STATEMENT OF THE G-77 AND CHINA FOR THE IAEA BOARD OF GOVERNORS
MEETING, PROGRAMME AND BUDGET COMMITTEE, 7-11 MAY 2007, DELIVERED BY H.E. AMBASSADOR
SAYED GALAL E. ELAMIN, PR OF SUDAN
Allow me, on behalf of the Group of 77 and China to congratulate Your Excellency,
Ambassador Milenko Sknoknic on your election as chair of the PBC. I would also
like to congratulate the other members of your Bureau on their election. The Group
stands ready to working closely with you as we deliberate on various items in
Agenda Item 2: THE AGENCY'S ACCOUNTS FOR 2006
The Group of 77 and China wishes to thank Deputy Director-General David
Waller for his informative introductory statement and the presentation highlighting
the various items for the Programme and Budget Committee Meeting. The Group
would like to commend the Secretariat for the preparation of document GOV/2007/13
that contains the Agency's Accounts for the Year 2006. The Group thanks Mr.
Norbert Hauser, the External Auditor and his colleagues for the report included
in part I of the document.
The Group is pleased to note that the External Auditor placed an unqualified
opinion on the Agency's financial statements for the year 2006. While appreciating
the work of the External Auditor and his staff, the Group notes that his report
includes comments on both the positive aspects as well those requiring improvement
in the overall financial situation of the Agency. The Group would like to request
Secretariat to consider carefully the Auditor's recommendation, in order to enhance
the effectiveness and efficiency of its activities, and to undertake necessary
measures to implement these recommendations.
The Group notes that, as pointed out last year as well, the Agency should
make efforts to minimize imposition of onerous conditions to the extra-budgetary
contributions. The External Auditor has pointed out another serious condition
pertaining to separate audit for the voluntary contributions that is rather
contrary to the principle of single audit as stated in the financial regulations.
The Auditor has recommended revisiting the verification clause in the Financial
and Administrative Framework Agreement (FAFA), to the extent of even refusing
acceptance of voluntary contribution under the condition of separate audit exercise.
The Group supports the Auditor's recommendation that the Agency should bring
such attempts to the notice of the Board of Governors for decision.
The Group notes that over 90% of the funding for the implementation of the
NSP continues to be provided through extra-budgetary contributions to the Nuclear
Security Fund. The Group commends the Agency for entering into an enhanced dialogue
with Member States to reduce conditions placed on donations. The Group believes
that Member States should not impose conditions on extra-voluntary contributions,
which could severely impede the Agency's work.
The Group notes with concern the delays in the publication of the Proceedings
Series of IAEA Conferences. In this regard, the Auditor has pinpointed certain
redundant steps in the workflow that need re-consideration for making the publication
processes and procedures more efficient and timely. We encourage the Secretariat
to take necessary corrective measures since timely publication of scientific
literature is essential for securing maximum benefits by the developing Member
The Group views with great interest, the observation of the External Auditor
on improvement in the coordination of international cooperation in the Developing
Countries. The Group encourages the Secretariat to step up its efforts to seek
greater financial and technical contributions towards the Technical Cooperation
The Group takes note of the External Auditor's observation that the Technical
Cooperation projects should be formulated more accurately as these were not
always completed within the planned timeframe, and without achieving the planned
objectives. The Group is of the view that the recently-introduced Programme
Cycle Management Framework (PCMF) may help in improving the quality of the project
formulation and implementation, and also enable the Secretariat to monitor outcomes
effectively. As regards deficiencies pointed out by the Auditor in the project
monitoring, we urge the counterparts to submit Project Progress Reports properly
and in a timely manner. The Group urges the national TC Liaison Officers, the
recipient national organizations and the Agency to enhance their coordination
towards this end.
As regards the observation on recurring projects based on similar requests,
the Group reiterates that technically, new projects seemingly quite similar
to the ones previously undertaken are possible in view of multidisciplinary
nature of nuclear technology. While it is generally understood that all projects
are formulated in the light of defined needs and national priorities, the observation
of the Auditor regarding Country Programme Framework merits consideration by
The Group concurs with the External Auditor's observation that the Secretariat
should formulate a clear and appropriate IT policy. The Group reiterates its
position on the importance of maintaining and enhancing information confidentiality
and security of the highly confidential safeguards-related data. The Group is
of the view that the External Auditor's recommendation on separation of IT and
Information Management/Knowledge Management Committee merits consideration by
The Group notes with satisfaction the Auditor's observation regarding the
implementation of the National Participation Costs mechanism, and supports his
recommendation to keep the scheme under review for possible improvements. We
also support his recommendation that inconsistencies in the application of the
Due Account Mechanism should be eliminated and request the Secretariat to provide
additional detailed information in this regard. As regards the consideration
of Support Costs System for Extra-budgetary Programme, the Group is of the firm
view that the already meager Technical Cooperation Fund should not be affected
by this scheme.
The Group agrees with the recommendation that efforts be made by the Member
States to complete the ratification process of the amendment of the Article
XIV of the Statute to enable the Secretariat to implement biennium budgeting.
12. The Group encourages all Member States to pay their assessed contribution
to the Agency in full and on time, and calls upon Member States with outstanding
contributions, to enter into negotiation with the Secretariat and to conclude
a reasonable payment plan agreement.
While the follow-up to audit recommendations from the report of 2005 is
generally satisfactory, the Group expects that the remaining recommendations
can be implemented in an adequate and timely manner.
As regards the Mid-term Progress Report, 2006-2007 and the 2006 Programme
Evalutation Report, the Group reserves the right to give its position at a later
With these comments, the Group of 77 and China takes note of the Agency's Accounts
and of the External Auditor's Report.
Agenda Item 3: THE AGENCY'S DRAFT PROGRAMME AND BUDGET FOR 2008-2009
The Group of 77 and China would like to thank Deputy Director General David
Waller for introducing this item and the Secretariat for Preparing "The
Agency's Draft Programme and Budget 2008-2009," as contained in document
The Group notes that the vision, goals and strategic objectives under the
Medium Term Strategy 2006-2011 have guided the preparation of this document
and that lessons learned from various Agency reports, in addition to the recommendations
by the Standing Advisory Groups and the Member States have also been taken into
account in its development.
The draft Programme and Budget shows huge disparities in the budget allocations
between the various Major Programmes. In this regard, The G-77 and China is
calling for a more balanced distribution of the budget so as to reflect the
equal importance of the three pillars of the Agency.
The Group of 77 and China has noted that a request has been made for allocation
of funds during 2008-2009 for undertaking "Essential Investments."
The Group, in principle, supports the Agency in upholding and maintaining its
competence and enhancing its capabilities and independence. At the same time,
however, if there are resource constraints, there would be need for further
prioritization and cost efficiency. The Group is prepared to actively participate
in any negotiations in a transparent manner on this issue.
Major Programme 1: Nuclear Power, Fuel Cycle and Nuclear
With regard to Major Programme 1, the Group notes with appreciation the
three important goals guiding the formulation of priorities, namely: the needs
of interested Member States in improving their national nuclear programmes and
infrastructure; to act as a catalyst for innovation; and to manage, preserve
and enhance nuclear expertise, knowledge and competence in Member States.
The Group notes that the Nuclear Power Programme has been expanded from
five to six sub-programmes by elevating activities on nuclear power infrastructure
from a project to a sub-programme.
While the Group endorses all activities envisaged within the six sub-programmes
under Nuclear Power, the Group particularly welcomes the introduction of a new
sub-programme on 'Infrastructure and Planning for the introduction of Nuclear
Power' established in response to General Conference Resolution GC. (50)/Res/13
Part B2 since several developing countries are planning to introduce Nuclear
Power as part of their energy mix. The Group believes that the allocated budget
for this sub-programme may not be sufficient to cover all the planned activities.
4. The Group has always been supportive of sub-programme 1.1.4 on: 'Coordination
of INPRO' and attaches great importance to its success. The Group believes that
INPRO provides a common platform for bringing together Industrialized and Developing
Countries for exchange of views on nuclear issues and commends the Agency for
the successful implementation of Phase- 1 of its activities. The Group also
notes with appreciation the continuing growth in its Membership and supports
its accelerated growth. Towards this end and especially since it is in an advanced
Phase- 2 implementation stage, the Group believes that INPRO merits significantly
enhanced Regular Budgetary support apart from Extra-budgetary funds, in the
current biennium Programme and Budget formulation.
The Group takes note of the rationale and objectives of all the four sub-programmes
under Programme 1.2 'Materials and Fuel Cycle Technologies' and endorses all
activities envisaged under these sub-programmes. The Group requests to be kept
informed of the progress under sub-programme 1.2.4 on: 'Topical issues of nuclear
fuels and fuel cycles for Advanced 'innovative reactors' periodically.
With regard to proposals on Multilateral approaches to the fuel cycle, the
Group is of the view, that this is more of a political decision of Member States,
and highlighting it in the programme and budget document appears to be out of
context. Moreover, assurances of fuel supply is an issue with complex technical,
legal and economic aspects. Therefore the Group underlines that it is premature
for this issue to be considered before the various aspects and concerns have
been adequately addressed.
The Group supports all activities envisaged under the Programme 1.3 'Capacity
Building and Nuclear knowledge Maintenance for Sustainable Energy Development.'
However, the Group would like to request for a larger share of funds to be allocated
to the sub-programmes 1.3.1 and 1.3.2 on: 'Energy Modeling, Data and Capacity
Building' and 'Energy, Economics and Environment (3E) Analysis'.
The Group has always been supportive of activities related to the use of
Research Reactors and Accelerators and, conscious of the importance of Atomic
and Nuclear Data and Fusion Research through ITER, approves all activities planned
under the five sub-programmes within Program 1.4: 'Nuclear Science'.
Major Programme 2: Nuclear Techniques for Development and
The Group wishes to highlight the continuing importance of the Programme
of Action on Cancer Therapy (PACT) as mandated by General Conference resolutions,
the latest being GC(50)/RES/13. In this regard, the Group urges Member States
to prioritize the approval of € 600,000 for each year of the biennium within
the draft Programme and Budget for 2008-2009. The Group also urges the Member
States to continue providing PACT with sufficient funds to enable the PACT Programme
Office to operate at an optimum level and beyond the minimum level during the
biennium to fulfill its mandate arising from Board decisions and General Conference
The Group wishes to emphasize that it is important to ensure that funds
allocated to Technical Cooperation are not diverted into PACT, and that PACT
activities do not overlap with those already being undertaken by the Technical
Cooperation. The Group also welcomes the inclusion of PACT under Major Programme
2.2, sub-programme on human health.
Major Programme 3: Nuclear Safety and Security
The G-77 and China is of the view that nuclear safety and security aspects
are interlinked and should be addressed simultaneously. The Group believes that
the publication of the Fundamental Safety Principles was an important step in
the completion of the action plan for safety standards. The Group calls on Member
States to establish an effective legal and governmental framework for safety
in all phases of nuclear activities. The Group welcomes the launch of the Agency's
newly Integrated Regulatory Review Service (IRRS) and the pilot Safety Culture
Assessment Review Team mission on safety culture.
The Group welcomes the on-going Revision of the International Basic Safety
Standards for the Protection against Ionizing Radiation and for the Safety of
Radiation Sources. The Group concurs with the Agency's assessment that technical
assistance should be provided to Member States, in order to strengthen the Member
States' infrastructures in all areas of radiation safety and waste safety.
The Group is of the view that the Agency plays an important role in assisting
Member States in the Management of radioactive waste.
Concerning nuclear security, the Group notes that the information on progress
in the implementation of the Nuclear Security Plan (NSP) 2006-2009, was included
in the report to the meeting of the Board of Governors (GOV/2006/46) in September
2006. The Group is of the view that the Agency concentrates a significant proportion
of its activities in meeting Member States' obligations under the new binding
and non-binding international instruments. The Group is concerned that increasing
financial and human resources of the TC Department are being dedicated to implementation
of the Nuclear Security-related activities.
Major Programme 4: Nuclear Verification
As for Major Programme 4, the Group notes the importance of maintaining
and enhancing the Agency's analytical capabilities in order to ensure its independence
and credibility. In this regard, the Group encourages the prioritization of
budget allocations towards the expansion of the capacity and capability to process
and analyze environmental samples at Safeguards Analytical Laboratory (SAL)
in Seibersdorf and the expansion of the capacity and capability of the Network
of Analytical Laboratories (NWAL) through the qualification of additional environmental
sampling laboratories as part of NWAL in the developing countries.
The G-77 and China notes that the proposed regular budget resources for
Major Programme 4 remains the same as in 2007 and only an amount of 1.2 million
Euro has been shifted from Subprogrammes 4.1.1 into Subprogramme 4.1.2. The
Group further notes the savings resulting from the implementation of integrated
safeguards and would like to know the impact of such savings on Major Programme
The G-77 and China notes that the Agency expects to start implementing safeguards
at several additional facilities in various Member States, in particular, the
development and implementation of safeguards approach for a large mixed fuel
fabrication plant in Japan (JMOX). It appears that funds have been sought for
this purpose under the regular budget and extra-budgetary resources, and would
therefore like to seek further clarification for requests of 3.7 million Euro
in 2008 and 7.7 million Euro in 2009 under the Essential Investments.
Major Programme 5: Policy, Management and Administration
The Group wishes to highlight the important functions including leadership
and the essential coordination for all Agency activities to ensure a one-house
approach particularly with respect to overall policies, interactions with Member
States, development of programmes and evaluation and assessment of performance.
The Group notes that Major Programme 5 and Major Programme 7 have been merged
into one Major Programme 5.
The Group notes that an important undertaking essential to more effective functioning
of the Secretariat has been introduced under the ICT Solutions subfunction, to
plan and implement an Agency-wide information system for programme support.
The Group welcomes any reasonable cost reduction measures taken by the Secretariat,
and wishes the Secretariat to continue to increase its efficiency and transparency
in operating Major Programme 5 at an optimum level with no increase or additional
Major Programme 6: Management of Technical Cooperation for Development
The G-77 and China recalls the IAEA's General Conference Resolution, GC.(50)/RES/12
of September 2006 on strengthening the Agency's technical co-operation activities
adopted by the 50th Regular Session of the General Conference in September 2006.
The Resolution mandated the Secretariat to explore means to ensure that resources
to the Technical Cooperation Programme are sufficient, assured and predictable.
The G-77 and China reiterates the great importance that the Group attaches
to the Agency's technical cooperation activities, as they are the main statutory
vehicle for transferring nuclear technology to developing countries for their
socio-economic progress through the peaceful application of atomic energy.
The G-77 and China is aware that the continuously expanding TC programme
with increased quality requirements and a growing number of Member States pose
challenges for the management of the programme, particularly with regard to
human resources. Since 2003, the size of the Technical Cooperation programme
has increased from $105 million to $144 million and the number of Member States
from 137 to 143. Technical Cooperation programme management officers managed
an average programme size of $2.6 million in 2003 per officer, while the average
programme size in 2006 was $3.4 million.
The G-77 and China is of the view that the present level of resources is
not adequate to support this increasing workload and the Group is therefore
concerned that this will have an impact on the level and quality of programme
delivery. While the use of IT-based systems may result in partial efficiency
gains, it may not be sufficient to compensate for the workload due to the expansion
of the scope of TC activities. Furthermore, the IT-based PCMF is still in Phase
1 of its implementation and Member States would need to receive training on
the application software through the Technical Cooperation staff. In this regard,
the G-77 and China would like to recommend that the financial resources for
Major Programme 6 in 2008-2009 include the costs in training Secretariat staff
and participants from Member States in the use of these relatively new IT-based
project management systems.
As noted earlier, the draft Programme and Budget shows huge disparities
in the budget allocations among the various Major Programmes. The G-77 and China
is calling for a more balanced distribution of financial resources, so as to
reflect the equal importance of the three pillars of the Agency's mandate.
Agenda Item 4: PROPOSAL TO ADOPT IPSAS BY THE AGENCY
The Group wishes to thank Deputy Director General Waller for introducing
this agenda item on IPSAS implementation and for introducing document GOV/2007/10.
The Group notes the Secretariat's statement that International Public Sector
Accounting Standards (IPSAS) would have no negative impact on the delivery and
implementation of Technical Cooperation Programmes.
The Group also urges the Office of the Deputy Director General for Administration,
to fully implement financial obligations of the Secretariat to Member States,
including procurement, purchase and delivery of equipment. Moreover, particular
emphasis should be placed on effects in the situation of accounts receivables
in the new system, as pointed out by the External Auditor.
The Group notes the External Auditor's recommendation that Member States
of IAEA may consider the adoption of IPSAS, as a goal for an improved accounting
framework to further enhance accountability and transparency. However, the Agency
should consider all aspects including costs, and other implications of its implementation,
particularly those where the External Auditor has offered his comments.
Thank you, Mr. Chairman.
Agenda Item 5: APPOINTMENT OF THE EXTERNAL AUDITOR FOR 2008-2009
The Group believes that the External Auditor plays an important role in
evaluating the Agency's financial accounts and activities. The Group expresses
its appreciation to Mr. Norbert Hauser, the External Auditor, for his contribution
and exhaustive work in identifying both positive aspects as well as shortcomings
in the Agency's overall activities. His comments and candid opinion, and recommendations
for improvement, would certainly go a long way in enhancing the effectiveness
and efficiency of the activities of the Agency.
The Group therefore recommends that the term of the External Auditor be
extended for another term, to audit the Agency's accounts for 2008/2009.
The Group believes that for the next term starting in 2009, consideration
should be given to appoint a candidate from a developing country as the External
Auditor of the IAEA.