275 Cabinet Submission by Evatt

Agendum 695F, CANBERRA, [14] June 1948

CONFIDENTIAL

POST-UNRRA RELIEF Cabinet decided in May 1947[1] that Australia should join the International Refugee Organisation, and accordingly �8[6]0,000 was paid to cover our contribution for the financial year 1st July 1947 to 30th June 1948. Our contribution for 1948/49 is now becoming due and this raises the question of future relief contributions of Australia.

2. On 12th May, 1947, Cabinet approved a contribution of �4m. to Post-UNRRA Relief[2] and in January of this year agreed that the allocation should be as follows:-

� (a) International Children's Emergency Fund 1,000,000 (b) International Refugee Organisation 860,000 (c) United Nations Educational, Scientific and Cultural Organisation 90,000 (d) General Post-UNRRA Relief 1,650,000 (e) Freight and contingencies in respect of (b), (c) and (d) 400,000 �4,000,000 3. The Trust Fund set up as a result of this decision will be committed in the next 2 or 3 months and it is now recommended that a further �2.5m. be contributed to Post-UNRRA Relief and that this should be allocated as follows:-

� (a) International Children's Emergency Fund 1,000,000 (b) International Refugee Organisation 860,000 (c) General Post-UNRRA Relief 470,000 (d) Freight and contingencies in respect of (b) and (c) 170,000 �2,500,000 International Children's Emergency Fund.

4. Last year Australia allocated �1m. to the Fund and agreed to pay freight and other expenses on supplies procured. Approximately �900,000 of our �1m. contribution was firmly committed by 30th May, 1948. At the request of the representative of the Children's Fund in Australia, the outstanding balance of �100,000 is being held in reserve to cover possible procurement of dried milk which is the Fund's first priority item and for which a special appeal has been made at ministerial levels to the major producers in an endeavour to obtain offers of supplies. The Department of Supply and Development is still planning ahead to ascertain what supplies can be procured out of funds which will be available from the voluntary contributions received as a result of our United Nations Appeal for Children.

5. The Executive Director of the Children's Fund has requested this Government to make a further donation to the Fund during 1948. A copy of his letter is attached as Appendix 1.

6. Allocation to the Children's Fund of a large proportion of future contributions by this Government to Post-UNRRA Relief, would have the advantage of automatically increasing the United States contribution, since the United States has agreed to make funds available to the I.C.E.F. according to the contributions of other countries. Congress has liberalised the matching formula under which the United States contribution becomes available and this new formula provides that the United States shall give $72 for every $28 received from other Governments from the beginning of the programme until 30th June, 1949. An Australian contribution at this stage of �1m. worth of supplies and of freight and other expenses on these would result in an additional contribution by the United States to the Children's Fund of over $9m.

7. In view of further additional United States contribution and the changed matching formula, the Fund Administration now considers that the Fund can operate until late 1949 and possibly to the middle of 1950. A large allocation to the Children's Fund of any further Australian contribution to Post-UNRRA Relief would considerably reduce administrative difficulties in distributing supplies procured before the end of 1950.

8. It is suggested that a second contribution of �1m. should be made available to the Children's Fund and that freight and contingencies in respect of goods procured for the Fund should be paid out of the Freight and Contingency Reserve.

9. In determining what goods are available Supply and Development should have in mind that Children's Fund supplies should not prejudice the export of Australian products to hard currency markets or the supply of goods essential to the Australian economy.

10. In the event of a second contribution to the I.C.E.F., the Department of Supply and Development should be responsible for arranging a supply programme after consultation with the Department of Commerce and Agriculture and in accordance with the existing agreement with the I.C.E.F. approved by Cabinet in January, 1948.

International Refugee Organisation.

11. The Preparatory Commission of the I.R.O. agreed at the fifth part of its First Session last February that the budget for the period 1st July 1948 to 30th June 1949 should be the sum of $4,797,800 for administrative expenses and the sum of $150,229,258 for operational expenses. As provided in Annex 2 of the Constitution of I.R.O., Australia's contribution to the budget is approximately �860,000.

12. The Preparatory Commission of I.R.O. has suggested that members may be willing to make voluntary contributions in addition to contributions provided for under its Constitution for the establishment of a large scale resettlement fund. The subject of this proposed fund was referred to the Department of Immigration which, for the following reasons, considers that Australia should not make an additional contribution for large scale resettlement:

(a) Australia contributes �10 sterling towards the cost of the passage of every displaced person brought to this country;

(b) all displaced persons are maintained for a period of approximately one month before being passed into employment, during which they are allowed 5/- a week pocket money;

(c) displaced persons are issued free of charge with a complete clothing outfit and their fares to the place of employment are paid by the Government.

13. The Preparatory Commission of I.R.O. has also proposed a special fund for ocean transport. The purpose of this fund is to increase the rate of repatriation and resettlement and to reduce correspondingly both the financial burden of the present heavy expenditure of care and maintenance and the wastage of human resources from long continued residence in displaced persons camps. The Preparatory Commission considers that if advances could be made in the course of the financial year 1948-49 out of members contributions to be paid for the succeeding financial year, adequate funds could be made available to the Executive Director to permit the chartering of additional ships sufficient to increase the present rate of repatriation and resettlement overseas to effect extensive economies in the care and maintenance expenditures of the Organisation and appreciably to advance the date by which its essential tasks can be carried out. It is suggested that consideration of the question of an Australian advance to the Fund for ocean transport should be deferred until the beginning of 1949. This would cause no inconvenience to the Organisation providing our contribution for the first quarter of the financial year 1948/49 is paid promptly.

14. In the event of a second year contribution to I.R.O. it is suggested that the question of the proportion of our contribution to be paid in hard currency should be a matter for the decision of the Treasurer.

General Post-UNRRA Relief 15. Of the �1,650,000 previously allocated to General Post-UNRRA Relief, �1.1m. in the form of raw wool has been offered to European countries recommended by the United Nations. Offers of supplies to the value of the remaining �550,000 are at present being made to countries in the South East Asia area.

16. It is suggested that a further allocation should be made to General Post-UNRRA Relief and that offers of commodities to the value of �470,000 should be left with the Minister for External Affairs in the light of Resolution No.48 adopted by the General Assembly of the United Nations and in view of the political benefits to be gained by Australia in making a further contribution.

17. The Department of Supply and Development has on hand at least �1m. worth of disposals goods which have been offered to the Australian market and are not required. If these were offered as relief supplies, there would be no effect on Australian economy, and the storage problem they are at present creating would be at least partly solved. It is proposed that goods made available under our second contribution to general Post-UNRRA Relief should come solely from these disposals stocks held by the Department of Supply and Development and that the details should be left to the Ministers of Supply and Development and External Affairs.

On-Cost 18. On-cost at 3.5% has in the past been charged on all goods supplied to the Children's Fund and to recipient countries, under the general Post-UNRRA Scheme. It is suggested that the same rate should be charged against any second contribution.

Prices of Supplies 19. Export prices have been charged in the past for supplies made available from our first contribution to Post-UNRRA Relief. It is suggested that this procedure be adopted with regard to any second contribution.

Recommendations 20. (a) That a second contribution be made by Australia to Post-UNRRA Relief and that the allocation be as shown in para. 3.

(b) General Post-UNRRA Relief.

(i) That the allocation of assistance under General Post-UNRRA Relief should be decided by the Minister for External Affairs in the light of general political considerations and the availability of supplies.

(ii) That the Department of External Affairs be responsible for executing a programme of supplies upon the recommendations put forward by the Department of Supply and Development after consultation with other interested Department, particularly the Department of Commerce and Agriculture.

(iii) That any reduction in freight and contingencies shown in para. 3 should go to increase our allocations to General Post-UNRRA Relief.

(c) Procurement and Shipping. That procurement of all supplies be arranged by the Department of Supply and Development which will also arrange storage and shipping in conjunction with the Departments of Commerce and Agriculture and Supply and Development.

(d) On-Cost. That on-cost at 3.5% be charged on all goods provided by Australia under the Post-UNRRA Scheme.

(e) Prices. That export prices be charged on all goods procured on behalf of the Children's Fund and recipient countries under the general Post-UNRRA Scheme.[3]

[1] See Volume 12, Document 75.

[2] See Volume 12, Document 75.

[3] On 15 June 1948 Cabinet approved clauses (a) and (b) in paragraph 3. It directed that the remaining recommendations be further examined and re-submitted to Cabinet at a later date. However, it does not appear to have been re-submitted to the Chifley Cabinet.

[AA : A2700, VOL. 11]