Contents -

VII. Constitutional and administrative matters

A. Constitutional and legal matters
B. Statutory report on status of conventions and agreements, and amendments thereto
C. Procedure for election of chairmen and members of the programme and finance committees
D. Confirmation of the agreement between FAO and UNIDO
E. FAO's accession to the convention on early notification of a nuclear accident and to the convention on assistance in the case of a nuclear accident or radiological emergency
F. Administrative and financial matters - Audited accounts
G. Scale of contributions 1990-91
H. Return of the regional office for the near east to the region
I. Status of Contributions
J. Measures to deal with problems of delayed payment of assessed contributions
K. Level of support costs from UNDP and trust fund programmes
L. Headquarters accommodation
M. Personnel matters
N. Staff commissary support cost reimbursement
O. Treatment of profit and loss on exchange

A. Constitutional and legal matters

B. Statutory report on status of conventions and agreements, and amendments thereto

Multilateral treaties deposited with the director-general

273. Pursuant to Rule XXI of the General Rules of the Organization, and in accordance with established practice, the Director-General submitted to the Conference the biennial Statutory Report reflecting the status of multilateral treaties concluded within the framework of FAO and deposited with him; the status of other multilateral treaties concluded outside the framework of FAO in respect of which the Director-General acts as depositary; and the status of the Convention on the Privileges and Immunities of the Specialized Agencies as applied to FAO. The Conference noted that the Statutory Report followed the same pattern as earlier reports.

274. The Conference took note of the status of the multilateral treaties concerned, contained in documents C 89/10 and C 89/10-Sup.l.

275. With respect to the International Plant Protection Convention, mentioned in paragraphs 19-24 of the Statutory Report, the Conference recalled that, when approving the amendments to the Convention at its Twentieth Session (1979) by Resolution 14/79, it had urged the parties to the Convention to accept the revised text at the earliest possible time. The Conference noted, however, that 15 acceptances were still required in order to reach the two-thirds majority of contracting parties (i.e. 63), which was necessary for the entry into force of the revised text. In view of the importance of the Convention in strengthening international action against the spread of pests of plants and plant products in the context of international trade, the Conference reiterated its appeal to contracting parties that had not yet accepted the revised text of the Convention to deposit an instrument of acceptance as soon as possible.

276. The Conference further urged that Member Nations concerned accept the amendments to paragraph (a), Article 1 of the Plant Protection Agreement for the Asia and Pacific region, relating to the definition of the region, approved by the Council in November 1983, in order to bring these amendments into force as soon as possible.

C. Procedure for election of chairmen and members of the programme and finance committees

277. The Conference noted that the matter submitted to it for information had been considered by the Council at its Ninety-fifth Session (June 1989) and that the Committee on Constitutional and Legal Matters (CCLM) had previously examined the question. The CCLM had explored three possible orientations which could be adopted with a view to ensuring conformity with Resolution 11/87 on the Procedure for the Election of the Chairmen and Members of the Programme and Finance Committees, in particular with the following criteria set out therein:

(a) The need for just and equitable representation of the various regions on the Programme Committee and the Finance Committee;

(b) that the essential element of such representation was that all regions that so wish are in fact represented on the Committees; and

(c) that members of the Council should bear the above in mind, as well as the importance of securing equitable rotation among the countries constituting each region, when electing the Chairmen and members of the two Committees in accordance with Rules XXVI.3 and XXVII.3 respectively.

278. The Conference noted that the three orientations considered by the CCLM focussed on the possibility of introducing greater degrees of formality into the procedures for reaching regional understandings amongst and within the regions.

279. The Conference also noted that the great majority of members of the Council had not favoured the introduction of measures or amendments which would formalize the procedures for reaching regional understanding. They had considered that the present provisions, combined with Resolution 11/87, were both satisfactory and sufficient. They had underlined that the problems which had arisen in 1985 and in 1987 were exceptional and that the present system had been working quite satisfactorily for many years. Each region should resolve any problems which might arise for it in the manner which it deemed best.

280. Some Member Nations suggested that a study should be undertaken with a view to establishing more appropriate regional groupings based on those used generally in the UN System. Many countries opposed this suggestion on the grounds that the present regional groupings within FAO were more appropriate in the context of the specific objectives and functions of the

281. In conclusion, therefore, the Conference agreed that it would be preferable to maintain the flexibility inherent in the present system and not to introduce any modification hereto. In so doing, it recalled the necessity of ensuring sufficient consultation and coordination both within and between regions in order to respect the criteria set forth in Resolution 11/87, the text of which is given in Appendix G to this Report. The Conference expressed the hope that in the forthcoming elections to be held at the next session of the Council this would result in the just and equitable representation called for in Resolution 11/87. At that time, it could be seen whether further action would be required.

D. Confirmation of the agreement between FAO and UNIDO

282. The Conference noted that, at its Ninety-fifth Session, in June 1989, the Council had expressed itself in favour of the conclusion of a formal relationship agreement between FAO and the United Nations Industrial Development Organization (UNIDO) and that the Conference had already expressed itself in the same sense in 1987.

283. The Conference further noted that working relations had existed between FAO and UNIDO since 1969, following the conclusion of an agreement setting out Guidelines for Cooperation between FAO and UNIDO in the Field of Industrial Development. The proposal to conclude a relationship agreement with UNIDO had been occasioned by the fact that UNIDO had become a UN Specialized Agency in 1985. The agreement itself was a formal relationship agreement which dealt only in general terms with the division of responsibilities between FAO and UNIDO. Detailed provisions on this matter were set out in the 1969 agreement between the Director-General and the Executive Director of UNIDO, the provisions of which would continue in force under the new agreement.

284. Several members underlined the interest of concluding an agreement between FAO and UNIDO with a view to ensuring proper coordination in fields of activity which they shared and of studying the possibility of establishing a joint division as had been done with the International Atomic Energy Agency.

285. In conclusion the Conference confirmed the decision of the Council to enter into the agreement with UNIDO and expressed the desire that cooperation between the two organizations be reinforced, for example, by the creation of a joint division. The text of the agreement is set out in Appendix H to this report.

E. FAO's accession to the convention on early notification of a nuclear accident and to the convention on assistance in the case of a nuclear accident or radiological emergency

286. The Conference noted that the matter had been considered by the Council at its Ninety-Sixth Session and that the two Conventions before it had both been adopted by the General Conference of the International Atomic Energy Agency in September 1986 in the wake of the Chernobyl nuclear accident. This accident had dramatically underlined the global significance of the release of radioactive contaminants into the environment and the importance of international cooperation at the level of the UN System. The Conventions had entered into force in 1986 and 1987 respectively. Both Conventions were open for accession by international organizations and, in fact, the World Health Organization had acceded to them in August 1988.

287. The Conference noted further that the Committee on Constitutional and Legal Matters had concluded that the subject matter of the Conventions would fall within the competence and constitutional mandate of FAO and that it would be legally in order for the Council to approve, and the Conference to authorize, FAO's becoming a party thereto. FAO's accession to the Conventions would be a symbolic act, above all, confirming its readiness to cooperate actively with States and other organizations in taking measures within its field of competence in the case of nuclear accidents.

288. One Member Nation, while not opposed to the accession of FAO to the two Conventions, considered that this was neither necessary nor useful.

289. The Conference noted that there was no intention to duplicate efforts; accession by FAO to the two Conventions would signify the willingness of FAO to become part of the overall information exchange and assistance system set up by the Conventions. The costs resulting from accession would be minimal.

290. In conclusion the Conference noted the Council's approval of FAO's accession to the two Conventions and decided to authorize FAO to become a party thereto. The text of the Conventions is given in Appendices I and J to this report.

F. Administrative and financial matters - Audited accounts

291. The Conference welcomed the Auditor's report and comments regarding FAO personnel policies and feedback and monitoring of evaluation findings, and noted with satisfaction the action taken thus far by the Director-General.

292. The Conference considered the Report of the Ninety-fourth Session of the Council regarding the certification of the 1986-87 WFP accounts, and noted that the Council had agreed that it was in the interest of all, but especially of the poorest countries, that the difficulties which had arisen between the Organization and the Programme be resolved with respect for relevant statutes and standards. The Conference was also advised in this connection that the reports of the Advisory Committee on Administrative and Budgetary Questions (ACABQ) and the Finance Committee had been transmitted to the Committee on Food Aid Policies and Programmes (CFA) for consideration at its Twenty-eighth Session commencing 11 December 1989.

293. The Conference adopted the following Resolution:

Resolution 12/89



Having considered the Report of the Ninety-fourth Session of the Council,

Having examined the following audited accounts and the External Auditor's Reports thereon:

Regular Programme 1986-87 C 89/5
C 89/5-Corr.1
United Nations Development Programme 1986-87 C 89/6
World Food Programme 1986-87 C 89/7
C 89/7-Corr.1

Adopts the above audited accounts.

(Adopted 28 November 1989)

G. Scale of contributions 1990-91

294. The Conference noted with concern the impact of the timing used in the methodology of the UN Committee on Contributions which might not always take into account the most recent changes in economic conditions of each Member Nation.

295. The Conference also took note that the Finance Committee and the Council had agreed that the FAO proposed Scale of Contributions for 1990-91 be derived again directly from the UN Scale of Assessments in force for the three-year period 1989-91.

296. The Conference accordingly adopted the following Resolution:

Resolution 13/89



Having noted the recommendations of the Ninety-sixth Session of the Council,

Confirming that as in the past FAO will continue to follow the UN Scale of Assessments subject to adaptation for the different membership of FAO,

1. Decides that the FAO Scale of Contributions for 1990-91 should be derived directly from the UN Scale of Assessments in force during 1989;

2. Adopts for use in 1990 and 1991 the Scale as set out in Appendix K of this Report.

(Adopted 28 November 1989)

H. Return of the regional office for the near east to the region

297. The Conference considered documents C 89/26 and C 89/LIM/31 on the "Return of the Regional Office for the Near East to the Region". It approved the return of the Regional Office or the Near East to Cairo, Egypt, and adopted the following Resolution:

Resolution 14/89



Recalling Resolution 20/79 on the Regional Office for the Near East,

Noting with appreciation that since the closure of the Regional Office in Cairo, the FAO regional programmes and activities have been carried out in an effective manner through the requisite coordination and cooperation between the Regional Office and the technical and administrative units at Headquarters,

Concurring with the view of Member Nations of the Near East Region, endorsed by the Council at its Ninety-fourth Session, that while programmes for the Region have been implemented effectively from Headquarters during the past ten years, the quality of implementation and the impact of the programmes would be significantly enhanced if the office were to operate once again in the Region,

Noting that the cost to the Organization of relocating the Office in the Region could be covered from the provisions for the Regional Office for the Near East in the proposed Programme of Work and Budget 1990-91,

Welcoming the generous offer made by the Government of the Arab Republic, of Egypt to resume the provision of host facilities for the Office, and its agreement to bear the cost of rehabilitation the old premises in Cairo, as confirmed by the recent Memorandum of Understanding,

1. Decides that the headquarters of the Regional Office for the Near East be re-opened in its old premises in Cairo, Egypt, as soon as possible and no later than 1 September 1990;

2. Requests the Director-General to take all necessary measures for the implementation of this Resolution and conclude negotiations with the Government of the Arab Republic of Egypt to ensure that complete and adequate rehabilitation work of the premises of the Office is carried out according to a mutually agreed timetable so as to permit the re-installation of the Office to commence no later than 1 June 1990;

3. Authorizes the Director-General, in order to implement these measures, to make the necessary adjustments in the approved 1990-91 Programme of Work and Budget, in connection with the relocation of the Office in Cairo;

4. Calls upon all Member Nations, especially those within the Near East Region, to provide their full cooperation to the Director-General and the staff of the Organization, and to the Member Nations concerned, to ensure the smooth and effective implementation of this Resolution.

(Adopted 28 November 1989)

I. Status of Contributions

298. The Conference noted the status of contributions from Member Nations to the Budget of the Organization at 22 November 1989 (Appendix L). The Conference was advised that 28 Member Nations had made no cash payment at all in 1989, while 46 Member Nations still had arrears outstanding. A total of US$ 91 636 591.14 of arrears was still outstanding, of which US$ 78 million was due from the largest contributor.

299. The Conference also noted that the total outstanding current contributions and arrears at 22 November 1989 was the largest at this date in the history of the Organization, with an expected tendency to end the current year without substantial changes in the figures.

Payment of assessed contributions

300. The Conference considered the report of the Council as presented in document C 89/LIM/12 on the subject of the financial situation of the Organization. In this respect the Conference noted that notwithstanding the Council's calls for Member Nations to honour their obligations, the rate of receipt of contributions was still highly unsatisfactory.

301. The Conference noted with concern the information regarding the cash flow situation which, although it had stabilized over the last few weeks, could soon become critical again if no significant additional contributions were received before year-end. In that regard, the Conference was reminded that the Director-General could be led to use the authorization to borrow, since no further cash would be available once the Working Capital Fund and the Special Reserve Account resources were exhausted, for payment of mandatory expenditure.

302. The Conference concurred with the views of the Council in expressing its high regard for the managerial ability of the Director-General who, under difficult financial circumstances, had ensured that the objectives embodied in the Programme of Work and Budget were met to the maximum extent possible.

303. The Conference regretted that the Council's appeals had not resulted in the payment of current contributions and arrears.

304. The Conference consequently adopted the following Resolution:

Resolution 15/89



Recalling that, in accordance with Financial Regulations 5.5, assessed contributions to the budget of the Organization by all Member Nations were due and payable in full within 30 days of the receipt of the communication of the Director-General, or as of the first day of the calendar year to which they relate, whichever is the later,

Noting that the requests of the Director-General to Member Nations to remit all contributions and advances due were sent on 1 December 1988 and that payments were therefore due as from I January 1989,

Noting that by 7 November 1989 only 66.8 percent of the total 1989 assessment had been collected and that the cumulative total of 1989 contributions outstanding and of the prior years' arrears amounted to US$ 174.7 million, which represents 72.4 percent of 1989 assessed contributions,

Regretting that in spite of repeated reminders by the Director-General and appeals by the Council, the level of unpaid contributions and arrears has dramatically increased over the last four years,

Being seriously concerned that the amount of unpaid contributions and arrears due to the Organization is the highest ever experienced by the Organization at this time of the biennium,

Recognizing the principle of non-discrimination among Member Nations concerning arrears and unpaid contributions, but at the same time being aware that the impact on the Organization's finances of non-payment varies with the considerable differences of the rates of contribution ranging from the minimum to the maximum rates of assessment, so that non-payment by a few of the largest contributors is far more serious than in the case of several at the lower levels of contribution,

Recalling that the Director-General had been obliged to cut programmes and costs during 1987 and 1988 amounting to some US$ 45 million, and that during 1989 an additional US$ 23 million in unanticipated costs related to staff had had to be absorbed with additional damage to approved programmes, so reducing further the capacity of the Organization to respond to the requirements of Member Nations,

Noting that Council Resolution 2/80 authorizing the Director-General, in case of need, to borrow monies to the extent necessary had not so far been used:

1. Addresses a solemn request to all Member Nations with current contributions outstanding and contributions in arrears urgently to honour their commitments to both the Organization and the other Member Nations which have contributed in a timely way, so as to ensure implementation of the Programme of Work and Budget voted by the Conference;

2. Requests all Member Nations to provide information to the Organization early each year as to the amount and timing of expected payments;

3. Requests the Council and the Finance Committee to study in depth the subject of contributions outstanding and in arrears and to submit recommendations with a view to proposing possible courses of action and to assess requirements in terms of the legal and other instruments that would assist the Director-General in his mandatory responsibility to ensure the implementation of the approved Programme of Work and Budget in similar adverse financial conditions.

(Adopted 28 November 1989)

J. Measures to deal with problems of delayed payment of assessed contributions

305. The Conference recalled Resolution 18/87 adopted at the Twenty-third Session. In this resolution the Conference had decided that the interest element of any Cash Surplus would be allocated to Member Nations on a weighted basis, in accordance with the amount and the timing of payment of their contributions during the financial period.

306. The Conference recalled also that it had requested the Director-General to report to the Council, and then to the next Conference, on the adoption of measures, as from the 1990-91 biennium, to comply with the resolution.

307. The Conference noted that since there was no possibility of a Cash Surplus for the 1988-89 biennium, there would be no distribution of the interest income portion of surplus in the 1990-91 biennium and therefore there were no measures required for adoption at this time.

K. Level of support costs from UNDP and trust fund programmes

308. The Conference welcomed FAO's active role in cooperating with the UNDP expert team, and in inter-agency mechanisms, aimed at the development of new UNDP support cost "successor arrangements", to come into effect in 1992 at the beginning of UNDP's Fifth Country Programming Cycle. This matter was considered very important in view of FAO's extensive field programmes, including those financed from Trust Funds, for which support cost reimbursement arrangements might also be influenced by the new UNDP "successor arrangements".

309. The Conference noted that, according to the latest FAO statistics, the present established support cost reimbursement rate, at 13 percent, was insufficient to cover the real costs incurred by the Organization in supporting and servicing field projects, and thus there was a subsidy involved in costs incurred under the Organization's Regular Programme budget.

310. In underlining that the issues involved in determining the most appropriate UNDP support cost "successor arrangements" had important system-wide implications, the Conference welcomed the recent ACC decision (1989/29) calling attention to the timetable for the implementation of the "successor arrangements". This was important in view of the delay, until early December, in the preparation of the report and recommendations on this subject by the UNDP expert team.

311. It was noted that the ACC decision stressed in particular the need-for this timetable to allow for appropriate review of the implications of proposed new "successor arrangements" by the governing bodies of the executing agencies. The Conference thus urged that, as implied in the ACC decision, no premature decision by the UNDP Governing Council should be taken on the support cost "successor arrangements".

312. The Conference noted that a detailed and full review of UNDP support cost "successor arrangements" by FAO's governing bodies should be undertaken no later than the Ninety-eighth Session of the Council, in November 1990. It was emphasized that such a review should be preceded by a full discussion of the subject by the Programme and Finance Committees at their sessions in May and September 1990. A few Member Nations noted, however, that it was the intention of the UNDP Governing Council to decide upon such arrangements at its June 1990 Session in the context of preparation for the fifth programming cycle and considered it important to adhere to this timetable. It was pointed out that this schedule of decision-making might require consultation between the FAO Secretariat and Member Nations in the Programme and Finance Committees so as to ensure that the interests of the Organization should be adequately reflected in the decisions to be taken in the UNDP Governing Council.

L. Headquarters accommodation

313. The Conference was informed of progress made in the three scheduled phases of the building construction project.

314. Delay with respect to Phase I, the construction of the three-level parking building, was reported.

315. Progress on Phase II was ahead of schedule and the work schedule of Phase III was respected.

316. The Conference took note of the reports and expressed its appreciation to all parties concerned, as well as its hope that the authorities of the Host Government would find a solution to the specific problems of Phase I.

317. The Conference once more expressed its thanks to the Host Government for its generous contribution and its progressive actions to improve Headquarters accommodation.

M. Personnel matters

Statistics of personnel services
Allowance for the chairman of the appeals committee

318. The Conference noted the developments in conditions of service of the staff, which had been reviewed by the Council at its Ninety-sixth Session. With regard to the post adjustment level for Rome, the data showed that in May 1989 there had been a slight increase due to cost-of-living movements subsequent to the resumption of the normal operation of the post adjustment system. The Conference also noted that an increase in the salaries for the General Service category had been granted, in accordance with the current methodology which maintained General Service staff salaries in line with salaries paid by leading employers on the local market.

319. The Conference took note of the recent developments in the activities of the Consultative Committee on Administrative Questions (CCAQ), the International Civil Service Commission (ICSC) and the UN Joint Staff Pension Board, and in particular the information in respect to the comprehensive review of the conditions of service of the Professional and Higher categories, and the proposed measures to reduce the actuarial imbalance of the Pension Fund. It noted that if the recommendations of the ICSC on the comprehensive review were to be approved by the UN General Assembly with effect 1 January 1990, the estimated cost for the entire UN System would amount to US$ 90 million per annum, US$ 48 million of which would be charged to regular budgets, and that costs to FAO's Regular Programme would be approximately US$ 8 million for the coming biennium. The Conference further noted that the recommendations of both the ICSC and the Pension Board would be reviewed by the UN General Assembly at its current Forty-fourth Session, and that the decisions of the Assembly would be reported to the Finance Committee at its Spring session in 1990.

Statistics of personnel services

320. The Conference noted that the Council had reviewed in detail the statistics of Personnel Services which had been prepared for the first time using the automated personnel computer system, PERSYS (Personnel Management System), and that the accuracy of the data had been consequently increased. The Conference also noted the Council's request that efforts be continued for further improvements in future presentations of personnel statistics.

Allowance for the chairman of the appeals committee

321. The Conference noted the Council's approval of the Director-General's proposal to increase the allowance of the Chairman of the Appeals Committee from US$ 3 500 to US$ 5 000 per annum effective 1 January 1989.

N. Staff commissary support cost reimbursement

322. The Conference, having noted the recommendation of the Council with respect to the Staff Commissary support cost reimbursement, adopted the following Resolution:

Resolution 16/89



Having noted that for 1988, in accordance with Resolution 29/71, the Staff Commissary transferred an amount of Lit. 53 315 000, equivalent to US$ 39 500, to the Organization in payment for indirect services and facilities made available to it during the year,

Recognizing that the level of such reimbursement as established under Resolution 29/71 is not adequate to cover actual related costs incurred by the Organization,

Decides that with effect from 1 January 1988

1. all actual indirect services rendered, and facilities made available, by the Organization to the Staff Commissary shall be estimated and charged as expenses of the Commissary operation; and

2. the equivalent of 0.5 percent of the total sales and any net profits of the Commissary shall continue to be transferred to the Staff Welfare Fund as heretofore, for use in accordance with policies and procedures to be developed jointly by the Director-General and the Staff.

(Adopted 28 November 1989)

O. Treatment of profit and loss on exchange

323. The Conference reviewed the proposal of the Director-General regarding the treatment of profit and loss on exchange which had been endorsed by the Finance Committee at its Sixty-sixth Session and approved by the Council at its Ninety-sixth Session.

324. The Conference noted that such profit and loss on exchange resulting from purchases and from re-evaluation of holdings of non-US Dollar currencies were charged to Chapter 5 of the Budget. It also noted that in the last four years the Organization had suffered considerable losses on exchange due to the fall in value and instability of the US Dollar.

325. The Conference recalled its Resolution 13/81 authorizing the Director-General to use funds in the Special Reserve Account to finance unbudgeted extra costs due to movements of currency exchange rates. It therefore considered that the Director-General's proposal to transfer to the Special Reserve Account the profit and loss on exchange which had previously been charged to Chapter 5, was consistent with the thrust of Resolution 13/81.

326. The Conference recognized that such a measure would improve the protection and the conditions of implementation of the Programme of Work and Budget against uncertainties of exchange rates.

327. The Conference consequently adopted the following Resolution:

Resolution 17/89



Recalling its Resolution 13/81 on the Special Reserve Account,

Recognizing that the above-mentioned Resolution directs the Director-General to credit to the Special Reserve Account any savings on staff costs arising from favourable differences between the Lira exchange rate used in calculating the budget and the effective UN rate,

Further recognizing that the above-mentioned Resolution authorizes the Director-General to use the funds in the Special Reserve Account inter alia, to finance unbudgeted extra costs due to movements of currency exchange rates,

Noting that profits and losses on exchange, arising from the purchase of non-UN Dollar currencies and from the revaluation of such currencies as a result of changes in the UN operational rate of exchange, are charged to Chapter 5 of the Budget,

Recognizing that these profits or losses on exchange can reach substantial amounts can either jeopardize the implementation of the Programme of Work and Budget and/or need to be subjected to an improved budgetary and accounting process:

1. Decides to deal with profits/losses on exchange under the Special Reserve Account;

2. Directs the Director-General to credit such profits and debit such losses on exchange to the Special Reserve Account;

3. Decides that the measure shall be applied to the Regular Programme Accounts for 1988-89 and in future biennia.

(Adopted 28 November 1989)

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