Dear Sir,

I have your letter of April 25th t requesting my views on the administrative and financial matters to be discussed at the forthcoming World Health Assembly. As you know, we have been seriously handicapped by the fact that documentation on these questions was not received until late last week. In the circumstances it has not been possible to give them as much attention as we would like. The following observations are, therefore, necessarily confined largely to broad statements of principle, with examples selected at random to illustrate specifc situations in which some of the principles might be applied. Because of their general nature, a meeting was arranged between Mr. Pollock of this Department, Doctor McCann, who is heading the Health Delegation, Doctor Cameron and Mr. Cleveland, to discuss some of the main financial issues which may arise at the Health Assembly. I hope that these arrangements, together with the documentation provided by Mr. Cleveland regarding the position taken by Canadian delegations at earlier Health Assemblies, will be adequate for the formulation of suitable policies during the forthcoming Assembly.

As you know, we have always emphasized the importance of sound programming and the development of efficient and economical administrative techniques in the Specialised Agencies. As far as I can see, our efforts in the WHO have had some success. The documents we have received give evidence of solid accomplishment. Many of the more questionable projects in earlier programmes have been eliminated. The problems of staffing and administration which troubled the Organisation in its formative stage are rapidly being overcome. However, even though the transition from a blueprint to a functioning agency is apparently being bridged quite successfully, the necessity for close scrutiny of the budget and programme continues. In fact, the reduction of organisational problems merely shifts our interest to new and even more difficult phases of WHO's activities.

The health needs of the world are almost limitless. Those experiencing these needs will not be easily convinced that because of current financial stringencies their requirements cannot be met fully. It is equally difficult to persuade a Secretariat, imbued with the ideals of the Organisation and spurred on by a Director General as dynamic as Doctor Chisholm, that attempts to keep the programme within reasonable limits are not intended to inhibit its orderly development. Finally, a heavy preponderance of the votes in the Assembly is held by countries whose needs are great and whose financial contributions are small. It would be wholly unrealistic to fail to appreciate the way in which these circumstances combine to induce an expanding rather than a stabilised programme. Under the circumstances it is more important than ever that the Canadian delegation, and others in a comparable position, should continue to stress the need for priority programming and the economical and effective utilisation of resources. In practice this means the limitation of the budget to a level for which it is reasonable to assume that the necessary funds will be forthcoming. It requires emphasis on projects likely to bring immediate and tangible returns for the expenditures involved. It also requires effective co ordination of all projects with those of other international bodies having related responsibilities, in order to avoid wasteful duplication of activities. Most of these principles are not new. They merely represent the logical extension and continuation of policies followed by earlier Canadian delegations.

This year the Health Assembly is fortunate in having an unusually good report from its Standing Committee on Administration and Finance. This report; which has been adopted by the Executive Board (Official Record No. 26), includes many useful recommendations. It will only be possible to provide detailed comments below on a few of the recommendations. However, I believe that in most cases their adoption by the Health Assembly would constitute a useful step toward sound administrative and financial practices.

There is one important exception to which I would like to draw your attention. Past Assemblies of the Health Organisation have stressed the need for rapid decentralisation of activities by the establishment of regional organisations. This principle is again endorsed in the Report of the Executive Board, as well as in the budget and the Report of the Director General. It has been the Canadian view that, although there should be an orderly and reasonable extension of the facilities of the Health Organisation to all countries, and especially to those which are "underdeveloped", it is desirable that the areas and headquarters of these regional groups should not be determined too hastily. At this stage of its existence, the WHO cannot afford to dissipate its meagre resources on an unduly elaborate regional structure. The Canadian delegation should not hesitate to express its misgivings on this matter.

In general, it is encouraging to note the growing sense of realism reflected by the Reports of the Standing Committee and the Executive Board. As you know, there have been strong differences of opinion in the past on the proper functions of the Executive Board and its correct relationship to the Director General. The Director General has, I understand, insisted that programme preparation is his responsibility, and that the Executive Board should limit itself to technical advice on the medical advisability of the programme. I do not think that this conception of the role of the Executive Board is consistent with the long range interests of the Organisation. While the responsibility for programme and budget preparation is clearly that of the Director General, the Executive Board should not be restricted to general expressions of medical opinion. Programme preparation and budget evaluation are closely related. The programme must always be framed with an eye to the financial resources likely to be available. In this connection, the Australian delegation has already submitted formal proposals which would alter the character of the Executive Board and give it greater executive and financial responsibilities. As indicated in earlier correspondence? with you on this matter, we are prepared to support this Australian proposal. However, if the Australian proposal is not adopted, it might be worthwhile considering a workable compromise based on it. This might take the form of a directive by the Assembly similar to that adopted last year instructing the Executive Board to give more attention to the financial implications of the budget and programme. The Assembly should also commend the very useful work of the Standing Committee on Administration and Finance. Its report this year seems most useful and the Canadian delegation should support a continuation of its efforts.

However, whatever decisions the Health Assembly may come to regarding the appropriate relationship to be maintained between the Director General and the Executive Board for the future, the delegation should support the recommendations (in paragraphs 1 to 21 of the Report of the Standing Committee) for dealing with the financial situation during 1951. Past Assemblies have approved large programmes in the expectation that the required funds would be forthcoming from the contributions of Member States. These expectations have not been realised. The withdrawal of the U.S.S.R. and its satellite states from the Organisation and arrears in contributions by others have placed the Organisation in a precarious financial position. Despite programme cuts, it has only been possible to maintain the present level of activities by heavy withdrawals from the Working Capital Fund and from other resources inherited from UNRRA etc. We have already informed you of our belief that, regardless of the legal position, there seems to be little likelihood that the U.S.S.R. will liquidate its obligation to the WHO. The correspondence? on this question will, I understand, be made available to the delegation. I would, however, stress again that the situation caused by these withdrawals and other arrears in contributions is serious and must not be ignored. The apparent inability to induce or force the U.S.S.R. and its satellites to make their payments increases the necessity for measures likely to induce other delinquent governments to bring their contributions up to date. The WHO has already amended its Constitution to deprive members more than two years in arrears of voting rights. This provision should be automatically enforced. Similarly, we believe that countries seriously in arrears should not be permitted membership on the Executive Board or on other important committees of the Organisation. The Canadian delegation might discuss with others the advisability of requesting the Executive Board or a special committee established for this particular purpose to examine and make recommendations to the next Health Assembly on the question of arrears. In any event, it is essential that maximum expenditures for 1951 be limited to a rate which the Organisation can reasonably expect to finance out of current contributions, the special UNRRA Fund and other sources of income. This would be consistent with the resolution of the United Nations General Assembly urging international organisations to limit their programmes to the amount of funds which they may reasonably expect to receive during the year. The Standing Committee's recommendations for dealing with this situation should be supported strongly, or even strengthened.

The largest part of the expenditures of the Organisation will, of course, be required for staffing and maintaining those sections of the Secretariat which are servicing technical projects. Decisions as to the projects which are most useful must necessarily be made by delegation specialists conversant both with their medical value and relative cost. However, on the purely administrative side there will be many other opportunities for economies within the budget. The following are a few random examples to indicate the kind of recommendation which should be supported. There will, of course, be many others of equal importance.

(a) An invitation has been received to hold the Fourth Health Assembly in Washington (see page 12, paragraph 35). This involves considerable additional expense beyond that which would arise if the meeting were held at headquarters in Geneva. It has always been the Canadian position that the annual conferences of the Specialised Agencies should be held at headquarters unless there are significant reasons to the contrary. I understand that there is a feeling that a successful conference in the United States would appeal to American public opinion and gain support for the Organisation. However, these and other arguments must be considered in relation to the additional cost involved. In the United Nations itself, it is common when considering meetings away from headquarters to look to the host state for the payment of all costs beyond those which would be required to hold the meetings at the permanent headquarters. Perhaps the Director General might seek to induce the U.S. to absorb the additional expenditures which would be incurred in holding the Fourth Session in Washington.

(b) On page 13, paragraph 36, it is recommended that transportation expenses of representatives to meetings of regional committees should be limited to inaugural meetings. This seems sound. I agree with the Executive Board that for reasons of economy payments should not be extended to all regional meetings.

(c) It is suggested on page 16, paragraph 70, that it would be more economical to have longer meetings of experts' committees at less frequent intervals. With transportation costs representing such a high percentage of costs, the present principle of frequent meetings for short periods of time seems unduly expensive.

(d) On page 31, paragraph 185, it is recommended that home leave should be granted on a three year basis instead of a two year basis. We agree that this recommendation, which is baud on tire Report of the United Nations Expert Committee on Salary, Allowances and Leave Systems, is sound. It is economical and also reduces the adverse effect on efficiency which results from the considerable interruptions in the conduct of the affairs of the Organisation which are caused by home leaves at two year intervals.

(e) Other references are made in paragraphs 184 to 194 to the Report of the United Nations Committee of Experts on Salary, Allowances and Leave Systems. The Report of the Expert Committee is now being examined in Ottawa. The Canadian Government is in general agreement with its recommendations and would be prepared to support their application to WHO. We are not entirely convinced, however, that the Expert Committee was fully warranted in the extent to which it recommends upgrading of senior staff. We would be inclined to rely on the judgment of the delegation, in consultation with others, to decide the upper limits which would be appropriate for salaries in the Organisation.

Another problem with which the conference may be concerned is that occasioned by the maintenance of proper geographical distribution in appointments to the Secretariat. Under Article 101, paragraph 3, of the Charter of the United Nations, staff must be selected on the basis of the highest competence, integrity and efficiency, with due regard to as wide geographical distribution as possible. The problem of reconciling the two concepts is a familiar one. It arises in most international bodies, even in the most technical organisations whose staffs must be obtained from countries with advanced technical standards. As indicated in paragraph 89, page 19, the World Health Organisation has experienced difficulties in recruiting staff in the past and foresees further difficulties when it tries to provide staff for the proposed Expanded Programme for Technical Assistance. If delegations insist, as they have in the past, that the principle of geographical distribution must be extended to recruitment for technical assistance activities, I believe that our delegation should not hesitate to point out the glaring inconsistency in such a position. It is clear that governments seeking technical assistance because of the dearth of trained personnel in their own countries cannot at the same time provide highly qualified technicians for international organisations.

On the question of the scale of contributions, there has been little change in the situation since the last Health Assembly. Therefore, instructions to earlier delegations are still applicable. In particular, we are disturbed by the implications of the continuation of the absolute financial ceiling on the U.S. contribution. We are anxious that a proper relationship be maintained between our contribution and that of the United States, United Kingdom and others, and are not prepared, because of the absolute ceiling on the United States contribution or for any other reasons that might be advanced, to pay more than a fair share of the expense of the Organisation. To date the United States Administration has not been successful in its efforts to have Congress remove the absolute ceiling from the U.S. contribution. The Canadian delegation should not hesitate to express its view that the continuation of this ceiling is inconsistent with the long range interests of the WHO.

Yours truly,
R.B. BRYCE