RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/BFA/103 
30 June 2008 
 (08-3117) 
Committee on Budget, Finance and Administration  
 
 
 
REPORT OF THE MEETING HELD ON 27 MAY 2008 
  
1. The WTO Committee on Budget, Finance and Ad ministration met on 27 May 2008 under the 
chairmanship of Mr. Tony Lynch of New Zealand.  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/3192/Rev.1 including two items under 'Other Business' was adopted.  
I. ADMINISTRATIVE UP-DATES AND PROG RESS REPORTS AS AT 30 APRIL 2008 
A. C
ASH SITUATION AND STATEMENT OF OUTSTANDING CONTRIBUTIONS – PROGRESS REPORT  
B. CONTRIBUTIONS OF OBSERVER COUNTRIES TOWARDS THE COST OF SERVICES PROVIDED BY 
THE SECRETARIAT – PROGRESS REPORT  
2. A member of the Secretariat presented the cash  situation, the statement of outstanding 
contributions from Members as at 30 April 2008 a nd a statement regarding the contributions of 
Observer countries towards the cost of services provide d by the Secretariat.  As at the reporting date, 
the total of funds available (WTO and Extr a-budgetary Funds) stood at CHF 114 million.  
Contributions received from Members amounted to CHF 123 million for the current year and 
CHF 0.7 million for prior years, while those fro m Observers amounted to CHF 316,000 for the current 
year and CHF 80,000 for prior years.  The Working Capital Fund stood at CHF 9.7 million as at 30 April 2008.  The Secretariat pointed out that si x Members (Chad, the Democratic Republic of the 
Congo, Djibouti, Guinea-Bissau, Niger and Tonga) still had outstanding advances to the Working 
Capital Fund amounting to CHF 212,000 as at 30 April 2008.  Five of the six Members belong to 
Category IV (Inactive Members).  One Member, Guin ea, has liquidated its arrears to the Working 
Capital Fund in April 2008. 
C. H
UMAN RESOURCES MATTERS  
3. A member of the Secretariat presented the progress report CRP(08)08 and informed the 
Members that the new WTO learning strategy had been reviewed by the Joint Advisory Committee 
and submitted to the DG for approval.  In the meantim e, DDGs and Directors had been informed  of 
the main items for the biennium, i.e.(i) the enha ncement of the performance of the Secretariat by 
emphasizing the role of supervisors in the an nual performance management cycle and (ii) the 
evaluation of training and development activiti es by demonstrating how learning was making a 
difference to staff performance.  It was added th at the learning programme would mirror the WTO's 
Competency Framework and consequently address training in the areas of Management/Leadership, 
Technical Skills and Core Personal Skills.  Priority tr aining needs would also have to be identified by 
the directors at organizational, divisional and individual level. 
4. Members were also informed that the WTO salary scale had been adjusted following the 
result of the 2008 salary survey with the two compar ators, the UN and the C oordinated Organizations, 
weighted at 70 and 30 per cent r espectively.  The survey resulted in  a grade-weighted difference of 
1.5 per cent between the WTO and the comparator s. However, the payroll-weighted average 
difference between the WTO and the comparators was calculated at only 1.3 per cent.  Consequently, WT/BFA/103 
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  according to the methodology stating that the estimat ed impact of the payroll must not exceed the 
pay-roll weighted difference, the scale adjustment in  terms of estimated increase to the payroll was 
limited to 1.3 per cent. 
5. Finally, with respect to e-recruitment, Members were informed that the Secretariat was in the 
final testing phase and that it was envisaged that the e-recruitment would be live before the end of the 
year. 
D. WTO
 PENSION PLAN 
6. A progress report (document CRP(08)09) was presented by a member of the Secretariat who 
informed the Members that the three-year term of office of the Management Board had expired on 
26 May 2008 and that the Members and Alternates for the new term of office had been elected by the 
General Council on 7 May 2008.  The appointment  of members and alternates representing the 
participants as well as the designation of an ob server and alternate representing the beneficiaries 
would follow shortly. 
7. With respect to the investment strategy, it w as indicated that a new manager for one segment 
of the global equity portion of the portfolio had been selected. 
8. It was further reported that the Management Bo ard had been apprised of the discussion in the 
CBFA concerning the proposed amendment to Article 9 of the Plan Regulations and that it had been 
agreed that the Chairman write to the Director-General asking for a costing of the implications of his 
restructuring proposals for the Plan  and offering the services of the Pl an's consulting actuary for that 
purpose. 
E. STATUS OF EXTRA -BUDGETARY ACTIVITIES : 
i) Technical Assistance Activity as at 30 April 2008; 
ii) Doha Development Agenda Global Trust Fund (DDAGTF). 
9. Another member of the Secretariat presented documents (08)10 and CRP(08)11 and informed 
the Committee that as at 30 April 2008, funds available in the DDAGTF amounted to 
CHF 13.8 million.  Taking into account pledges tota lling CHF 3.7 million, it was pointed out that the 
fund was CHF 6.5 million short of the target amount of CHF 24 million agreed for the year 2008.  It 
was further explained that, although the end-of-June threshold, i.e. 100 per cent of the target amount 
to be in the bank, would most probably be missed, the Secretariat hoped that the target would be met 
later in the year and that the 25 per cent reserve re quired towards the following year's Plan would also 
be built. 
10. It was further highlighted that, at the end of  April, the DDAGTF had registered a total of 
expenses and commitments of CHF 11.9 million, thereby leaving a positive balance of 
CHF 1.9 million for the fund as at 30 April.  Anothe r member of the Secretariat pointed out that the 
Director-General was concerned about the position of  the GTF and that he hoped that Members would 
make every effort to meet the target of the plan. 
11. Two Members, Korea and Spain, announced pledges of USD 350,000 and EUR 350,000, 
respectively, to be made in th e following weeks to the DDAGTF. 
12. The Committee took note of the various reports.  WT/BFA/103 
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  II. REPORT ON THE FUTURE BUILDING NEEDS OF THE WTO 
13. A member of the Secretariat explained that th e plans for the occupancy of the building in 
Chemin des Mines (CDM), as well as the plan for the re-deployment of staff into CDM had been 
finalized. He indicated  that the Secretariat was on target to complete the move from Rue Rothschild, 
(RR) and the other moves necessary from CWR, to CDM by the end of 2008 in order to begin the 
renovation of the CWR at the beginning of 2009.  Howe ver, it was highlighted that all this depended 
on the finalization of the MOU/agreement with th e Swiss authorities and further on the approval of 
the CBFA and the General Council.  He hoped that th e CBFA would be  in a position to support the 
MOU. 
III. MEMORANDUM OF UNDERSTANDING WITH SWITZERLAND 
14. A member of the Secretariat presented document WT/BFA/W/170 and recalled that the 
Memorandum of Understanding (MOU) /agreement - was the result of intensive discussions between 
the Swiss authorities and the Secretariat.  He explai ned that the agreement spelt out in certain detail 
the renovation, the intra-mural extension, the extra- mural extension, transitio nal measures such as the 
rental of office premises, parking space, the densification of the conference room and others.  He 
added that the agreement had been negotiated in go od faith, that Members' concerns had been taken 
into account to the extent possible and that the S ecretariat was most appreciative of the cooperative 
spirit shown by the host country. 
15. The Swiss ambassador highlighted the political will of the host country that the WTO could 
have its building on a single site. The Federal C ouncil had already given its approval to the principle 
of a single site.  He added that the negotiations ha d been intense and fruitful and that the agreement 
would now be submitted to the Fede ral Council for approval at the same  time it was considered in the 
CBFA.  He reported that it would then be sent to the 'Chambres Fédérales' where actual funds would 
be allocated. It would be necessary to go to the Cham bers at three different times,  i.e. (i) for the 
renovation, (ii) for the intra-mural renovation and (iii ) for the extra-mural renovation.  In conclusion, 
the Swiss Ambassador confirmed that Switzer land would deal with all issues regarding 
implementation of the agreement in a spirit of cooperation. 
16. Members expressed their general support of the agreement, but several Members underlined 
that the project should be considered as a singl e undertaking with a financial flexibility across the 
various elements of the project and also th at the upper expenditure limit for Members was 
60 million Swiss Francs.  Other Members expressed thei r concern with respect to parking and stressed 
that, given the fact that the Organization was grow ing, it would be essential to have enough parking 
places for Members. 
17. In reply, the Secretariat expressed its understandi ng for the Members' concerns and stated that 
it would work closely with the Swiss authoriti es in order to find an adequate solution. 
18. The Committee decided to make the follo wing recommendation to the General Council:  The 
Committee recommends to the General Council that the Director-General be authorized to sign 
the Agreement between the Swiss Confederation  and the World Trade Organization on the 
long-term housing needs of the WTO, as containe d in document WT/BFA/W/170,  it being noted 
that the French version is the authentic text.   
IV. RENOVATION AND RELOCATION COST ESTIMATES 
19. A member of the Secretariat addressed the Comm ittee with respect to new estimates regarding 
relocation and renovation costs (document WT/BFA /W/171) and explained that, when the budget 
2008 had been prepared, precise figures on several it ems had not been available and could therefore WT/BFA/103 
Page 4  
 
  not be foreseen in the budget proposal.  However, the member of the Secretariat pointed out that 
additional expenses in 2008 would be absorbed by savings in ot her areas.  With respect to 2009, 
additional costs for moving and IT had to be fo reseen, as well as rental costs for additional floor 
space. 
20. Several Members expressed the wish that additiona l costs in 2009 should al so be absorbed by 
savings on other items. Some other Members were su rprised about the rental of additional space in 
2009 in CDM and requested more information on that issue. 
21. In response, the member of the Secretariat confirmed that it was the WTO's standard 
operating procedure to try to absorb extra costs by savings and that the Secretariat hoped to continue 
to do so.  With respect to the additional space needs in 2009, it  was explained that the space was 
mainly required for staff working on the STDF and IF and for some temporary translators. 
V. SECRETARIAT VERSION.3 
22. A member of the Secretariat in formed the Committee that the Director-General had revised 
his Secretariat Version.3 proposals in the light of comments received from the Joint Advisory 
Committee (JAC).  The JAC had recommended that th e Director-General pursue some proposals such 
as the new PER form and a new system for the perf ormance evaluation of supervisors, an expanded 
programme for staff training, the adoption of activity-based budgeting, the new competency framework and the opening up of Grade 11 for a rest ricted number of non-Director posts.  However, 
the JAC was not in favour of proposals such as the introduction of a new grade scale, the use of 
minimum time-in-grade requirements and mobility cr iteria for promotions, the replacement of the 
APB by an advisory committee and linking bonuses to salary levels.  It was further added that the 
Director-General was giving consideration to these recommendations and would complete his final 
review by the end of June. 
23. With respect to the restructuring plan, Members were informed that the Director-General was 
in a process of finalizing the decisions on restruct uring and indicated that the proposal would include 
the reduction in the number of smaller divisions, an d some staff alignment and re-deployment, but 
without affecting the quality of fundamental services  to Members. The Direct or-General wished to 
defer the deadline for the presentation of the pl an from 1 July 2008 to 31 July 2008, whilst 
maintaining the deadline for implementation of December 2008. 
24. Several Members indicated that they had no pr oblem with the extension of the deadline as 
long as the implementation would take place in 2008 .  However, some Members expressed concern 
with respect to the impact of the restructuring on the Pension Plan and asked for the presentation of 
the full costs including contingent liabilities. 
25. The Committee recalls the recommendation forwar ded to the General Council in December 
2007 (WT/BFA/101, paragraph 7) to make availabl e CHF 1,500,000  from the credit balance in the 
2006 Surplus Account to finance the restructuring plan in 2008.  The plan was to be finalized by 1 July 2008 and implementation completed by 31  December 2008, after which any un-used funds 
would be returned to the WTO accounts.  At  the request of the Director-General, the Committee 
recommends to the General Council that the date of 1 July 2008 be amended to read 
31 July 2008.  Other provisions of the original recommendation remain unchanged.  
 
VI. ACCESSION OF UKRAINE 
26. The Chairman introduced document WT/B FA/W/172 concerning the assessment of 
contribution on the Government of Ukraine.  WT/BFA/103 
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  27. Consequent to the accession to the WTO of the Government of Ukraine on 16 May 2008, the 
Committee decided to make the following recommendation to the General Council:  The Committee 
recommends to the General Council that a pro ra ta contribution to the 2008 budget amounting 
to CHF 363,208 be assessed on the Government of Uk raine.  This assessment, calculated as from 
16 May 2008, is based on an annual contributio n of 0.324 per cent, taking into account the 
international trade figures (imports plus expo rts in goods, services and intellectual property 
rights) of Ukraine for the years 2001-2005.  Furt hermore, on the basis of the level of the 
Working Capital Fund of CHF 9,677,653, the Committ ee recommends to the General Council to 
assess an amount of CHF 48,388 on the Govern ment of Ukraine as an advance to the Fund . 
 
VII. OTHER BUSINESS 
A. FOLLOW -UP ON DG'S REPORT 2006 
28. A Member asked for follow-up regarding the Ex ternal Auditor's recommendations included in 
the Director-General's Report 2006, especially with  respect to the cost of unused air-tickets and 
overtime.  A Member of the Secretariat explai ned that a full follow-up on all the auditor's 
recommendation during their mandate had been prep ared and included in the Director-General's 
Report for 2007. However, as the approval of the re port would still take some time, it was suggested 
that the follow-up on the 2006 recommendation woul d be presented at the next CBFA meeting. 
B. ADMINISTRATIVE MEASURES  
29. Another Member proposed a new review of the administrative measures, which had been 
changed in March 2006, as he was of the opinion that, in light of the still very high amount of 
outstanding contributions, additional measures such as the limitation of speaking rights, the access to 
training or funding should be considered.  A further Member agreed to that proposal.  The chairman indicated that this issue would be placed on the ag enda for consideration at the next CBFA meeting, 
and that he would in the meantime be contacti ng those Members subject to Category II-IV measures 
on this matter. 
 
POINTS FOR DECISION:  Paragraphs 18, 25 and 27 
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