SECRETARY-GENERAL, ADDRESSING GENERAL ASSEMBLY, STRESSES IMPORTANCE OF REFORMS TO ENHANCE UNITED NATIONS ABILITY TO PROMOTE DEVELOPMENT

16 July 1997

Press Release
GA/9283

SECRETARY-GENERAL, ADDRESSING GENERAL ASSEMBLY, STRESSES IMPORTANCE OF REFORMS TO ENHANCE UNITED NATIONS ABILITY TO PROMOTE DEVELOPMENT

19970716 Kofi Annan Proposes Way of Ending UN Persistent State of Near-Bankruptcy; Says Financial Viability of Organization is Condition for Success of Reforms

Pledging a "quiet revolution in the United Nations" in time for the twenty-first century, Secretary-General Kofi Annan said today that reforms must enhance the Organization's ability to promote development and address the root causes of poverty and conflict.

And, since more private and governmental resources were required to finance development, he said he would create an Office for Development Financing to raise funds. Meanwhile, he proposed a "Development Dividend" to shift resources from administration to economic and social activities, with projections that at least $200 million would be available by the year 2002.

Furthermore, he proposed that Member States create a Revolving Credit Fund, initially capitalized at up to $1 billion, to end the United Nations persistent state of near-bankruptcy and because its financial viability was a condition for the success of reform. The Fund could be paid for through voluntary contributions and other means that States might suggest.

To enhance the Organization's ability in the field of development, the Secretary-General said United Nations funds and programmes would be clustered into a United Nations Development Group to foster cooperation amongst them, without compromising their distinctiveness. The idea would be carried to the field, where all entities would work in a single "United Nations House".

As for the management of the United Nations itself, Secretary-General Annan recommended the creation of the post of Deputy-Secretary-General to spearhead efforts to raise funds for development and to represent the Secretary-General in his absence from Headquarters. The Deputy-Secretary- General would also ensure the coherence of the Organization's cross-sectoral activities.

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Other reforms related to the restructuring of the Organization in management and human rights, economic, social and humanitarian affairs include:

-- Establishment of a new Emergency Relief Coordination Office in place of the Department of Humanitarian Affairs;

-- Formation of a Senior Management Group to function like a cabinet and lead the change process;

-- Establishment of a Strategic Planning Unit in the Secretary-General's office to identify and analyse emerging global issues; and

-- Strengthening of four Executive Committees, established in January, to guide the Organization in its main work.

On the reforms that should be undertaken by the Assembly, he proposed that Member States enact "sunset provisions" -- specific time-limits -- for initiatives involving new organizational structures or major commitments of funds. They should consider adopting a new "results-based budgeting" system and establishing a commission to study fundamental change in the United Nations specialized agencies.

Preliminary and welcoming statements on the Secretary-General's proposals were made the representatives of Ghana (for the African Group of States), Luxembourg (on behalf of the European Union and associated States), Suriname (for the Latin American and Caribbean States), Russian Federation (for the Eastern European States), New Zealand (on behalf of Canada, Australia and New Zealand), Norway, Philippines (for the Asian States), Japan, Ukraine and the United States.

Also addressing the Assembly this morning, the Prime Minister of Andorra said that his goal was to point out the importance that small States -- "those same States to whom one was careful in 1945 to give sovereign equal voices and voting powers in the General Assembly" -- would have in order for the reform process to go forward. At the United Nations, small States were the majority; with them, reform should progress. Without the big States, reform was not possible either. However, without the small States, the reform would be half of a reform, and at the practical level, the contribution of small States deserved to be taken into consideration.

The Assembly will meet again at a date to be announced.

Assembly Work Programme

The General Assembly resumed its fifty-first session this morning to consider measures and proposals for United Nations reform, as contained in a report of the Secretary-General (document A/51/950).

The report contains proposals for wide-ranging institutional reforms of the United Nations, designed to instil "greater unity of purpose, coherence of efforts and agility in responding to the pressing needs of the international community". It will be introduced by Secretary-General Kofi Annan.

In the report, entitled "Renewing the United Nations: A Programme for Reform", the Secretary-General's proposals confront a number of vital organizational questions, including the establishment of a new Secretariat leadership and management structure; the consolidation of United Nations operations at the country level; and the need for a thorough overhaul of United Nations human resources policies and practices.

The report suggests avenues to streamline the work of intergovernmental bodies, particularly the General Assembly and the Economic and Social Council. It advances "a new concept of Trusteeship" and proposes a "Millennium General Assembly", as well as a companion "People's Millennium Assembly" to articulate visions and propose ways to deal with the challenges of the future. It also suggests methods to bring financial solvency to the Organization.

The proposals encompass the five core missions of the United Nations around which the Secretary-General has already restructured the Secretariat's substantive work programme: peace and security; economic and social affairs; development cooperation; humanitarian affairs; and human rights.

They address such key substantive issues as the promotion of development as a central priority of the United Nations and the creation of a "dividend for development"; the strengthening of international efforts to combat crime, drugs and terrorism; the extension of the Organization's human rights activities; the advancement of the international disarmament agenda; and the strengthening of the world community's response to humanitarian needs.

Departing from previous reform efforts undertaken in a piecemeal fashion over the years, the Secretary-General's present initiatives address the structure and functioning of the Organization as a whole, the report states, in particular its ability to act as a whole. "What is more, as they pertain to the United Nations Secretariat, the present initiatives take as their starting point not the existing organizational chart, but the core institutional problems that need to be redressed, both generically and in each of the substantive domains in which the Organization operates." (For a summary of the report, see Press Release SG/2037-ORG/1239 issued today.)

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Statement by Secretary-General

Secretary-General KOFI ANNAN said it was time for reform since the United Nations needed it and Member States wanted it. They were showing the way for change by rethinking their practices and adapting their policies, seeking out new efficiencies and value for money.

Since taking office in January, he said, he had pursued a culture of reform to the United Nations. Since new, momentous steps forward must be taken as from today, he was presenting some measures and recommendations for renewing the Organization. They included the reform proposals initiated in the last six months and would move the Organization in new directions.

Presenting his reform measures, he said that for the United Nations to pursue its core objectives and carry out its tasks, leadership and management must be refined. Accordingly, a Senior Management Group would be formed to function like a cabinet and lead the change process. A Strategic Planning Unit would also be established in the Secretary-General's office to identify and analyse emerging global issues. Then, four executive committees, established in January to guide the Organization in its principal areas of work, would be strengthened.

The Secretary-General said he would recommend that the Assembly establish a post of Deputy Secretary-General, who would represent the Secretary-General in his absence from Headquarters and spearhead efforts to raise funds for development. The Deputy Secretary-General would also ensure the coherence of the Organization's cross-sectoral activities.

Continuing, the Secretary-General said his proposals would streamline the United Nations in several ways: by proposing a no-growth budget for the first time in a generation; by eliminating 1,000 posts or a 25 per cent cut from a decade ago; by cutting administrative costs by 33 per cent, with the savings allocated to development; and by cutting back on documentation, a process that would reduce the use of paper by 30 per cent by the end of 1997.

Turning to the Organization's finances, the Secretary-General expressed his desire to end its persistent state of near-bankruptcy. Too many Member States were failing to pay their dues in full and on time and without preconditions. In response, he proposed that Member States establish a Revolving Credit Fund, initially capitalized at a level of up to $1 billion through voluntary contributions or any other means that they might wish to suggest. Assuring the Organization's financial viability was a condition for the success of reform, he stressed.

Reform must enhance the Organization's ability to promote development and address the root causes of poverty and conflict, the Secretary-General continued. The grouping of United Nations funds and programmes working in

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development into a United Nations Development Group would foster consolidation and cooperation amongst them, without compromising their distinctiveness or identity. That idea would be carried through to the field level, where all United Nations entities would function under "one flag" in a single "United Nations House". The first such designation, effective immediately, would apply to the United Nations presence in South Africa.

On financing for development, he said that more financial private or governmental resources were needed for development. He said he would create an Office for Development Financing since raising such funds required a full- time effort.

The Secretary-General went on to say that his report had proposed a "Development Dividend" in order to shift resources from administration to economic and social activities. Projections indicate that at least $200 million could be available by the year 2002. However, he proposed that a down payment be made in January 1998 from savings achieved from the current biennium's budget.

The programme of reform he was proposing, he said, would affect virtually every department and activity of the United Nations. It contained proposals for increasing the speed with which peace-keeping and other field operations could be deployed. It focused on improving United Nations capacity for peace-building, advancing the disarmament agenda, and strengthening of the environmental dimension of United Nations activities. The programme proposed to combat the scourge of "uncivil society" -- criminals, drug pushers and terrorists. Public information activities would be reoriented so that the world's peoples could better understand the Organization's goals, role and range of work. It called for simplified administrative procedures, for a thorough overhaul of human resources policies and major restructuring in human rights, as well as economic, social and humanitarian affairs. To deal more effectively with complex humanitarian emergencies, a new Emergency Relief Coordination Office would replace the Department of Humanitarian Affairs.

Some changes would have to be undertaken by Member States as some of them would relate to the Assembly, he continued. The Assembly should refocus its work on issues of highest priority and reduce the length of its sessions. He proposed that it enact "sunset provisions" -- specific time-limits -- for initiatives involving new organizational structures or major commitments of funds. It should also consider adopting a new system of budgeting -- a shift from input accounting to "results-based budgeting". That approach, which many Member States already used at the national level, would give the Secretariat greater flexibility while maintaining strict accountability. Member States should consider establishing a commission to study the need for fundamental change in the system at large -- the specialized agencies which were essential members of the United Nations family.

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The reform outline proposed today would enable the United Nations to do even more, even better, he said. "This is my pledge to you, and to the world: that starting today, we begin a quiet revolution in the United Nations", he concluded.

Other Statements

JACOB WILMOT (Ghana), speaking on behalf of the African States, said that no one in the General Assembly could seriously question the need for reform of the United Nations. The overall aim of reform was to make the Organization more efficient, relevant and effective to be able to fulfil better its core principles and purposes of promoting peace and security, economic prosperity, social progress, humanitarian assistance and overall development; and also to deal with current and future challenges as the international community entered the new millennium. To achieve those, reform must be rooted in consensus on the role of the Organization as envisaged in the United Nations Charter, and buttressed by agreement on how it should play that role and achieve those goals.

He noted that the Secretary-General, like his predecessor, had undertaken to maintain the focus on what was really required in order to restructure, equip and finance the United Nations to enable it to do more with less, and to obtain value for its money. In submitting his proposals today, the Secretary-General had been true to his word given last March, to present additional proposals which would benefit from consultations with, and guidance from, Member States, as well as proposals and recommendations in respect of the more fundamental issues which could only be decided by governments.

It was incumbent upon all Member States to respond to the Secretary- General's initiative by providing him with clear and coherent policy guidance in the implementation of the proposals, he said. That should also be done in time, in order not to lose the momentum. For the developing countries, particularly those in Africa, the yardstick for evaluating the proposals would be the extent to which the reforms satisfied their priorities and concerns. The issue of reform was one of common interest and concern to all mankind. It called for the exercise of a collective political will backed by adequate, timely and unconditional financial support in a spirit of partnership that was unquestionable.

JEAN-LOUIS WOLZFELD (Luxembourg) spoke on behalf of the European Union and Bulgaria, Hungary, Lithuania, Latvia, Poland, Czech Republic, Slovakia, Slovenia, Romania and Liechtenstein. He said that reform was not about cost- cutting, but rather about enabling the United Nations to meet its responsibilities. Its objective should be to increase the Organization's unity of purpose, as well as its ability to respond flexibly. He was fully committed to making the Organization more in tune with existing trends in international relations.

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Successful reform required rationalization and streamlining of operations, he continued. It also required strengthening the Organization on the basis of sound and predictable financial resources. If the Organization was to respond to the challenges of the next century, reform should lead to a world forum providing effective leadership, while at the same time making the Organization more efficient, transparent, accountable and reliable.

The United Nations played an important role in supporting governments in their development processes, he said. The Union had presented a number of proposals in the economic and social fields in October 1996 and January 1997. He noted with appreciation that the Secretary-General's proposals had thoroughly dealt with questions pertaining to development, humanitarian activities and human rights.

The Organization must strengthen the efficiency of its bodies and its operational framework in order to give greater coherence to its work, and ensure coordination at all levels, he continued. By combining efficient services at the country level with a common programming framework, the Organization would enhance the impact of its work while influencing other actors in the development sector. In addition to reform at the intergovernmental level, it was necessary to streamline the Organization's consultative machinery.

MARC FORNE MOLNE, Prime Minister of Andorra, said that his goal today was to point out the importance that small States -- "those same States to whom one was careful in 1945 to give sovereign equal voices and voting powers in the General Assembly" -- would have in order for the reform process to go forward. At the United Nations, small States were the majority; with them, reform should progress. The biggest and most powerful States must not fear the abundance of the small. If reform led to imbalances in the founding principles of the United Nations, the Organization would cease to be universal, and therefore it would cease its function as the flag of the future.

Without the big States, he pointed out, reform was not possible either. Without the small States, the reform would be half of a reform. At the practical level, the contribution of small States deserved to be taken into consideration. Small States, in spite of their presence everywhere, had a tendency to concentrate their efforts at the United Nations in particular areas in which they become experts. Andorra, for example, had proposed to the Western European and Other States Group to computerize its archives, a task that its Mission, with the help of the National Center for Informatics, was doing right now. Those efforts of computerization fitted very well into the goals of immediate managerial changes that the Secretary-General had proposed as a first phase on 17 March.

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SUBHAS CHANDRA MUNGRA (Suriname), speaking on behalf of the Latin American and Caribbean Group, said he welcomed the reform proposals. Those proposals would be forwarded to the Group's respective capitals for thorough consideration.

SERGEY V. LAVROV (Russian Federation), speaking on behalf of the Eastern European Group, welcomed the Secretary-General's report. Consideration of the reform proposals would allow Member States to continue their dialogue with the Secretariat. The report covered a broad spectrum of issues. He drew attention to the report's emphasis on peace-building, human rights and crime prevention, noting that multilateral disarmament was taking on greater importance in the current world situation.

The reforms' success would depend on the support they received from Member States, he said. No reforms to strengthen the Organization could be effective without unconditional support by Member States. After the proposals were considered, an appropriate mechanism should be established to consider them. At that time, the Russian Federation would voice its opinions in greater detail.

MICHAEL POWLES (New Zealand), speaking also for Canada and Australia, said that bold and innovative measures were needed to prepare the Organization for the twenty-first century. Governments wished for more targeted programmes. There was need to redistribute resources to priority areas and away from administration and lower priorities. Mere cost-cutting was not the solution; he emphatically disagreed with suggestions that would diminish the United Nations role.

The initial reforms presented in February and March, as well as today's proposals, provided a critical window of opportunity to address long overdue reform, particularly in the economic and social sectors, and management reform, he said. It was to be hoped that the package would deliver concrete changes to revive and enhance the work of the United Nations. Such reforms would not be painless, but without them the Organization risked sliding into increasing irrelevance. New Zealand, Canada and Australia were determined to support necessary reforms, and had already contributed to them. The Secretary-General's package must not be considered in a dismembered form by different bodies within the system. The entire package should be considered by the General Assembly at the fifty-second regular session. The plenary should decide on follow-up and implementation.

HANS JACOB BIORN LIAN (Norway) recalled that the Nordic countries had earlier this year presented a comprehensive report suggesting reform of the economic and social areas of cooperation in the United Nations. That was an area of key importance to the developing world. Norway was pleased that the

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Secretary-General had built on, and taken further, the proposals in his first reform package of March this year. Those were important steps which would permit even greater impact of United Nations activities.

It also augured well for the overall efforts to reform the United Nations that the General Assembly's open-ended high-level working group on the strengthening of the United Nations system had achieved consensus, a few days ago, on a large number of measures for reform of the General Assembly and the Secretariat, he said. The Secretary-General's report and the report of the working group were mutually supportive, and he was convinced that, taken together, they would enable the United Nations to take decisive steps to strengthen the Organization. That was what Member States and the United Nations had now demonstrated that they wanted.

FELIPE H. MABILANGAN (Philippines), on behalf of the Asian Group, said that the Group appreciated the Secretary-General's introduction of the report, which would be forwarded to capitals for careful consideration, with the expectation that further opinions would be exchanged during the Assembly's upcoming fifty-second regular session.

HISASHI OWADA (Japan) joined the previous speakers in expressing deep appreciation to the Secretary-General for personally introducing the reform plan. He attached great importance to the Organization's reform. It was necessary to promote reform in a balanced manner. Whether or not the Organization could play an effective role in the future depended largely on its present reform. The proposals presented today touched upon a wide range of United Nations activities.

In the areas of peace and security, he welcomed the Secretary-General's emphasis on strengthening the Organization's role in global services, including rapid reaction capability and preventive action. He was gratified that development had been deemed of great importance in the Organization's work. His country advocated "reinvestment of savings", by which savings would be integrated into development activities. If the Organization was to respond to humanitarian crises, greater coordination among its humanitarian bodies was needed.

Japan would examine the proposals carefully, together with the forthcoming biennial budget, he said, adding that the Organization must be strengthened and made cost-effective.

YURIY V. BOHAYEVSKY (Ukraine) said the United Nations was an irreplaceable institution that was still useful to the international community. The conclusion of the work of the working groups on the Agenda for Development and on the strengthening of the Organization were significant milestones in the existence of the United Nations. Speaking on the Organization's needed reforms, he said they would succeed only if all Member

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States were guided by determination, good-will and a consensus approach. His delegation would make substantive statements on the reform proposals later. Meanwhile the discussion on the Secretary-General's report on the reforms should be the substance of debates at the fifty-second regular session of the General Assembly, starting next September.

BILL RICHARDSON (United States) said that when the Secretary-General had announced his initial reform blueprint in March, the United States had welcomed it wholeheartedly. Today, he was pleased to see the Secretary- General's carefully considered "track two" proposals. Having received the report only today, like other delegations, he would need to examine the details carefully. In making those proposals, the Secretary-General had taken a significant step towards the kind of structural reform that would enable the Organization to do more for the world's people, and do it for less.

He pledged the United States' full support for making the reform process effective. The Secretary-General's proposals required action by all Member States in order to be fully implemented. Both the Secretariat and the Member States shared responsibility for the reform process as a whole. Cooperation would be crucial if efforts were to bear fruit.

He urged the Assembly to take action on the proposal by its President, Razali Ismail (Malaysia), to establish an Ad Hoc Committee of the Whole to consider the Secretary-General's proposals. That body represented the next logical step in the continuing process of reform. Today's announcements were tangible expressions of the culture of reform which had been developing within the Organization over recent years. The international community should work together for the future, he concluded.

RAZALI ISMAIL (Malaysia), President of the General Assembly, said, in closing the meeting, that he and Secretary-General Annan had spoken on the need for and the ways of ensuring reforms in the Organization since the latter's entry into office. In continuing his efforts to spur the Organization onto further reforms, the Secretary-General had today made proposals that would need the approval of the Member States of the United Nations. Those proposals also challenged Member States to adopt an open mind in working on the reforms. The proposals should not be approached in a stereotypical manner and should not become casualties to tussles between one or two groups of States in the Organization. Rather, the reforms proposed by the Secretary-General should be to the benefit of all of the peoples of the world.

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