RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/BFA/83 
6 February 2006 
 (06-0481) 
Committee on Budget, Finance and Administration  
  
 
 
REPORT OF THE MEETINGS HELD ON 17 OCTOBER, 31 OCTOBER, 8 NOVEMBER, 16 
NOVEMBER, 18 NOVEMBER  AND 21 NOVEMBER 2005 
  
1. The WTO Committee on Budget, Finance and Admi nistration met on 17 October, 31 October, 
8 November, 16 November, 18 November and 21 November 2005 under the chairmanship of 
Mr Jan-Meinte Postma from the Netherlands.  The terms of reference and composition of the Committee are set out in document WT/L/44/Rev.1.  The agenda contained in document WTO/AIR/2691 was adopted. 
2. This report is to be read in conjunction with document WT/BFA/82 which contains the 
recommendations of the CBFA. 
A. 
ADDRESS BY THE DIRECTOR GENERAL  
1. The Director General addressed the Budget Comm ittee at the time of the budget process and 
pointed out his desire to invest in the budget process from the very beginning as it had important implications for the WTO in the years to come.  He explained that he had taken a prudent and 
conservative approach for the budget 2006-2007, fo cussing on two important initiatives:  (i) the 
Human Resources Reform Plan with the objectiv e to increase staff mob ility and ensure that 
managers have the skills to create and maintain th e best and most efficient work environment; and 
(ii) the Restructuring Plan, a management tool to  improve the WTO's ability to respond to changing 
conditions and demands.  The Director General also  expressed his wish to reserve the possibility of 
using the process of revision to the second year of the biennium in order to take account of the 
developments emerging from the Doha Round. 
B. 
DIRECTOR GENERAL 'S BUDGET PROPOSALS FOR THE BIENNIUM 2006-2007 
2. A member of the Secretariat introduced the Budget Estimates for the biennium 2006-2007, 
document WT/BFA/SPEC/134.  He informed the Committee that it was the second time that the 
Director-General presented a biennial budget proposal , consisting of two annual  financial periods, in 
accordance with the guidelines for biennial bu dgeting (WT/BFA/W/105/Rev.1).  The primary 
concerns of the budget proposals were:  (i) to  correct past staffing problems which were 
acknowledged in the Committee last year (that is  the consolidation of Temporary Assistance 
positions which have been examined in an extern al consultant's report), (ii) to invest in 
improvements which would bear fruit in the medium to long-term (HR Reform, Restructuring Plan), 
(iii)  to authorize the transfer of allocation fro m Temporary Assistance to regular budget for 7 posts 
of revisers in order to expand the very cost-effectiv e translation outsourcing, and (iv) to create three 
new posts for 2006 and two new posts for 2007. 
3. The 2006 budget estimates showed an overall increase of 5.46% over the 2005 budget.  A 
member of the Secretariat explained that 60% of this increase was attributable to the increase for the 
International Trade Centre, the Dispute Settlement Panels, the Restructuring Plan, the HR Reform, 
the Training and Media Facility and Statutory Increases.  The 2007 budget proposal showed an WT/BFA/83 
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  overall increase of 3.54% over the proposed 2006 ap propriations, which took into consideration the 
initiatives planned for 2006 (HR Reform, Restructur ing Plan) and two new posts (internal auditor 
and support position) which have been suggested fo r a number of years by the external auditor in 
order to provide a level of oversi ght more consistent with that in  other international organisations. 
4. Several Members welcomed the proposal of th e Director General and considered that, in 
general, it was not an unreasonable point at whic h to begin discussions  Some Members nevertheless 
indicated that they had difficulties w ith the overall increases in the budget. 
2. HR Reform and Restructuring Plan 
5. A member of the Secretariat presented the brochures "HR Reform" and "Career Development 
Programme" providing information about the WT O's learning policy and guidelines as well as 
document WT/BFA/W/137 concerning the Secretariat's proposal for an early separation programme 
in the WTO (Restructuring Plan).  The Secretariat i ndicated that the Restructuring Plan would not be 
considered as a fund for a "golden handshake" but as a resource to support necessary organisational 
changes during the biennium.  At the request of several Members, the Secretariat included the long-
term saving aspect in the objectives of the restructuring plan and clarified that it would be time-
limited in nature  Several Members asked to be kept informed of implementation of the plan.. 
6. Several Members expressed concern regarding the speed of increase for the HR Reform 
compared to 2005 and requested a concise descri ption of the programme, as well as regular 
reporting on the implementation. 
3. Consolidation of Temporary Assistance Positions 
7. Another member of the Secretariat introduced document CRP (05)29/Rev. 1 and explained 
that the consolidation of 14.5 positions into the regular budget should be viewed as a step in the 
direction of returning to the practice whereb y temporary assistance funds were used only for 
temporary peaks in workload and occasional work s ituations, rather than as a response to long-term 
staffing needs.  At the same time, it was consider ed that the current situation was not in the best 
interests of the organization, in terms of manageme nt and transparency, nor in the interest of the 
staff who become "second class" employees. At a request from Members, documents CRP (05)32, 
providing a simplified example of the budgetary  effects of consolidating positions, and 
WT/BFA/W/136, including a summary of the external  consultant's report with  regard to temporary 
assistance, were distributed. 
8. The Secretariat also presented document CRP (05)33, providing details  on the consolidation 
of short-term contracts under trust funds into L- posts contracts whose renewal would be strictly 
subject to the availability of funds.  The Secr etariat pointed out that as these positions would 
continue to be financed through trust funds, and th at there would be no implication for the regular 
budget of the WTO.  
4. New Posts 
9. A member of the Secretariat presented document CRP(05)26 proposing the creation of three 
posts for 2006 (Finance Officer, HR Specialist in Classification and Recruitment and Legal Officer) 
and two for 2007 (Internal Auditor and Support Staff). 
5. IT Budget 2006-2007 
10. The Secretariat presented document CRP(05)30 pr oviding details about the projects included 
in the budget 2006-2007.  Members considered that the proposal was high and that it would be  WT/BFA/83 
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  difficult for them to consider sympathetically an increase of 18 per cent for 2006.  Through further 
prioritisation and re-scheduling, the overall increa se included in the recommendation to the General 
Council was reduced to 8.7 per cent. 
6. Training and Media Facility 
11. Document CRP(05)31 providing information about  the benefits of a training and media 
facility was presented by the Secretariat.  At a re quest by Members, the Secretariat prepared and 
distributed document CRP(05)34 analyzing possible reductions of expenses.  The Directors of the 
Information and Media Relations Division and the Institute for Technical Cooperation and Training 
elaborated on the implications of the proposal  for the work of their respective divisions. 
7. Overall Budget Proposal Biennium 2006 - 2007 
12. Following the discussions, the Secretariat pr epared revised 2006-2007 Budget Estimates 
(documents CRP(05)35 and CRP(05)36) showing an  overall increase of 3.87 per cent for 2006 and 
3.16 per cent for 2007 with reductions mainly in the Restructuring Plan, the Human Resources Reform and IT.  The Secretariat also drew the atte ntion of the Members to the fact that due to the 
planned organizational changes and a very prudent budget for 2007, a revision might be necessary.  
Some Members emphasized that in order to render the biennial budgeting meaningful any possible 
revision has to be limited to necessary cha nges resulting from unavoidable and unexpected 
developments, taking advantage of opportunities created through efficiency savings.  Financial 
resources that are expected to be needed to bridge a liquidity gap due to organizational 
changes should be fully covered by the biennial budget 2006/2007.  
13. Several Members were prepared to accept the re vised proposal, but some Members asked for 
further reductions.  The Chairman subsequently  submitted a second revised proposal (document 
CRP (05)35.Rev 1) limiting the overall increase for 2006 to 3.73 per cent and 3.06 per cent for 2007. 
14. Members accepted the second revised 2006-20 07 budget proposal.  Generally, Members 
considered the budget proposal as a prudent re quest and welcomed the included projects. 
15. Finally, the Secretariat highlighted the fact that the biennial budget for 2006-2007 only 
included the funding for one
 Ministerial Conference, and if it were decided to hold another 
Ministerial Conference, the Secretariat would be obliged to bring the question of the financial 
implications to the Committee. 
16. See recommendation V, paragraphs 8-10 of document WT/BFA/82. 
C. ITC BUDGET PROPOSALS FOR THE BIENNIUM 2006-2007 
17. The Executive Director of the ITC presented documents ITC/BUD/52 and ITC/BUD/53.  The 
Members were informed that th e actual increase of the biennial ITC budget 2006-2007 compared to 
2004-2005 including security enhancements amounted  to 3.4%.  The main increase was due to 
statutory and unavoidable costs for posts, 3 ne w posts which are offset by reductions in 
administrative costsand an increase in costs for jo int services paid to UN Geneva (UNOG).  It was 
further explained that the three additional posts  concerned one P-5 post of programme officer 
dedicated principally to MDG issues and gender ma instreaming,, one P-4 post of senior officer for 
the ITC's expanding programme in export strategy  design and management , and one P-3 post of 
trade promotion officer for the Office for Ar ab States, Europe and the Commonwealth of 
Independent States (OASEC). WT/BFA/83 
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  18. The Committee took note of the proposal and included the requested amounts in the WTO 
budgets for 2006 and 2007 under the point relating to WTO's contribution to the budget of the ITC. 
19. See recommendation IV, paragraphs 6-7 of document WT/BFA/82. 
2. Performance against Budget as at 30 September 2005 
20. The Director of Program Support of the ITC presented document ITC/BUD/51. The 
Committee was informed that the projected expend iture of the ITC for 2005 was estimated at some 
98 per cent.  The projected savings comprises mainly decreased requirements for a) posts – due to vacant posts being filled by short term staff at lo wer costs pending the filling of the post b) savings 
under contractual services due to higher costs bei ng charged to extra budgetary resources c) lower 
than budgeted costs for the Joint Advisory Group meeting d) savings under joint services due to the 
delay in recruitment of security guards by UNOG partially offset by higher charges from UNOG.  
These decreases are offset by increased  requirements for a) permanent equipment – due to purchase 
of a disaster recovery storage area network and b) training – due to increased activities stemming from audit recommendations in this area.  
21. The Committee took note of the report. 
D. 
WTO MEMBERS IN ARREARS  
22. See document WT/BFA/82, paragraph 3 - 5. 
E. DOHA DEVELOPMENT AGENDA GLOBAL TRUST FUND : SETTING TARGET AMOUNT FOR 2006 
23. A member of the Secretariat presented documents WT/BFA/W/138 and CRP(05)25.  
Members were informed that th e estimated cost of the techni cal assistance activities requiring 
financing from the Doha Develo pment Agenda Global Trust Fund amounted to 24 million Swiss 
francs in 2006. It was explained that Regional Tr ade Policy Courses represented some 42 per cent of 
the total expenses financed trough the Global Tr ust Fund, which could be seen as the clearest 
indication of the efforts made by the Secretariat to  reinforce the activities that had the most impact 
for beneficiaries.   
24. Finally, the attention of the Members was drawn to  the fact that the Secretariat had been very 
careful to make sure that the continuous re-engin eering of the TA and Training Plan was designed to 
enhance the Plan's effectiveness and efficiency in 20 06, while maintaining costs at the same level as 
for the previous three years. 
25. See Recommendation I, paragraph 1 of document WT/BFA/82. 
F. ACCESSION OF SAUDI ARABIA  
26. See Recommendation II, paragraph 2 of document WT/BFA/82. 
 
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