423 High Commissioner's Office in London to Prime Minister's Department
Cablegram unnumbered LONDON, 20 December 1939, 10.02 p.m.
Your telegram 19th December League of Nations Assembly.  In budget discussion McDougall  stressed need for further reduction in Secretariat expenses particularly in regard to political activity. Chairman of Supervisory Commission announced that in addition to 33 1/3% cut in total expenditure, whole staff of Secretariat and of International Labour Office had voluntarily agreed to accept cut ranging from 2% on lowest salary up to 20% on highest allowance. No definite estimate of this saving was available but will probably exceed 1,000,000 Swiss francs.
Chairman also announced policy reduction of staff would be continued. Hence total reduction will be substantially greater than in budget referred
to in Prime Minister's telegram of 30th November.  In the discussion on allocation committee McDougall drew attention to the proposal to reduce Argentine from 23 units to 21 and urged such a reduction was difficult to justify on basis of comparisons between Australian and Argentine ability to pay. As result, fourth committee decided to regard new scale as only to operate for one year instead of three.
In council election there was no contest. South Africa, Bolivia, Finland elected to seats previously held by New Zealand, Bolivia and Sweden. Assembly decided to maintain additional two seats and reelected China and elected Egypt. Finnish question: no votes in assembly but, following joint declaration by Sweden Norway and Denmark, by the Baltic states and by Bulgaria of intention to abstain, and speeches of condemnation of Russia by Argentine, United Kingdom, France and some other State members, resolution as forecasted in McDougall's telegram from Geneva  was carried without opposition. Council met immediately after assembly adjourned on December 14th and unanimously decided on expulsion of Russia. China, Finland, Greece and Yugoslavia abstained from voting, France made strong statement condemning Russian aggression and comparing this to German action; United Kingdom took similar line.
McDougall realised you would have liked fuller information from Geneva but owing to extreme rapidity of procedure and the fact that he was alone could not send more adequate message.