SECRETARY-GENERAL'S ESTIMATES FOR 2000-2001 BUDGET LESS THAN AMOUNTS SPENT ON FOOD FOR CATS AND DOGS IN SOME LARGE CITIES, FIFTH COMMITTEE TOLD
Press Release
GA/AB/3276
SECRETARY-GENERAL'S ESTIMATES FOR 2000-2001 BUDGET LESS THAN AMOUNTS SPENT ON FOOD FOR CATS AND DOGS IN SOME LARGE CITIES, FIFTH COMMITTEE TOLD
19981204 Committee Takes Up Proposed Budget Outline for 2000-2001 Biennium, Considers Net Budgeting, First Performance Report on 1998-1999 BudgetThe Secretary-General's preliminary estimates for the 2000-2001 budget were less than the amounts spent on food for cats and dogs in some large cities, the Fifth Committee (Administrative and Budgetary) was told this morning, as it commenced its consideration of the proposed budget outline for that biennium.
The United Nations budget growth rate was now approximately zero, and the lack of resources was chronic, Cameroon's representative continued. If Member States continued to mark time or step back on budget growth, the Organization would not be able to face the challenges of the twenty-first century.
The representative of Austria, on behalf of the European Union and associated States, welcomed the Secretary-General's determined approach to budgetary discipline. However, reform did not have to mean budget reduction; rather, it should strengthen the Organization.
The Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), C.S.M. Mselle, told the Fifth Committee it must decide how to address projected expenditures for special political missions not yet mandated for the upcoming biennium. The ACABQ recommended the outline estimate be close to $2.569 billion, which would include about $112 million for such projections.
The Secretary-General's preliminary budget estimates for 2000-2001 were about $2.469 billion, the United Nations Controller, Jean-Pierre Halbwachs, said as he introduced the proposed programme budget outline. That was 2.5 per cent less -- $63.8 million -- than current biennium appropriations.
In other business, the Committee approved a decision by which the Assembly would take note of the Secretary-General's report on net budgeting and endorse the views of the ACABQ.
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It also approved a decision to advise the Assembly of the budgetary implications of a draft resolution by which the United Nations component of the International Civilian Mission to Haiti (MICIVIH) would be extended until 31 December 1999, at a cost of $5.9 million under section 3 of the budget, Peacekeeping and special missions.
Both decisions were introduced orally by the Committee's Chairman, Movses Abelian (Armenia), and were approved without a vote.
The Committee also commenced consideration of the first performance report on the 1998-1999 budget in which the Secretary-General proposes reducing the level of required resources by some $48.2 million to $2.484 billion, mainly as the result of currency fluctuations and inflation.
The representatives of Ukraine, Cuba, Chile, Algeria, Australia, United States, Costa Rica, Egypt and Indonesia spoke.
Mr. Mselle introduced the reports of the ACABQ, while reports of the Secretary-General were introduced by Mr. Halbwachs and the Director of the Management Policy Office, Amir Dossal.
The Committee will meet again at 10 a.m. on Monday, 7 December, to continue discussing the budget for 1998-1999 and the budget outline for 2000-2001.
Fifth Committee Work Programme
The Fifth Committee (Administrative and Budgetary) met this morning to take up the Secretary-General's first performance report for the 1998-1999 programme budget. At its fifty-second session, the General Assembly had approved the initial budget appropriations for 1998-1999 in the amount of some $2.532 billion, by resolution 52/221A. On the basis of the Secretary- General's first performance report on the budget, and the Advisory Committee on Administrative and Budgetary Questions (ACABQ) related report, the Assembly will approve revised appropriations for 1998-1999.
Under the same agenda item, programme budget for the biennium 1998-1999, the Committee was also scheduled to take up reports on the impact of pilot projects on budgetary practices and procedures, the Secretary-General's report on net budgeting, and a statement of programme budget implications.
Also this morning, the Committee was to take up the Secretary-General's budget outline for the 2000-2001 biennium. In accordance with the United Nations budgetary process, the Secretary-General submits a report outlining the programme budget for the upcoming biennium in "off-budget" years -- the second year of the biennium.
Consideration of the outline takes place under the agenda item review of the United Nations financial and administrative efficiency. Under the same item, the Committee also had before it reports of the Committee for Programme and Coordination (CPC) on programme planning (document A/53/16, Chapter II), a report from the Secretary-General on guidelines for Internal Control Standards (document A/52/867), and a report from the ACABQ on the same matter (document A/53/508).
(For background on the CPC's report see Press Release GA/AB/3243 of 12 October; for background on the reports on internal control standards, see Press Release GA/AB/3264 of 16 November.)
Reports on 1998-1999 Programme Budget Performance
The Secretary-General's first performance report on the 1998-1999 budget (document A/53/693) proposes that the level of resources for the biennium would be some $2.484 billion -- about $48.2 million less than the $2.532 billion originally approved.
The primary purpose of the report, according to the Secretary-General, is to indicate changes to budget requirements caused by inflation and exchange rate variations and by changes to cost assumptions made when the initial appropriations were calculated. It also accounts for General Assembly and Security Council mandates approved subsequent to the biennium budget appropriation, unforeseen and extraordinary items that could not be deferred to 1999, and certain decisions of policy-making organs.
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The report does not account for programme budget implications of draft resolutions or anticipated draft resolutions considered at the current General Assembly session, except those related to decisions and resolutions of the 1998 substantive session of the Economic and Social Council.
The decrease in resource requirements are largely due to changes in exchange rates (a decrease of some $27.6 million), lower than anticipated inflation rates (a decrease of some $11.7 million), and reduced standard costs (a decrease of some $17 million).
The Secretary-General reports the exchange rate recostings are based on an average of operational rates experienced so far in the biennium, rather than on the rates at the time of recosting. This method was chosen in accordance with General Assembly and ACABQ instructions that whichever of the two methods produced the lowest estimates should be used. The reduced requirements are mainly a result of favourable exchange rate movements of the United States dollar against the Swiss franc and the Austrian schilling.
Reduced standard costs were mainly due to higher than anticipated vacancy rates in 1998 at the Professional level and above, according to the report. The 1998 Professional vacancy rate slightly exceeded 10 per cent as a consequence of high levels of separation in 1998, despite active recruitment efforts and the absence of recruitment restrictions. Because this should not impact on recruitment in 1999, and because the average vacancy rate for the biennium would only be available at its end, the original rates used to calculate the budget -- 5 per cent for Professional and 2.5 per cent for General Service staff -- are retained for 1999 estimates.
The Secretary-General reports projected average salary costs $700,000 higher than the initial appropriation, a $5.7 million anticipated net increase in common staff costs, and additional upwards adjustments totalling some $2.5 million.
Additional commitments for expenditure of some $2.7 million have been entered into under the Secretary-General's authority to meet unforeseen and extraordinary expenses, according to the report. Of this amount, some $2.4 million relates to peacekeeping operations and special missions, $223,600 relates to unforeseen expenses of the International Court of Justice, and $19,900 relates to inter-organizational security measures.
New mandates account for increased requirements totalling some $5.3 million. A $239,200 reduction included in this figure comes as a consequence of the incorporation of the Office of the Secretary-General's Special Envoy in Sierra Leone into the United Nations Observer Mission in Sierra Leone. Reductions resulting from changed mandates under economic and social affairs, and under trade and development are also included. Additional requirements result from Security Council actions on Cambodia, Liberia and Burundi, as a consequence of a comprehensive review of conditions of service
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for members of the International Court of Justice and because of revised staff assessment estimates.
The Secretary-General reports that the expenditure changes also mean a $4.5 million decrease in income from staff assessment. A $158,200 decrease in general income is attributable to exchange rate revisions, and a $302,400 increase in income from services to the public results from exchange and inflation rate induced recosting.
The report also notes that the Secretary-General has issued statements and estimates of programme budget implications amounting to some $31.3 million in response to draft resolutions considered by the General Assembly's Main Committees, and that a number of anticipated resolutions yet to be submitted to the General Assembly would give rise to between $13 million and $16 million in budget implications. These have not been taken into account in this revision.
In its related report (document A/53/7/Add.8) the ACABQ recommends approval of the Secretary-General's revised requirements. It notes dissatisfaction with the Secretary-General's explanations of high vacancy rates, and points out once again that unless measures are taken to simplify and streamline personnel procedures, high vacancy rates will continue, with a consequent impact on mandated programmes.
According to the Secretary-General's note on pilot projects on budgetary practices and procedures (document A/52/852), he initiated pilot projects to delegate authority for managing the Organization's human and financial resources. These will provide a practical context for greater delegation of authority and flexibility, within existing United Nations rules and regulations.
As part of the management reform adopted by the General Assembly, the Secretary-General intends to pursue delegation of authority as an instrument for improving management, the report says. In the event of delegation beyond his authority, he will seek the Assembly's approval.
The report presents the framework for delegating authority. The General Assembly establishes the basic regulations for managing financial and human resources. These are then implemented by the Secretary-General in his capacity as Chief Administrative Officer. On his behalf, the Under-Secretary- General for Administration and Management shall be responsible for the administration of the Organization's Financial Regulations and Rules, and can delegate authority to other officials. In practice, the United Nations Controller has authority for the administration of financial resources.
Authority for staff management is delegated to the Assistant Secretary- General for Human Resources Management, according to the report. Under a pilot project, further authority has been given to programme and line managers
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in several areas of human resources management. A report on the delegation of authority in human resources will be submitted to the Assembly during the fifty-third session.
Also before the Committee was the Secretary-General's report on net budgeting (document A/53/410). It says the change from gross to net budgeting has been effected smoothly, without changing the ability to operate of those entities that previously budgeted on a gross basis. Net budgeting is applied to those entities whose costs are shared by participating organizations. It consists of including in the regular budget only the United Nations share, while recording the gross budgets of those entities as special accounts and handling the net budgets as a component of the regular budget. It does not affect the funding arrangements or the assessments for the United Nations regular budget, since Member States assessments are the same in either case.
The only difference, the report states, is that, whereas in gross budgeting Member States are assessed the gross amount of appropriations approved by the General Assembly less income anticipated from reimbursements from participating organizations, in net budgeting the appropriation granted by the Assembly under the expenditure sections reflects only the regular budget's net share, with no offsetting income for the shares of participating organizations.
The Secretary-General says that net budgeting has been applied to the programme budgets of the International Trade Centre, and the secretariats of the Consultative Committee on Administrative Questions (CCAQ), the Information Systems Coordinating Committee (ISCC) and the Consultative Committee on Programme and Operational Questions (CCPOQ). For 1998-1999, the Assembly approved the arrangements for the International Civil Service Commission (ICSC), the Joint Inspection Unit (JIU) and the conference and security services at Vienna.
The Secretary-General asks the Assembly to take note of the report.
A statement by the Secretary-General submits the programme budget implications of draft resolution A/53/L.57 (document A/C.5/53/39) by which the Assembly would decide to authorize the renewal of the mandate of the United Nations component of the International Civilian Mission to Haiti until 31 December 1999. The draft resolution would give rise to additional requirements of some $7.7 million under section 3, Peacekeeping operations and special missions, of the programme budget for 1998-1999.
The estimated 1999 requirements of some $7.7 million would be offset by the unencumbered balance of some $1.7 million from the appropriation granted by the General Assembly in 1998. Net additional requirements under section 3 would come to about $5.9 million.
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Review of Efficiency
In his programme budget outline for 2000-2001 (document A/52/220), the Secretary-General puts his preliminary budget estimates at $2,468.5 million, which is $63.8 million -- or 2.5 per cent -- less than the $2,532.3 million initial appropriations for the current biennium. The contingency fund is to be $18.5 million, or 0.75 per cent of the outline. The level of the proposed programme budget for the 2000-2001 biennium reflects priorities set out in the medium-term plan for the period 1998-2001, the Secretary-General writes.
The 2000-2001 estimate is less than the 1998-1999 appropriations for several reasons, the Secretary-General explains. A one-time 1998-1999 expense of $1.9 million, largely used for the interim secretariat of the United Nations Convention to Combat Desertification, is not included. Neither are political missions mandated only for 1998-1999, despite the likelihood that many will be renewed. By omitting from the outline missions partially funded in the current budget and not yet mandated for 2000-2001, some $61.9 million in 1998-1999 appropriations were excluded from the 2000-2001 estimate.
Traditionally, the extension or creation of such missions is addressed by additional appropriations voted by the General Assembly after programme budget proposals were prepared, the report states. However, that practice is not satisfactory because the need to incorporate large, unspecified and unpredictable resource provisions within the budget after the adoption of the budget outline, and mid-way through the biennium, undermines the outline exercise. The Secretary-General believes that provisions for mandated political missions should be included in the regular programme budgets and has suggested two ways to do this: by including projected requirements in the regular budget outline, or by including a contingency provision for such resources. Both he and the ACABQ recommend the former, but the Assembly has yet to take action on the matter. Therefore, political missions partially funded in the current budget and not yet mandated for 2000-2001 are omitted from the proposed outline.
A number of mandates exist for the convening of major conferences and special sessions during the 2000-2001 biennium, for which $20 million will be needed, the report states. That amount would likely be identified as a result of scrutiny within the Secretariat to identify economies.
Below is a comparison of the budget estimates for 1998-1999 and 2000-2001.
I: Overall policy-making, direction and coordination
1998-1999 appropriation: $478.3 million 2000-2001 estimates: 474.5 (decrease of $3.8 million -- 0.8 per cent)
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II: Political affairs
1998-1999 appropriation: 206.1 2000-2001 estimates: 146.9 (decrease of $59.2 million -- 28.7 per cent)
III: International justice and law
1998-1999 appropriation: 53.5 2000-2001 estimates: 54.6 (increase of $1.1 million -- 2.0 per cent)
IV: International cooperation for development
1998-1999 appropriation: 272.6 2000-2001 estimates: 276.5 (increase of $3.9 million -- 1.4 per cent)
V: Regional cooperation for development
1998-1999 appropriation: 370.4 2000-2001 estimates: 371.9 (increase of $1.6 million -- 0.4 per cent)
VI: Human rights and humanitarian affairs
1998-1999 appropriation: 127.4 2000-2001 estimates: 128.4 (increase of $1 million -- 0.8 per cent)
VII: Public Information
1998-1999 appropriation: 138.0 2000-2001 estimates: 137.0 (decrease of $1 million -- 0.8 per cent)
VIII: Common support services
1998-1999 appropriation: 446.2 2000-2001 estimates: 441.2 (decrease of $5 million -- 1.1 per cent)
IX: Internal oversight
1998-1999 appropriation: 18.4 2000-2001 estimates: 19.2 (increase of $0.8 million -- 4.7 per cent)
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X: Jointly financed administrative activities/special expenses
1998-1999 appropriation: 58.5 2000-2001 estimates: 60.5 (increase of $2 million -- 3.5 per cent)
XI: Capital expenditures
1998-1999 appropriation: 34.6 2000-2001 estimates: 35.2 (increase of $0.6 million -- 1.8 per cent)
XII: Staff assessment
1998-1999 appropriation: 315.4 2000-2001 estimates: 309.6 (decrease of $5.8 million -- 1.8 per cent)
XIII: Development account
1998-1999 appropriation: 13.1 2000-2001 estimates: 13.1 (no change)
TOTAL: 1998-1999 appropriation: $2,532.3 2000-2001 estimates: $2,468.5 (overall decrease of $63.8 million -- 2.5 per cent)
In its related report (document A/53/718), however, the ACABQ recommends that the Assembly adopt a higher preliminary estimate -- $2,568.8 million. That figure would include projected requirements for special political missions funded for 1998-1999 and not yet mandated for 2000-2001, which the ACABQ believes should be included in the outline. (About $112.6 million would be needed for such missions -- $22,818,000 for those mandated by the Security Council and $89,808,400 for missions mandated under the General Assembly.) Also, it would reflect the ACABQ's belief that there was no justification for the Secretary-General's expectation that $20 million would be realized from unspecified "compensating economies".
The ACABQ had been informed that, should the revised rates for 1998-1999 be used, the preliminary estimates for the biennium 2000-2001 would amount to $2,439 million, the report states. Had the Secretary-General included in his preliminary estimates resources for special political missions and had he not deducted the amount for "compensating economies", preliminary estimates for 2000-2001 would be $2,568.8 million at revised 1998-1999 rates, which is the amount the ACABQ recommends.
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Statements on First Performance Report
JEAN-PIERRE HALBWACHS, United Nations Controller, introduced the Secretary-General's first performance report. He said the document was primarily technical and described its contents. The changes reflected a number of elements: unforseen and extraordinary expenses; new mandates and decisions of legislative bodies; and changes caused by exchange rates, inflation rates and the changed standard costs.
He described the two methods for recosting the budget as a consequence of currency fluctuations, either using an average or using the rate at the time of recosting. The Board of Auditors had advised that only the averaging method should be used, but the Secretary-General had responded that that might not have the most favourable outcome for Member States, and his position had been endorsed by the Advisory Committee on Administrative and Budgetary Questions (ACABQ) and the General Assembly. In this instance, the averaging method had proved the most beneficial.
C.S.M MSELLE, Chairman of the ACABQ, introduced the ACABQ's comments. He drew the Committee's attention to the ACABQ caution on vacancy rates. The ACABQ had also recalled the General Assembly's decision in resolution 52/220, that vacancy rates should not be used to achieve budgetary savings. The Advisory Committee recommended approval of the revised appropriations, he said.
OLEKSII V. IVASCHENKO (Ukraine) said he wanted to make remarks on financing the Office of the General Assembly President during the Ukrainian Presidency. He recalled the General Assembly had taken a decision to provide supplementary financial support to the General Assembly President's Office. Ukraine was disappointed with the Secretariat's interpretation of that decision. The report said that the way of distributing the additional funds would be in consultation with the President. There had been a number of misunderstandings between the Secretariat and the presidency. Consequently, Ukraine sought detailed information on how the supplementary funds from the Secretariat had been used and recommended the General Assembly give the Secretariat clear guidance on how such funds were to be used if it provided such funds in the future.
Statements on Impact of Implementation of Pilot Projects
AMIR DOSSAL, Director of the Management Policy Office, introduced the Secretary-General's note. The Secretary-General had originally proposed three pilot projects, but, after General Assembly consideration, had introduced one pilot project in the Economic Commission for Latin America and the Caribbean (ECLAC). The pilot project focused on three areas -- simplification of recruitment processes, procurement, and financial aspects. The pilot would be reviewed in several months, and the Secretariat would then report back to the General Assembly on it.
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Mr. MSELLE, Chairman of the ACABQ, introduced the ACABQ's oral comments. The ACABQ noted the exercise was not finished. The ACABQ had reviewed the Secretary-General's note and had concluded that the information was not sufficiently developed to allow an ACABQ evaluation of the pilot. Therefore, it would come back to the pilot in its review of the proposed budget proposals for 2000-2001 at its spring session.
DULCE BUERGO RODRIGUEZ (Cuba) said her delegation was dissatisfied with the Secretary-General's document, which lacked substantive information and was very preliminary. It had taken note of the information that the other pilot projects had been abandoned, and that ECLAC was the only one which would continue with experimental implementation. When the countries of ECLAC had last met, they had not given final approval to the project, and that should be taken into account in evaluating its status. Additionally, Cuba wished to draw attention to the impact on the pilot of General Assembly considerations on proposals to give greater delegation of authority, which were being considered under the agenda item on human resources management.
She noted that the ACABQ also believed the information provided was insufficient. The matter should be kept on the Committee's agenda to allow for more follow-up, and in light of ECLAC's forthcoming decision.
She also drew attention to the recent practice, occurring due to time problems for the Committee, by which the ACABQ presented oral reports. That practice was not satisfactory. She suggested the Committee take a final decision on the practice to avoid complications caused by the presentation of oral reports. The purpose of such presentations, she understood, was to avoid delaying the work of the Fifth Committee, and in some instances related to brief items. However, Cuba was concerned about the practice, and the Fifth Committee should take a definitive position on it.
ALVARO JARA (Chile) said Chile would like to have received a more detailed report, and was awaiting additional information to shed light on the matter. However, General Assembly resolution 52/220 had placed the pilot project in the hands of the ECLAC countries, and, in that context, at the ECLAC session, the ECLAC countries had not taken a final decision on the pilot.
MOVSES ABELIAN (Armenia), Fifth Committee Chairman, proposed that the Fifth Committee decide to recommend that the General Assembly take note of the Secretary-General's report and the comments of the ACABQ.
DJAMEL MOKTEFI (Algeria) said that in the light of the ACABQ comments and given that the matter was still under consideration by ECLAC, the note of the Secretary-General should, in principle, remain under consideration. There was no need at this stage to take note of the report or the ACABQ comments. Algeria would prefer to leave the matter under consideration.
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Mr. MSELLE, Chairman of the ACABQ, recommended deferral of consideration of the item, pending the receipt of further information and the relevant recommendations of the ACABQ.
Ms. BUERGO RODRIGUEZ (Cuba) said aspects in the proposal transcended budgetary procedures and touched on other matters, such as human resources management. She regretted that the information submitted did not enable the question to be completed at the present time. The matter should be kept under review.
The CHAIRMAN suggested that consideration of the item be deferred until he proposed a draft decision based on delegations' comments.
MILES ARMITAGE (Australia) said the Committee could take note of the reports of the Secretary-General and the ACABQ and decide to continue consideration of the item at a later date.
Mr. MOKTEFI (Algeria) said his delegation was not prepared to take note of the Secretary-General's report.
The CHAIRMAN said the Committee should adjourn its consideration until a draft text could be prepared and submitted. He then drew the Committee's attention to the Secretary-General's report on net budgeting.
Mr. HALBWACHS, United Nations Controller, introducing the Secretary- General's report, said the change from gross to net budgeting had been smooth and had not affected the operations of the entities concerned.
Mr. MSELLE, ACABQ Chairman, said the ACABQ intended to examine the experience with net budgeting when it reviewed the proposed programme budget for the biennium 2000-2001.
The Committee CHAIRMAN proposed that the Committee decide to recommend that the General Assembly take note of the Secretary-General's report on net budgeting contained in document A/53/410 and endorse the observations of the ACABQ.
The Committee approved that decision.
The CHAIRMAN then drew attention to the Secretary-General's statement on the programme budget implications of the draft resolution on the International Civilian Mission to Haiti (MICIVIH).
Mr. MSELLE, ACABQ Chairman, introducing that body's views, said the draft resolution would renew the joint participation of the United Nations with the Organization of American States (OAS) in MICIVIH and extend the United Nations component until the end of 1999. He recommended that the Fifth
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Committee inform the Assembly of the programme budget implications of that draft.
The Committee CHAIRMAN then proposed the following draft decision:
Should the General Assembly decide to adopt draft resolution A/53/L.57, an additional appropriation of $5.9 million would be required under section 3, Peacekeeping operations and special missions, of the programme budget for 1998-1999. An additional appropriation of $849,800 would also be required under section 32, Staff assessment, to be offset by a corresponding amount under income section 1, Income from staff assessment.
The Committee approved that decision.
Statements on Review of Efficiency
Mr. HALBWACHS, United Nations Controller, introduced the proposed programme budget outline for 2000-2001. The outline was prepared with the current level as the starting point. One-time costs for 1998-1999 were then deducted. Provisions in the current appropriations for special missions were then removed.
In preparing the outline for the current biennium, the Secretariat had included resources for possible mandates related to political missions, but the Assembly had not approved that practice, he said. The Secretary-General had then submitted a report indicating that there was need in every biennium for resources for special missions. Those requirements could either be included in the outline, or excluded from it and anticipated with a contingency provision, included for that purpose. Both the Secretary-General and the ACABQ had recommended the former option, but, in the absence of action by the Assembly, those projected resources were excluded from the outline.
The outline also included a provision of about $20 million for activities anticipated for 2000-2001 on the basis of existing mandates and other considerations, he said. That was offset by compensating economies of the same amount. The Secretary-General proposed that the priorities of the current biennium remain the same. Since the outline was not a preliminary proposed budget, it must be general, he added.
Mr. MSELLE, ACABQ Chairman, said preliminary resources for special political missions were currently estimated at $112.6 million. The Fifth Committee must decide how such potential expenditures were to be financed. The ACABQ's view had been expressed previously: such expenditures should be included in the budget outline. If the projected $112.6 million was excluded from the outline, the level of the preliminary resources would be $2,439 million at 1998-1999 rates. However, if that amount was included in the outline, the proposed estimates should be $2,568.8 million at 1998-1999 rates.
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Additional requirements for special missions would continue to be handled in accordance with resolution 41/213 [by which the budgetary process had been defined], he said. Since the outline was not a budget, $112.6 million could not be added to the outline on the understanding that the amount could be fully or partially absorbed. The extent to which efficiency measures could be absorbed could only be determined in the context of implementation of the budget, and the ACABQ recommended against the identification of $20 million to cover expenditures.
The ACABQ was to have reported on the Secretary-General's report on the relationship between perennial activities and the contingency fund (document A/C.5/52/42) in conjunction with its report on the budget outline, he recalled. However, it had decided to report on it separately. It was now waiting for additional information from the Secretariat.
HANS PETER MANZ (Austria), speaking on behalf of the European Union, Bulgaria, Czech Republic, Estonia, Hungary, Lithuania, Poland, Romania, Slovakia, Cyprus, Iceland and Liechtenstein, said that when the General Assembly had adopted its resolution 41/213 it had wished to improve the Organization's financial and administrative functioning and to facilitate Member States agreement on the programme budget. That resolution had introduced the concept of a budget outline, to provide a preliminary estimate of resources. Since then, the budget outline had become a pillar of the budget process.
Reform should not necessarily mean a reduction in budget, but should strengthen the Organization, he said. The Union welcomed the Secretary- General's determined approach to budgetary discipline.
It also took note of the Secretary-General's preliminary estimate. That, however, did not contain provisions for special missions partially funded in the current budget and not yet mandated for the next biennium. The Secretary-General had explained why he had not included them, but clearly stated he considered the current arrangements inadequate. The Union believed estimates for those missions should be included in the budget outline. It therefore agreed with the ACABQ recommendation that the Secretary-General make provision in the outline for peace and security missions expected to continue through the biennium.
He endorsed the Secretary-General's proposal that the budget reflect the priorities in the medium-term plan for 1998-2001 and the programme budget for 1998-1999, he said. There was also a need to safeguard priority areas within the budget. The Union endorsed allocation of greater resources for peacekeeping, human rights and humanitarian affairs, which were inadequately provided for in the budget outline. It also agreed that the size of the contingency fund should be 0.75 per cent on top of the proposed outline.
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S.E.M TOMMO MONTHE (Cameroon) said that, with the introduction of this important agenda item, the Committee was at the heart of one of the most important innovations introduced into the budget process. It would be useful to remember that the goal being sought with this innovation was to enable Member States to become involved in the process quite early and follow it through to the end. That would allow Member States to achieve the broadest possible agreement on the preliminary estimates necessary for the execution of the projects decided on, the growth rate, the sectoral priorities and the percentage amount of the contingency fund. Broad agreement on those elements would enhance the ability to foresee commitments and therefore the confidence and determination of Member States when it came to bearing their proportion of those commitments. Cameroon was therefore grateful to the Secretary-General for the document and for its introduction by his representative. The information provided by the ACABQ and the comments of the CPC were also important.
Cameroon believed that despite years of commendable reform of the budgetary process, the finances of the Organization were still in a difficult situation, he said. It was legitimate now to ask whether it was a lack of funding that caused the almost perennial financial crisis. The preliminary amounts mentioned were less than the budgets of many large businesses and less than the amounts spent on food for cats and dogs in some large cities. However, large businesses did not have the task of maintaining peace and security or of promoting economic and social development.
Now that it was almost certain that the special political missions of the biennium would not end, he said, it would be desirable to have recommendations on them in the current outline. Cameroon supported their inclusion in the spirit of predictability.
On the some $20 million savings envisaged, the procedure used had been inappropriate and, moreover, arbitrary, as the ACABQ had noted, he said. It resembled covert pressure on programme managers and did not allow them any flexibility. The savings were a hypothetical exercise, potentially harmful for programme management.
Cameroon supported the priorities mentioned in the Secretary-General's report, he said. They had already been endorsed by the General Assembly. He would like to stress the importance of the promotion of international peace and security, of sustainable development, of the development of Africa, and of human rights -- notably economic and social rights.
The budget growth rate had been declining year after year to approximately zero, he said. Was there any need to mention again the consequences that had on programmes, on staff and on the work of the Organization? he asked. If Member States continued to mark time or step back on budget growth, the Organization would not be able to face the challenges of the twenty-first century. There was a chronic lack of resources, and Cameroon
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asked the Secretary-General to produce an analysis of the problem to reverse the negative trend.
Cameroon supported the 0.75 per cent proposed level of the contingency fund, he said. That fund should regularly be brought to the attention of deliberative bodies, so it could be effectively used, in preference to obliging programme managers to redeploy resources, absorb reductions or rely on extrabudgetary contributions.
While the outline was not a budget, Cameroon attached great importance to the setting of priorities, he said. There should be proper budgets for peacekeeping, the safety of staff, preventive diplomacy and confidence- building. The regional commissions and, notably, the Economic Commission for Africa (ECA), should be given special attention. So should public information -- particularly programmes to heighten awareness of Africa and information centres, which should no longer be treated as second class cousins.
Developing countries had been innovative in promoting democracy and that should be taken into account, he continued. Greater attention in administration and management should be given to training, and to maintenance of premises. Negligence in those areas would lead to higher costs in the future. National and regional mechanisms for disarmament and the prevention of conflict in Africa should be adequately supported. Programme managers should focus on those areas when formulating their budget proposals. Cameroon would await their recommendations, and any inappropriate recommendations would be dead on arrival.
Guidelines for Internal Control Standards
The CHAIRMAN drew attention to reports of the Secretary-General and the ACABQ on guidelines for internal control standards, which had been introduced at earlier meetings. On the basis of "informal informal" consultations, he proposed that the Committee recommend the following draft decision:
"The General Assembly takes note of the report of the Secretary-General on the Guidelines for the Internal Control Standards (document A/52/867) and endorses the observations and recommendations of the ACABQ thereon (document A/53/508)."
THOMAS REPASCH (United States) said his delegation had not been part of those "informal informal" deliberations. Since it still had questions on the matter, it could not now join the consensus.
Other Matters
The CHAIRMAN, speaking also for the Bureau, apologized to the representative of Chile for unintentionally not apprising him of the Bureau's intention regarding consultations on results-based budgeting. He hoped the
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representative would accept that apology; both he and his delegation were held in the highest esteem. The Committee Chairman would coordinate the agenda item on results-based budgeting.
Ms. BUERGO RODRIGUEZ (Cuba) said she regretted that the ACABQ Chairman had left the room. She was very concerned with the practice of orally introducing reports of the ACABQ. The Advisory Committee had had sufficient time to properly prepare reports on some items. In the next few days, the Committee should take a decision on the need for the ACABQ to discontinue its practice of oral reports.
The CHAIRMAN said the ACABQ Chairman was now in another meeting, but he would ask that he respond to those comments in a formal meeting. The Committee should not prejudge the ACABQ's working methods.
Ms. BUERGO RODRIGUEZ (Cuba) said she was not attempting to prejudge the work of the ACABQ. The matter was not about what the ACABQ thought, but was rather a decision of the General Assembly.
NAZARETH INCERA (Costa Rica) said her delegation's views had been expressed by the representative of Cuba.
The CHAIRMAN said he had not challenged those views. Rather, he had said that the views of the ACABQ Chairman should be heard before the Committee took a decision on the matter.
AHMED DARWISH (Egypt) said that in informal consultations Mr. Mselle had said he would submit oral reports on certain items that were not controversial. The Fifth Committee Chairman had said he would transmit the request of the representatives of Cuba and Egypt regarding presentation of summary records. The ACABQ's reports should be written, he stressed.
PRAYONO ATIYANTO (Indonesia) said that in the interest of fairness, the Committee should hear from the ACABQ Chairman and then take a decision.
The CHAIRMAN said the Committee was free to take any decision it wished. He had proposed that the ACABQ Chairman be asked to comment in a formal meeting for the sake of balance and courtesy.
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