(from "Chairman's Report of the Fifty-First Annual Meeting")
21.1 Review of provisional financial statement, 1998/99
Key points of the Secretariat's presentation dealt with income, which exceeded
the budget by £38,000, largely due to penalty interest charged on late
financial contributions and receipt of voluntary contributions; expenditure,
which was approximately £8,000 over budget; and extraordinary expenditure,
stemming from the Commission's decision last year to draw on reserves by up to
£50,000 to implement some elements of the Administrative review.
The actual expenditure was £31,000.
There were some developments that had occurred since the Secretariat had arrived in Grenada, including the recovery of arrears of £20,000, additional voluntary contributions of £5,000, and an absence of expenditure on the Whale Killing Methods Workshop, which three together resulted in extra income roughly equivalent to the original deficit. The General Fund therefore remained unchanged at approximately £987,000.
The Finance and Administration Committee recommended approval of the Provisional Financial Statement, subject to audit.
21.2 Consideration of estimated basic budgets, 1999/2000 and
2000/2001
The Secretariat presented the proposed budget, noting that it took into
account the Commission's strong overall financial position; the expressed wish
of a number of members that membership costs not increase; and discussions at
the 50th meeting reaffirming the target of maintaining reserves
at the level of approximately six months' costs and taking measures to promote
the reduction from the present high level to the target level.
The budget projected income similar to the current year's (after allowance for non-budgeted receipts, such as penalty interest on late contributions and voluntary contributions). It also assumed a similar level of activity for most expenditure items but with some significant expenditure variations. For example, the recruitment and selection of a new Secretary to the Commission could entail a one-time cost of £60,000. The inclusion in Secretariat costs of the new Assistant Editor post and a provision for staff training are budgeted at £20,000 and £10,000, respectively. A rent review for the Secretariat has the potential to raise costs with effect from June 2000 by up to 50%. The Secretariat's telephone system requires upgrading, probably in 1999-2000, at an estimated cost of £20,000. IWC resolution 1998-6 instructed the Secretariat, in drawing up the provisional budget for 1999-2000, to make provision for the expenditure of £100,000 from the Commission's reserves to fund selected proposals recommended by the Scientific Committee for environmental research.
Germany expressed its concern with the IWC's budgetary practices, saying the present distinction between realised and assessed contributions should not be maintained, and that the Commission's high level of reserves show overbudgeting. It considered both to be unsound budgetary practices. Denmark voiced concern regarding the swift reduction of the level of general reserves.
Concerning the proposal in the budget to increase the meeting attendance fee for NGOs from £490 to £500, the USA expressed its displeasure at the increase, questioning the extra value NGOs would receive for the extra money and asking what the objective of the increase is. The Secretary responded that the primary purpose served by the increase was to keep pace with inflation; he added that it also brings the NGO fee closer to that paid by IGOs (£800/person), in accordance with the Commission's decision.
21.2.1 Scientific programme
The Chairman of the Scientific Committee went through a list of research
projects and their associated costs.
The proposed expenditures fell into two categories: items associated with the
Scientific Committee's work over a number of years (regular expenditures); the
other items associated with the Scientific Committee's recently developed
Environmental Concerns programme (environmental expenditures).
The Chairman of the Finance and Administration Committee noted that the proposals under review were wide-ranging, and reminded delegates that the role of the Committee was to decide how much the Commission can afford, leaving to the Commission the debate over the endorsement of various proposals.
A long discussion lead to the consensus view that countries had no problems with the regular expenditures. A spirited debate ensued, however, about the proposed environmental expenditures.
The Chairman of the Finance and Administration Committee eventually summarised the discussion, saying that there appeared to be general agreement on the amount of the total budget and on the items in it other than research, including the proposed fees for observers and press, and the proposed level of the severance pay provision. On research, the Finance and Administration Committee agreed the Scientific Committee's recommendations on regular expenditure. The amount to be spent on environmental research programmes, and the timing of any expenditure, would be examined carefully by the Commission as part of its consideration of those programmes.
In the Commission, Japan commented on the huge amount designated for the environmental fund, which it thought was a misuse and outside the Convention. It gave notice that it was considering withdrawing the SOWER vessels for other purposes.
The Chairman of the Commission reminded the meeting that a resolution on the environmental fund had been adopted last year.
21.2.2 Assessment of contributions from Contracting Governments
The Finance and Administration Committee noted the estimate of financial
contributions provided by the Secretariat, recognising that the figures were
dependent upon budget decisions by the Commission and final delegation sizes.
They would be revised after the meeting.
Antigua and Barbuda asked that the Finance and Administration Committee give consideration to the idea of moving to the UN system of country assessments. Dominica agreed, asking for the establishment of a committee to investigate the possibility. St Lucia also agreed, pointing out that the IWC already follows the UN system so far as it concerns salaries and issues such as tax exemptions. If the IWC adopts one part of the UN system, it should adopt it comprehensively, averred Austria. Finally, St Vincent and The Grenadines pointed out that the assessments of some G-7 countries were lower than his own government's, and expressed the view that such a circumstance was clearly unfair.
Other countries, including the USA, Germany, New Zealand and the UK pointed out that the current system was entered into after long and difficult discussions, and said they would be reluctant to enter into any new discussions concerning the system of assessments. New Zealand further stated that the Commission would need much more information about the possible effects on the organisation of such a change, reminding delegates that the IWC was nearly insolvent a decade ago.
The Chairman of the Finance and Administration Committee concluded that views were split on the proposal by Dominica.
21.3 Action arising
In the Commission, Antigua and Barbuda introduced a proposal for the
reassessment of membership contributions.
The importance of the sea means that all states, and particularly developing
coastal countries dependent on fishery resources, should be allowed to
participate in international organisations such as the IWC.
The current membership does not include all countries which hunt whales, in
part because of the heavy financial burden of the present contribution system.
Its proposal was to re-examine the way in which contributions are assessed, and to consider adoption of a system more in line with that used by the UN and similar organisations. It offered a possible new system comprising a basic element of 10%, and 90% shared in accordance with the UN contribution rate.
Specifically, Antigua and Barbuda proposed that:
St Lucia supported this proposal, stating that the right to manage whales and whaling is not just for the privileged few, and this was an opportunity to open to the world community. St Vincent and The Grenadines observed the reduction in its contribution under this proposal.
New Zealand wished to examine the proposal and the implementation of a specific system, noting that there might be others. Chile agreed.
The USA was sympathetic to the needs of developing countries, and noted the long discussions which had taken place in earlier years, but regretted the proposal by Antigua and Barbuda, although the issues are worthy of further consideration. The Netherlands had similar reservations but would not stand in the way, and Germany agreed with both New Zealand and the USA.
Argentina wanted to consider the proposal and any written comments before the next meeting.
France noted the unusual characteristics of the IWC, which takes account of the size of delegations and uses one language only. It could not support the proposal. Denmark also commented on the use of delegation size, but would not block future discussion.
Monaco had sympathy with the proposal and thought it useful to consider and make a comparative analysis. Mexico concurred. Spain had some doubts about using the UN system, while the Republic of Korea also thought the current system has some equity problems. Switzerland believed the contributions could be a problem particularly for developing nations to join.
Norway and Oman were also willing to discuss the proposal further, while Dominica and Grenada spoke in support.
The Chairman of the Commission concluded that there was wide support for looking at the options and issues raised by the proposal from Antigua and Barbuda for a reassessment of membership contributions, and asked for written comments.
The budget as presented in Appendix 11 was also adopted, including the core funding for research agreed under Agenda Item 16.
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