In progress at UNHQ

GA/AB/3173

SECRETARY-GENERAL TO PRESENT 1998-1999 BUDGET TODAY AS FIFTH COMMITTEE BEGINS DISCUSSING ITEM

22 October 1997


Press Release
GA/AB/3173


SECRETARY-GENERAL TO PRESENT 1998-1999 BUDGET TODAY AS FIFTH COMMITTEE BEGINS DISCUSSING ITEM

19971022 Background Release

Secretary-General Kofi Annan will present this afternoon his $2.583 billion budget proposal to cover the expenses of the United Nations during the next two years, as the Fifth Committee (Administrative and Budgetary Committee) begins its discussion of the subject.

The $2.583 billion proposed budget for 1998 and 1999, the Secretary- General's first since assuming office this year, is $20.3 million less than that of the current two-year period. The amount reflects a resource reduction of $124 million, as well as a $104 million adjustment for inflation and exchange rates prevailing in December 1996. For the next two years, the Secretary-General initially proposes a staffing level of 8,839, a reduction of 1,182 posts, including the abolition of 904 posts.

For its consideration, the Committee will have before it a two-volume budget document, as well the revisions to it, which reflect the changes required to implement the reform proposals the Secretary-General presented to the Assembly in July. While not reducing the overall amount of the proposed budget, those changes would result in a dividend of $12.7 million for economic and social development activities and a staffing level that is 144 posts less than initially proposed.

The item on United Nations reform is currently being considered in the Assembly plenary. The Fifth Committee will consider the revised budget proposal in due course, following the allocation of the programmatic and financial aspects of the reform item to it by the plenary.

Also before the Committee will be the first report on the initial proposed budget of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), the 16-member expert body that examines and reports to the Assembly on all budget proposals, and of the 34-member Committee for Programme and Coordination (CPC) (document A/52/16).

The total United Nations budget consists of the regular budget and extrabudgetary resources. But it is on the basis of the regular budget that States' contributions are determined. Each State is charged at a proportionate share of the budget, based on the scale of assessments, which is also being reviewed by the Fifth Committee at the current session.

1998-1999 Initial Budget Proposal

According to the initial budget proposal (document A/52/6/Rev.1: Volumes I and II), the $2.583 billion gross will net at $2.213 billion when income of $369.5 million is taken into account. Of the total income, some $329.1 million is from staff assessments, about $35.1 million from general income, and $5.3 million from revenue-producing services to the public. Sources of general income include rental of premises, reimbursement for services provided to specialized agencies, and interest. The sale of United Nations postage stamps, gift, publications and tours fall under revenue- producing services.

The Secretary-General says the initial proposal was formulated according to the priorities set for the Organization last year when the General Assembly adopted the medium-term plan for the period from 1998 to 2001.

The amount requested will be spent on United Nations activities as follows: common support services, $904.2 million; regional cooperation for development, $399.4 million; staff assessment, $324.6 million; international cooperation for development, $302.3 million; political affairs, $164.9 million; public information, $140.3 million; human rights and humanitarian affairs, $138.7 million; jointly financed administrative activities and special expenses, $60 million; international justice and law, $55.6 million; overall policy-making, direction and coordination, $38.6 million; capital expenditures, $35.9 million; and the Office of Internal Oversight Services, $18.6 million. A major departure from the 1996-1997 regular budget is that nothing is proposed for the International Seabed Authority, which has been weaned off the United Nations.

By objects of expenditure, the sum includes $1.508 billion for posts; $161.3 million for other staff costs; $213.5 million for general operating expenses; $68.8 million for grants and contributions; $46.7 million for travel; and $15.9 million for experts and consultants.

The budget is divided into 13 parts, covering 33 expenditure sections. (Details on the sections will be provided in press releases to be issued on the day that they are discussed by the Committee.)

ACABQ Report

Chapter I of the ACABQ report (document A/52/7), expressing its overall position on the initial budget proposal, states that there are numerous uncertainties remaining with regard to the proposed budget. Chief among them is the impact the reform proposals may have on the estimates once those proposals have been acted upon by the Assembly. (Chapter II of the ACABQ report, containing detailed comments on individual budget sections, is being issued separately.)

- 3 - Press Release GA/AB/3173 22 October 1997

The ACABQ notes that the budget proposal represents a 0.8 per cent decrease in nominal terms compared with appropriations for 1996-1997. For that biennium, there was a nominal increase of 3 per cent over the revised estimates of 1994-1995.

The 5 per cent vacancy rate for the Professional category and above and 2.5 per cent for General Service proposed by the Secretary-General are lower than in the recent past. Their application accounts for an increase of $88.2 million.

The report also states that the Secretary-General will actually abolish 895 posts. It says that he should have clearly stated the organizational necessity of every abolition and the effects on United Nations work. He needs to justify proposed reductions in the same manner as he does increases.

But, the ACABQ notes, the reduction in posts has been accompanied by an increased request for consultants and experts, totalling some $15.9 million, to provide some flexibility in implementing mandates. It recalls its previous recommendation that consultants should be used only when their skills were not available "in-house".

Changes Arising from Reform Proposals

After issuing the 1998-1999 regular budget, the Secretary-General unveiled the second phase of reforms in July. The budgetary consequences of his proposals are contained in his 11 September report on United Nations reform: measures and proposals (document A/52/303).

Among the reform initiatives, he says, is the establishment of the post of Deputy Secretary-General and of a strategic planning unit in the Office of the Secretary-General. He would consolidate some Secretariat entities supporting legislative bodies into a single Department of General Assembly Affairs and Conference Services and create a Department for Disarmament and Arms Regulations. Three departments would be fused into a Department of Economic and Social Affairs. They are the Departments for Policy and Coordination and Sustainable Development, Economic and Social Information and Policy Analysis, and Development Support and Management Services.

Further, he would consolidate the human rights programme and strengthen the Office of the United Nations High Commissioner for Human Rights at Headquarters; reconstitute the Crime Prevention and Criminal Justice Division as the Centre for International Crime Prevention; reorient public information; recast the Department of Humanitarian Affairs as the Office of the Emergency Relief Coordinator; and change the Department of Administration and Management into that of Management.

- 4 - Press Release GA/AB/3173 22 October 1997

The new report proposes to cut another 144 posts (164 to be abolished, offset by 20 new posts), leaving the number proposed for 1998-1999 at 8,695. Apart from the post of Deputy Secretary-General, new ones include an Under- Secretary-General for Disarmament, an Assistant Secretary-General for Economic and Social Affairs, and a D-1 post for development financing. Public information would be headed by an Under-Secretary-General. Among those to be abolished is an Under-Secretary-General in Economic and Social Affairs.

The table below summarizes the Secretary-General's initial budget proposals, and the revised provisions necessary to implement his reforms.

1998-1999 Budget Proposals and Changes to Implement Reforms

PART I: OVERALL POLICY-MAKING, DIRECTION AND COORDINATION

1. Overall policy-making, direction and coordination Secretary-General's initial proposal: $38,622,800

Reform proposals: 1A Overall policy-making $41,704,300 1B General Assembly Affairs and Conference Services $458,119,600

PART II: POLITICAL AFFAIRS

2. Political Affairs Secretary-General's initial proposal: $60,965,400

Reform proposals: 2A Political Affairs $41,882,100 2B Disarmament $12,254,200

3. Peace-keeping operations and special missions Secretary-General's initial proposal: $99,478,900

Reform proposals: No change in figures

4. Peaceful uses of outer space Secretary-General's initial proposal: $4,428,900

Reform proposals: No change in figures

- 5 - Press Release GA/AB/3173 22 October 1997

PART III: INTERNATIONAL JUSTICE AND LAW

5. International Court of Justice Secretary-General's initial proposal: $22,077,000

Reform proposals: No change in figures

6. Legal Affairs Secretary-General's initial proposal: $33,478,800

Reform proposal: Legal affairs $33,528,300

PART IV: INTERNATIONAL COOPERATION FOR DEVELOPMENT

7. Policy coordination and sustainable development Secretary-General's initial proposal: $45,694,100

8. Africa: New Agenda for Development Secretary-General's initial proposal: $5,443,000

Reform proposal: No change in figures

9. Economic and social information and policy analysis Secretary-General's initial proposal: $51,547,800

10. Development support and management services Secretary-General's initial proposal: $27,631,900

Reform proposals: Three sections -- 7, 9 and 10 -- merged into new one, 7A. Economic and social affairs $110,427,700

11A. Trade and development Secretary-General's initial proposal: $105,657,900

Reform proposal: No change in figures

11B. International Trade Centre UNCTAD/World Trade Organization Secretary-General's initial proposal: $21,973,400

Reform proposal: No change in figures

- 6 - Press Release GA/AB/3173 22 October 1997

12. Environment Secretary-General's initial proposal: $9,304,400

Reform proposal: No change in figures

13. Human settlements Secretary-General's initial proposal: $13,206,600

Reform proposal: No change in figures

14. Crime control Secretary-General's initial proposal: $5,507,000

Reform proposal: $6,029,200

15. International drug control Secretary-General's initial proposal: $16,372,000

Reform proposal: No change in figures

PART V: REGIONAL COOPERATION FOR DEVELOPMENT

16. Economic and social development in Africa Secretary-General's initial proposal: $90,771,600

Reform proposal: No change in figures

17. Economic and social development in Asia and the Pacific Secretary-General's initial proposal: $73,408,100

Reform proposal: No change in figures

18. Economic development in Europe Secretary-General's initial proposal: $49,310,800

Reform proposal: No change in figures

- 7 - Press Release GA/AB/3173 22 October 1997

19. Economic and social development in Latin America and the Caribbean Secretary-General's initial proposal: $90,245,500

Reform proposal: No change in figures

20. Economic and social development in Western Asia Secretary-General's initial proposal: $49,704,800

Reform proposal: No change in figures

21. Regular programme of technical cooperation Secretary-General's initial proposal: $45,921,800

Reform proposal: No change in figures

PART VI: HUMAN RIGHTS AND HUMANITARIAN AFFAIRS

22. Human rights Secretary-General's initial proposal: $46,448,500

Reform proposal: $46,138,700

23. Protection of, and assistance to, refugees Secretary-General's initial proposal: $50,568,700

Reform proposal: No change in figures

24. Palestine refugees Secretary-General's initial proposal: $19,375,000

Reform proposal: No change in figures

25. Humanitarian assistance Secretary-General's initial proposal: $22,254,200

Reform proposal: $18,401,100 Office of Emergency Relief Coordinator to replace Department of Humanitarian Affairs

- 8 - Press Release GA/AB/3173 22 October 1997

PART VII: PUBLIC INFORMATION

26. Public Information Secretary-General's initial proposal: $140,327,600

Reform proposal: 26. Communications and public information $139,009,000

PART VIII: COMMON SUPPORT SERVICES

27. Administrative Services Secretary-General's initial proposal: $904,192,900

Reform proposals: Department of Administration and Management to be recast as Department of Management

PART IX: INTERNAL OVERSIGHT SERVICES

28. Internal Oversight Secretary-General's initial proposal: $18,637,300

Reform proposal: No change in figures

PART X: JOINTLY FINANCED ACTIVITIES AND SPECIAL EXPENSES

29. Jointly financed administrative activities Secretary-General's initial proposal: $6,228,800

Reform proposal: No change in figures

30. Special expenses Secretary-General's initial proposal: $53,720,800

Reform proposal: No change in figures

- 9 - Press Release GA/AB/3173 22 October 1997

PART XI: CAPITAL EXPENDITURES

31. Construction, alteration, improvement and major maintenance Secretary-General's initial proposal: $35,893,400

Reform proposal: No change in figures

PART XII: STAFF ASSESSMENT

32. Staff Assessment Secretary-General's initial proposal: $324,600,100

Reform proposal: $321,804,300

PART XIII: INTERNATIONAL SEABED AUTHORITY

33. International Seabed Authority Secretary-General: $ -

Reform proposal: New section 34. Development account $12,702,700

TOTAL ESTIMATES OF EXPENDITURE Secretary-General's initial proposal: $2,582,999,800

ESTIMATES OF INCOME

1. Income from staff assessment Secretary-General's initial proposal: $329,104,900

2. General income Secretary-General's initial proposal: $35,135,800

3. Services to the public Secretary-General's initial proposal: $5,271,400

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For information media. Not an official record.