'CORPORATE' UN MANAGEMENT STRATEGY FAR REMOVED FROM CHARTER, FIFTH COMMITTEE TOLD

25 October 1996

Press Release
GA/AB/3100

'CORPORATE' UN MANAGEMENT STRATEGY FAR REMOVED FROM CHARTER, FIFTH COMMITTEE TOLD

19961025 United Nations Not a Company, says Costa Rica; Committee Also Discusses Funding Operation in former Yugoslavia, Budget Cuts

The Secretary-General's human resources management strategy had shown an excessive tendency towards a "corporatist" management far removed from the United Nations Charter, the Fifth Committee (Administrative and Budgetary) was told this afternoon, as it discussed staff management.

Making a statement on human resources management on behalf of the "Group of 77" developing countries and China, Costa Rica's representative said the Secretariat should keep in mind that the United Nations was not a company. "The United Nations does not sell a product whose production can be increased or decreased at will according to profits", she said. "It is of extreme importance that the new direction towards the so-called `corporate' mentality does not destroy the fabric of the international civil service." She added that the performance appraisal system (PAS) was a private enterprise conception that could work perfectly in an institution which was benefit- oriented.

Also this afternoon, the Committee discussed budget cuts and programme planning and took up the funding of the United Nations peace-keeping operations in the former Yugoslavia.

The need to provide more systematic training and development opportunities for all United Nations staff should be emphasized, said the representative of Jamaica, also speaking for the 13 Member States belonging to the Caribbean Community (CARICOM). For staff to be motivated, they should have the opportunity for upward mobility and advancement. "A certain sense of malaise and pessimism overhangs the Organization in this respect, and can only be countered by giving people hope through improved prospects for advancement", she said.

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The Secretariat should recruit staff on the basis of the principle of equitable geographical representation to correct the staff composition showing that some States were unrepresented or underrepresented, Mali's representative said. It should place people from developing countries in high-level posts. Budgetary problems should not make the United Nations forget the need for personnel training and new staff.

Speaking on the budget-savings proposals, the representative of the United States said that, just as the Secretary-General had his duties, the Fifth Committee, too, had its responsibilities. "We contribute little, however, if we were to attempt -- as a Committee with 185 members -- to do the Secretary-General's job for him," she added. "We cannot take upon ourselves the job of scrutinizing every personnel decision, every decision to authorize or not authorize travel, and every decision to move one position from here to there. That level of micro-management is a recipe for the paralysis of this institution."

The representative of the Russian Federation said that the Secretariat should explain the need to raise the Professional vacancy rate to 11.8 per cent, from the 6.4 per cent approved by the General Assembly. The higher rate might hamper the implementation of mandated programmes.

Statements on human resources management were also made by the representatives of Argentina, Russian Federation and China. On the proposed cuts to the budget, the representatives of India, Ghana, Philippines and Colombia also spoke. Statements on programme planning were made by Japan and Norway. Statements on the financing of peace-keeping missions were made by the representatives of Ireland, speaking for the European Union and other States, the United States, Canada and Uruguay.

The Secretary-General's reports on the financing of the missions to the former Yugoslavia were presented by the United Nations Controller, Yukio Takasu. The Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), C.S.M. Mselle, introduced his committee's report, while Nicanor Guerra, of the Office of Internal Oversight Services, introduced that Office's report.

The Committee is scheduled to meet again at 3 p.m., Tuesday, 29 October, to continue discussing the proposed budget cuts, pattern of conferences and review of United Nations efficiency and programme planning, under which it would debate the proposed medium-term plan for 1998-2001.

Committee Work Programme

The Fifth Committee (Administrative and Budgetary) met this afternoon to take up the financing of the United Nations Protection Force in Bosnia and Herzegovina (UNPROFOR), the United Nations Preventive Deployment Force (UNPREDEP), the United Nations Confidence Restoration Operation in Croatia (UNCRO), and the United Nations Peace Forces headquarters (UNPF) in the former Yugoslavia. It would also continue discussing cuts in the regular budget, human resources management, pattern of conferences and programme planning. (For background information, see Press Release GA/AB/3096 of 21 October.)

The Committee is also scheduled to discuss the funding of the United Nations Assistance Mission for Rwanda (UNAMIR).

Missions to Former Yugoslavia

A report of the Secretary-General discusses the decentralization of some administrative functions and the reduction of the staff of UNPROFOR, UNCRO, UNPREDEP and UNPF (document A/50/696/Add.6). He cites some analysis showing that the centralization of administrative functions in the mission area would yield modest savings in terms of staffing because even in a centralized environment, focal points for procurement, finance and other areas would have to be retained locally. Also, the creation of an additional procedural tier would render support functions more cumbersome. The functions that need centralization are already centralized at Headquarters in the Departments of Peace-keeping Operations and Administration and Management. They include recruiting and placing international staff, contracting air and sea carriers for the repatriation of troops as well as biddings for large-scale purchases. Further centralization at the regional level would only duplicate the work. In the area of local personnel administration, centralization would not reduce staff since those functions require officers to be present in various locations throughout a mission area. Therefore, the overall number of staff would not change regardless of whether the service was centralized or not.

The report states that the Secretary-General withdraws a proposal to set up a central transport warehouse in Zagreb since it would be counterproductive operationally. He recommends that the budgetary provisions for the warehouse be deleted and its eight staff shared equally by the Communications Control Centre and air operations. The total proposed staffing for the missions' central support unit would remain at 62.

In its related report on decentralization and reduction in the overall number of administrative staff (document A/51/497), the Advisory Committee on Administrative and Budgetary Questions (ACABQ) says that the review does not seem to have produced much progress towards a centralized administrative structure. But it does not oppose the Secretary-General's proposals, trusting that the question of administrative support in the area of the operations will

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continue being reviewed. The ACABQ will revisit the issue while considering the Secretary-General's future reports on the funding of those operations.

The Secretary-General's financial performance report on UNPROFOR, UNCRO, UNPREDEP and UNPF (document A/50/696/Add.7) for the period 1 July to 31 December 1995 also relays his request for the Assembly to decide on what to do with an unencumbered balance of $227.4 million gross ($227.9 million net) for the period 1 October 1994 to 31 December 1995.

As for the period 1 July to 31 December 1995, about $861.3 million gross ($854.4 million net) was spent out of the total of $889 million gross ($882 million net) provided by the Assembly. That created an unencumbered balance of $27.7 million gross ($27.5 million net) for that period.

In reviewing the financial administration of the missions in the former Yugoslavia, the Secretary-General says that total resources of $5.09 billion gross ($5.06 billion net) was made available to them from 12 January 1992 to 30 September. The total estimated spending for that time was $4.77 billion gross ($4.74 billion net), including voluntary contributions of $40.6 million. There are total outstanding dues of $736.5 million.

In its related report mentioned above, the ACABQ, addressing UNPROFOR's financial performance, reiterates the need for the most recent financial data to be made available. Despite its request, it had not been provided with the most up-to-date information on the total obligations of $861.3 million for the period 1 July to 31 December 1995.

The ACABQ notes that the Secretary-General's performance report deals with extraordinary charges totalling $70 million made against several budget items due to changes in the accounting for the reimbursement of consumables such as rations, ammunition, spare parts and medical and miscellaneous supplies. In response to its request for an explanation on how the $70 million was derived, the ACABQ was told that the sum was determined after extensive reviews in December 1995. It was also informed that the UNPF owed Member States about $587.4 million for contingent-owned equipment.

The ACABQ suggests that the Secretary-General should clarify the changes in how to account for the reimbursement of consumables, the status of unliquidated obligations and other issues.

The Committee also has before it the Secretary-General's consolidated report on the UNPF in the former Yugoslavia and on the administrative and budgetary aspects of the financing of peace-keeping missions (document A/51/389), which proposes to limit the Organization's peace-keeping liabilities.

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The report describes the scope of United Nations liability for the activities of United Nations forces, especially in relation to the types of damage most commonly seen in United Nations operations. They include non-consensual use and occupancy of premises, personal injury and property loss or damage as a result of the ordinary operation of the force, as well as injury and damage resulting from combat operations.

The report comprises three parts: the first describes the scope of United Nations liability for damage resulting from the ordinary operation of the force, from "operational necessity", and combat-related damage. The second examines the existing procedures for settling third-party claims, the difficulties that have been experienced and modified mechanisms that will ensure simpler settlement of third-party claims. The third part proposes financial and time-limits on the Organization' liability and suggests measures of recovery from States that contribute contingents.

The United Nations has, since the inception of peace-keeping missions, assumed its liability for damage caused by members of its forces in the performance of their duties, says the Secretary-General. In accordance with section 29 of the Convention on the Privileges and Immunities of the United Nations, the Organization has undertaken in its model status-of-forces agreement to settle, by means of a claims commission, the claims that arise from damage caused by members of the force and which, due to the immunity of the Organization and its Members, could not be settled in local courts.

The report explains the scope of United Nations liability. It states that the use of land and premises for the headquarters, camps and offices of a United Nations force and for accommodating its members are essential in a host country. Based on the assumption that, by inviting a peace-keeping force to its territory, a host State has agreed to provide it with premises, the various status-of-forces agreements have included an obligation on the part of the host State to provide a United Nations peace-keeping mission, free of charge, with premises for its use. The obligation is reflected in article 16 of the model status-of-forces agreement. But article 16 of the model agreement has rarely been applied to the letter, with the result that, with few exceptions, the United Nations has had to negotiate the rental of its premises with the owners of private premises. The problem of premises becomes acute when no government existed to obtain premises for the Organization, and where the existing government did not exercise effective control over the United Nations area of operation or had otherwise refused to cooperate with the force.

In such situations, it goes on, the need to take temporary possession of land and premises, often privately owned, has arisen. That has raised the question of whether taking possession is lawful, and whether compensation should be paid for such non-consensual use of land. Since the power to seize private property lay with the host government, United Nations forces took

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possession of land only when governments failed to provide the premises that were operationally necessary to enable the force pursue its mandate.

The report says that the legality of the occupancy in such circumstances does not exempt the Organization from liability to pay compensation or fair rental for privately owned property, while maintaining its right to seek reimbursement from the government under the terms of article 16 of the model status-of-forces agreement. Unlike privately owned property, for which compensation must be paid, State-owned property need not be compensated for when used temporarily.

The Secretary-General states that the Organization's liability for property loss and damage caused by its forces in the ordinary operation of a force is subject to the exception of "operational necessity". He defines operational necessity as a situation in which damage results from the necessary actions taken by a peace-keeping force in pursuing its mandate. The determination of such a necessity remains the discretion of the force commander who must try to strike a balance between the force's operational needs and respect for private property.

According to the Secretary-General, the scope of the Organization's third-party liability will have to be determined in each case according to whether an act by members of its forces violated international law. Such liability would arise if damage was caused in violation of international law and could not be justified on grounds of "military necessity".

Liability usually lies where the command and control of a force is vested, according to the report. Complications in determining responsibility arise when a State or States provide the Organization with forces to support a United Nations mission but not necessarily as an integral part of that operation, and where operational command and control is unified or coordinated. That was the case in Somalia where the Quick Reaction Force and the United States Rangers were sent to back up the United Nations Operation in Somalia (UNOSOM II) and in the former Yugoslavia where the Rapid Reaction Force supported the United Nations Protection Force (UNPROFOR).

The Secretary-General states that there are two kinds of procedures for handling third-party claims. One is provided for under article 51 of the model status-of-forces agreement and the other is established internally by the United Nations. The model agreement provides for a standing claims commission as a mechanism for settling disputes whereby both parties -- the United Nations and the host country -- take part equally. The internally created mechanism, on the other hand, leaves the investigation, processing and final adjudication of claims in the Organization's hands.

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While article 51 of the model agreement allows the establishment of a standing claims commission to settle private law disputes involving a United Nations operation or any of its members, third-party claims of that nature have been settled without resorting to standing claims commissions, the report states. Instead, local claims review boards have been established in mission areas to handle third-party claims for injuries or death and property damage attributable to official acts by members of a mission. When the claims review board -- established under authority delegated by the United Nations Controller -- approves a settlement amount within its authority, the sum is paid out in the field. But, when the sum exceeds the board's financial limit, the claim is referred to Headquarters for review and approval.

Consisting typically of at least three staff members, the claims review board mechanism applies to all United Nations operations regardless of size, the report explains. But the increasing number and complexity of claims from recent major operations have taxed the Organization's ability to deal with them efficiently and promptly. That has led to backlogs and longer delays in settling claims. Shortage of staff for investigating and processing claims at the field level and Headquarters has worsened the problems. Procedural problems have been exacerbated by the lack of clarity about the scope of United Nations liability for property loss or damage, in general, and its liability for damage due to "operational necessity", in particular.

In response to the problems, the Secretary-General proposes some modifications to the procedures which he asks the Assembly to approve. He says that United Nations operations should be provided with the personnel needed to deal with claims. The financial authority of the local claims review boards could be changed. Meanwhile, claims exceeding the local boards' financial authority should continue to be forwarded to Headquarters with recommendations for final decisions. Also, instead of having only one local review board in a peace-keeping area, multiple boards could be created. That would enable them to divide their work into such specific areas as personal injury or property damage claims. The boards must be given the administrative, financial, operational and legal personnel they need.

The lump-sum payment of claims, by which the United Nations negotiates a settlement directly with the government acting on behalf of its nationals, offers the Organization the advantages of efficient and expedient settlement and limitation of its liability, according to the Secretary-General. Under this type of settlement, the government -- usually that of the host State -- aggregates and submits its nationals' claims to the United Nations. It then negotiates on their behalf for a lump-sum amount to settle their claims. Once the amount is paid, it is for the government to distribute it as it sees fit.

The lump-sum approach has several advantages, according to the Secretary-General. First, it avoids long and costly proceedings that would have been necessary to deal individually with a large number of claims.

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Second, since the lump-sum amount would be the final settlement of claims, it would set a finite limit to the Organization's financial responsibility. It would also prevent a situation in which individual claims continue to be submitted long after a United Nations mission has been ended. Third, it would eliminate the need for the United Nations to settle the issue of who owns the property for which claims were made; such a determination would be left to the government concerned. Where there is no government in the mission area, or where the government is not ready to espouse claims, the Organization will have to face individual claimants. The lump-sum agreement would be negotiated between the Organization and a claimant State at the level of Headquarters.

Due to the huge increase in the number and amount of third-party claims against the United Nations, the Secretary-General states that the Assembly may consider some limitations on the Organization's liability. They include financial and time-limits, counter-claims and recovery from States contributing contingents, in specific cases of gross negligence, wilful misconduct or international criminal liability of a member of the force.

The Organization's financial liability could be capped in relation to economic and non-economic loss and exclude the payment of punitive or moral damages, says the Secretary-General. A temporal limitation -- which would provide that claims made after a certain period would be invalid -- would reflect the need to investigate claims on site. Accordingly, claims submitted after an unreasonable period of time would not be considered. In some instances, the United Nations may press claims against a party that has asserted a claim against it. If the United Nations claims arise from the same situation that gave rise to a claim being filed against it, they are regarded as "counter-claims"; but if they arise from different situations, they are "off-sets". Cases in which the Organization has counter-claims or off-sets against individuals are not common. They are more likely to arise against a host government.

In the relationship between the United Nations and States contributing contingents, the Secretary-General says that the Organization may seek recovery from a State if a member of its national contingent causes damage through negligence or wilful misconduct. The Organization may also seek recovery from States contributing contingents in situations where combat-related damage is caused by a member of their national contingent in violation of international humanitarian law and where the international criminal responsibility of the individual member is entailed.

Providing estimates on the settlement of third-party liability claims, the Secretary-General states that a total of 151 claims were pending in relation to the United Nations Peace Forces in the former Yugoslavia. They include 37 cases worth about $28.8 million. The $10 million that has been authorized for the period 1 January to 30 June and the $5.5 million in the cost estimates for the period 1 July to 30 June 1997 presently seem adequate

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for settling claims, based on several factors. They include the number of actual claims received since the cost estimates were prepared, the rate at which claims continue to be filed, the number of claims that have been settled and the number and value of those outstanding.

In its report on the revised cost estimates for third-party claims (document A/51/491), the ACABQ concurs with the Secretary-General's view on the financial and temporal limitations. However, aspects of the limitations such as the ceiling of compensation, modalities for establishing the Organization's financial limitation and the duration of the limitation periods must be studied further.

After referring to the 151 claims pending in UNPF, the ACABQ recommends that the Organization should establish a standard format for preparing claims for consideration. That will allow claimants to present information in a verifiable manner and facilitate the processing of claims. The ACABQ also recommends that the Assembly endorse the Secretary-General's proposals on limiting the Organization's liability. The presentation by the Government of Bosnia and Herzegovina of undocumented claims totalling $70.7 million "is compelling evidence of the need for the United Nations to develop, as quickly as possible, effective measures which could limit its liability", it adds.

The claims, annexed to the report, include about $43.4 million for damage to roads by United Nations vehicles, $18.3 million for damage at Sarajevo Airport and about $2.2 million for damage at Marshal Tito Barracks.

In its review of the management structure in the civilian staff component of the UNPF, transmitted in a note by the Secretary-General (document A/51/305), the Office of Internal Oversight Services concludes that UNPF's management would have been more effective and could have saved significant resources if its management structure had been more appropriate. Frequent expansions and changes in the UNPF mandate made the establishment of adequate internal controls even more important. Better internal control systems would have contributed to more efficient operations within UNPF. They would have enabled the administration to manage the resources of the Organization more effectively and to ensure greater value for money.

The Office concludes that future peace-keeping missions should establish, at an early stage, appropriate management structures with proper internal controls to allow efficient management. The reply from the Department of Peace-keeping Operations to the Office's audit report showed that UNPF had taken several steps to improve its operations -- they are incorporated in the report.

The Office recommends sound planning as a prerequisite for efficient missions, stressing that the creation of stronger management capacities at peace-keeping missions is crucial. The appointment of qualified officials as

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Chief Administrative Officer and for other functions is essential and should be supported by Headquarters. Monitoring and documenting of internal control systems and procedures should be developed to help future missions achieve their objectives.

Statements on Funding of Missions in Former Yugoslavia

YUKIO TAKASU, United Nations Controller, introduced and reviewed the reports of the Secretary-General. He said that there was an unencumbered balance of $227.4 million in the missions' accounts and the Assembly should decide on how to dispose of it.

C.S.M. MSELLE, Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introduced and reviewed his Committee's reports. He said some of the Secretary-General's reports had been difficult to understand. For example, his performance report dealt with extraordinary charges totalling $70 million against several budget items resulting from changes in accounting for reimbursement of consumables. The ACABQ had sought additional information on how the expenditures of $70 million had been arrived at.

NICANOR GUERRA, of the Office of Internal Oversight Services, introduced the report of that Office.

PATRICK KELLY (Ireland), speaking on behalf of the European Union and Cyprus, Czech Republic, Estonia, Hungary, Lithuania, Romania, Slovakia, Slovenia and Norway, said that the scale of the missions in the former Yugoslavia led to costs of some $4.8 billion and members of the Union had contributed troops, equipment and funding to them. He expressed concern at the slow pace of liquidating those missions and delays in settling claims from troop-contributing States, including for contingent-owned equipment. He had noted from the ACABQ report that about $600 million was owed for contingent- owned equipment. The criteria used in settling all claims should be transparent.

Welcoming the report of the Office of Internal Oversight Services on the management of the civilian component of UNPF, he said that many of the problems it highlighted were germane to the Committee's consideration of the overall financing of the mission. Noting some of the findings of the Office, such as an unnecessary expenditure of $6 million, he said that its recommendations should be taken into account in future planning for peace- keeping operations.

Turning to the ACABQ report on third-party claims, he said that one of the major problems faced by the United Nations was the non-compliance by host governments with their obligations under the status-of-forces agreements and other pacts. The Union was concerned about the numerous instances in which

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the missions in the former Yugoslavia had been forced to pay excise duties and commercial rents which they had not been properly required to pay. The Union supported the recommendations of the ACABQ, which among other things, asked the Secretary-General to take measures to rectify the situation and to recover the losses of the Organization resulting from reported violations by governments of the provisions of the status-of-forces agreement. The Union also supported the recommendations that the Secretary-General should explain the changes in accounting arrangements for reimbursements for consumables. He should also clarify the reasons for the need of an additional $23 million for rations. He should take prompt action to follow-up on his proposals to limit United Nations liabilities related to third-party claims.

The Union, he said, was concerned that some $312 million was still owed in assessments to the United Nations Mission in Somalia (UNOSOM II), as a result of which many countries that had contributed troops and equipment were yet to be fully reimbursed. Nations should pay up their dues even if the mission had been closed. The Secretariat should provide further information on the issue of reimbursing all troop-contributing States.

WILLIAM K. GRANT (United States) said that the Secretary-General's reports and those of the ACABQ had referred to more than $21 million in voluntary contributions. Those contributions had come from the United States. It had also provided the Controller's office with information on how certain claims would be validated. The payment of excise tax was a violation of the status-of-forces agreements. The United States would pursue that matter with a view to taking more aggressive measures to resolve that matter.

G. DRUSCHNER (Canada) said that some delegations had expressed concerns about delays in the payment of reimbursement, which she shared. She welcomed the establishment of the strategic database as a mechanism to monitor cost recovery. There should be greater transparency between the Secretariat and Member States on the issue of reimbursement. The strategic database did not give information to all Member States, but just on those who were connected to it. The issue of reimbursement to troop-contributing States was fundamentally important if Member States were to continue sending their troops to peace- keeping operations. To improve the transmission of information to Member States, the Secretariat should produce a document monthly to state what was owed to each troop-contributing State and what was available in each peace- keeping operation's account earmarked for reimbursements. The Secretariat should send a note verbale to inform troop-contributing States whenever the payment of reimbursement was suspended.

BERNARDO GREIVER (Uruguay) supported the view expressed by the representative of Canada, in particular regarding the database. The communication system for peace-keeping operations was useful and should be continued.

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Statements on Savings from Regular Budget

PRAKASH SHAH (India) said that the Secretary-General should provide more information on whether his proposals were the result of executive decisions or were from the legislations of the Assembly, then the Assembly could take a look to see whether the changes he was proposing would affect the implementation of programmes. The Secretariat should also provide a chart to explain the origins and implications of the proposed changes.

The representative said that the questions raised by the ACABQ in paragraph 26 of its report should be answered. [Note: The paragraph states, among other things, that the issue of vacancies was central to the savings exercise. The manner in which the Secretary-General would use vacancies to achieve savings should have been fully elaborated. It was clear that it was not necessary to maintain a vacancy rate of 11.8 per cent for Professionals to achieve the 6.4 per cent rate required by the Assembly. He should also elaborate on how vacancies were being used to accommodate additional mandates.]

He said that it was useful to know if the effort to maintain a rate of 11.8 per cent for Professionals was a way to achieve the targeted savings of $104 million or whether it went beyond that to accommodate the costs of additional mandates for the International Civilian Mission to Haiti (MICIVIH), the United Nations Human Rights Verification Mission in Guatemala (MINUGUA) and other activities that had not been covered by budget resolution 50/214. Unless that question was answered convincingly, doubts would remain as to the reasons underlying such actions as the termination of several permanent staff members.

The Secretariat should clarify statements in the Secretary-General's various reports in which he sometimes said the budget was not being overspent but said, on other occasions, that he could not absorb the additional mandates, he continued. Also, the Secretariat should confirm or deny the impression that it was trying to accommodate the additional mandates through increased vacancies. India believed, in principle that, if additional funding could not be provided for unfunded mandates, any absorption of costs for such activities should only be done in the same budget cluster from which the new activities would normally be funded. Therefore, any efforts at absorption must be done only in part II of the current budget, dealing with political affairs and peace-keeping. If that was not possible, additional funds might be required.

MADELEINE K. ALBRIGHT (United States) said that the Secretary-General was the United Nations Chief Administrative Officer, with full authority and responsibility for running the Organization within the budget approved by the Assembly. He must organize the Organization's structure efficiently, reduce excess staff, minimize overlap and modernize modes of operation. His report

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informed members in considerable detail of the steps he was taking to fulfil those responsibilities and to implement the budget. It was encouraging that the Secretary-General had been able to say that the programme of work was being carried out in full, subject only to the adjustments required to accommodate activities within available resources. It was also encouraging that he had been able to conclude that there were no indications of the budget being overspent.

The Secretary-General's report, she said, was part of a longer process. The central challenge of that process was to reconcile the level of expenditures in an earlier budget estimate within the approved budget of $2.61 billion. Just as the Secretary-General had his duties, the Fifth Committee, too, had its responsibilities. In exercising them, its members should maintain a balance, raise legitimate questions and seek sufficient information to permit them to make accurate judgements. "We contribute little, however, of we were to attempt -- as a Committee with 185 members -- to do the Secretary-General's job for him. We cannot take upon ourselves the job of scrutinizing every personnel decision, every decision to authorize or not authorize travel, and every decision to move one position from here to there. That level of micro-management is a recipe for the paralysis of this institution."

Committee members, she continued, had a larger responsibility; they should approve budgets that reflected sound priorities and did not exceed what States were willing to pay for. The budget ceiling approved by the Assembly must be considered firm. The United States Government expected to pay its full share of the budget this year, just as it had met its obligations to the budget in full for 1995. Evidence of discipline by the United Nations in establishing and funding programmes was essential if Member States were to have the confidence to fund those activities reliably. The United States commitment to reform, revitalization and increased discipline was due to its belief in the Organization and a desire to make it more effective. The implementation of the current budget was a test of the progress being made in that regard.

HENRY HANSON-HALL (Ghana) said that the Assembly should be guided by its resolution 41/213 in dealing with the budget of the United Nations. In implementing the savings approved by the Assembly, care should be taken to ensure the full implementation of mandated programmes and activities. To ensure that, the Assembly had retained for itself the right to approve any proposal made by the Secretary-General on how to cut the budget. The Assembly had also requested him to ensure that adequate resources were allocated for activities specifically relating to the least developed countries in accordance with priorities set by the Assembly.

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The representative said his delegation supported in principle the measures aimed at streamlining procedures, taking advantage of technological innovations, among others, and welcomed the Secretary-General's efforts in that direction. The Secretariat had, however, not clearly stated how the numerous deferrals, delays, postponements and cancellations in the approved programmes would affect the United Nations ability to carry out its mandates.

Regarding the Secretary-General's proposals to attain higher vacancy rates than those sought by the Assembly, he said that he agreed with the ACABQ that such action could undermine staff morale, especially when the question of abolishing posts had not yet been disposed of. The Secretariat should not carry out any involuntary separations solely to make savings from the budget, as the ACABQ had stated. Ghana was concerned that too high a vacancy rate would harm programmes approved by the Assembly. He agreed with the view expressed by Costa Rica, on behalf of the "Group of 77" developing countries and China that further information should be provided to Member States, to justify the Secretary-General's proposals.

CELSO D. GANGAN, Chairman, Commission on Audit of the Philippines, said the Secretary-General's report on savings in the 1996-1997 budget had failed to adequately address the issues raised by the ACABQ regarding the impact of proposed actions on programme delivery. Noting that some programmatic reviews had been undertaken by intergovernmental bodies, particularly some regional economic commissions, he said in many areas, the Secretary-General's report was unclear whether the proposed changes in programmes were the Secretariat's initiative or the results of intergovernmental review.

It would have been preferable for the relevant intergovernmental bodies to have had the opportunity of reviewing how their work programmes would be affected by the proposed reductions, he continued. In that connection, the Philippines shared the concerns of the Economic and Social Commission for Asia and the Pacific (ESCAP) that the budget reductions would have an adverse impact on major priority areas of its work programme which were crucial in accelerating the economic and social development of the countries in that region, especially developing countries.

On staff reductions, he said there was cause for concern that the savings would be largely achieved through higher vacancy rates for the Professional and General Services posts than what was called for in the budget resolution 50/214. As at 30 June, those vacancy rates were 11.8 and 7 per cent, respectively. There was further cause for concern that the highest vacancy rates for the Professional posts were in areas of international and regional cooperation for development which were of particular importance to developing countries. It was not clear what criteria had been used for the personnel action proposed by the Secretary-General, especially with regard to involuntary separation of staff. He urged the Secretariat to pursue greater efforts in placing the staff concerned from the developing countries.

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Regarding financing of new mandates for the current biennium, his delegation shared the ACABQ's concern that those additional costs, estimated at $92 million for the biennium, might be absorbed through a further increase in the vacancy rates, he continued. Assembly resolution 41/213 had established procedures to deal with the financing of new mandates. Stating that he was not adverse to the concept of savings, he said the manner in which it was implemented would diminish the Organization's unique and international character and might even result in greater costs. The Secretary-General's performance report should make available information on the programmatic impact and financial aspects of the proposed savings to enable the Assembly to arrive at an informed decision on those matters.

AURELIO IRAGORRI (Colombia) said that the Committee must have sufficient information to know what the impact of the savings would be on mandated programmes. What had given rise to the current situation and why was the information required not made available? he asked. There could be many reasons for the present state of affairs. The Organization's budget was of greatest concern to his delegation. The current state of affairs had begun with the adoption of the 1996-1997 budget. It was understood then that it was better to have a consensus budget rather than postpone the decision. Had delegations not supported the budget's adoption, the consequences would have been very grave. Hence a savings objective had been developed which meant a permanent pressure on the Secretariat to achieve an efficiency culture which had become more difficult with the imposition of conditions by one Member State.

Member States had maintained the premise that the savings measures should not impact on the implementation of the mandates adopted by the supreme body -- the Assembly, he continued. That consensus had given rise to the budgetary uncertainty that was being experienced today. The Organization's mandates were so broad and complex and the needs so great that there was no doubt that the financial resources to cover them would be insufficient. Using resources for better efficiency was one matter. To move from that position to justify that despite cuts in resources, mandates would be implemented was another. He had doubts that it was possible.

Stressing that all Member States wanted a more efficient organization, he asked if they were ready and willing to make the necessary sacrifices. The answer to that question was a negative one. Efficiency and full implementation would not be possible at the same time. Efficiency might have to yield. It had been one year since the budget had been adopted. Yet Member States still held positions of principle and awaited the Secretary-General performance report to make final decisions. What had been done already was done. It appeared that the Committee was so steeped in the technical aspects of the issues that reality came as a cruel shock to them.

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What would be the Assembly's response if the implementation of programmes had been adversely affected, he continued. Would there be a re- evaluation of the budget? he asked. What would be the response if the priority programmes for the developing world would bear the brunt? he further asked. Those decisions would have to be faced. He said he trusted the veracity of the information presented by the Secretariat. He hoped that decisions made on staff would not weigh heavily on such factors as friendship and nationality. It was also hoped that all programmes had been treated fairly. The Committee would have to face the consequences of the action already taken by the Secretariat and take alternative action. It was important for the Committee to receive the relevant information on all those matters so that they could determine the resources that were necessary for the Organization to carry out its obligations to mankind.

YEVGENY DEINEKO (Russian Federation) said he appreciated the number of specific measures taken to rationalize the Secretariat's work and structure and to reduce unproductive expenses. He also appreciated the significant contribution of the Secretariat, including that of programme managers, to achieve savings. The Secretary-General's report on the budgetary savings was a significant step in the right direction. Regrettably, the report lacked the substantiated financial implications of the proposed changes and a complete analysis of the impact the proposed actions would have on programme delivery. In the majority of cases, the Secretary-General's report left unclear whether the proposed changes derived from his initiative or were the results of intergovernmental reviews. The Russian Federation shared the ACABQ's opinion that very little information was available on the related budgetary consequences of the actions proposed by the Secretary-General as well as their impact on programme delivery.

Although the Secretary-General faced a very serious challenge to achieve the savings, Member States believed the task could be fulfilled, he continued. Efficiency reviews must play an important role in attaining the objectives set. Those reviews must be pursued on a continuing basis, not sporadically. He drew attention to the three-phased approach developed by the Secretary- General to enhance the Organization's efficiency. However, it was a pity that the report failed to fully reflect even the appropriate measures taken to implement the first phase.

Regarding the vacancy rate proposed, he called on the Secretariat to provide the reason for the need to increase the Professional vacancy rate (to 11.8 per cent) in comparison with other options for ensuring savings outside of the personnel costs. Such action might have a negative impact on the implementation of mandated programmes. The financial implications of early separation of staff and involuntary separations were questionable. The implementation of such action would have only minimal utility for achieving savings. One could not exclude a possibility of legal and administrative appeals against such decisions, which would mean additional costs, not

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savings. The Secretary-General must update proposed estimates in the context of the first performance report on the budget. The Assembly would consider and approve at that time revised appropriations for the current biennium. Budgetary expenditure was not an end in itself but a way to a more efficient and streamlined Organization geared to specific priorities.

Statements on Programme Planning

FUMIAKI TOYA (Japan) said the Perspective -- the document prepared by the Secretariat containing a perspective on the proposed medium-term plan for the period 1998-2001 -- enumerated the Organization's strengths and capabilities. If the United Nations was to play a more active role on a range of issues, from peace and security to economic and social development, and meet the expectations of the international community, it was essential that reform efforts be ongoing and that its activities be prioritized and rationalized. The Perspective's discussion of the activities the Organization should undertake was too general and broad and failed to identify priorities.

The other document prepared by the Secretary-General on the proposed medium-term plan in response to a request from the Committee for Programme and Coordination (CPC) -- the Note -- also remained general and broad. "What is needed is a document that presented a feasible strategy." Member States should carry out the task of prioritizing activities based on the Secretary- General's proposal, if necessary. The following four United Nations activities would be particularly important during the period of the next medium-term plan: activities relating to the promotion of peace, including preventive diplomacy, peacemaking, peace-keeping and peace-building; the micro and macro aspects of disarmament; development efforts, especially in the African region; and humanitarian assistance.

However, in view of the difficulty of reaching a consensus among Member States quickly so that the new medium-term plan could be adopted, the Japanese delegation was basically prepared to endorse the Note, with some reservations on individual paragraphs which had already been submitted to the CPC, he said. In paragraph 61 of the Note, which deals with priority activities during the plan period, several areas of activity should be added, including global issues such as drugs, crime, the environment and clearance of existing land- mines.

JORN GUTTEROD (Norway) said all the parts of the present structure of the draft medium-term plan were necessary to constitute a whole. The Perspective represented a visionary attempt by the Secretary-General to grasp current global problems as well as emerging trends, challenges to the international community and the instruments at the Organization's disposal to cope with those challenges. The Secretary-General was commended for providing the plan document with that added dimension.

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Commenting on the four global trends around which the Perspective had been developed, he said, concerning globalization, that to offset the negative repercussions of global trends, economic and social development would have to be kept as one of the Organization's important priorities. Marginalization was a threat the Organization must help to contain. Efforts in that regard must continue to be the Organization's most substantial core activity. In that connection, he underlined the need to keep up and improve its efforts in favour of African development.

The Organization should be prepared to deal with the positive and negative dimensions of fragmentation, he continued. Preparedness for developments such as internal crises within States and internally displaced persons must remain high priorities for the Organization. He welcomed what was stated in the Perspective on democratization and the civil society as important factors in meeting the challenges ahead. The Organization's priorities should concentrate on the promotion of peace, security and human rights, development, rapid response to human and environmental emergencies and respect for and compliance with international law. His country's priorities were very much in line with those in paragraph 56 of the Perspective. He, therefore, strongly recommended that the Perspective constitute an integral part of the proposed medium-term plan.

The Note could not replace the Perspective, he said. Rather, it would serve as a coherent tool in the difficult process of transforming the visions outlined in the Perspective into concrete action. Together, both documents would furnish the Assembly with a solid basis for an active strategic planning process, an activity which had been inadequately exercised during the past years.

Statements on Human Resources Management

NAZARETH INCERA (Costa Rica), speaking on behalf of the Group of 77 and China, expressed concern on the relationship between staff representatives and the International Civil Service Commission (ICSC). The Fifth Committee should deal with that problem since staff were the most valuable assets of the Organization. The strained relationship between staff and management and other problems should be dealt with as a matter of priority.

The representative said that the Group had noted that, in the implementation of the Secretary-General's human resources management strategy, there had been an excessive tendency towards a "corporatist" management, which was far removed from the United Nations Charter's purposes and principles and the objectives of the Secretary-General's initiative. The fact that the United Nations was not a company should be kept in mind. "The United Nations does not sell a product whose production can be increased or decreased at will according to profits. We believe that the founding fathers of this Organization had no intention of establishing an institution which functions

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on the basis of value for money. It is of extreme importance that the new direction towards the so-called `corporate' mentality does not destroy the fabric of the international civil service", she said.

The Group of 77 and China attached great importance to the principle of equitable geographical representation, she said, adding that it should be applied as widely as possible. The Secretary-General should take that into account, especially when the Organization had been called upon to freeze recruitment in the face of the budgetary cuts. The Secretariat should state how the freeze was being applied and how many staff from the developing and the developed countries had been terminated. The Secretariat should clarify whether staff were consulted in the process. The Group recognized that staff were seldom the first to be informed of major changes affecting them.

She was also concerned about the impact of the freeze on the representation of developing countries, since a majority of the 45 States that were underrepresented or unrepresented were from the Group. The performance appraisal system (PAS) was a private enterprise conception that could work perfectly in an institution which was profit oriented. However, international civil servants did work that was not quantifiable, and therefore, the Group questioned the value of the PAS and its impact on the efficiency of the Organization. It was concerned about the large amounts of money being spent to hire consultants to organize seminars when cuts were being made to programmes that were important to the Group. The Organization was tilting in favour of fixed-term and non-career staff, depriving it from a core institutional capacity essential for its continuity and effectiveness.

Despite the freeze, she said, recruitment had continued at various levels as had promotions to higher positions vacated by nationals of developing countries. The beneficiaries of such a practice were often staff from the industrialized world. Those trends decreased the developing countries' representation in the Secretariat. The Group of 77 and China wanted the Secretariat to submit accurate information on staff subject to redeployment, as follows: by contractual status, nationality, titles, ranks and duration of service in the Organization. She asked if incentives were being provided to safeguard the gains women had made in the Secretariat.

SHEILA SEALY MONTEITH (Jamaica), speaking on behalf of the 13 Member States that belonged to the Caribbean Community (CARICOM), said the Community understood that undertaking a comprehensive human resources management strategy was a long-term endeavour. It did not imply that some benefits could not be achieved. The 1996-1997 regular budget placed some demands on the Organization with serious implications for its human resources. Insecurity and general uncertainty about conditions of service had dampened morale. The United Nations should avoid the danger of reversing the very aims of its human resources strategy. Despite budgetary restraints, sufficient consideration

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should be given to the competence of personnel and the relevance of their qualifications.

The members of CARICOM stressed the need for staff to be involved in the efforts to create a new culture of excellence, she said. Regarding the PAS, she stated that the process of review should remain an ongoing feature of the system in order to ensure that it could most efficiently meet the needs of the Secretariat. Leadership skills and managerial capacity should be strengthened.

The various components of the human resources management strategy hinged upon the training process, she continued. That was critical to fostering staff development and promoting career growth. She endorsed the Secretary- General's view that there was a need to provide more systematic training and development opportunities for all staff throughout their careers. For staff to be motivated, they should have the opportunity for upward mobility and advancement. "A certain sense of malaise and pessimism overhangs the Organization in this respect, and can only be countered by giving people hope through improved prospects for advancement", she said.

The plan to introduce in 1997 a comprehensive programme of development for junior Professionals was laudable, she said. It should be managed to serve as an incentive for attracting and retaining high quality of young Professionals through exposure to various organizational experiences and developmental opportunities. It should provide realistic prospects for mobility and promotion. The presumption was that the entry of junior level staff should not be restricted. The national competitive examinations, long identified as useful in identifying suitable candidates for entry into the Secretariat, were relevant to the small States of the Caribbean which remained underrepresented. The G to P examinations, a priceless mechanism for providing opportunities for advancing General Service staff, should remain part of that process. The measures to improve recruitment, as mentioned in the Secretary-General's report, should be implemented, with the participation of Member States.

She welcomed efforts to streamline the system of filling vacancies in order to reduce delays. They called for efforts to put into effect resolution 45/239A, which called for all measures to be introduced to ensure the equitable geographical representation of all Member States, especially the developing countries, at senior and policy-formulating levels of the Secretariat. Priority should be given to those that were underrepresented, unrepresented or below the mid-point of desired range. Efforts to improve the status of women should be continued. While endorsing the Secretary-General's proposal to build a network of global recruitment sources and contacts, she cautioned that traditional means for that purpose should not be abandoned. Priority should be accorded to applying the network to the recruitment of women at the senior levels of the Secretariat.

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MAHAMANE MAIGA (Mali) said that the issue of human resources was given a special place in the United Nations Charter because the implementation of the Organization's programmes depended on staff members. The Secretary-General's new strategy tried to meet the concerns of modern administrations and to provide a tool for management. The activities of the Secretariat, as part of the implementation of the strategy, had led to a great deal of concern, as mentioned by the representative of Costa Rica on behalf of the Group of 77 and China. The budget problems of the Organization should not make the United Nations forget the need for personnel training and new personnel.

The representative said that the Charter had stressed the need to recruit staff on the basis of the principle of equitable geographical representation. The report of the Secretary-General on the composition of the Secretariat had shown that some States were either unrepresented or underrepresented. That situation should be corrected. The Secretariat should also put people from developing countries in high-level posts, especially those from underrepresented States. The status of women should also be improved through continuing concrete steps. There should be more women in the management and execution levels.

CARLOS RIVA (Argentina) expressed support for the views expressed by Costa Rica on behalf of the Group of 77 and China. The result of the review on progress so far in the implementation of the new PAS should be submitted if the Committee was to be in position to adopt corrective measures. He supported the efforts to ensure that junior Professional staff were encouraged. There was need to increase the recruitment of staff on the basis of public competition and on the basis of the principle of equitable geographical representation. He did not support actions to recruit staff outside the context of the national competitive examinations, as was the case with seven women who were recruited to P-2 positions.

The representative said, on the administration of justice, that he supported efforts to improve communications between the sides. Training for dispute settlement and for arbitration would be useful in reducing the number of disputes in the Secretariat. The issue of hiring external arbitrators to replace the current appeals board should be considered with caution. It might be difficult for the Secretary-General and the staff to agree on which outside arbitrators to contract. The hiring of arbitrators by one party might affect the perception of the impartiality of the judicial system.

He welcomed the improvements in the status of women in the Secretariat. The recruitment of more female staff should accord priority to the underrepresented Member States. Argentina had ratified last January the Convention on the protection of the personnel and officials of the United Nations and its agencies. Member States that had not ratified or acceded to it should do so.

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YEVGENY DEINEKO (Russian Federation) said, with regard to the Secretary-General's human resources management strategy, the proposal that promotion to the P-3 level would be contingent on only satisfactory performance in the staff members' assignments was not in keeping with the urgent need to improve the professionalism of the global Secretariat's staff. The performance appraisal system did not meet modern requirements. It impeded effective staff policies and negatively affected the morale of staff. The Secretariat's efforts to improve the system were welcome.

Turning to the long overdue consideration of reform of the internal system of justice, he said the Sixth Committee had not agreed on the legal implications of the reform. He supported the widely-voiced opinion that the system in its current form had become obsolete and was now an obstacle to the resolution of staff-management disputes. The Secretary-General's proposal to professionalize the work of arbitration personnel should be carefully approached. It was necessary to consider the arguments of the Administrative Tribunal about the possible financial implications of those innovations.

The moratorium on granting career appointments should be extended until the full completion of the Secretariat's restructuring process, he continued. Permanent appointments entailed expensive professional staff training and development that should be kept at a minimum. A more effective and less costly way would be to recruit well-qualified experts for specific emerging programmes and new activities, based on fixed-term appointments. It was regrettable that the Secretary-General's report analysing the current ratio of permanent versus fixed-term appointments had not yet been published. Member States should be active participants in the process of personnel recruitment for the Organization.

In furthering decentralizing the Organization, the downward delegation of authority should be contingent upon stronger control functions by the central management and on regular reporting on the fulfilment of obligations, including financial ones, he said. Within the decentralization process, the Office of Human Resources Management should be a central body in charge of global planning and policy-making in human resources management. Regarding the status of women, he said achievement of women's representation should be in keeping with the principle of competence, integrity and efficiency. He noted the exorbitant amount of direct costs covered by the regular budget for staff representational activities. "The motive for such extensive travelling of staff at the expense of the Organization, .. and at the expense of Member States defy understanding", he said.

On the issue of the employment of retirees, he said that although he supported the majority of the recommendations, he could not support the proposal to exempt retirees employed in conference services from the ceiling set for earnings. One solution would be for retirees to suspend the receipt of pensions during their period of temporary employment in the Secretariat.

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LIU YANGUO (China) said reform in human resources management was an integral part of the Organization's reform. Those reforms had been negatively affected by the grave financial crisis. The human resources measures taken must not fail to recognize that professionalism should not be confined to existing human resources. "A continuous infusion of new blood should be accorded the same importance as the training of staff members already in the system." The United Nations had a unique advantage in that it could fall back on 185 Member States in attracting and recruiting competent professionals. He hoped that the Secretary-General's human resources development strategy would be effectively implemented and not aborted under financial pressures.

There seemed to be many drawbacks in the actual execution of the principle of equitable geographical representation in the composition of the Secretariat, he continued. Of particular concern was the question of how to increase the rate of representation of nationals (including women) of developing countries in recruitment and for promotion to high-level posts. Downsizing had a negative impact on the principle of equitable geographical representation and should be endorsed by the Assembly before being put into effect. When downsizing, the Secretariat should take into account of the principle of equitable geographical representation .

He welcomed the increase in women in posts subject to geographical distribution. However, he hoped that the women's participation rate would no longer be subjected to the impact of financial difficulties. China agreed with the Sixth Committee on the relevant issues relating to reform of internal justice.

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