PRESS BRIEFING BY USG FOR ADMINISTRATION AND MANAGEMENT

23 April 1997

Press Briefing

PRESS BRIEFING BY USG FOR ADMINISTRATION AND MANAGEMENT

19970423 FOR INFORMATION OF UNITED NATIONS SECRETARIAT ONLY

At a Headquarters briefing yesterday afternoon, 22 April, the Under- Secretary-General for Administration and Management, Joseph Connor, told correspondents that managerial reform in the United Nations would yield savings of $100 million this year. The efforts were results-oriented intended to "add up to a more effective and efficient United Nations". "We are not just cutting costs", he said.

Echoing the Secretary-General's statement that "reform in the United Nations is a process, not an event", Mr. Connor said that in addition to the projects already accomplished, the Secretary-General had set a goal of 400 completed projects by the end of 1997 and had asked that much more emphasis be put on effectiveness and service to Member States, as well as efficiency.

Stressing that managerial reform was part of the overall United Nations reform effort, Mr. Connor reported on the "real results" that had been achieved by the end of the first quarter of 1997. The reforms had been documented in a report entitled: UN 21: Accelerating Managerial Reform for Results, (Sales No. E.97.I.10), which was made available to the correspondents during the press conference.

In addition to the estimated $100 million in efficiency savings in 1997, Mr. Connor said the managerial reforms had resulted in an estimated $30 million savings in 1996. He highlighted some of the results that had been achieved, and which reflected better value and improved service and management. Those included the following:

-- The Department of Peace-keeping Operations had changed the way it moved equipment to its various peace-keeping operations around the world -- including using chartered vessels. Those changes had resulted in a $21 million difference in the cost of transporting equipment.

-- The Office of Human Resources Management had saved $25,000 in 1996 in a pilot project, using video and teleconferencing for oral examinations and interviews. Estimated savings of $50,000 were expected for 1997 and more in 1998-1999.

-- The United Nations Conference on Trade and Development (UNCTAD) had made economies of $300,000 in telecommunications by eliminating unused phone lines and by expanding the use of e-mail.

-- Since November 1996, any Member State with an Internet connection could retrieve United Nations documents in any of the six official languages, by their connection to the optical disk system (ODS) through the United Nations Home Page.

-- The consolidation and decrease in the amounts of foreign currency purchases had saved the Organization $510,000 as at the end of March.

-- The Department of Political Affairs had saved $188,000 by reducing the number of its meetings.

-- The United Nations Environment Programme (UNEP) had streamlined its internal management reports, saving $175,252 per year.

-- The United Nations Office at Geneva had automated its financial clerical work and its security systems, saving $2,197,000 in the present biennium. By outsourcing building management, the Office had saved an estimated $1,155,000.

-- By consolidating the United Nations mainframe operations in Geneva as of April, at least $1.2 million had been saved annually.

Mr. Connor said the United Nations approach to managerial reform had the following key aspects: setting clear goals; involving people; examining processes; measuring performance; and using technology.

He said the General Assembly and the Secretary-General had set clear goals which included: delivering all mandated programmes while operating within the budget cap set by the Assembly ($2,608 million for 1996-1997); reducing administrative costs from 38 per cent to 25 per cent of the United Nations regular budget and reallocating resources to economic and social programmes; and improving information services to Member States while reducing hard copy documentation by 25 per cent. The reduction of administrative costs could be rephrased as "put three out of every four dollars of the regular budget into programmes", Mr. Connor said, adding that reducing non-programme costs substantially below 38 per cent was a step in the right direction. Giving examples of such costs, he said that 47 per cent of non-programme costs were attributable to direct administration. Twenty-five per cent of conference service costs were devoted to producing internal administrative documents and budget and personnel papers.

Staff members involvement in the managerial reform process, Mr. Connor said, had included more than 450 efficiency projects. The United Nations was also expanding managerial training and had recognized the efforts of more than 100 staff members, comprising eight project teams for specific contributions to enhancing effectiveness and efficiency. Two hundred and thirteen efficiency projects had been completed by the end of the first quarter.

Connor Press Briefing - 3 - 23 April 1997

He said improvements in internal processes which were being shared across the United Nations system included: streamlining information technology support for meetings by installing necessary equipment in the first three conference rooms at Headquarters by mid-May, and in all of them by the end of the year; and bar coding of mail in the United Nations pouch system and speeding the delivery of pouches. Other areas being examined were travel, internal management reporting, the procurement of low value items and the simplifying processes in the human resources area in the next few months.

The Organization's management was measuring performance by drawing lessons from the experience of national governments and other international organizations and comparing the Organization's performance with them, Mr. Connor said. As an example, he said a senior official from Canada was working with the planning group in the Office of Human Resources Management to look at significant challenges posed by the changing demographic profile of United Nations staff members. Another example was that of comparing the financial management system with those in Australia, Singapore and New Zealand.

In addition, he said, the Organization was setting meaningful performance measures for its programmes, including increasing the responsibility of programme managers as well as allowing for flexibility for achieving results. In that context, he announced that three management pilot projects would be launched in 1997 in the Economic Commission for Latin America and the Caribbean (ECLAC); the Division of Administration and Common Services in Vienna; and in the Office of Conference Services in New York. The projects were based on clearer, enhanced accountability and, as an example, would be expected to increase the percentage of their professional staff positions occupied by women and the percentage of new staff members recruited from unrepresented and underrepresented Member States.

The expanded use of technology, Mr. Connor said, represented tremendous opportunities for the Organization to accomplish its mission more effectively and efficiently. In addition to the Secretariat's achievements, every Member State in the United Nations now had access to information via the Internet. To illustrate the implications of the Internet, especially for developing countries, he quoted a recent comment by the Executive Secretary of the Economic Commission for Africa (ECA), Kingsley Y. Amoako: "The Internet enables Africa to leapfrog in terms of access to information; it is essential for Africa's economic and social development."

One of many reviews of the United Nations Home Page by search engines (Lycos, Excite Reviews and Hyperspace) had rated it in the top 5 per cent of World Wide Web sites and had commented that "there is enough United Nations info' to satisfy surfers from all 185 nations", he continued. There were now more than one million "hits" every week which meant that "52 million times a year, people around the world are consulting the United Nations for

Connor Press Briefing - 4 - 23 April 1997

information about development, security, human rights, international law and the environment".

On other information technology, Mr. Connor said the Integrated Management Information System (IMIS) now in use had also been changing the way the Organization functioned. At least 11 locations around the world were currently using the facilities. Personnel management relied heavily on the system -- in New York and in other United Nations capitals as well as in specialized agencies. Progress was also being made with international communications, reflected in a fourfold per cent increase in the number of staff members with Internet access and the 40 per cent increase in the number of e-mail connections which speeded up access to information for their work.

In conclusion, Mr. Connor compared the managerial reform measures to putting the bell around the cat's neck" -- as in the Aesop fable about the mice and the preying cat. He added that, "There is more to be done -- which is why the Secretary-General has set concrete targets for the next two years, and why this process requires continued involvement of United Nations staff members and support of the Member States."

In response to a question about the total savings resulting from managerial reform for the first three months of this year compared to last year, Mr. Connor said that $100 million in savings had been estimated for the current year, and $30 million had been saved in 1996. The future target was to reduce real costs by another $123 million in the 1998-1999 biennium.

Asked if more staff members were being "let go", Mr. Connor said, "we've stabilized", meaning that "we can now resume normal operations -- hirings, dismissals, retirements", in the Secretariat worldwide. As of the beginning of the year there were 10,021 authorized posts, of which slightly less than 9,000 were occupied, a number that had not changed in approximately nine months. The 1998-1999 biennium budget would suppress most of the vacant posts and return the system to a normal vacancy rate amounting to several hundred currently unfilled positions.

Another correspondent asked whether any thought had been given in the Administrative Committee on Coordination (ACC) or elsewhere to centralizing the administrative and personnel costs of the specialized agencies, thereby resulting in savings from activities that seemed to be duplicated in Vienna, Rome and elsewhere.

Mr. Connor said he was not so sure about such savings, and would rather take the current steps being pursued. He was actively integrating the United Nations common system into the IMIS system. If the staff components of the United Nations Children's Fund (UNICEF) or the United Nations Educational, Scientific and Cultural Organization (UNESCO) could be accessed, for example, tremendous flexibility would be achieved. The UNICEF, and particularly the United Nations Development Programme (UNDP), had been close collaborators in

Connor Press Briefing - 5 - 23 April 1997

the process. The United Nations High Commissioner for Refugees (UNHCR) participated in the system, UNESCO was reviewing it, and the International Labour Organization (ILO) had bought into it. "We've got a good thing. Not perfect, but good. And, we're making it available at a price that can't be beat -- zero", he said.

He went on to say that he wanted to extend IMIS to the peace-keeping missions and other field operations. It would probably take one year. Logging the entire United Nations system into one data system would make that system even more attractive to organizations like UNICEF and the UNHCR. Once over that hurdle, further consolidation might be possible. Conference services, for example, had been consolidated. There were undoubtedly areas of administration, such as common purchasing and travel, that could and should be integrated as well. A project had been developed to undertake that.

In light of the examples just provided, another correspondent asked if it was fair to say that the bulk of the changes were actually instituted last year? Mr. Connor said they were "conceptualized" last year, and "implemented" this year. "We had a gleam in our eyes" last year, he said. "For example, last year we were hard-pressed to find surplus computers. This month we have found them and are giving them to Permanent Missions that cannot buy them, together with providing training, so that they can access the Internet through the optical disk system."

Stating that the missions would all be "hooked up by June 30", he said that linking them electronically to the United Nations had been an effective way of downsizing the Organization's documentation. Once that process was completed, he could begin to consider reducing hard copy documentation, including content. Fewer documents were already being sent to permanent missions. For them, it was also cheaper to send reports via the Internet, rather than by mail, to their capitals. Overall, the end result was a reduction in the number of documents being produced.

Another correspondent, noting a reference by the Secretary-General on 17 March to savings of $123 million, asked if more savings had to be made. She also noted that Mr. Connor had "covered the diplomats, and you've covered the people who want to do research, you haven't covered the daily press". The access (to information) is not there, she continued. Documents had decreased and the number of press releases had been reduced and were also being issued later, for a variety of reasons. "And as you step up, we write less", she said.

Responding to the question on the savings, Mr. Connor said when the 1996-1997 budget was legislated in December 1995, the Fifth Committee (Administrative and Budgetary) had asked for an additional $154 million savings further to the $100 million savings already included in the Secretary- General's budget proposals. Total savings of $254 million were therefore mandated. The Secretariat then began a process of looking for efficiency

Connor Press Briefing - 6 - 23 April 1997

gains which were identified by -- "looking and picking the low-hanging fruit" -- which produced some $30 million in savings in 1996.

The rest of the savings came from "generic productivity increases" which resulted in fewer people to do the work -- which always works, he continued. Despite the reduction in the number of staff members by 1,000, somehow the work got done by the 9,000 that remained. For 1997, he had identified $100 million in efficiency savings. The combination of productivity gains and the savings of $30 million (1996) and the $100 million (1997) contributed to achieving the $254 million in savings.

There was now a new target of $123 million for the next biennium, he said. It had already been built into the budget outline, and would result in negative, nominal growth which meant that after providing for inflation the budget would still be less than that of 1996-1997.

Mr. Connor said he was not in a position to respond to the question concerning the production of press releases.

To a follow-up question about whether the $100 million in savings referred to in his presentation was included in the $123 million proposed by the Secretary-General in March, Mr. Connor said that the $100 million savings would be generated in 1997, and that the $123 million in savings had to be achieved additionally in 1998-1999.

Responding to another question, Mr. Connor said he was trying to incorporate outside benchmarks of the Secretariat's management reforms. As an example, his staff had been sent to the United Kingdom and Canada and would be going to Australia, Singapore and New Zealand to research those countries revised budgetary processes. The Commonwealth Secretariat had also been tapped. "We're not trying to reinvent this thing", he added.

Asked if a study by Paul Kennedy and the group from Yale University on the future of the United Nations commissioned by the Organization was useful, Mr. Connor said that Mr. Kennedy as well as other groups had dealt largely with organizational and intergovernmental reform, including the structure of the General Assembly and the Security Council. The Secretariat was dealing with management reform, which was the Secretary-General's responsibility as Chief Executive Officer, and did not require General Assembly approval.

To a question about whether there was any consideration of reducing "the rather impressive salaries" of staff members and the education and relocation grants, Mr. Connor said that United Nations salaries were set by the International Civil Service Commission (ICSC) and approved by the General Assembly. They were slightly under the mid-point of the range of the comparator salary scale, the United States Federal Civil Service.

Connor Press Briefing - 7 - 23 April 1997

He added that changes in education grants would have to be part of a policy decision by Member States. The grants were for the benefit of United Nations employees living away from their countries. They did not apply to local recruits who lived in New York.

Asked which of the changes he had announced were directly tied to the benchmarks that United States Senator Jesse Helms would set, Mr. Connor said he had not seen an official version of any of the Senator's benchmarks, only references to them in the newspapers. The Secretary-General had said repeatedly that he was setting his own benchmarks. Eliminating 1,000 posts was one; achieving negative nominal growth was another. The Secretary-General hoped he would be judged, not just by the United States, but by all Member States, by how good a job he did in achieving his own benchmarks.

Asked about the cost of a Security Council meeting extending past 6 p.m. on a debate or a vote that could easily be decided on the next business day, Mr. Connor said that he did not know, but that the question had its own answer -- if the meeting did not have to be scheduled, then it was all excess cost. Overtime was not paid to the Professional staff, but was paid to the General Service staff. Meetings had been restricted "rather rigidly". The Security Council, however, had not been affected by such restrictions.

Asked if any efforts were being made to make the permanent civil service system more flexible by increasing fixed-term appointments, and who was going to control certain reform steps such as more efficient travel arrangements, Mr. Connor said that travel was his area of responsibility. Regarding permanent contracts, he said that the work in the management reform area highlighted an enormous demographic change emerging in the Organization. The average age of United Nations staff members was 48 or 49, which meant that there would be between 300 and 500 retirees in the next series of years, a number in excess of normal attrition rates.

He added that it would be a period of enormous turnover of staff, which meant that it was the right time to reconfigure all of the existing personnel rules -- to determine, for example, whether there should be a large or a small core staff, more outsourcing, or more insourcing. The number of people who would leave the Organization in the next couple of years, regardless of management changes, would constitute a personnel reduction through attrition. As a result, there would be an enormous opportunity in remaking the management of the Organization.

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