RESTRICTED  
  
WT/BFA/163  
 
14 June 2017 
(17-3118) Page 1/4 
Committee on Budget, Finance and Administration    
 
  
 
REPORT OF THE MEETIN G HELD ON 18 MAY  2017  
The Committee on Budget, Finance and Administration (CBFA) met on 18 May  2017 under the 
Chairmanship of Ambassador  Peter BRŇO  (Slovak Rep ublic). The Terms of Reference and 
composition of the Committee are set out  in document WT/L/44/REV.1.  The Agenda is contained in 
document WTO/AIR/BFA/ 17. Before the agenda was formally adopted, the Committee agreed to 
the Secretariat's request for the deferment of agenda item F.  
 
The following item was included under "Any Other Business": Least Developed C ountries ' Trust 
Fund for Participation in Ministerial Conferences.  
1  2017 SALARY SURVEY  – WT/BFA/W/413/REV.1  
1.1.  An Official of the  Secretariat introduced the document to the Committee . He mentioned that 
the Secretariat had made some amendments to the previous document in accordance with  
comments made by Members during earlier discussions . He also mentioned that the Appendix 3 , 
which  shows the existing three frozen salary scales  and the 2017 salary scale , was added to the 
report.   
1.2.  The Official then informed the Committee about the outcome of the 2017 salary survey  
ensuing in a slight increase in the salary scale (0.47%). The Official stated that the calculation 
resulted from the comparison of two comparators, the United Nations Office in Geneva and specific 
Coordinated Organizations. The United N ations Geneva salary scale for local staff increased by 
1.8% and that for professional staff remained unchanged . The Coordinated Organizations had a 
consolidated 1.6% increase in the ir salaries . He concluded by informing the Committee that the 
proposal to introduce a 1% threshold before , which salary  scales could be changed had been taken 
off the table.    
1.3.  A Member thanked the Secretariat for the revised document  and its clarity. He requested tha t 
the salary scales should be included in future documentation on the salary survey in order to 
enhance the quality of the information. He pointed out that the annual value of the frozen salary 
scales approximated CHF 3.5 million per year  and that this sub ject was correlated to the subject of 
dependency allowances . He then concluded by saying this is a element in the political appreciation 
of the issue.  
1.4.  The Committee took note of the report.  
2  ADJUSTMENT OF THE WT O DEPENDENCY ALLOWAN CES – WT/BFA/W/4 16 
2.1.  The Cha ir tabled the subject and stated that he recognized that some Members were not yet 
at a stage where they could express a decision pertaining to the proposed recommendations and 
the overall contents of the paper.  He then opened the floor for comments and q uestions. A 
Member thanked the Secretariat for the amended version of the paper and for the opportunity 
provided to ask further questions to get a better  understanding of this complex issue  with legal, 
ethical, political and financial aspects. Her capital was still considering how best to proceed , but 
she would like to make some preliminary comments.  
2.2.  She reiterated the view that the methodology for adjusting the  dependency allowances, 
adopted by the General Council in 2004 ought to be simplified. She noted  that the Members  of the WT/BFA/163  
 
- 2 - 
 
  Committee were in agreement regarding this and requested that the next version of the paper 
should reflect this. She continued by saying that it was regrettable that the results of the 
calculation of the adjustments of the dependen cy allowances from 2011 and onwards  were not 
brought to the attention of the Members  before in 2017 .  
2.3.  She then stated that her delegation's point of departure is the role of the WTO as a 
responsible employer and the role of the secretariat in loyally follo wing up decisions and guidelines 
from the General Council. As a matter of principle, her delegation 's preferred  option would 
probably be  that members of staff  receive retroactive payment for the adjustment s of prior years. 
She pointed out that the opinions  of the members of staff are an important consideration. Her 
delegation was therefore carefully reviewing paragraphs 8 and 9 in the paper. They had learnt, 
with surprise, that no formal response was provided to the Staff Council, even though the Staff 
Council regularly made inquiries from 2012 to 2017. She said that lack of formal response to the 
Staff Council regarding any issue should, of course, not be repeated.  
2.4.  With reference to paragraph 14, the Member  suggested that a clear er distinction be made 
between the chapeau and the actual action that the General Council is recommended  to take. 
Regarding the years prior to 2016 , indications were  that her  delegation would rather take note 
than explicitly approve the lack of adjustment s of the dependency allowanc es. She said that they 
were not convinced that the word "only" should be included at the end of the paragraph 14 as this 
seem ed to indicate that the General Council is aware that not approving adjustment s for earlier 
year than 2016 and 2017  could be questi oned.  
2.5.  The next Member to take the floor noted that the  issue is a difficult one and that some 
additional time and modifications to the document would be necessary before a consensus could 
be reached on a proposal to be made to the G eneral Council . He said that his delegation is  
generally sympathetic to the Secretariat's objective to address this matter . He summed up his 
understanding of that the contributing factors included the following:  i) the G eneral Council  had 
approved a salary freeze , instead of a salary reduction , that would have re sulted from the s alary 
survey that was conducted  in 2012 ( around the same time as the adjustments to the dependency 
allowances should have been provisionally applied ). He stated that from his delegations 
perspective, it would be advisable to include as much information in the background section of the 
document as both possible and prudent. In addition he noted that paragraph 14 required 
improvements and indicated that his delegation was available to contribute to this . 
2.6.  A Member thanked the Secretariat for its  transparency and integrity. She observed that the 
Members and the Secretariat share the same budgetary and administrative goals  and 
responsibilities of the WTO. Considering this, she stated that her delegation preferred  that the 
General Council  be asked to approv e of the fact that no adjustments were nor would be made for 
the period 2011 -2015, instead of just taking note of this. She emphasized that "taking note" was 
akin to  leaving all the responsibility of the past fai lure to the WTO Secretariat. She stated that an 
express approval would be  more legally and morally relevant way for Member s to act  and that this 
is the most secure way to mitigate the risk to the Organization .  
2.7.  Another  Member advocated for clarity regardin g the phrase "less likely" as used in the 
context of the likelihood of legal challenges. Turning to the review of the methodology, he stated 
that a timeline for this has to be included in the paper. Referring to paragraph 13  he welcomed the 
fact that the S ecretariat would, henceforth,  provide an annual report to the Committee on whether 
or not dependency allowances had to be adjusted . He opined whether help could be sought from 
internal or external auditors so as to pre -empt other issues of this type being overlooked . He 
expressed  concern that the facts presented on this subject  keep changing. He said that this made 
it difficult for delegations to form a position.  
2.8.  The next Member requested that the following points related to this issue be included in the 
paper: the salary freeze that was in place during th e concerned  period ; some reference to the fact 
that the situation was not brought to the attention of the CBFA or the GC ; and  stronger language 
regarding the review of the methodology . She stated that give n that this situation was of 
importance to the  WTO as a whole , then in making a decision, the Members  need to be conscious 
that at the end of the day it is political solution that will be required. She expressed the view  that 
is the  responsibility of the C BFA, together with the Secretariat , to find this political solution.  WT/BFA/163  
 
- 3 - 
 
  2.9.  A delegate informed the Committee that i f delegations were to consider a retroactive 
application of the methodology for the  years 2011 to 2015,  his delegation would insist on looking 
at staff remuneration in its entirety . He stated that o bviously this would mean to put the salary 
freeze into question and to apply  the negative adjustment rate to staff salaries  retroactively . He 
closed by saying that he doubted if  Members wanted to reach su ch a stage. He noted  that his 
delegation supported  the idea of introducing mechanism s involving the external auditor  or the 
Office of Internal Oversight , to prevent a repetition of this kind of functional failure.  
2.10.   A Member stated that her delegation was o f the view the inclusion of the word "only" is of 
concern because it implies that the Members  are not taking any decision with regard s to 2011 -
2015. She said this would leave the Organization exposed to any possible future action.  Adding to 
enhancements th at should be made to the text relating to the review of the methodology, a 
Member suggested  that the practices of comparable  organizations  could be assess ed to aid the 
process . 
2.11.   Another  Member stated that the implications of this issue would cover the longe r term . He 
expressed the opinion that  the environment of zero nominal growth and the economic uncertainty 
and austerity in many countries forming the Membership should be taken into account  since these 
have a longer term implications . 
2.12.   on taking the floor, the next delegate called for clarity in the next version of the document 
to make it more intelligible.  A Member cited that error s in the document where important elements 
had been fairly and broadly su bstantiat ed. He stated that  though certainly some eleme nts would 
benefit from further elaboration, his delegation  would also welcome, if possible, a conclusion of 
this item at the next meeting of this Committee.  
2.13.   In closing, the Chairman highlighted  three key elements that had emerged from the 
discussions: the need for the Secretariat  to improve the document and provide information that is 
still missing since some delegates want ed to have more clarity in the text ; more precise text 
regarding the review of the methodology for dependency allowances, including a  time-frame ; and  
a redrafted text on the recommendations to be made to the General Council , which will hopefully 
make it possible  for Members of the Committee to agree on at the next formal meeting.  
2.14.   The Committee took note of the report.  
3  UPDATE REGARDING TH E WORKING GROUP ON THE ASHI FUND  
3.1.  The Chairwoman of the Working Group on the ASHI Fund updated the Committee on its 
ongoing work. Since its establishment, the Working Group met three times : on 30 March, 26 April 
and 15 May. The Chairwoman indicated that t he Working Group has made progress in identifying  
the key issues to be addressed in its work, as well as the relevant information that would be 
required to facilitate deliberations. During the session on 15 May, the Working Group  had 
examined the different m odels of Funds already in existence in the WTO as well as those from a 
few International Organisations such as the ITU and WIPO.  
3.2.  The Chairwoman  then added that the German D elegation ha d submitted a non -paper with 
ideas on a possible structure for the Fund . She said that the  Working Group would  continue its 
effort  in developing a  structure for the ASHI Fund, bearing in mind the aim of arriving at an 
agreement on  a recomme ndation to make to the CBFA before the S ummer break. Subsequently, 
the Chairwoman informed t he Committee that the next two Working Group meetings were 
scheduled for 29 May and 9 June , respectively .  
3.3.  The Committee took note of the report . WT/BFA/163  
 
- 4 - 
 
  4  2017 BUDGET AND FINA NCE REPORT  – QUARTER 1  
4.1.  An Official from the Secretariat started her presentation by s tating  the situation regarding 
contributions received from Members' and Observers' during  the first quarter of 2017. Receipts of 
contributions and the cash position were slightly lower  than the level as at March 201 6. With 
respect to Members' contributions , 50% of the overall assessment had been received. Regarding 
Observers, 32% of assessed contributions  had been received. As of 31  March 201 7, 58 Members 
and 6 Observers had no outstanding balance s.  
4.2.  The budget for 201 7 was on track , with an overall expendi ture rate of 31% or CHF 61 million. 
The Official  underlined that the major contracts for the year had been committed. With respect to 
negative interest, she informed the Committee that the situation had become critical , considering 
that negotiated limits were being renegotiated by the banks .  
4.3.  One Member inquired whether the Secretariat was taking any actions with regard  to Members 
under Administrative Measures. On  that issue, the Chairperson indicated  that the Director General 
continue d to inform the Member s under  Administrative Measures by sending a formal letter, 
annually. The Official from the Secretariat stated that reminder letters to all Members with arrears 
of contributions were sent on a quarterly basis . In addition, the concerned Members were regula rly 
contacted through  mail or by  phone . In some specific cases, the Secretariat arrange d meetings 
with the Representatives of the mission or the Capital to review the situation.  
4.4.  With respect to negative interest charged by  Swiss banks, a Member appreciated  that the 
Secretariat informed the Committee about the current critical situation. He wondered whether the 
Secretariat had taken additional steps and thought of other options if the situation  became worse.  
4.5.  The Committee took note of the report.  
5  2017 EXTRA -BUDGETARY FUNDS REPO RT – QUARTER 1  
5.1.  A member of the Secretariat presented the financial situation o f Trust Funds, especially 
focussing on the Doha Development Agenda Global Trust Fund (DDAGTF). He stated that the 
DDAGTF  had an opening balance of  CHF 16 mil lion at the beginning of 2017 . He then stated that 
contributions , totalling CHF 0.7 million had been received from Austria, Estonia,  Lithuania and the 
Netherlands  during the first quarter . There were also pledges from France and Lichtenstein.  
CHF 4.3 milli on expenditures and commitments were recorded at the same period . With regard to 
activity level, in comparison with the same period in 201 6, the overall implementation rates were 
slightly lower .  
5.2.  The member of the Secretariat informed the Committee that th e STDF fund had received 
significant contributions from Canada, the Netherlands and the United States of America. 
Nevertheless , he emphasized  that more funds would be necessary to continue approving and 
contracting new projects.  He concluded that other Trust Funds are in a stable position.  
5.3.  The Committee took note of the report.  
6  ANY OTHER BUSINESS  
6.1.  The Chairperson urged the Members  to contribute to the Trust Fund that finances the 
participation of Least Developed Countries  in Ministerial Conferences . He under lined that as MC11 
draws closer, Members' support to finance the Trust Fund to finance the participation of eligible 
LDC Delegations at the 11th Ministerial Conference was urgently needed. The estimated overall 
cost approximates CHF 840,000. He indicated t hat s o far pledges have been received from five 
Members  and that n o contribution ha d been received as yet. The Chairperson concluded by 
drawing Members attention to the fact that time was becoming more critical given that air ticket 
prices continue to incr ease as the date  of the Conference approaches.  
6.2.  The Chairperson mentioned that the next meeting will take place on 22nd June.  
6.3.  The meeting was then closed. 
__________