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the Government of Panama submitted a counter-proposal to which the Commission responded in November 1979 with its evaluative comments and a request that the two parties meet to discuss further the points in question in order to arrive at an agreement in the near future.
To date, no formal response to our comments has been received even though several attempts have been made to elicit action on the part of the Government of Panama to successfully resolve this long-standing matter of joint concern. The latest of these appeals was forwarded to the Director of the Office of the Comptroller for the Canal area in May 1980, to which we received a response on May 27, 1980, indicating that they would be in contact with us to discuss the method to be used for cost reporting. We will continue to pursue this matter with Panama.
Senator LEVIN. What about the quality of public services? Have you been satisfied so far with the services you have been purchasing from Panama?
Mr. McAULIFFE. Most public services being purchased from Panama have been provided since October 1, 1979, at a level generally comparable to that provided by the Company/Government prior to that date. Standards for these services have not yet been fully agreed by Panama. In the area of roads and street maintenance, performance has lagged and the quality is barely satisfactory. Panama's work effort has been severely hampered by late release of funds for acquisition of materials and equipment, and by labor problems. Road and street maintenance began only two months ago, missing the dry season climate, most favorable for this type of work. Notwithstanding the problems, our direct working relationship with counterpart operating personnel responsible for this function in Panama remains good, we will continue to press Panama to provide service as contemplated by the standard.
RETIREMENTS
Senator LEVIN. Mr. McAuliffe, we heard dire predictions last year concerning the flight of experienced American personnel from Panama that would result from implementation of the Treaty. How severe was that impact now that it is behind us? Was it larger or smaller than we had anticipated? Are there particular areas or skills where the early retirements were particularly damaging?
Mr. McAULIFFE. The mass exodus of experienced U.S. citizens, which some persons had predicted, failed to materialize. The liberalized retirement provisions of Public Law 96-70 which are applicable throughout the life of the Treaty, together with the relative smoothness of the transition to date have undoubtedly served to calm the apprehensions which many U.S. citizen employees had about the Treaty.
In the one-year period from April 1979 through March 1980 a total of 317 U.S. citizen employees retired. During the same period in 1978-1979 there were 105 U.S. citizen retirements. At the same time, however, the number of resignations by U.S. citizens were 28 fewer in 1979 than in the previous year. The higher number of retirements among U.S. citizens is largely attributed to the reduction in force that was in process in 1979, during which many employees elected to retire in lieu of being adversely affected in the reduction in force. To a lesser degree, they were also due to the early retirement eligibility provisions available under regular Civil Service rules to employees involved in major reductions in force. Still others retired because of their unwillingness to stay on under the changed conditions brought about by the Treaty.
The retirements and resignations among U.S. citizens which occured during the one-year period spanning from six months before to six months after the Treaty implementation date were not concentrated in any single occupation or group of occupations. The loss of a larger-than-usual number of U.S. citizens in the period could not help but be felt in the Canal organization, especially since many of these employees, through their years of service, had acquired a fund of experience and expertise that is difficult to replace. In spite of this, however, we have not suffered damaging losses in particular areas or skills. To a large extent, competent and wellqualified on-board employees have replaced those who have retired or resigned. Where outside recruitment has been necessary, we have been able to locate sufficient numbers of qualified candidates with the particular skidls that we require.