FIFTH COMMITTEE BEGINS RESUMED SESSION

Press Release
GA/AB/3212

FIFTH COMMITTEE BEGINS RESUMED SESSION

Procurement reform, outsourcing and the chronically late issuance of documents were among the topics discussed this morning by the Fifth Committee (Administrative and Budgetary), as it began the first part of its resumed session, which will last until 27 March.

The Under-Secretary-General for Management, Joseph Connor, introducing reports on the United Nations administrative and financial efficiency, said the Organization's supplier roster for procurement contracts was being expanded. Bidding guidelines and contract information would soon be available on the Internet, as one of several initiatives aimed at broadening the roster's geographical reach.

During an extensive debate before the Committee adopted its programme of work, many delegations the Secretariat must comply with relevant resolutions of the General Assembly, and issue reports six weeks prior to their consideration.

Delays in issuance had become a chronic problem, negatively affecting both the implementation of mandated activities and the work of the Fifth Committee, Indonesia's representative said on behalf of the "Group of 77" developing countries and China.

The representative of Pakistan asked for a written explanation from the Secretariat as to why it had failed to issue reports in a timely manner for the Committee's consideration. The delay was not because of time constraints; some reports had been due for years, he added.

Responding, the United Nations Controller, Jean-Pierre Halbwachs, said that the timing of the resumed session was not convenient. The beginning of the year was an extremely busy time. Still, while seven reports remained outstanding, 54 had been completed.

After introducing a report of the Office of Internal Oversight Services on implementation of procurement reform, the Under-Secretary-General for Internal Oversight Services, Karl Paschke, said that reports sometimes turned out to be much more voluminous and labour-intensive than expected. The most time-consuming factor for his Office was the process of client consultation.

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The representatives of Slovakia, United Kingdom -- for the European Union and associated States -- Netherlands, India, Syria, Egypt, Cuba, Canada, Côte d'Ivoire, Greece, Uganda, Algeria and the United States also spoke this morning.

The Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), Conrad S.M. Mselle, and the Fifth Committee's Secretary, Joseph Acakpo-Satchivi, also spoke. Speaking for the Chairman of the Board of Auditors, Kanwal Nath introduced financial reports and audited statements to the Committee.

The Committee will meet again at 10 a.m. tomorrow, 10 March, to continue its review of the Organization's administrative and financial efficiency. It will also begin considering aspects of the 1998-1999 programme budget, including the Secretary-General's proposal to redirect savings resulting from cuts in non-programme costs towards a development fund. Mr. Connor is scheduled to address the Committee on the United Nations financial situation.

Committee Work Programme

The Fifth Committee (Administrative and Budgetary) met this morning to begin the first part of its resumed fifty-second session, which will be held until 27 March. It will consider 15 agenda items during that period.

This morning, it is scheduled to discuss its organization of work and begin considering reports of the Board of Auditors and aspects of the 1998-1999 programme budget -- specifically, honorariums payable to members of United Nations organs and subsidiary organs. It will also review the Organization's administrative and financial efficiency, including procurement reform.

During the three-week resumed session, the Committee will consider the 1996-1997 programme budgets, and financial reports and reports of the Board of Auditors, as well as reports of the Joint Inspection Unit (JIU) and of the Office of Internal Oversight Services. It will take up agenda items on improving the United Nations financial situation, human resources management and appointments to the United Nations Staff Pension Committee.

In addition, it will consider financing of the International Criminal Tribunal for Rwanda, as well as of the United Nations Mission for the Referendum in Western Sahara (MINURSO), United Nations Mission of Observers in Tajikistan (UNMOT), United Nations Support Mission in Haiti (UNSMIH) and the United Nations Observer Mission in Angola (MONUA). It will also take up administrative and budgetary aspects of peacekeeping operations.

Financial and Board of Auditors Reports

The Committee had before it a report by the Secretary-General on United Nations financial regulations and rules (document A/52/727). The text contains a proposed amendment to the terms of reference governing the content of audit opinion to reflect the requirements adopted by the International Federation of Accountants. The new approach would not limit or reduce the existing scope of the external auditors' work, which would continue to be governed by the Financial Regulations of the United Nations. The Panel of External Auditors of the United Nations recommended that the text be introduced throughout the United Nations system.

By the revision, four new elements would be added, according to the report. They include reference to the Secretary-General's responsibility for financial statements and to the Auditors' responsibility for expressing an opinion on those statements; and an explanation of the auditing standards followed and of what the audit covers.

A note by the Secretary-General transmits the Board of Auditors' proposals for improving the implementation of its recommendations approved by the General

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Assembly (document A/52/753). The Board notes that the requirement of including timetables for implementing recommendations was not fully complied with, and recommends that administrations rectify this situation.

Regarding the disclosure of office holders, the Board recommends that progress reports specify the title or position of individual officers to be held accountable for the implementation of the recommendations. It also suggests that the United Nations and all its funds and programmes, as well as the secretariat of the United Nations Joint Staff Pension Fund, establish mechanisms to strengthen oversight in regard to the implementation of audit recommendations.

On change in reporting arrangements, the Board suggests that all the progress reports be submitted to the General Assembly on an annual basis. The Board will examine these reports and submit a summary report to the General Assembly on the status of their implementation.

A note by the Secretary-General transmits a report of the Board of Auditors on its updated special audit of the Integrated Management Information System project (IMIS) (document A/52/755).

The report states that the project, initially estimated to cost $28 million (1988 estimates), was reprogrammed and rebudgeted in 1994 and is expected to cost $76 million (1994 estimates), against which $55.85 million had been spent as at 31 October 1997. A contractor was engaged in May 1991 to develop IMIS at a total price of $17 million, but by 1996, after 13 amendments, the price stood at $34.5 million. The project, initially expected to be completed at Headquarters by January 1994, is now expected to be completed after July 1998.

The report recommends that the Administration draw up a comprehensive plan of action indicating the time schedules and resources needed to resolve all outstanding problems generated in IMIS.

Review of Administrative and Financial Efficiency

The Secretary-General's report on procurement reform (document A/52/534 and A/52/534/Corr.1) states that most of the recommendations of the General Assembly, the Advisory Committee, the Board of Auditors and the Oversight Office related to the Organization's procurement process are being implemented.

The Secretary-General asks the Assembly to establish a post for Director of the Procurement Division by reclassifying an existing post within the Division (from D-1 to D-2). Except for that post, he considers the resources in the 1998-1999 budget for staff within the Division to be adequate, in light of the decreased numbers and amounts of procurement contracts, due in part to the fact that no new large operations have been mandated and several peacekeeping operations have been reduced. Five seconded personnel have been loaned to the

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Division at no cost, from the Governments of France, Ireland, Norway, Spain and the United States.

Efforts are being made to broaden the supplier roster's geographical base, with special emphasis on developing countries and those with economies in transition, the report states. Of the total 2,027 suppliers registered in the roster, 935 come from the United States. The next five highest national suppliers are the United Kingdom (216) France (84), Germany (81), Netherlands (70), and Canada (62).

Increasingly, the report states, procurement contracts are awarded through competitive bidding. From January to July 1997, some $124.7 million, or 72.43 per cent of the total volume of the Division's procurement considered by the Headquarters Committee on Contracts, was obtained in that manner. Regarding exigency situations, the Secretary-General directed departments and offices to review their financial procedures and propose amendments to respond to emergency operations.

From January through June 1997, architectural and construction services claimed some $38 million of procurement resources, while $27.3 million was used for air transportation, and $21.4 million for food rations and catering, the report states.

In its related report (document A/52/7/Add.3), the Advisory Committee on Administrative and Budgetary Questions (ACABQ) says it does not recommend acceptance of the proposed reclassification of a D-1 post to the D-2 level, since sufficient justification for the request had not been provided. Noting that the loan agreements for the five gratis personnel in the Procurement Division expired between February 1998 and July 1999, the ACABQ states that the provisions of General Assembly resolution 51/243 regarding the use of such personnel should be applied.

The Advisory Committee questions information that the new delegation of procurement authority had not necessarily reduced the procurement officers' workload, the report states. The Secretary- General's report had indicated that there had been a significant reduction in the number and dollar value of cases submitted to the Headquarters Committee on Contracts, due to the revised thresholds, as well as to the fact that no new large operations have been mandated, while several missions had been reduced. In view of the above, the ACABQ states that there should indeed have been a significant reduction in workload. A report by the Secretary-General transmits the findings of the Office of Internal Oversight Services on its review of procurement reform (document A/52/813). It notes that in the early 1990s the value of procurement by the Organization increased significantly as a result of the growing demand for goods and services in field missions. During the last three years, however, the average value of goods and services procured by the United Nations

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decreased from $500 million annually to approximately $310 million, mostly due to the downsizing of peacekeeping missions.

Among other recommendations, the Office suggests that management consider using procurement and contract administration services offered by the United Nations Office for Project Services for development projects, the report states. Further, financial rules should be interpreted to permit the initiation of procurement actions pending the allocation and commitment of funds in cases where a financial commitment is operationally necessary prior to budget approval. The procurement of professional services and medical supplies should no longer be exempted under the Organization's financial rules from the requirement for bidding.

A note by the Secretary-General transmits the Oversight Office's report on outsourcing at the United Nations (document A/51/804), written after an audit of more than 25 contracts worth over $100 million, states that well managed outsourcing can help achieve efficiency, cost reductions and provide the expertise the Organizations needs to supplement its personnel.

The Office recommends that the United Nations develop Organization-wide guidelines for managing outsourcing, according to the text. For a majority of outsourcing contracts reviewed, programme managers did not formally evaluate vendors' performance. That should be corrected. The Office asks the Organization to consider expanding the use of outsourcing when it was justified by cost-benefit analyses.

The Office says it found no standard operational definition for "outsourcing" within the Organization. As a result, it takes different forms, ranging from personnel contracts and purchase orders. Some outsourced services and their contracts were in fact management efforts to supplement their personnel resources. Given that outsourcing would replace United Nations staff with outsiders, it could hurt prospects for career development.

Expected economies were achieved for garage administration, the report states. For translation at Headquarters, more could have been saved if more outsourcing had been implemented. In some cases, however, outsourcing proved more costly than in-house services. For example, at the United Nations Mission in Haiti (UNMIH), monthly costs were cut 66.5 per cent from $157,288 to $52,870 after camp maintenance and laundry services were taken in-house.

The Joint Inspection Unit (JIU) in its report (document A/52/338) states that outsourcing can provide alternative means for achieving cost savings and/or other important improvements in performing activities and services of an organization. Whether or not specific activities or services are outsourced is less important than having agreed rules and procedures to assure consideration, where appropriate, of external, as well as in-house, options for performing them.

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The report concludes that the more planned use of the challenge of outsourcing could foster a culture of openness to innovation and concern for cost-effectiveness. Potential problems stemming from the use of outsourcing are: respecting the international character of United Nations system organizations; assuring the necessary expertise to provide appropriate control and/or management of outsourced contracts; and avoiding negative impact on affected staff.

The report recommends that the legislative organs of each participating organization request their executive heads to prepare a policy statement committing their organizations to the use of outsourcing as a means for achieving improved cost-effectiveness. This statement would include the criteria for determining what current and planned non-core activities should be considered for outsourcing; and measures to assure that outsourcing will not compromise the international character and mandate of the organization.

The report also recommends that the executive heads prepare, for approval at the appropriate level, administrative rules and/or procedures for implementing the planned policy. They should also make structural and procedural changes to facilitate and encourage the best use of outsourcing. Further, the General Assembly should request the Administrative Committee on Coordination (ACC) to develop a system-wide definition of outsourcing; encourage increased sharing among United Nations system outsourcing; and explore possibilities for joint and coordinated actions in regard to the use of outsourcing in order to gain the advantages of economies of scale and increased bargaining power.

A note by the Secretary-General transmits a report of the Oversight Office on the audits of four regional commissions (document A/52/776), conducted from September 1996 to April 1997. The Economic Commission for Europe (ECE) was not covered since it was scheduled for a different audit cycle.

On the Economic Commission for Africa (ECA), the Office found that major improvements were needed to strengthen internal controls and monitor compliance with financial regulations and rules. The costs of running the newly completed United Nations Conference Centre were not segregated from the operating costs of other ECA facilities; therefore, separate account codes should be established and common costs prorated to reflect the actual costs of operating and maintaining the Centre. The ECA management generally agreed with the recommendations of the Office and has already addressed many of the problems reported.

On the Economic Commission for Latin America and the Caribbean (ECLAC), the report states that audits of ECLAC and its subregional offices disclosed generally satisfactory management of programmes. However, the monitoring of extrabudgetary projects was inadequate and the quality of programme outputs

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was not being properly assessed. ECLAC management generally concurred with the recommendations of the Office and has initiated implementation action.

Regarding the Economic and Social Commission for Asia and the Pacific (ESCAP), the Office noted that the changes in the ESCAP secretariat needed to support the thematically oriented programme of work of the Commission had not been effected. There was also little congruence between the programmatic and organizational structures, and no correlation between the programme budget and the financial statements. ESCAP management agreed to implement many of the recommendations.

On the Economic and Social Commission for Western Asia (ESCWA), the report notes that internal controls in place are generally adequate, but procedures needed strengthening, in particular, in the areas of procurement and financial management. An audit of the Commission's technology management revealed that disaster planning and prevention needed improvement. ESCWA management agreed with the recommendations and has already begun implementation.

Another Oversight Office report contains its review of programme management in the United Nations Crime Prevention and Criminal Justice Division (document A/52/777). The report states that although the Crime Prevention and Criminal Justice Division operates under the supervision of the Director General of the United Nations Office at Vienna, there is little evidence of guidance and oversight provided by top management, which suggests that the Division has been conducting its work in an independent manner.

The lack of direct involvement of upper management is manifest in the absence of clear strategic direction, including resource mobilization, the report states. That lack is also evident in the manner in which the Division's resources are being managed and the priorities being addressed. While available resources are not commensurate with the increasing demands on the programme, the Secretariat's approach towards the challenges posed by the financial constraints appear thus far to be piecemeal and lacking strategy.

The report states that, regarding the Commission on Crime Prevention and Criminal Justice -- the policy-making body of the United Nations in the field of crime control -- the secretariat should focus on integrating interrelated issues into fewer activities and refrain from expanding its role in areas where it does not have a comparative advantage. The programme planning and budgetary process should be used more effectively than it has been up to this point, particularly in the preparation of programme budget implications in response to new mandates.

The Commission on Crime Prevention and Criminal Justice, created by General Assembly resolution 46/152 of 18 December 1991, is composed of representatives of 40 governments. Its sessions are held annually in Vienna.

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Aspects of 1998-1999 Budget

The Secretary-General's report on an interim study on the question of honorariums payable to members of organs and subsidiary units of the United Nations (document A/52/699) resubmits his 1992 recommendation that the General Assembly increase current rates by 25 per cent. The proposed increase would take effect from 1 January 1998 -- replacing the current rates that became effective on 1 January 1981 -- and cost $182,500 for 1998-1999.

The revised annual rates of honorariums, he adds, would be paid to some members of the International Law Commission, International Narcotics Control Board (INCB), United Nations Administrative Tribunal, Human Rights Committee, Committee on the Elimination of Discrimination against Women, and Committee on the Rights of the Child.

The revision would be as follows:

Rate of honorariums

Present Proposed rate rate

Chairmen (Presidents) $5,000 $6,250

Vice-Chairman of the INCB $4,000 $5,000

Other members $3,000 $3,750

Additional amount payable to members of the International Law Commission when acting as special rapporteurs, conditional upon the preparation of specific reports of studies between sessions of the Commission $2,500 $3,125

In its report (document A/52/7/Add.7), the ACABQ says it is more appropriate for the matter to be considered in the context of the Secretary- General's comprehensive report on the issue, to be submitted to the Assembly's fifty-third session.

Statements on Organization of Work

ANWARUL KARIM CHOWDHURY (Bangladesh), Fifth Committee Chairman, drew attention to the revised programme of work and the status of documentation. He also drew attention to document A/52/40, containing the text of a letter to him from the Acting Chairman of the "Group of 77" developing countries and China, requesting that the Group's concerns regarding the timely issuance of

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documentation be drawn to the Secretary-General's attention. A second, related letter in the document was from the Fifth Committee Chairman to the Secretary-General.

He informed the Committee that administrative arrangements of the United Nations Conference on Trade and Development (UNCTAD)/World Trade Organization (WTO) International Trade Centre had been made through an exchange of correspondence between the Secretary-General and the WTO Director-General. The Assembly had noted with concern that arrangements made in that correspondence had not been transmitted to it. Based on those agreements, the Secretariat had submitted a report to the Assembly at its fifty-second session on possible revised administrative arrangements for the Centre. That report had not yet been reviewed by the ACABQ.

The Secretariat had issued the 1998-1999 proposed programme budget for the Centre, he continued. The WTO, however, felt that the proposals put forward by the Secretariat did not meet its concerns. The relevant agreements and exchange of correspondence between the Secretary-General and the WTO Director-General would be issued as a conference room paper, he continued. The Committee would have to decide whether to consider the matter at its present resumed session.

PRAYONO ATIYANTO (Indonesia), speaking on behalf of the Group of 77 and China, said that reports on many of the important items on the Committee's agenda had either not been submitted or had been issued very late. Despite the fact that several General Assembly resolutions required the Secretariat to issue documents six weeks prior to their consideration, delays in their issuance had become a chronic problem, negatively affecting both the fulfilment and implementation of mandated activities and the work of the Fifth Committee. The issuance of the first report on gratis personnel, for example, had been very late in November 1996 which was seen as a complete disregard for earlier Assembly resolutions.

He said that the Group of 77 and China believed that the continued late issuance of documents by the Secretariat adversely affected the decision- making process in the Committee. It was, therefore, important that the Secretariat comply with the relevant Assembly resolutions and decisions and submit the reports in accordance with the six-week rule. The Secretariat should also indicate the reasons for any delays.

The Group of 77 and China proposed that the report of the Board of Auditors on the IMIS should be considered under the agenda item on the 1998- 1999 programme budget, as the Committee would consider two other reports on another, he said. Also, the draft of the United Nations code of conduct was an administrative issue related to human resources management and, therefore, should be considered in the Fifth Committee.

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C.S.M. MSELLE, Chairman of the ACABQ, said it had come as a surprise to the ACABQ that there had been an exchange of letters between the WTO and the United Nations that had not been communicated to the General Assembly. This had been brought to the attention of the Fifth Committee. The Secretary- General had prepared a related report which the ACABQ had not yet had time to review. The Advisory Committee would have to study the Secretary-General's report very carefully -- this had been communicated to the WTO. The ACABQ would not be able to report to the Fifth Committee at the current resumed session. The issue would be taken up at the second resumed session.

MARCEL JESENSKY (Slovakia) said the Committee was fully aware of Slovakia's status regarding its participation in the financing of peacekeeping operations. Financing such operations was not a privilege, but an obligation. He expected that the Fifth Committee would reach consensus on Slovakia's grouping in the current scale of assessments for peacekeeping. NICHOLAS THORNE (United Kingdom), speaking for the European Union, said while it was generally satisfied with the Committee's programme of work, it shared the concerns expressed by Indonesia's representative regarding adherence to the Organization's rules. Further, he noted the comments made by the representative of Slovakia.

PAUL MENKVELD (Netherlands), expressing support for Slovakia's request, said the Bureau should provide guidance on how to resolve the issue.

AMJAD HUSSAIN SIAL (Pakistan) associated himself with the statement made for the Group of 77 and China. During the last session, a number of delegations had requested that the reports on gratis personnel be submitted at the first part of the Committee's resumed session. The Secretariat had not accorded that request the seriousness it deserved. He asked the Secretariat to submit in writing the reasons for its failure to comply. Other reports that had not been issued included those pertaining to the use of consultants. The Committee would be interested in knowing what steps the Secretary-General intended to take to rectify the delay in the issuance of documentation.

The Committee Chairman, Mr. CHOWDHURY (Bangladesh), said that a letter had already been directed to the Secretary-General.

RAJAT SAHA (India), expressing support for the statement made on behalf of the Group of 77 and China, said the code of conduct for United Nations staff should be discussed under the item on human resources management. Reasons for the delay in the submission of reports should be provided.

TAMMAM SULAIMAN (Syria), expressing support for the statement on behalf of the Group of 77 and China and on the code of conduct, said Assembly resolutions were not being respected. The Secretariat had not complied, for example, with the decision that two Muslim holidays should be made official. Only one of those dates had been made official.

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AHMED H. DARWISH (Egypt) supported Indonesia's statement and on the code of conduct.

EVA SILOT BRAVO (Cuba), expressing support for Indonesia's statement and on the proposal regarding the code of conduct, said some documents had not been issued at all; an explanation from the Secretariat was requested. Consideration of issues on the programme of work should not take place until the relevant reports had been published and considered. Information should be provided on the status of various reports.

JEAN-PIERRE HALBWACHS, United Nations Controller, said the resumed session had been essentially to consider peacekeeping operations; indeed, most of those reports were complete. More than 60 reports were expected for completion by the beginning of April. The timing of the first part of the resumed session was not convenient; the beginning of the year was a busy time for his office.

The Committee Chairman, Mr. CHOWDHURY (Bangladesh), said those points could have been brought to the Committee's attention when its schedule was being finalized. The Committee should know the exact status of documentation. Secretariat officials concerned should explain to the Committee why the documentation for the resumed session was not available. If documentation was not ready, the Committee would have to postpone its consideration of certain items.

Mr. SIAL (Pakistan) said the problem was chronic and system-wide. It had nothing to do with the time factor. A number of reports had been due for years.

Mr. SULAIMAN (Syria) said the Controller's answer had been shorter than some of the questions. His delegation was particularly interested in documents pertaining to the code of conduct. He did not agree with the Controller's emphasis on peacekeeping operations; other items should be taken up at the resumed session. Reports on the United Nations Interim Force in Lebanon (UNIFIL) should be issued this month in accordance with the six-week rule.

Ms. SILOT BRAVO (Cuba) said that in view of the repeated comments of delegations, a better response from the Controller was requested. All of the stated concerns should be addressed.

SAM HANSON (Canada) thanked the Comptroller for a response that had been short and to the point. There was a tendency after the session in December to leave for vacation without paying attention to the amount of work left for the Secretariat. Canada thought it was a point "very well taken" that the scheduling of the first resumed session should be undertaken with a realistic estimation of what could be achieved between late December and March. Perhaps the session could begin later.

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Mr. ATIYANTO (Indonesia) also thanked the Controller for his answer. The Committee could make an informed judgement on how to continue only after hearing from the relevant Secretariat officials.

NARCISSE AHOUNOU (Côte d'Ivoire) was grateful for the Controller's information. The intention of Member States was not to overwork the Secretariat. It would be more logical for the work of the session to be agreed upon together. What could be done about the chronic problem of documents? All Committees suffered from this problem, but the Fifth Committee suffered especially because of its workload.

Mr. HALBWACHS, United Nations Controller, said that 54 documents had been issued for the first part of the Committee's resumed session; only seven remained outstanding. He then briefly explained the status of each.

Mr. SULAIMAN (Syria) asked for clarification on why the report on upgrading and modernizing meeting rooms was late.

Mr. SIAL (Pakistan) expressed appreciation for the Controller's statement and asked that action be taken on reports regarding gratis personnel during the present session. That would enable the Committee to make its decisions at the second resumed session, to be held in May.

Ms. SILOT BRAVO (Cuba), thanking the Controller, asked for a more thorough response regarding upgrading the conference rooms.

The Committee Chairman, Mr. CHOWDHURY (Bangladesh), recalled that the Controller had indicated that he would be providing further information on modernizing meeting rooms. However, the Committee should also be addressed directly by the Secretariat officials concerned.

The Committee Vice-Chairman, ERICA-IRENE DAES (Greece), associated herself with the comments made by the European Union on the programme of work.

Mr. SIAL (Pakistan) said the report on the issue of gratis personnel should be considered during the present session, as had been suggested by several delegations.

The Committee then adopted its programme of work on the understanding that the Bureau would make adjustments as necessary. It decided that the International Trade Centre's administrative arrangements would be taken up during the second part of the Committee's resumed session. The Bureau would submit a proposal on how to address Slovakia's location in the scale of assessments for peacekeeping operations. The Secretariat would submit a conference room paper on the status of posts during the current session. Reports related to gratis personnel would be considered at the current part of the resumed session, subject to availability of the reports of the Advisory Committee.

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Responding to a question, JOSEPH ACAKPO-SATCHIVI, Committee Secretary, said that the report on consultants by the Office of Internal Oversight Services would be published tomorrow. A second report on the subject had not yet been received. As soon as it had been received, it would be submitted for publication.

Ms. SILOT BRAVO (Cuba) said that until responses had been received on experimental projects regarding the budget, it should not be considered.

ODYEK AGONA (Uganda), said almost two hours had now been spent on the programme of work. Was this part of the efficiency gain that the Organization had been trying to achieve? The remarks of the Controller had seemed to imply that the reports were not being produced because of a shortage of staff. Organizational efficiency should not come at the cost of the quality of work. If the situation continued, it would also be necessary to question the timing of the resumed session. Also, Uganda found it difficult to understand why some reports were always issued on a timely basis and others, continuously, were not.

Statements on Financial Reports

KANWAL NATH (India), Chairman of the Audit Operations Committee, introducing the reports of the Board of Auditors, expressed the Board's appreciation for the continued support extended by the Secretary-General and the heads of the various audited organizations, as well as their staff members.

Mr. THORNE (United Kingdom), speaking for the European Union and Bulgaria, Cyprus, Czech Republic, Estonia, Hungary, Lithuania, Poland, Romania, Slovakia and Slovenia, said he would revert to the IMIS project at a later date. The Union approved the Secretary-General's report on amendments to the terms of reference governing the audit of the United Nations and welcomed the Secretary- General's report on implementing recommendations made by the Auditors.

The title or position of individuals to be specified as the one to be held accountable for implementing the Board's recommendations should be at the level of programme managers, he said. While the Union endorsed the proposal to establish a special committee for ensuring that recommendations were implemented, clear terms of reference should first be in place, to avoid overlapping responsibilities. The primary managerial responsibility for implementation of audit recommendations should remain with the department head. The reporting cycle for all progress reports should be on an annual basis, to improve implementation of recommendations. Although that might increase the Committee's workload, it was justified by the importance of ensuring the highest standards of financial administration.

Mr. SAHA (India) said the Secretariat should monitor the implementation of recommendations regarding IMIS. Dates for completion of project stages

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should not be changed. It was of utmost importance to ensure that efficiency be brought about, if necessary, by introducing programme accountability. He would return to the matter at a later date.

DJAMEL MOKTEFI (Algeria) said his delegation was pleased with the quality of the reports submitted by the Board of Auditors, particularly that of the report on IMIS, which clearly identified the heart of the problem facing the system. Algeria would make specific comments at a later date.

THOMAS A. REPASCH (United States) supported the proposal to amend the terms of reference governing the audit of the United Nations. The United States looked forward to discussing the issue of implementation of the Board's recommendation. He requested the ACABQ to inform the Committee of its findings, if it had reviewed the report.

Statements on Administrative and Financial Functioning

JOSEPH E. CONNOR, Under-Secretary-General for Management, introducing reports on procurement reform, said pursuant to an Assembly resolution adopted at its last session and the recommendations of the Advisory Committee, the phasing out of the five gratis personnel in the Procurement Division had begun in December 1997. The remaining three such personnel were scheduled to be phased out by July.

Training remained a priority in the Division, he said. Business seminars and conferences supplemented in-house training; a number of procurement officers had attended conferences worldwide, to enhance their knowledge of products and services. The revised procurement manual would be issued shortly.

The supplier roster was being expanded, he said. All permanent and observer missions had been contacted with information on the registration process. The Procurement Division also provided general information on the Internet. Bidding guidelines and contract information would soon also be available through that medium. Other efforts were needed, and so consideration was now being given to advertising in a limited number of papers in selected countries.

He said the current reform process must look at outsourcing as only one method of enhancing efficiency. The United Nations policy on outsourcing must ensure that quality and cost-effectiveness was maintained. Careful review would be needed to ensure that outsourcing would not negatively affect staff. The Secretary-General was committed to appropriate action on recommendations which were considered to be practical.

The Procurement Division had responded to over 80 reports from oversight bodies, primarily on procurement in peacekeeping operations and offices away from Headquarters. A number of recommendations had been implemented, while others were being reviewed.

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The Procurement Division was responsible for obtaining a wide range of equipment and services, he said. Many cases were operationally complex. Procurement required absolute accountability. The head of the Division supervised 80 staff, close to half of whom were at the Professional level. The Division's workload had increased with the recent transfer of responsibilities to it. In light of the above, the Secretary-General believed the head of the Division should be at the D-2 level.

Mr. MSELLE, Chairman of the ACABQ, said that the report of the Advisory Committee contained a comment relating to the work plan of the Procurement Division. Mr. Connor's response had provided up-to-date information and was appreciated. The ACABQ would have more to say on the subject at a later date.

KARL TH. PASCHKE, Under-Secretary-General for Internal Oversight Services, then introduced the report of his Office on the review of the implementation of procurement reform. He sought the understanding of the Committee regarding the delay of the publication of documents. Two reports by the Office that had not yet been published were being finalized. They had turned out to be much more voluminous and labour-intensive than had been originally thought. The most time- consuming factor was the process of client consultation. A multitude of clients were often dealt with. While the timetables of the legislative bodies were taken seriously, so were of those to be audited. Efforts would be made to minimize delays.

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