There is, however, one point of importance on which I do not think all those
present last Saturday reached agreement. This point concerned the best
mechanism through which to handle the requirements of those Governments
which have funds and are anxious on restoration to full sovereignty to
assert their position in the world. I think we are all agreed that our aim
must be to meet the susceptibilities of these Governments so far as we can,
while retaining that control over the allocation of resources which we must
preserve for war purposes, but at the same time to maintain the authority of
UNRRA to veto or cut down the demands of these countries, should this be
necessary to promote a fairer distribution. In my view we shall be most
likely to retain the co-operation of such Governments if we are prepared to
admit them to direct consultation with the authorities controlling the
supplies. I have little doubt that it will be the aim of such Governments
[Page 1015]
to get a seat on the
Combined Boards.3 Failing that, I think they
would press for a form of association with the Combined Boards such that
they could be sure of being consulted when their interests were concerned.
It is for this reason that we have made certain proposals to the State
Department in connection with the French National Committee4 in
particular, and with other third countries in general. We believe that this
general approach is more likely to be found satisfactory and to form a
sounder basis for future development than would a system by which all
Governments of liberated territories were forced to channel their demands in
respect of territories liberated after November 9th, 1943, through UNRRA
and, unlike those liberated before that date were deprived of direct access
to the supply authorities. I think this question is a straight-forward
political issue. There is, of course, no question of coercing a Government
into one method or the other. I think, however, that this is a kind of
question on which it is most important that the political thinking of our
two Governments should not be in disagreement. It would, I think, be most
unfortunate if we advocated different policies at the UNRRA Council
table.
I should like to suggest for your consideration that we might have a word
with Mr. Stettinius5 on the subject and that after that you
should let me know whether the views of your Government are in accord with
those in the enclosed memorandum. This would enable me on return to London
to give the Departments concerned a basis for their further thoughts between
now and November 9th.
[Enclosure]
Memorandum on the Scope and Operations of UNRRA
A. Principles.
- 1.
- The purpose of setting up UNRRA is to help liberated territories
to secure those supplies and services which are essential for the
health and stability of their populations and which cannot be
provided by other means. It must see that succour is brought to the
needy. The
[Page 1016]
supplies and
services it will be interested in, therefore, will be in the main
consumption goods for the local population and such additional
supplies as are required to enable local production to provide for
consumption needs which would otherwise call for imports. Long range
reconstruction and production for war purposes will not be its
task.
- 2.
- The period during which UNRRA is active will be one during which,
because of the war, or the dislocation caused by the war, many
essential supplies will be critically scarce and in which demands
upon shipping and other forms of transport will be greater than can
be satisfied. Scarce supplies and shipping which are used for the
supply of any liberated territory will mean that less are available,
not only for other liberated territories, but also for the fighting
services and for the populations which are maintaining the armies of
the United Nations. It will be necessary, therefore, to maintain the
allocation machinery which has been built up round the Combined
Boards and with which the principal supplying nations are
associated.
- 3.
- Certain liberated countries will have little or no foreign
exchange with which to finance essential imports and it will be
necessary for funds or credits to be provided at the disposal of
UNRRA out of which supplies and services can be financed for
countries which cannot pay.
- 4.
- Other liberated territories will be able to pay for their own
imports and there will be a tendency for these countries to attempt
to procure supplies which would otherwise be available for countries
which are not able to purchase for themselves. It will be an
essential part of the functions of UNRRA to see that countries which
cannot pay obtain a fair deal and are not deprived of supplies
through the heavy demands of the countries which can pay. It will be
necessary, therefore, for UNRRA to have complete knowledge of the
import demands filed by all liberated territories, whether or not
they can be paid for, and to be in a position in which it can if
necessary prevent the submission of excessive demands to the
allocating authorities.
- 5.
- It will be desirable that the greatest possible use be made of the
world-wide supply purchasing and handling and ship operating and
routing organisations which have been built up during four years of
war by the Governments of the United States and the British
Commonwealth. This machinery is geared to the allocation machinery
referred to in 2. above and will in any case have to remain in
operation until the end of the war in the Far East and for some
period thereafter. A duplication of it would lead to confusion and
waste of resources. The supply agencies (in conformity with policies
established by the Combined Boards) will moreover be directly
concerned with the development of local industry and resources in
liberated territories and (in collaboration with the local
authorities) with
[Page 1017]
mobilizing them as far as possible for the war effort or to relieve
overall shortages. For this reason representatives of the U.S. and
U.K. Governments will be associated with the local authorities in
order to assist them to procure and utilise certain raw materials,
industrial equipment, etc. Such representatives will be concerned
with the development of sources of supply for purposes other than
relief. These representatives and those of UNRRA should be
instructed to work out their exact division of function in any area
in the light of local circumstances in conformity with the general
principle referred to above.
- 6.
- It will be the general policy of the Allied and associated
Governments that recognised and stable local Governments in
liberated areas should be encouraged to do as much as they can for
themselves and local Governments will be anxious to do so since in
this way they will improve their status in the eyes of their people
and will get their own administrative organisation into working
order. In the field of relief it will be desirable that local
Governments should, wherever possible, themselves organise the
distribution of supplies and should be allowed to play as much part
as possible in negotiating contracts and making other arrangements
with suppliers. The stronger Governments possessing funds, some of
which will already have extensive contacts with the supplying
authorities before they are restored to their metropolitan
territory, will be jealous of interference or supervision and it
will be desirable that the comparing and checking functions which
UNRRA must perform in order to arrive at a fair distribution of
supplies should be as unobtrusive as is consistent with their
efficient discharge.
- 7.
- UNRRA will come into operation in any liberated territory at such
time and to such extent as the military commander shall invite them
to do so, or after the military commander has handed over his powers
to a local Government, at such time, and to such an extent as the
local Government may request.
B. Procedure.
Allocation of supplies and shipping.
The machinery for the allocation of supplies and shipping which the
Governments of the United States and the British Commonwealth have built
up is centred on the Combined Boards and the various Supply Agencies of
the Governments. The two main centres of this machinery are Washington
and London, while local units exist for the screening and liaison
purposes in various overseas territories, e.g. in the Middle East, South
Africa, North Africa. The Combined Boards themselves are concerned with
the overall supply and shipping picture, the allocation of sources of
supply and policy to be pursued
[Page 1018]
in developing sources of supply and the
co-ordination of the activities of the Governments represented on the
Boards. The efficient operation of this machinery calls for the
establishment in the main centres of committees concerning themselves
with the position in the various territories, receiving and processing
the import programmes of the territories so that the problems requiring
action by the Combined Boards can be isolated and passed to them in the
appropriate form, and that uniformity of action by the various Boards
and Agencies can be secured. It is most desirable that UNRRA should be
closely associated with this machinery so as to be in a position to
present the case for the supplies needed for the territories for which
it has responsibility on comparable terms to the cases presented for
other territories.
Pre-invasion functions of UNRRA.
The operations, both of UNRRA and the supply authorities, will be greatly
assisted if reasonably complete estimates of requirements can be
prepared before the actual invasion of the territories concerned. Such
estimates will enable the Combined Boards to gauge the size of the
problem with which they will have to deal and to adjust their programmes
as far as possible to allow for the demands which will become actual
later. In addition advance estimates are required if action is to be
taken to accumulate stockpiles or to place orders for the delivery of
supplies at future dates when they will be needed. The preparation of
estimates in a form in which action can be taken on them requires
agreement upon standards of provision, the calculation from such
standards of basic requirements for the various territories to be
liberated and the formulation (by the use of an agreed strategic key) of
overall requirements schedules divided into periods in which delivery
will be needed. During this pre-invasion period it will not be desirable
for particular supplies to be earmarked for each territory to be
liberated and the Governments of these territories should not be able to
take action themselves to secure supplies. In formulating plans it will
be necessary, therefore, for UNRRA to act for all liberated territories
and to collaborate both with the U.S. and U.K. military and supply
authorities in the presentation of estimates of requirements and in
securing by the national agencies the necessary procurement action
wherever this is possible.
Post-invasion functions of UNRRA.
Once a territory has been liberated it will be necessary to decide at
what time and to what extent the territory concerned will require the
assistance of UNRRA in providing and paying for the supplies and
services needed from abroad. As soon as possible authenticated
programmes of actual import requirements will have to be drawn up to
[Page 1019]
supplement or replace the
advance estimates already prepared before invasion. To some extent these
programmes may be formulated during the period of military control. Once
representatives of UNRRA are established in the territory, it will be
essential for them to play their part, in collaboration with the local
authorities and with the military or civilian officers of the liberating
powers, in the preparation of import requirements. Such collaboration
will require the formation of some kind of joint office or programming
authority in which the various interested authorities can work together
and the necessary co-ordination secured between them. The form of such
an office or programming authority will no doubt vary from country to
country and will depend in part on the ability of the local Government
to formulate its own demands, to distribute supplies and to pay for its
requirements. A well-established local Government with administrative
services and foreign exchange at its disposal will be able to do most of
the work itself and will only require comparatively small detachments
from UNRRA and some representatives of the U.S./U.K. supplying agencies
attached to the U.S./U.K. Diplomatic Missions to collaborate with it and
advise on the preparation of requirements, the development of industry,
etc. Other Governments, with less authority or without funds, will
require more extensive assistance. In such cases representatives from
UNRRA will no doubt play the major part on the spot in drawing up and
screening import requirements. Representatives of the supply agencies in
this case would play a supplementary role. In any event, such a
U.S./U.K./UNRRA/local Government screening unit will be required if a
fair distribution of supplies is to be obtained and if the allocating
authorities are to be satisfied that the supplies and shipping made
available at the expense of others are genuinely required and properly
used.
The position and responsibility of UNRRA in respect of the requirements
of any territory will differ according to whether the local Government
is able to pay for its imports. If the local Government cannot pay for
its imports, it will have to make application to UNRRA for its needs and
the programmes of requirements when drawn up should go to UNRRA for
action (either direct to its head office or through a regional office if
appropriate). It is suggested that time will be saved and efficiency
promoted if a copy of such programmes is sent for information direct to
the supply authorities, who would, however, take no action as regards
allocation or procurement until authority was received from UNRRA. If,
on the other hand, the local Government were able to pay for its
requirements and was not, therefore, in a position of having to apply to
UNRRA for assistance, it would still be necessary for UNRRA to receive
complete information about the import programmes and to have a right of
veto over excessive
[Page 1020]
demands
if it is to see that supplies are fairly distributed between paying and
non-paying countries. The question arises whether in these cases the
susceptibilities of the paying Governments would be better met if these
Governments were given direct access on their requirements to the
U.S./U.K. supply machinery (as the next best thing to direct membership
of the Combined Boards) or whether they would feel better satisfied if
their requirements were handled exclusively through UNRRA, who could act
as their champions (or could disapprove of those requirements which it
thought excessive). In the view of the U.K. Government the former method
is more likely to achieve the political end of satisfying the
susceptibilities of such Governments while preserving the full authority
of UNRRA. Accordingly the U.K. Government would propose that in the case
of programmes of requirements for which the recipient Government intends
to pay, the programmes should be sent by the local screening authorities
to the supply authorities in Washington and London (either direct or
through the Missions of the recipient Governments in those capitals)
while a copy of such programmes should be sent to UNRRA. It would then
be for the Director-General of UNRRA or his nominee to inform the
U.S.-U.K. authorities whether he approved or disapproved of the demands
in the programmes. It would be understood that no demands in these
programmes would be submitted to the allocating authorities without his
approval. At the same time the Director-General would be able to make
such other comments as he saw fit on the programmes which would already
have been screened by his representative in the field in the light of
local circumstances. Such comments might take the form of suggesting an
upward revision if this were appropriate. In this way UNRRA would be
able to make sure that the richer countries were not obtaining more than
their fair share, while at the same time not interfering with the direct
contact between the local Government and the supply authorities which
such a Government is likely to demand.
A chart6 is attached to
this note showing in schematic form how import programmes would be drawn
up and routed in two typical cases, one a paying country and the other a
non-paying country.
C. Distribution and
Procurement.
It seems desirable that recognised local authorities should undertake as
much as possible of the business of distribution within liberated
territories. On the one hand Governments will wish to do this for
themselves as soon as they are able and on the other it is doubtful
whether UNRRA will wish to become involved in the complexities
[Page 1021]
of local rationing and with
the political disputes and factions that this may entail. Experience in
Europe after the last War points to the desirability of local
Governments being encouraged to undertake as much of the responsibility
as they can. At the same time, in some countries great dislocation may
exist or epidemics or other special conditions may make it essential for
some outside authority to come to the assistance of the local Government
by providing technically trained personnel. In these cases UNRRA,
supplemented as necessary by charitable organisations, would be the
appropriate authority. The provision of such assistance should be a
matter for discussion between the local Government and/or the military
authorities and UNRRA. In any event it must be recognized that UNRRA
representatives must be able to supervise distribution of the supplies
which UNRRA has financed and to satisfy themselves that they are being
properly used.
In cases where UNRRA was undertaking functions of distribution, supplies
imported from abroad might be consigned to the local representative of
UNRRA. In cases where the local Government pays for supplies,
consignment would be made direct to such Government. There would no
doubt be political advantages if, in cases where UNRRA paid for the
goods but did not distribute them, supplies were consigned to the local
Government. If this were done UNRRA would avoid having to deal with the
business of shipping documents, general average charges, and the other
duties of a consignee. On the other hand UNRRA might find that their
supervision over the distribution of free supplies was best enforced if
the goods were consigned to their representative. This can only be
decided in the light of local circumstances.
Just as local Governments should be encouraged to undertake their own
distribution, there would be advantages in their being given as much of
the work of procurement and handling as is possible without disrupting
the existing machinery. The stronger Governments would no doubt maintain
supply missions in London and Washington (some already have them) which
would be able to negotiate with suppliers and handle the extensive paper
work which is necessary to conform with wartime procedures. The part
which such Governments might play in procurement would vary according to
the commodity and the source of supply recommended by the allocating
authority. The United States Government has taken over all procurement
for lend-lease countries and may wish to do so in respect of all large
scale purchases for liberated territories however financed. The U.K. and
Canadian Governments also would probably not be prepared to allow
[Page 1022]
Allied Governments complete
freedom to negotiate purchases with private firms, although there are
often details of specifications, etc., which it is convenient for the
agent of the requiring Government to settle direct with the supplying
firm. Again in other cases, e.g. certain foodstuffs, where Government
Agencies control directly the whole supply, it would be most convenient
for such Agencies to do the whole of the handling.
In cases in which UNRRA was providing the finance, it could be arranged,
where necessary, that the appropriate Agency of the supplying Government
procured and handled the goods and were reimbursed through UNRRA from
the credit or fund opened in that country for UNRRA.
Similar considerations would apply as regards shipping, since the various
supplying Governments have established procedures for the handling and
loading of ships and for synchronising the movement of goods to the
ports with the arrival of vessels for loading.
D. Finance.
Whatever arrangements are made to finance UNRRA, certain general points
will have to be met. In the first place UNRRA will have to have credits
wherever supplies can be obtained, whether those supplies are to reach
Europe or Asia from overseas or later to be carried from one European or
Asiatic country to another. In the second place, it will probably be
politically easier for the Government of each of the contributing
countries if it stipulated that the bulk of its appropriation of funds
for UNRRA is to be spent within its own territorial limits. But it will
be desirable that the system should be given flexibility and the degree
to which each Government is successful in securing some latitude for
spending outside of its own territory the sum appropriated will
influence UNRRA’s ability to finance supplies where supplies and
shipping availability is greatest. In the third place, some countries
will pay for all their supplies, without drawing on UNRRA, others will
pay for some and others again for none of their supplies. It will,
therefore, be necessary for UNRRA to establish machinery for deciding at
an early stage in the drawing up of an import programme by a country
which expects to get all or part of its supplies as a gift, what shall
or shall not be eligible to be supplied by UNRRA. The earlier the UNRRA
representatives on the local programming authority in the country
applying for free supplies can make known to the Supply Committee of
UNRRA what is likely to be sought, the less the delay in procuring
supplies when the programme is finally presented.
