VZCZCXYZ0000
OO RUEHWEB

DE RUEHUNV #0509/01 3131409
ZNR UUUUU ZZH
O 091409Z NOV 09
FM USMISSION UNVIE VIENNA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 0276
INFO RUEHII/VIENNA IAEA POSTS COLLECTIVE PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RHEBAAA/DOE WASHDC PRIORITY
RUEANFA/NRC WASHDC PRIORITY

UNCLAS UNVIE VIENNA 000509 
 
SENSITIVE 
SIPDIS 
 
IO FOR ANDERSON, ABRAHAMS, CONNER, HUSKEY, DETEMPLE; ISN 
FOR JENKINS, DOE FOR NA-24, NA-25, NA-21; NSC FOR 
SCHEINMAN, HOLGATE, CONNERY; NRC FOR DOANE, SCHWARTZMAN 
 
E.O. 12958: N/A 
TAGS: AORC PREL KNNP IAEA UN
SUBJECT: IAEA BUDGET: DEPUTY DG SHARES VIEWS 
 
REF: UNVIE 491 
 
¶1. (SBU) Summary:  IAEA Deputy Director General David Waller 
contributed his views on the 2011 budget process, focusing on 
issues of sequencing, financing capital investments, and 
building alliances among G8 countries.  Waller described DG 
ElBaradei's recent meetings in Washington as "very positive," 
and noted the IAEA's strong message on resources with the 
Senate Foreign Relations Committee and others.  Waller felt 
strongly that close coordination between the IAEA and USG on 
budget strategy had been lacking from previous debates, but 
would be key to future budget increases.  Waller hoped that 
high-level U.S. commitment to resourcing the IAEA would be 
expressed in global venues, particularly the Nuclear Security 
Summit in April and meetings of the G8.  DCM underlined the 
need to seize the opportunity of DG Amano's arrival to set a 
new tone on management reform.  Waller said Amano is already 
emphasizing economy.  End Summary. 
 
¶2. (SBU) IAEA Deputy Director General David Waller shared his 
thoughts on the 2011 budget and newly established Budget 
Working Group (BWG) in a meeting with DCM November 6. 
Factors that would alter the normal course of budgeting 
included DG-designate Amano's ascension in December and the 
outcome of BWG deliberations in January.  Waller suggested 
that the BWG's activities could cancel the traditional 
"informal" meeting of the Program and Budget Committee (PBC) 
in February and possibly delay the "formal" PBC in May. 
Waller had assumed that regardless of the BWG's results, the 
Secretariat would use the previously-introduced figures for 
2011 as the point of departure (which envision an 11.4 
percent real increase).  DCM warned Waller that many Geneva 
Group members had already dismissed the 2011 figures and 
expected to start with ZRG as the point of departure and 
counseled against the Secretariat's over-shooting as they did 
with the February 2009 proposal for a 22 percent increase 
(reftel).  Waller agreed with us that early, high-level 
action would be required to keep the "budget hawks" from 
settling immediately into a zero growth position. 
 
¶3. (SBU) Waller did not immediately embrace the Canadian idea 
of a "special assessment" to fund the Safeguards Analytical 
Laboratory, noting that most of the Secretariat-proposed 
increase of 11.4 percent real growth was already destined for 
SAL.  DCM suggested that disaggregating SAL from the general 
budget debate through a special assessment or other mechanism 
might accomplish some strategic goals: 1) it would lower the 
2010 proposal to a figure much closer to ZRG, thus reducing 
the "sticker shock" of the 11 percent figure; 2) it would 
give global leaders a tangible project which they could latch 
on to and champion (rather than the less compelling general 
proposition of a budget increase), 3) it would remove SAL 
from the normal "tit-for-tat" budget negotiations in which 
the G-77 trades safeguards for technical cooperation.  Waller 
promised to think over the proposal. 
 
¶4. (SBU) Turning to other topics, Waller reported DG 
ElBaradei's positive encounters in Washington.  Waller had 
recently accompanied DG ElBaradei to a meeting with members 
of the Senate Foreign Relations Committee, where the two 
enjoyed highly productive talks with Senator Lugar 
(R-Indiana), John Kerry (D-Massachusetts), Chris Dodd 
(D-Connecticut) and others.  According to Waller, Senator 
Lugar recalled a previous visit to the IAEA's Seibersdorf 
Analytical Laboratory and its lamentable conditions, and 
expressed his interest in seeing it revived. 
 
¶5. (SBU) Waller offered to reciprocate ElBaradei's positive 
exchanges in Washington with similar meetings in Vienna both 
now and with the advent of the new Amano administration.  He 
especially urged improved coordination with Washington to 
ensure that U.S. goals for the 2011 budget were put forward 
at a high, strategic level early in the process.  He 
encouraged use of G8 venues for budget talks, agreeing that 
Canadian and UK flexibility could be weighed against French 
and German obstinacy.  He also agreed that the April Nuclear 
Security Summit could be leveraged to convince skeptics like 
Egypt and Pakistan to sign on to the idea that the IAEA 
required additional resources to fulfill its nuclear security 
mandate. 
 
¶6. (SBU) Comment:  Waller was surprised to learn that some 
Member States were already championing a zero growth position 
for the 2011 budget.  He recognized immediately the need to 
loosen the budget hawks' positions through dialogue closer to 
the policy-making level than the IAEA Board Room (i.e., G8, 
Nuclear Security Summit).  His tactical advice in addition to 
the substantive program and budget presentations he musters 
will be crucial to new DG Amano and us as we negotiate the 
2011 budget and subsequent, longer-term planning documents. 
We will want to use Amano's arrival on December 1 to set a 
clear tone on both budget increases and further management 
efficiencies.  End Comment. 
 
 
 
 
DAVIES