecast on budgetary and cash flow status during the biennium. These paragraphs are very important as they do refer to the budgetary situation in the future and we draw your attention particularly to them. In paragraph 44, we should like to invite you to bring your attention to bear on all of this section. It states that the Director-General in the meeting of the Finance Committee announced what savings he proposed to make in programme delivery. The measures which he proposed are quoted here. Staff costs are involved. This is based upon a meeting which was held before we were fully aware of the situation involving the non-payment of a large assessment to the Organization.
Paragraph 45 also states that the Committee welcomed what the Director-General had proposed, and the proposal is quoted in the preceding paragraph 44. In fact, the Director-General has asked for a special session of the Finance Committee to be held next month on 15 to 16 December so that a final review of the financial situation of the Organization may be made.
Mr Chairman, members of the Council, that concludes my introduction. I stand ready to answer any questions which may be raised by Council members. I thank you for your attention.
Dean K. CROWTHER (Assistant Director-General, Administration and Finance Department): I will refer to document CL 90/LIM/1, and at the same time in comparison with the information which was just reported by the Finance Committee Chairman, would you have available document CL 90/17 and particularly page 3, because document LIM/1 updates page 3 from the period of 25 September up to.
last Saturday and gives you the status of contributions up to last Saturday. It is important to note the changes which have occurred since the reporting to the Finance Committee to give Council the latest information.
Would you look first at page 3 of document CL 90/17 on which the Chairman of the Finance Committee was reporting and note the third underlined heading "Amounts outstanding at 25 September". You will see that current assessments together with contributions in arrears totalled $87, 138, 947 at that date. That represents the amount owed to the Organization by the Member Nations in current assessments and contributions. Since that time, as shown on the face of document CL 90/LIM/1, you will see that we received a sum of $3, 480, 000 since 25 September and as of 15 November, last Saturday.
If you will turn over the page of CL 90/LIM/1 you will see the 1986 column again which compares with the same information reported to the Finance Committee on 25 September, and you will see that the amount owed as of 15 November has been reduced now to $83, 730, 609. That compares with the figure opposite for 1985 of only $62 million-a substantial difference. There are two reasons for the difference. One was that there was a distribution of surplus in 1985 that applied heavily against the arrears in current contributions. That makes a substantial difference, therefore, in the receipt of arrears. Secondly, Member Nations were paying faster in 1985 than they are in 1986.
If I can call your attention to the following page, and particularly paragraph 5, you will note there is a comparative schedule for 1986 and the previous four years as to the receipt of current assessments. This does not include arrears. This is current assessments only. I should particularly like to call your attention to the September/October figures, and note a particular pattern, because it is an important point. to show that there are many Member Nations who are not paying this year at the same rate as they have been paying in prior years.
The largest contributor has normally paid in November, and if you look across the percentages and compare October with November for the prior four years you will see a substantial jump in the percentages. For the most part, that represents the payment of the largest contributor. But now look at the October figures. In October the largest contributor had not paid, and you see the respective amounts paid by the remainder of the members, the amounts which have been received at that point. For 1986 we are comparing in October 64.75 percent with 73 percent in 1985, 86 percent in 1984, 75 percent in 1983, and 56 percent in 1982. It was only the year 1982 in which receipts were coming in slower than they are in this year. It is important to note that receipts are not coming in as rapidly from many Member Nations at this point.
LE PRESIDENT: Avec votre permission, je vais passer la parole â M. Shah pour exposer le document CL 90/23 Sup. 1 et 2.
V. J. SHAH (Director, Office of Programme, Budget and Evaluation): It is my pleasure to introduce this item on behalf of the Director-General. We face a serious problem of liquidity affecting the implementation of our Programme of Work and Budget for 1986/87. This has led the Director-General to submit a document for the consideration of the Council, document CL 90/23 with its supplements 1 and 2, and to invite the Council to deal with this matter at the earliest time during this Session.
In November 1985 our Conference approved the Programme of Work and Budget for 1986/87 on an amount of $437 million, and requested the Director-General to implement it up to that amount. The fact that we currently have to face is that contributions are not paid in on time and up to the amounts due. The assessment of the income shortfall is a difficult and fluid matter when we are not certain what each Member Nation will pay and when it will pay the amounts due. The situation has worsened considerably since the Finance Committee met in September and considered the matter. It has even worsened since the document before you was prepared. We now estimate the income shortfall for 1986/87 at $92 million. There are three factors responsible. Firstly, we face, as always, the fact that all Member Nations do not find it possible to pay their shortfall contributions during the biennium. For 1986/87 we estimate the arrears in contributions from six Member Nations at $26 million. Secondly, because of the sharp decline in interest rates and a lower level of our investible funds, because of the lower contributions, our miscellaneous income is expected to be some $19 million less than was estimated in the Programme of Work and Budget. The third factor is that we face, for the first time, the prospect of a shortfall in the payments by our largest contributor.
This shortfall is totally different from the arrears of other Member Nations, because it is based on legislative action not to pay the full contribution due to the United Nations and some specialized.
agencies, including FAO. Consequently, it is a real cut in our income and it will represent, and it will be treated as, arrears due to the Organization. We have no way of knowing when these arrears would be settled. In the circumstances a full implementation of the Programme of Work and Budget as authorized would inevitably lead to a cash flow problem before the end of this biennium if no corrective measures were taken. The problem is not a legal one. It is not a question requiring submission to the Conference to amend the Programme of Work and Budget which it has approved. We are not debating whether the question requires submission to the Conference, it is a fact of force majeure of the Director-General not receiving the resources required needed to implement the full Programme of Work and Budget.
In the circumstances he does have the option of making use of the authority to borrow which was conferred on him by the Council in 1981 and reconfirmed by the Conference in 1983. However, the Director-General has rejected this option for the time being so as not to create an additional burden on Member Nations. He prefers to take managerial action to contain expenditures where possible in order to avert a cash flow problem for as long as possible. His policy aim in the circumstances is two-fold. Firstly, on the one hand, to implement the approved Programme of Work and Budget to the maximum extent possible and, on the other hand, to avoid problems of cash flow. He has studied the situation in all its aspects and considered all options.
The first course of action is to make programme savings from postponements, interruptions, reductions, slow downs and even cancellation of certain activities. We should not close our eyes to the fact that all these measures have programme implications. In the circumstances, these are managerial measures to preserve to the maximum extent possible the programme content, particularly in the economic and technical areas. In particular, the Technical Cooperation Programme is not proposed to be affected at all. We do have precedents for programme savings. We were obliged to make them in 1972/73 by as much as 7. 6 percent of the then budget. We were also obliged to make them in 1980/81 at a level of 2. 5 percent of the then budget. The proposals now total 3. 7 percent of our current budget. Other organizations in the United Nations system affected by the same problem are also forced to make similar adjustments ranging from 4 percent in the case of the United Nations to around 7 percent in the case of the International Labour Organization (ILO) and the World Health Organization (WHO).
Despite the measures which I have just indicated and in addition to them, it will be necessary to draw on the Working Capital Fund for the maximum extent of its resources of $13 million. The Working Capital Fund exists precisely to deal with the present situation and its use would be fully in accordance with the financial regulations. With the implementation of the measures proposed we estimate that we would avoid a cash flow problem during this biennium. We would begin 1988 with a credit of $98 million, a credit representing outstanding contributions, legally due to the Organization. Unless a significant part of this amount is settled promptly we will not have the resources to meet our financial obligations in the first month of 1988 arising from commitments incurred in 1987.
It is entirely normal that the expenditures relating to the activities of one biennium are not spent entirely within the same biennium. There are expenditures, for instance, for supplies or contractual services, the invoices for which are only received in the year following the biennium. In 1988 we would need to meet financial obligations of some $60 million relating to the present biennium of 1986/87. However, the funds would not be available because of the shortfall in contributions. We would, therefore, have to borrow. The exact amount required and for what duration will be directly determined by the contributions actually paid. At the present time we have indicated an estimate of some $30 million.
In recent days a number of Representatives have raised the question of witholding distribution of the 1984/85 cash surplus amounting to $34. 7 million which will be distributed to Member Nations on 1 January 1987. The witholding of the distribution of this cash surplus, which would indeed require a special session of Conference to be convened at thirty days notice before 31 December 1986, would not resolve the problem. The Council will realise that the share of each Member Nation in this cash surplus is automatically applied to the arrears outstanding and the contributions due in 1987. As regarding countries with arrears of contributions there would thus be no net cash flow benefit. There would only be a benefit if those Member Nations who are not in arrears and pay their 1987 contributions in full are prepared to relinquish their share of the cash surplus. This can be done voluntarily. There would be no need for a special session of the Conference to be convened to deal with this matter.
The Council is invited to consider and note the serious situation regarding the liquidity and urge Member Nations to pay their contributions due in full and on time. In the circumstances, the Director-General has no alternative to the programme adjustments on the lines and on the scale proposed, as well as the other measures he has indicated. The situation will remain fluid. We cannot be held to the estimates given today. The prospects will change according to the contributions actually received. It is precisely for this reason that the Director-General has convened, as you have just heard, a special session of the Finance Committee to meet on 15 and 16 December of this.
year. The Programme and Finance Committees will have their usual two sessions in 1987 and the Council itself will have the opportunity of reviewing the situation and requirements in June and November of next year.
LE PRESIDENT: Je voudrais passer la parole au délégué du Brésil qui se proposait de parler du document CL 90/23.
Octavio Rainho da SILVA NEVES (Brazil): I would just like to recall briefly the main points, perhaps if you would allow me, of my previous intervention that are now somewhere lost in this difficult discussion. I would like as well to thank both the Chairman of the Finance Committee and Mr Shah for the very helpful explanations and contributions.
One of the points that we tried to develop in our previous intervention concerned this overall question of this liquidity crisis facing the organization is that the Worst features of the present situation are the certainty that the largest contributor is not going to pay its full contribution due to FAO and the uncertainty regarding the time and announcement of present and future payments by that member.
Another point, and I will be quite brief, that we tried to stress is that shortfall in payments of contributions have occurred previously but, whereas the whole conformed to the rules of the international organizations and were justified by the commodity of goods and by the currency scarcity in developing countries, they have never, never, however, constituted a major problem to FAO's activities as they represent only around 5 percent of each annual budget. For 1986/87, delayed contributions from members other than the largest, making up to the past in any single way to the contribution of recent years of around 20 million dollars, and I would suggest once more that we consider this in itself an extraordinary performance given the financial uncertainty faced by the majority of the developing members of this organization.
The point is that if the contribution by the main contributor to the organization is paid the financial situation of the organization will improve in relation to that of the five preceeding years. The liquidity crisis is not of itself in our view attributable to the arrears or the delayed payment by developing countries. That is why we take some exception with the suggestions in the report of the Finance Committee in document CL 90/17 paragraph 31 when they suggest some three specific measures to take and they would examine those measures at a subsequent session to take care of the matter in connection with prompt payment of contributions. I do not see how any of those suggestions, any of these ideas by the Finance Committee is going to solve the main point, our main problem and the problem that we are concerned with, the probable non-payment of the future contribution, or a large part of the future contributions by the main contributor. All the measures envisaged here by the Finance Committee, let us say they have an historical connotation but they do not adjust themselves to this new situation. So from this point of view, with all due respect to the Finance Committee I take exception to those measures.
Taking into account the seriousness of the situation we appreciate the prompt proposals presented by the Director-General in order to curb the most immediate difficulties faced by the organization. At this point we wish to present our support for the programme adjustments proposed of the order of 16. 4 million dollars, or 3. 7 percent of the budget for 1986/87. As the Director-General pointed out with document CL 90/23 we would prefer as well to have no adjustments at all but as they are necessary we prefer that they address themselves to delays in filling posts, to reductions of meetings, publications, consultancies, contractual services and travel where they would do the least damage to the approved Programme of Work.
We deeply appreciate that the technical and economic programmes have not been touched. Brazil, as well as all the other developing member countries of this organization, has been a strong supporter of the Technical Cooperation Programme: a very flexible and universal programme that enables FAO to intervene rapidly and give the necessary relief in the case of emergency and support to development-oriented projects.
Once more I think the intervention made by Mr Shah in connection with TCP was once more quite helpful. In order to facilitate the needed consensus and to help the Director-General to overcome the present difficulties, my delegation would make no additional comments on the total savings proposed or on the specific programmes affected by the adjustments. We prefer to offer our unconditional support to the proposal, considered that the Director-General is sufficiently aware of FAO's needs at present and the person best suited to monitor programme adjustments.
We support also the proposal for drawing on the working capital fund for an estimated 9 million dollars.
Finally my delegation wishes to reiterate Brazil's commitment to multilaterism, to a strong United Nations system and to FAO. We do believe that all member countries should participate in equal terms in the work of United Nations international agencies and no country or group of countries should be allowed to have an undue influence on their decision-making mechanisms. We must preserve the integrity of rules and principles we have constructed during the course of more than 40 years.
In accordance with your ruling, Mr Chairman, we will come later on to the next point of the agenda concerning this financial situation.
Eiichi KAWAHARA (Japan): I should here like to make a very few brief remarks on the subject of the utmost importance which has exercised the minds of many of us in recent months. I wish to give my government's view on how we might deal with the substantial shortfall that is foreseen in contributions and the assessment for 1986 and 1987. I should like to refer to the matter of contributions first.
According to the report of the 58th Session of the Financial Committee the position at the end of September 1986 regarding 1986 assessments of Member Nations indicated the best performance for the last five years. This is no mean achievement given the fiscal difficulties facing all countries. However, seventy, or now 64 members, according to the recent information that is available, these Member Nations, including the largest contributor, had still not made contributions under their 1986 assessment. I fully support the Finance Committee's earnest appeal to all Member Nations with contributions in arrears to honour their obligations to the FAO and to take urgent action now to give the amount due so as to ensure effective implementation of FAO activities in the financial period 1986/87.
Japan is unable to support any proposals for adjustments which would entail additional contributions by member countries which, not-withstanding the severe budgetary constraints confronting all the governments, have already fulfilled their obligations. We should vigorously pursue further economic measures, including not only programme savings measures. as proposed by the Director-General, which amount to $16 million, but alSo additional expenditure reduction efforts relating to the total current budget. In this connection I wish to refer to the relationship of the TCP appropriations to the FAO budget as a whole. We recognize that the Technical Cooperation Programme can play valuable roles as a rapid action measure to meet unforeseen needs in the developing countries. Nevertheless, reservations and the hopes that there will be a review of the rapid growth of the TCP budget item have been expressed. I wish to draw the attention of the members of the Council to page 23 of the 1984/85 financial report and statement of the FAO Regular Programme document C 87/5. Statement one gives the budget appropriations for TCP during the year as around $72 million, but actual disbursements amounting to no more than an approximate amount of $26 million. An unutilized balance of 45. 6 million dollars has consequently been carried forward for use in the current financial period. If one adds these transferred financial resources to the TCP budgetary appropriations already approved for the current period, which is 61. 42 million US dollars, the total TCP appropriation thus available for the current financial year exceeds 100 million US dollars.
We congratulate the Secretariat on the efforts made for TCP programme savings of around 45 million dollars in the preceding financial period, savings which are greatly to be welcomed. I believe, however, that given the unprecedented shortfall envisaged for contributions to FAO for the fiscal year 1986/87, we should consider the advantages of using those savings to ensure that FAO may continue to maintain a sound and solid financial foundation across the board.
I should also like to mention the need in this connection for the evaluation of TCP programmes already implemented in order that TCP may achieve its objectives as effectively as possible. We would greatly appreciate it if the Secretariat would give us at a later stage its views on concrete proposals for such evaluation now being studied.
Regarding alternative approaches in the medium and long. term, we would at a later stage like to express our views.
Mohammed ABDELHADI (Tunisie): Avec votre autorisation, Monsieur le Président, je me propose de scinder mon intervention en deux parties: une première partie où je ferai quelques commentaires sur les rapports du Comité financier et une deuxième partie consacrée au document CL 90/23 et a ses suppléments. Comme on le sait, ces documents sont consacrés aux perspectives budgétaires et a la situation financière de l'Organisation.
Mais auparavant, je voudrais saisir cette occasion pour exprimer, au nom de la délégation tunisienne, mes vifs remerciements à M. Bukhari, Président du Comité financier, pour les éclaircissements fort utiles qu'il nous a donnés sur la situation financière et budgétaire de l'Organisation et sur les travaux du Comité financier dont nous voudrions louer ici l'ardeur et la clairvoyance.
Mes remerciements vont également à M. Crowther pour les éclaircissements qu'il nous a donnés tout à l'heure sur des questions financières.
Ma délégation a pris note de tous les éléments des rapports du Comité financier. Nous avons constaté avec une certaine inquiétude, au paragraphe 19 du document CL 90/4, que 105 Etats Membres n'ont fait aucun versement sur leur contribution de 1986 malgré les dispositions claires en la matière du Règlement financier. Toutefois, nous avons noté une certaine amélioration dans le règlement des arriérés des contributions, fait mentionné dans le paragraphe 18 du document CL 90/17.
Dans le passé, nous avons eu l'habitude d'affronter une telle situation mais, cette fois-ci, la situation s'est aggravée en raison de la décision du principal contribuant de limiter le montant de sa contribution et d'en différer le paiement à une date ultérieure non précisée. Nous regrettons sincèrement cette situation. Le paragraphe 25 du document CL 90/17 est d'ailleurs édifiant à cet égard. C'est pourquoi ma délégation souscrit sans réserve à l'appel lancé par le Comité financier, au paragraphe 26 du document qui fait l'objet de notre examen. Il est donc à espérer que les pays membres entendent cet appel du Comité financier et règlent le plus rapidement possible leur participation en honorant leurs obligations.
En ce qui concerne les observations faites par le délégué du Royaume-Uni sur les coûts d'exécution des programmes de la FAO, qu'il a estimés élevés, les éclaircissements fournis par le Directeur général adjoint de l'Organisation et les explications de M. Shah, notamment, nous paraissent convaincants. Je ne voudrais donc pas entrer dans le détail; d'autant plus que les efforts considérables déployés par la FAO depuis plusieurs années pour compresser les frais de gestion en général et les dépenses en personnel en particulier sont connus de nous tous. D'ailleurs, le Directeur général l'a très clairement mentionné avant-hier dans sa déclaration liminaire.
En ce qui concerne le Programme de coopération technique, les explications de M. Shah sont claires, nettes et exhaustives.
Le problème des crédits inutilisés a la fin de l'exercice précédent et reportés à l'exercice en cours a été effectivement examiné par le Comité financier, par le Conseil et par la Conférence, à sa dernière session. Il n'est donc pas question pour nous de revenir sur cette question et les explications de M. Shah, chiffres à l'appui, nous satisfont.
Enfin, pour revenir aux rapports du Comité financier, ma délégation souscrit à toutes les propositions formulées et félicite le Comité financier et son Président pour l'excellent travail accompli. Voilà pour la première partie.
En abordant la deuxième partie, je voudrais tout d'abord saisir cette occasion pour remercier M. Shah, au nom de la délégation tunisienne, de l'exposé clair et précis qu'il nous a fait et de son introduction aux excellents documents soumis â l'examen du Conseil.
Les problèmes que nous examinons sont très importants dans la mesure où le fonctionnement et l'efficacité de l'Organisation se ressentiraient des solutions retenues par le Conseil.
La situation financière consécutive à une conjoncture imposée à l'Organisation nous paraît effectivement préoccupante, dans son ensemble, pour des raisons largement analysées dans les documents soumis à l'examen du Conseil. J'en retiens toutefois une qui me paraît prépondérante en ce sens qu'elle est à l'origine du problème, à savoir que les perspectives budgétaires et financières de l'Organisation pendant l'exercice dépendent fondamentalement du montant et de la date des versements effectués par les Etats Membres pour le Programme de travail et budget approuvé par la dernière Conférence générale de la FAO.
Autrement dit, la situation et les perspectives budgétaires et de trésorerie sont provoquées notamment par la décision unilatérale du principal contribuant au budget de l'Organisation de limiter et retarder le versement de ses contributions qui ont fait l'objet, comme on le sait, d'engagements conventionnels antérieurs. Pour faire face à cette situation qui risquerait de s'aggraver davantage à l'avenir, le Directeur général nous a présenté des propositions de mesures de nature à limiter les effets néfastes de cette situation. De prime abord, nous voudrions dire que ces propositions de mesures nous ont paru cohérentes et de moindre mal en ce sens qu'elles pourraient permettre à l'Organisation de fonctionner quasi normalement moyennant quelques ajustements dans ses programmes de travail jusqu'à la fin du biennium actuel. A cet égard, nous sommes heureux d'apprendre que la situation de trésorerie de la FAO ne rendra pas nécessaire pour le moment du moins, et durant le biennium actuel, le recours à un emprunt. Npus savons que cela a été rendu
possible grâce à une gestion saine de l'Organisation due aux efforts considérables du Directeur general.
Toutefois, le problème se poserait avec acuité en 1988 si la situation persistait et si les retards et la limitation des contributions de certains membres étaient maintenus. En tout état de cause, je pense qu'il serait impératif, au moins pour l'actuel programme de travail, qu'il n'y ait pas de coupe ou de diminution importante qui le dénaturerait. En tout cas, nous sommes soucieux au plus haut point du maintien, tel qu'approuvé par la Conférence générale, du Programme de coopération technique (PCT), auquel les pays en voie de développement attribuent la plus grande importance. Par ailleurs, et outre les propositions de mesures formulées par le Directeur général, ma délégation pense que le Conseil devrait lancer un appel à tous les pays, et notamment au principal bailleur de fonds, à faire preuve de compréhension afin de faire en sorte que les engagements conventionnels en matière de contributions au budget de l'Organisation soient scrupuleusement respectés et éviter ainsi à la FAO, dont l'efficacité n'est plus à démontrer, des problèmes inextricables qui pourraient limiter dangereusement les activités, surtout au moment où une organisation comme la FAO est appelée par la communauté internationale à continuer à jouer un rôle primordial dans la lutte contre la faim et la malnutrition partout où cela est nécessaire dans le monde.
Leopoldo ARIZA HIDALGO (Cuba): Nosotros tenemos un problema para el enfoque de la discusión. Después de la presentación del informe del 57 y 58 periodo de sesiones del Comité de Finanzas, creo que lo que nos corresponde es aprobar o rechazar lo que nuestros representantes en ese Comité han aprobado ya previamente y no entrar en un análisis de auditoría, que no se puede llamar externa, sino auditoría de Consejo.
Creemos que la presentación por parte del Embajador Bukhari constituyó un análisis muy sencillo y muy claro de la real problemática que presenta la Organización con respecto a la situación financiera. De aquí se sacan las conclusiones, de aquí se sacan problemas fundamentales que nos ha presentado con brillantez y objetividad el señor Crowther y el señor Shah. Con estas tres presentaciones nosotros quisieramos hacer solamente un compendio con enfoques objetivos; a que se ha compendiado la situación de crisis financieras provocadas, podemos aclarar que no hay una crisis financiera de la Organización, que es una crisis provocada.
Nosotros queremos insistir, apoyando totalmente lo expresado por el Embajador del Brasil, en el sentido de que es necesario ver diferencias, y que esta crisis que se atraviesa la provoca uno sólo de los contribuyentes, precisamene el más importante, esto es una pequeña casualidad, por lo que creeemos que debemos hacer diferencias a la hora de enfocar los problemas.
Hay precedentes de cómo se vienen retrasando o difiriendo los pagos y cómo se van también llegando a pagar; pero en el caso que se nos presenta de unilateralidad de uno de los grandes contribuyentes, del principal contribuyente, que inclusive presenta como condición de su no pago la legislación de su país, legislación que está en función de problemas internos de su país, nos hace pensar dos veces la situación que tenemos enfrente. Creo que esto es lo principal, analizar. 0 sea, que estamos en la obligación de reprobar la actitud unilateral del principal contribuyente.
Queremos aclarar, sin embargo, que para nosotros sin un análisis, diríamos directo de esta situación, no podemos analizar la problemática del no pago de ese contribuyente. Se nos hace muy difícil juzgarlo sin oírlo. Por lo tanto quisiéramos que nos hablara específicamene sobre el problema del no pago de un contribuyente. Nos reservamos el derecho de volver a intervenir cuando ese contribuyente hable porque es difícil juzgarlo si no olmos las razones que debe tener.
Independientemente de esta situación, ya esta mañana se han expresado opiniones sobre los otros temas. Queremos decir que nuestra delegación apoya en todas sus partes, después de analizados, los documentos que nos ha presentado la FAO y después de múltiples discusiones, que hemos hecho inclusive en el seno de nuestro Grupo Latinoamericano y del Caribe, apoyamos en todas sus partes las medidas propuestas por el Director General para evitar la crisis de liquidez de inmediato, sin afectar a las bases fundamentales del Programa que es el objetivo.
Apoyamos, además, esas alternativas que el Director General nos propone y que se analizaron brillantemente por el señor Shah, donde se expresa claramente que no se va a tocar el Programa de cooperación técnica. Esto no es un capricho del Director General. El Director General es persona dinámica, valiente, audaz, pero nunca lo he visto en el plano caprichoso, siempre ha sido realista y el realismo está en función del PCT, es una realidad de la transferencia tecnológica directa, fácil y oportuna que piden los gobiernos, que no nos impone nadie. Nosotros hemos oído algunos criterios contrarios a los Programas de Cooperación Técnica, lo venimos oyendo desde hace algunos años. No creo que la coyuntura de esta crisis ha alentado a querer enfrentar el Programa de Cooperación Técnica. Tenemos experiencia de otras sesiones del Consejo y Conferencias en que hemos tenido que defender los Programas y no había crisis de liquidez en aquellos momentos. Por lo tanto no creo que debemos unir esto con la crisis.
Queremos decir, que creemos que hay una pequeña diferencia entre los que consideramos que los proyectos de cooperación técnica son utiles, que deben seguir incrementándose y los que niegan su existencia y su mecanismo. Esta pequeña diferencia es la de los que la necesitamos y la de los que no la necesitan. Los que los necesitamos, y utilizamos, y pedimos a FAO que los aumente y que no se toquen, son los países del Tercer Mundo. Los que niegan su utilidad, todavía no me han convencido con razones, porque no saben explicar las razones, porque expresan criterios eminentemente teóricos, fuera del programa, porque ellos ni han implementado ni han sido sujetos de proyectos de cooperación técnica.
Si la situación critica mundial llegara a tal punto de que fueran sujetos, nosotros estaríamos de acuerdo en que la FAO les diera proyectos de cooperación técnica para que salieran de su crisis económica. Queremos decir que a veces el alto coeficiente de inteligencia nubla los sentidos y hay que ser más objetivos. No podemos ligar cuestiones que no están en estos momentos en discusión.
Posteriormente, después de que hable la distinguida representante de Estados Unidos, daré mi criterio para poder calificarle de unilateral, aunque ya hay un principio que puedo adelantar, porque hay una cifra que aprobó el Comité de Finanzas y esa cifra nos dice que hay unos 83 millonee pendientes de cuentas corrientes y de esos 83 millones, de acuerdo con la cuota que le corresponde a ese gran país que es de 51, 5, se mantiene la proposición que planteaba nuestro querido Embajador de Brasil de que solamente el 20 por ciento corresponde al resto de los países.
Esta es una cifra que yo quisiera que se me aclarara si no es real como está en los documentos.
Esto es todo por ahora.
Mrs Millicent M. FENWICK (United States of America): I cannot resist saying a few words now but I hope that we can reserve for later a more technical response to some of the most important and interesting interventions that we have been listening to. Concerning this particular intervention, I must say in good friendship and good humour that it is pretty hard to be scolded because you have been giving too much money over all these years. I mean, that is the trouble. In times of difficulty we do not expect to find strong things said against those who do not give anything or those who want to be Members and still never make up their arrears. To me that would be something very understandable. Of course, I am joking now because I understand how people feel. It is hard. It is also hard for some countries where one person can say "give, I sign", to understand how difficult it is in another country where 435 people are in charge of the money, 435 people who have to get elected every two years, and this is a problem also. We have to have understanding-one of the other. I understand that there is a certain amount of resentment obviously that we who have been, we may say, the major support in all this, have found this I hope, temporary, difficulty-although we do not know what Congress will say. I hope that they too will understand that we sit in a different seat and we have different powers and different abilities to respond. So, you scold people, dear friends, who do not give. Stop scolding us.
LE PRESIDENT: Je remercie Mme la déléguée des Etats-Unis pour avoir respecté son droit de réponse. Nous tâcherons de garder au niveau de ce Conseil la sérénité è laquelle j'avais fait appel hier et nous tâcherons d'éviter les interventions trop personnalisées.
Benjamin KOUESSEU (Cameroun): Permettez-moi d'abord de vous féliciter pour le tact et le calme avec lesquels vous dirigez nos travaux. Je voudrais, sur ce point concernant la situation financière de notre Organisation pour l'année 1986-87, après le brillant exposé qui nous a été fait par le Président du Comité financier ainsi que les explications complémentaires données par M. Shah, dire que nous apprécions â sa juste valeur la situation de la crise dans laquelle notre organisation risque d'être plongée.
Ma délégation exprime ici sa satisfaction au Directeur général pour avoir bien voulu prendre l'initiative courageuse et hardie de saisir notre conseil pour lui demander son avis sur la situation et les perspectives des finances de la FAO. La situation actuelle nous montre que sur un budget de 437 millions de dollars, les contributions attendues des Etats Membres s'élèvent à 394 millions de dollars, soit plus de 90 pour cent de ce budget. Or, il apparaît que le déficit total des contributions pour 1986 et 1987 est estimé à 60 millions de dollars, déficit qui sera aggravé par un manque à gagner de près de 19 millions de dollars sur les recettes accessoires prévues. Ces quelques chiffres soulignent à l'évidence la situation préoccupante et inquiétante dans laquelle se trouve la FAO à la fin du biennium en cours. Cette situation préoccupe d'autant plus notre délégation qu'elle intervient à un moment où la situation agricole et alimentaire de nombreux pays en voie de développement, et en particulier ceux d'Afrique, est des plus critiques et
appelle plutôt une action coordonnée et vigoureuse de l'ensemble de la communauté internationale au sein de laquelle la FAO tient une place irremplaçable. Devant cette situation que nous ne pouvons que déplorer vivement, nous tenons à marquer notre plein appui à l'opinion émise par le Comité financier à sa cinquante-septième session en mai dernier, à savoir que les autres Etats Membres ne devraient pas être appelés à compenser un déficit dû à la réduction par certains contribuants de leur quote-part librement consentie.
Nous souhaitons pouvoir partager par ailleurs l'optimisme du Président du Comité financier ainsi que les assurances données par le Secrétariat concernant les économies possibles dans l'exécution du programme du biennium en cours, tout en sauvegardant la possibilité financière et budgétaire du biennium de l'Organisation. Parmi ces mesures proposées dans ce sens par le Secrétariat, c'est avec regret et une grande amertume que ma délégation a parcouru la liste des publications et des activités destinées à être réduites. Dans certaines de ces publications, certaines de ces activités, paraissent importantes, voire déterminantes pour l'amélioration de la situation agricole et alimentaire des populations des zones rurales de mon pays. Je ne citerai pas toutes les publications et toutes les réunions qui mériteraient d'être maintenues car ce serait reprendre pratiquement toute la liste des propositions, mais, â titre d'exemple, comment expliquer et justifier que dans le domaine de la pêche par exemple, après la célébration, il y a un mois, de la Journée mondiale de l'alimentation consacrée â la pêche et aux petits pêcheurs (célébration qui a été ponctuée dans presque tous les pays du monde par des déclarations solennelles et des engagements en faveur d'une plus grande attention vis-à-vis des problèmes des petits pêcheurs)' la réduction des activités relatives à la technologie des pêches, à la planification des pêches. Au total, c'est près de 23 publications concernant la pêche que sont proposées à la suppression.
Notre délégation fait confiance au Directeur général et à ses collaborateurs pour réaliser une évaluation objective de l'impact de ces réductions sur les populations bénéficiaires. Nous recommandons du tact et de la souplesse dans la mise en oeuvre de ces mesures de réduction d'activité, notamment compte tenu de l'environnement physique et économique très instable et très incertain où évoluent les économies fragiles de nos pays. C'est une situation qui peut à tout moment conférer une importance capitale à une activité ou à une réunion désignée comme devant être supprimée·
En ce qui concerne le programme de coopération technique, ma délégation souligne que sa souplesse et son efficacité ont permis tout récemment encore au Cameroun de bénéficier d'une aide rapide pour organiser avec diligence la lutte contre l'invasion soudaine des sauteriaux et des criquets pèlerins dans la partie Nord de mon pays. A ce sujet, nous sommes de l'avis du Directeur général sur le fait que le PCT doit être intégralement maintenu, et garder tout son caractère de souplesse qui a toujours permis à la FAO d'intervenir avec une particulière rapidité chaque fois qu'un Etat bénéficiaire l'a sollicité.
M. Shah a donné tout à l'heure des explications pour confirmer que les reliquats de crédits qui apparaissent au PCT ne sont pas des économies réalisées sur ces programmes; il a indiqué le nombre d'engagements par mois et qui prouvent que les crédits de PCT seraient insuffisants si la FAO pouvait répondre à l'appel de tous nos pays. Il ne faudrait donc pas faire une lecture comptable du Programme et considérer que ces fonds sont gelés et ne sont pas engagés. Nous espérons vivement que les projections financières actuellement pessimistes de la FAO seront très vite démenties grâce à un sursaut d'adhésion des contributeurs actuellement en retard de paiement, grâce également à l'adhésion de ces pays aux idéaux multilatéralistes qui, ne l'oublions pas, constituent la plus grande conquête du vingtième siècle en matière d'organisation de la société internationale.
Le fait accompli devant lequel nous placent certains contributeurs est pour le moins embarassant pour nous. Tout en respectant la souveraineté de chaque Etat Membre dans la mise en oeuvre de sa législation interne, nous pensons que les engagements internationaux, antérieurement pris, devraient pouvoir être assumés.
En affirmant combien mon gouvermenent apprécie le dynamisme que M. Saouma a imprimé aux activités de la FAO, vis-à-vis de l'Afrique en général et du Cameroun en particulier. Nous souhaitons que les pays lui facilitent l'accomplissement de sa tâche en mettant à sa disposition les moyens budgétaires nécessaires et indispensables librement souscrits.
Les explications de M. Shah, en réponse à la note sur les coûts de prestation de la FAO présentée par la délégation du Royaume-Uni, ont donné entière satisfaction à notre délégation. Nous pensons qu'une rencontre entre les experts de la délégation du Royaume-Uni et ceux du Secrétariat général, permettrait d'apprécier les coûts de prestation de la FAO à partir des mêmes paramètres.
En réalité la FAO ne connaît pas de crise de gestion. Tous les pays membres devraient l'aider à accomplir sa mission dans une totale sérénité, à commencer par les plus grands contributeurs, en la mettant à l'abri d'une crise de trésorerie qui pourrait être évitée.
John GLISTRUP (Denmark): On this matter I am speaking on behalf of the Nordic countries, Finland, Norway, Sweden and Denmark.
We have noted the wish of the Secretariat and of you, Mr. Chairman, to divide the debate into two parts. We would have preferred more broadly to comment on both short-term and long-term measures since we believe they are somewhat interrelated and that it may also save some time. However, we shall comply with your ruling.
May I start by thanking the Chairman of the Finance Committee, Mr Crowther and Mr Shah, for their introduction to this important agenda item on which we have received a number of documents, some immediately before this meeting. We accept that the financial situation of FAO is difficult, but at this stage not yet to the extent as described by the Secretariat.-It is, however, an excellent opportunity to have a thorough and comprehensive discussion of the situation in the Council, FAO's governing body, in order to provide guides to the Finance Committee and to the Secretariat on appropriate measures to be taken within the next year as well as in the long term.
Parts of the problem have existed for some time. As stated in the documentation, unpredictability of payments from a number of contributors, including the largest one, is an important factor in influencing the liquidity of FAO and other UN agencies. Fluctuations in exchange rates as well as interest rates also play an important role. However, these are short-term problems. We are living in a world subject to violent and unpredictable changes. Therefore, member states should refrain from adding to these uncertainties and instead support United Nations agencies in their longer-term aim of carrying out their approved programme of work. We cannot accept unilateral decisions not to meet international financial obligations.
Turning now to the short-term measures proposed by the Director-General, I will concentrate on two issues: the programme adjustment in the 1986/87 biennium and the transfer from the Working Capital Fund of $13 million.
Like other United Nations agencies, FAO is undoubtedly forced to make some programme adjustments. Let me say at once that the Nordic countries are not impressed by the proposals concerning the proposed programme saving of $16. 4 million. It is impossible for us to judge from the documentation whether it is the appropriate level, and I want to stress that it is the responsibility of the Director-General to make the necessary savings proposals. However, the proposals seem to reflect the philosophy of a linear adjustment of the whole programme of work rather than a conscious setting of priorities.
Freezing of posts and weakening of the general technical backstopping and servicing of programmes are measures which have only very limited justification. In the short term FAO may save some money by reducing its servicing activities in relation to the volume of technical assistance. However, what matters is the long-term impact of activities rather than short-term results in terms of transferred resources. What we require is a deliberate and visible choice between programmes. In the future, we must insist on that kind of priority saving. We agree to the proposed transfer of $13 million from the Working Capital Fund. It goes without saying that we cannot accept TCP as a high priority goal in itself. It should rather be an ad hoc support for achievement of the more long-term goals of the Organization's programme of work. Therefore, non-obligated funds for TCP should not be considered sacrosanct in the process of making economies.
In connection with the cash situation of FAO, we have some difficulties in fully understanding the stated gravity of the problem. This might be due to lack of information. From the financial statement, document C 87/5 Vol. 1, we note that the total cash of FAO at the end of the biennium 1984/85 amounted to some $300 million. Taking into consideration the level of miscellaneous income and making some backward calculations, we would assume that FAO's cash disposal is in the range of $300-400 million, which is a rather large amount, probably too large in normal circumstances. While we acknowledge prudent cash management, we feel there is a need for having a detailed breakdown of the bank deposits in order to know about their composition and degree of liquidity, and before being able to take any position on short-term measures. We would appreciate further clarification on that point·
In closing, let me stress that the matter before us is. of direct concern to each and every Member State. It is not an East-West nor a North-South issue; it is a matter of common interest and concern, and the Nordic countries wish to underline that whatever measures of reform one undertakes, the financial liability of our Organization can only be fully restored and secured if all member states pay their assessed contributions in full.
The meeting rose at 12. 45 hours
La seance est levée à 12 h 45
Se levanta la sesión a las 12. 45 horas