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Embassies: Finance

Volume 486: debated on Thursday 22 January 2009

To ask the Secretary of State for Foreign and Commonwealth Affairs with reference to the answer of 26 November 2008, Official Report, columns 1048-9W, on exchange rates, which 10 overseas posts have had the greatest reduction in the purchasing power of their local budgets; and what the reduction has been in each case. (242706)

The Foreign and Commonwealth Office maintains an overseas pricing movement (OPM) mechanism, intended to negate the impact of changes in exchange rates on the budgets of overseas posts. The OPM increases or decreases the sterling budget of posts when there is a change in the value of sterling relative to local currencies. This ensures that posts purchasing power is kept consistent.

The following table shows the 10 posts most affected by exchange rate fluctuations and the resulting change in budget due to the last OPM exercise completed in October 2008.

Ranking

Country

Post

Initial budget (£)

OPM uplift (£)

New OPM uplift (percentage)

New budget (£)

1

Moldova

Chisinau

276,425

94,596

34.22

371,021

2

Czech Republic

Prague

1,367,901

453,943

33.19

1,821,844

3

Poland

Warsaw

1,899,370

615,929

32.43

2,515,299

4

Georgia

Tbilisi

751,724

221,919

29.52

973,643

5

Slovakia

Bratislava

514,504

149,465

29.05

663,969

6

Israel

Tel Aviv

2,021,378

577,534

28.57

2,598,912

7

Brazil

Sao Paulo

1,741,230

334,880

19.23

2,076,110

8

Brazil

Brasilia

2,756,710

529,071

19.19

3,285,781

9

Brazil

Rio de Janeiro

1,361,791

259,488

19.05

1,621,279

10

Switzerland

Berne

2,102,964

400,347

18.70

2,542,885