First- and second- year contributions (U. S. dollars)
Table 4 : First- and second- year contributions (U. S. dollars)
|Dominican Republic||1 250||2 500||2 000|
|Ecuador||1 250||2 500||2 000|
|New Zealand||28,750||43,000||34 400|
|Syria||5 000||10 000||8,000|
|Union of South Africa||57,750||86,500||09,'200|
|Costa Rica||$ 1,250||$2,500||$2,000|
|U.S. S. R.||200,000||500,000||400,000|
(a) Of this amount, $296,625 has already been paid, as, indicated by Table 1.C. Supporting statement on the budget submitted by commission B to the conference
(b) Of this amount, $6,000 has already been paid, as indicated by Table 1.
(c) Of this amount, 523,000 has already been paid, as indicated by Table 1.
THE Committee on Finance has received the budget recommendations of the Director-General for the first and second financial years and transmits herewith the proposed budget resolution for adoption by the Conference, together with attached estimates of receipts and expenditures.
It will be noted that the recommended budget for the first financial year of 81,/e months is the figure fixed in the Constitution, $2,500,000, while the recommended budget for the second financial year of 12 months is $5,000,000. These are the amounts to be allocated to governments for contributions in accordance with the scales of contributions which have been fixed for the first and second financial years respectively. In the event that the next session of the Conference should decide to reduce the length of the second financial year to 6 months or some other period less than 12 months, it is intended that any proportionate overpayments of contributions for the second financial year shall be credited towards the contributions which will become due for the third financial year. This contingency is taken into account in the budget resolution as recommended.
The estimate of receipts and expenditures attached to the budget resolution are those submitted by the Director-General and must necessarily be regarded as wholly provisional except as to the allocations for contributions. Under the Financial Regulations which have been approved by Commission B and which it is hoped will be adopted by the Conference, the somewhat general estimates of expenditures which have been submitted will be subject to change in accordance with the provisions of Regulations III and IV of the Temporary Financial Regulations. Under these Regulations it is provided that the Director-General shall present a detailed budget for the first financial year to the Committee on Financial Control not later than January 31, 1946, and that the detailed budget for the first financial year shall be sent to Member governments not later than March 31, 1946, for their information. The Director-General is being given a very broad authority to take final action on the detailed expenditure budget for the first year in consultation with the Committee on Financial Control.
For the second financial year, the Director-General is required to present his detailed provisional budget to the Committee on Financial Control not later than May 1, 1946, and this is to be sent on to the Member governments not later than the beginning of the second financial year on July 1, 1946. The detailed provisional budget will be subject to approval and adoption at the next regular session of the Conference, which it is anticipated will be held in October or November, 1946, in accordance with Rule I of the Rules of Procedure as approved by Commission B. Pending the final adoption of the detailed expenditures budget for the second financial year at the next regular session of the Conference, the Director-General is authorized by the Regulations to incur expenditures after June 30, 1946, consistently with the total amount approved for the ensuing financial years, and for the functions and purposes which will have been approved by that time in the detailed budget for the first financial year.
Since the estimates of receipts and expenditures will be subject to change in accordance with the procedure previously indicated, it is unnecessary to comment at length on the various items of the estimates submitted by the Director-General. Some comments, however, may be helpful by way of clarification and amplification.
TOTAL AMOUNTS ALLOCATED FOR CONTRIBUTIONS
With respect to the figure of $2,500,000 for the first year, the Committee considered that it had virtually no discretion in view of the somewhat rigid provisions of the Constitution and the common understanding of the intent of these provisions. In proposing the figure of $5,000,000 for the second financial year, the Committee was guided by the recommendation of the Director-General and by the intent expressed in the Interim Commission's First Report to Governments, since that First Report was indicative of a general agreement that the budget of the Organization should average about $5,000,000 annually over the first five years.
ALLOCATIONS NOT YET TAKEN UP
Here the Director-General and the Committee have followed the decisions taken in preparing the scales of contributions for the first and second financial years respectively, and have indicated the amounts corresponding to the percentage allocations reserved for new Members. It is the hope of the Committee that these allocations will be taken up by new Members in a substantial degree no later than the next regular session of the Conference, if not within the remainder of the first financial year. To the extent that these allocations are taken up by the adherence or acceptance of new Members, it will be possible to increase the estimates of expenditures and of transfers to the working capital fund.
EXPENSES OF THE INTERIM COMMISSION
The expenses of the Interim Commission, as shown for the period ending September 30, 1945, are from the Auditor's Report, approval of which has been recommended. The sum carried in the budget for the remaining period of the Interim Commission up to the beginning of the first financial year on October 16, 1945, is an estimate.
OVERPAYMENTS OF FIRST-YEAR CONTRIBUTIONS
Four Members, the Dominican Republic, Iceland, Liberia, and Luxembourg, have overpaid their first year contributions to a total of $6,000. It is assumed that these overpayments should be applicable against the second-year contributions of the Members named.
ESTIMATES OF EXPENDITURES
1. The Conference, committees, and technical conferences
The estimate of $345,000 for the first financial year includes an estimate of $120,000 for advances by Canada in the form of the expenses of the First Session of the Conference. The Committee recommends that a refund be made to the extent that the expenses of the conference met by Canada exceed the amount remaining due of its first-year contribution. The estimate of $430,000 for the second financial year includes provision for the next regular session of the Conference, which it is thought may be somewhat less expensive than the First Session, which was necessarily devoted in part to many non-recurring preparatory and organizational matters.
In Table 1, the greater part of the estimates under I (Estimates of Expenditures) are provided for the work of various anticipated standing committees, ad hoc technical advisory committees, and technical conferences.
An item of special significance under I (Estimates of Expenditures) consists of provision for paying the cost of bringing members of the Executive Committee to the meetings of that Committee. Since the members of the Executive Committee are the servants of the Organization as a whole, and not of their respective governments, it has been assumed that suitable provision for their expenses should be made from the funds of the Organization. The Committee on Finance is of the opinion that a suitable provision would take the form of payment of actual transportation expenses of the members and an additional allowance for subsistence and other necessary expenses, such additional allowance to be uniform for the members serving under like circumstances. The matter will require review at the next regular session of the Conference.
2. Missions, investigations, and special projects
Much of the work of the Organization will consist of organizing a variety of missions to render assistance to governments. The Organization is instructed by its Constitution "to furnish such technical assistance as governments may request."
The estimates do not assume that the Organization will bear the entire cost of missions or special projects in all cases; the extent of the activity which will be possible will depend to a considerable degree on such arrangements as may be possible for the sharing of expenses by governments requesting assistance.
As indicated by its minutes, the Committee on Finance at its seventh meeting discussed a proposal of the United Kingdom on the subject of the expenses of missions. The Committee considered that the proposal had been presented too late in the conference to permit the perfecting of a proposed resolution or regulation, but agreed that the subject was one which will require the careful study of the Director-General and the Executive Committee. In view of the variety of situations which may arise in connection with missions, agreements respecting the sharing of expenses may require adjustment to fit the circumstances of individual cases.
This item is to cover the salaries of all personnel of the Organization, including those on temporary appointments or on reimbursable loan from their governments, universities, or other institutions, except in so far as compensation of personnel specially appointed for missions, investigations, and special projects is covered under II (Estimates of Expenditures).
4. Official travel and removal expenses
Since the Organization will frequently find it necessary to pay the removal expenses of persons appointed and their families in order to bring them to the seat of the Organization, substantial items have been included for this purpose.
5. Provident, retirement, and health insurance funds
Pending the development of a retirement fund, the Director-General proposes that the Organization shall establish a provident fund and a health insurance fund.
6. Office and operational expenses
These include such items as stationery, communications, postage, printing, library, rent, fuel, utilities, and furniture and equipment. The estimate for the second year includes an amount, exclusive of salaries, for the maintenance of regional offices. No information is at present available as to the probable number or location of the proposed regional offices. Space rental, printing, and library items will be substantial for the second year.
7. Miscellaneous and unforeseen
Under VII (Estimates of Expenditures) an allowance is included for the second year to cover the costs of moving office and staff from temporary to permanent headquarters.
WORKING CAPITAL FUND
As indicated by the figures, it is hoped that transfers to the working capital fund will be not less than $750,000 by the end of the second financial year. In the opinion of the Committee on Finance, this will constitute only a minimum provision for the possible requirements, particularly in view of the probability that it may be necessary to accumulate a building fund for the construction of a headquarters building at the eventual seat of the United Nations. In the earlier consideration of estimates by the Interim Commission, it had been hoped that a working capital fund might be accumulated much more rapidly, but to do so is obviously inconsistent with the rapid beginning of the work which is desired, unless new Members come into the Organization at an early date. The working capital fund is to some extent a buffer fund. If the staff cannot be built up as rapidly as hoped, it may become possible to transfer amounts larger than now estimated to the working capital fund. It may be hoped that the need for a substantial working capital fund will induce the Director-General and the Executive Committee to institute all feasible measures of economy in carrying forward the important work of the Organization.
In view of the late date in the conference on which the Director-General
was appointed, the preparation and presentation of his budget estimates
could only be a hasty affair. The Committee on Finance has appreciated
the difficult position of the Director-General, and expressed its confidence
in his administration by forwarding his initial budget recommendations
for consideration by the Conference without change. In considering the
Director-General's detailed estimates of expenditures the Executive Committee,
as the Committee on Financial Control, may well feel the need for expert