1. Consideration of scenarios for 2014 Program-Budget Ceiling Secretariat for Administration and Finance April 2013

2. 2014 Program-Budget Assumptions Impact of statutory increases on RF personnel expenditures: $1.9 million Impact of 2013 increases 666.2 Health and Life Insurance 139.6 Salary / Post Adjustment 755.1 Step Increases 379.5 1,940.4

3. 2014 Program-Budget Financing Considerations for All Scenarios Reduced Income to the Regular Fund: – Prompt Payments discounts to member States in 2014: $553 thousand (64% increase) – FEMCIDI 15% contribution reduced by $176 thousand (-58% decrease) ICR contribution to the RF to remain unchanged ($1.5 million). 100% of rental income now needed to cover repayment of demand notes for F Street renovation. $500k income contribution to Regular Fund no longer included, and expense for repayment to be charged to Rental Income Fund.

4. Why reduce rental income? Rental income served a dual purpose – To make payments on funds borrowed to finance renovation/improvements to GSB and Main building infrastructure during 2001-2004. – To defray maintenance costs of leased office space and some of the GSBs maintenance costs In the past, $500 thousand from rental income was allocated to the Regular Fund as income exceeded required debt payments. In recent years, debt servicing and rental income are nearly equal; thus, all rental income must be used to make payments on the demand note. This prompted the Secretariat to transfer, every year, $500 thousand back to its funding account, effectively cancelling out the rental income of the RF.

5. Budget Scenarios 2014 Scenario 1: – Covers statutory increases to personnel expenditures (COLA, step increases, Health Insurance) – Excludes $500 thousand contribution to Reserve Sub-Fund – Ceiling increases by $940 thousand (1.12%) – Quota increase: 2.26%

6. OAS REGULAR FUND BUDGET CEILING PROPOSAL FOR 2014 Scenario One Ceiling Increase Includes:Statutory payments to staff members (COLA and step increases) Ceiling increase level:1.12% Quota income increase:2.26% 2013 2014 Variation $thousand % Personnel53,024 54,964*1,940 3.66% Non-Personnel30,347 29,847 -500 -1.65% Reserve Sub Fund Contribution500 0 -500 -100.00% Budget Ceiling $ 83,871 $ 84,811 $ 940 1.12% FINANCING Quotas81,105 82,938 1,833 2.26% Less prompt payment discount-337 -553 -216 64.09% Net Quota Income80,768 82,385 1,617 2.00% FEMCIDI contribution302 126 -176 -58.28% ICR subsidy1500 0 Other Income1300 800 -500*-38.46% Total Financing $ 83,870 $ 84,811 $ 941 1.12% *Preliminary projection Includes Impact of Statutory Increases $ 1,940

7. Budget Scenarios 2014 Scenario 2: – Covers statutory increases to personnel expenditures (COLA, step increases, Health Insurance) – Maintains $500 thousand contribution to Reserve Sub- Fund – Ceiling increases by $1,440 thousand (1.72%) – Quota increase: 2.88%

8. OAS REGULAR FUND BUDGET CEILING PROPOSAL FOR 2014 Scenario Two Ceiling Increase Includes:Statutory payments to staff members (COLA and step increases) Maintenance of $500k contribution to Reserve Fund Ceiling increase level:1.72% Quota income increase:2.88% 2013 2014 Variation $thousand % Personnel53,024 54,964*1,940 3.66% Non-Personnel30,347 29,847 -500 -1.65% Reserve Sub Fund Contribution500 0 0.00% Budget Ceiling $ 83,871 $ 85,311 $ 1,440 1.72% FINANCING Quotas81,105 83,438 2,333 2.88% Less prompt payment discount-337 -553 -216 64.09% Net Quota Income80,768 82,885 2,117 2.62% FEMCIDI contribution302 126 -176 -58.28% ICR subsidy1500 0 Other Income1300 800 -500*-38.46% Total Financing $ 83,870 $ 85,311 $ 1,441 1.72% *Preliminary projection Includes Impact of Statutory Increases $ 1,940

9. Budget Scenarios 2014 Scenario 3: – Covers statutory increases to personnel expenditures (COLA, step increases, Health Insurance) – Maintains $500 thousand contribution to Reserve Sub- Fund – Increase in non-personnel by 1.7% to compensate for inflation – Ceiling increases by $1,940 thousand (2.31%) – Quota increase: 3.49%

10. OAS REGULAR FUND BUDGET CEILING PROPOSAL FOR 2014 Scenario Three Ceiling Increase Includes:Statutory payments to staff members (COLA and step increases) 1.7% increase in non-personnel funding to cover inflation Maintenance of $500k contribution to Reserve Fund Ceiling increase level:2.31% Quota income increase:3.49% 2013 2014 Variation $thousand % Personnel53,024 54,964*1,940 3.7% Non-Personnel30,347 0 0.0% Reserve Sub Fund Contribution500 0 0.0% Budget Ceiling $ 83,871 $ 85,811 $ 1,940 2.3% FINANCING Quotas81,105 83,938 2,833 3.5% Less prompt payment discount-337 -553 -216 64.1% Net Quota Income80,768 83,385 2,617 3.2% FEMCIDI contribution302 126 -176 -58.3% ICR subsidy1500 0 Other Income1300 800 -500*-38.5% Total Financing $ 83,870 $ 85,811 $ 1,941 2.3% *Preliminary projection Includes Impact of Statutory Increases $ 1,940