OFFICE OF UNITED NATIONS HIGH COMMISSIONER FOR REFUGEES WELL-MANAGED, FIFTH COMMITTEE TOLD

Press Release
GA/AB/3319

OFFICE OF UNITED NATIONS HIGH COMMISSIONER FOR REFUGEES WELL-MANAGED, FIFTH COMMITTEE TOLD

Committee Takes Up Board of Auditors and Oversight Office Reports

The Office of the United Nations High Commissioner for Refugees (UNHCR) was well-managed,and media allegations to the contrary were unproven. The Fifth Committee (Administrative and Budgetary) was told this morning.

This had been confirmed by a report on the agency by the United Nations Board of Auditors, the representative of Norway said, as the Committee commenced its consideration of the reports of the United Nations Board of Auditors.

The specific problems the Auditors raised almost all related to the reporting obligations of the agency’s humanitarian assistance partners -- governments and non-governmental organizations, he continued. While it could assist in obliging non-governmental organizations to comply, the UNHCR’s influence on governments was more limited.

The representative of the United States asked what further action had been taken to follow up on defaulting implementing partners, and why so little had been made of losses reported and written off in 1998, which were three times more than in 1997. One finding of great concern was that the financial records of 83 per cent of projects implemented during 1994-1997 had not been closed, he added.

The representatives of Bangladesh and Pakistan also addressed the Committee on the reports of the Auditors, which were introduced by the Board’s Chairman, O.T. Prempeh of Ghana Under-Secretary-General for Management Joseph E. Connor introduced the related Secretary-General’s reports.

Reports from the Office of Internal Oversight Services on a variety of issues, under the Committee’s agenda item reviewing the efficiency of the administrative and financial functioning of the United Nations, were also taken up. Among these were reports on allegations -– found to be inaccurate –against the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA)

Fifth Committee - 1a - Press Release GA/AB/3319 14th Meeting (AM) 25 October 1999

office in Lebanon, and reports on several investigations into the United Nations Conference on Trade and Development (UNCTAD) matters.

The Chairman of the Joint Inspection Unit, Louis Dominique Ouedraogo, introduced that body’s comments on the Oversight Office reports, and Under-Secretary-General for Internal Oversight Services Karl Paschke introduced the reports themselves.

Mr. Paschke also introduced Oversight Office reports on several administrative and budgetary aspects of peacekeeping missions, on the subject of which the representative of Cyprus spoke.

Under other matters, the Committee decided to accept a proposal from its acting Chairman, Ahmed Darwish of Egypt, to allow representatives of two international staff unions to address the Committee when it came to consider human resources management and the United Nations common system. The Assistant Secretary-General for Central Support Services, Toshiyuki Niwa, answered questions raised previously about the United Nations cafeteria and the representative of Costa Rica made follow-up comments.

When the Committee meets again, at 10 a.m. on 26 October, it plans to continue its consideration of these same agenda items, and take action on a draft proposal on the United Nations Iraq-Kuwait Observation Mission (UNIKOM).

Committee Work Programme

The Fifth Committee (Administrative and Budgetary) met this morning to take up aspects of its agenda items on: financial reports and audited financial statements, and reports of the Board of Auditors; review of the efficiency of the administrative and financial functioning of the United Nations (reports of the Office of Internal Oversight Services; and administrative and budgetary aspects of the financing of the United Nations peacekeeping operations (Oversight Office reports).

Board of Auditors Reports

The Committee had before it the audited financial statements for the year ended 31 December 1998 of, and the report of the Board of Auditors on, voluntary funds administered by the United Nations High Commissioner for Refugees (A/54/5/Add.5).

The Board of Auditors audited the operations of the voluntary funds administered by the United Nations High Commissioner for Refugees (UNHCR) at its headquarters at Geneva and at its branch offices in Austria, China, Croatia, Djibouti, France, Germany, Greece, Iran, Italy, Lebanon, Saudi Arabia, Somalia, Syria, Turkey and Venezuela for the period from 1 January to 31 December 1998. The Board also validated the financial statements of the voluntary funds administered by the High Commissioner.

The Board’s main findings included the following: that the financial statements and schedules of the voluntary funds generally conform to United Nations accounting standards; that of the $346.4 million advanced to the implementing partners during 1998 and recorded as expenditure, financial reports had not been received for $92.8 million as of 31 March 1999, and that, in addition, audit certificates had not been received in respect of $97 million in funds advanced to government partners and $234.5 million in funds advanced to other implementing partners; that the projects reviewed at headquarters and in the field did not contain work plans or milestones for project implementation; and that out of 2,565 projects implemented during the years 1994 to 1997, 83 per cent had not been closed as of November 1998.

Its main recommendations included the following: to treat advances to implementing partners as accounts receivable at the time the advances are made and clear the advances to expenditure on receipt of satisfactory financial reports, and also persevere with efforts to clear the outstanding balances of cash advances expeditiously, in particular the balances relating to earlier years; to assess the reasons for non- compliance by respective governmental and non-governmental implementing partners with the requirement to render audit certificates as prescribed in the sub-agreements and draw up a strategy, in consultation with the Board of Auditors, for securing sufficient audit certificates; to ensure that work plans are programme-specific and that they are prepared as an integral part of the project-planning and monitoring process; and to exercise stricter control over the progress of work of implementing partners in order to ensure achievement of the stated objectives and recover the savings of $371,368 from the implementing partner concerned.

The Committee also had before it a report by the Secretary-General on the implementation of the recommendations of the Board of Auditors (A/54/140).

In the category of previous recommendations not fully implemented, the report says revised guidelines for the use of consultants have been endorsed by the General Assembly. The Board drew attention to its 1992- 1993 recommendation that the Administration develop and implement a career development system; in that context, the Organization has continued to develop a career support system. To meet the Organization’s priorities, staff development and learning programmes have been reinforced and refocused and new target programmes are being implemented for staff at all levels.

The report also says that attention is being given to reviewing the issue of mobility, bearing in mind that the needs and the means of the Organization must be the paramount consideration. Accordingly, measures are being taken to achieve greater mobility of staff in terms of functions, departments, duty stations and organizations of the United Nations system, and to address internal constraints.

Also among the report’s finding are the following items, each related to a specific recommendation of the Board: the Controller is continuing to monitor expenditures closely to ensure compliance with the authorized allotments; in late 1998, offices were requested to report on the level of actual and projected expenditures, by object group, for the first year of the biennium; accounting systems away from Headquarters are now being integrated into the Integrated Management Information System (IMIS); several improvements have been made after a recommendation by the Board that the Administration modify Release 3 of IMIS to avoid the necessity of introducing substantial adjustments of accounts receivable and payable outside IMIS; the Procurement Manual had been made available to all users on the Internet.

The Committee also had before it a report of the Secretary-General on the implementation of the recommendations of the Board of Auditors concerning United Nations funds and programmes (A/54/140/Add.1).

In its resolution 52/212 B of 31 March 1998, the General Assembly accepted the recommendation of the Board of Auditors that reports on measures in response to the recommendations of the Board be submitted to the Assembly on an annual basis. The present report was prepared accordingly.

It contains the responses of the executive heads of organizations and programmes, namely: the International Trade Centre UNCTAD/WTO (ITC), the United Nations University (UNU), the United Nations Development Programme (UNDP), the United Nations Children’s Fund (UNICEF), the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), the United Nations Institute for Training and Research (UNITAR), the Fund of the United Nations Environment Programme (UNEP), the United Nations Population Fund (UNFPA), the United Nations Habitat and Human Settlements Foundation, and the Fund of the United Nations International Drug Control Programme and the United Nations Office for Project Services. The responses mainly relate to the recommendations of the Board of Auditors in its reports for the period ended 31 December 1997.

The Committee also had before it the report of the Board of Auditors on implementation of its recommendations (A/54/159). The general comments of the Board of Auditors are as follows.

Out of the 13 organizations reporting on the implementation of the Board’s recommendations, 10 had generally included timetables. Seven of the 13 had identified office-holders to be held accountable. In general, organizations had established effective mechanisms to strengthen oversight with regard to the implementation of audit recommendations. In overall terms, the Board noted that of the 156 recommendations made in respect of the 13 organizations covered in the present report, 48 recommendations had been fully implemented, 100 had been partially implemented, four had not been implemented and in the remaining four cases the organizations had not been able to implement the recommendations as these had been overtaken by events.

The Committee also had before it comments by the Board of Auditors on the report of the Secretary-General on the hiring and use of consultants in the Secretariat (A/54/165), in which the Board welcomes the issuance of comprehensive guidelines, which substantially addresses the issues and concerns raised by the Board in its reports.

The Board now intends to monitor the application of the guidelines by departments, as well as the implementation of recommendations on the need to plan their project and programme personnel requirements in advance. The Board looks forward to the introduction of Release 5 of IMIS, which will enable the Secretariat to identify candidates on a broader basis through a worldwide exchange of information. The Board notes that the Administration proposes to introduce a detailed evaluation form to measure the quality of work. It noted Release 5 of IMIS would also facilitate the integration of evaluations of consultants’ performance into the central occupational rosters for worldwide use.

The Committee also had before it a report of the Advisory Committee on Administrative and Budgetary Questions (ACABQ) on the financial reports and audited financial statements of the Board of Auditors (A/54/441). On the voluntary funds administered by the United Nations High Commissioner for Refugees (UNHCR), the Advisory Committee notes that although considerable progress has been achieved in clearing outstanding balances of cash advances to implementing partners, the problem of timely receipt of audit certificates, in particular from government implementing partners, persists.

The Advisory Committee is very concerned that with regard to government partners, the influence of the UNHCR is limited, and that in certain countries it has no alternative than to work with government partners. On the implementation of the recommendations of the Board of Auditors, the Advisory Committee notes that the bulk of the recommendations of the Board of Auditors, 100 out of 156, has been partially implemented.

The Committee also had before it the report of the Secretary- General on the Year 2000 (Y2K) compliance issue (A/C.5/54/3). A special management structure has been set up to oversee the Organization’s efforts to manage the Y2K issue, the report says. A specialized consultant has been engaged to conduct a Y2K risk assessment study for the telecommunications and computing infrastructure as well as business applications at Headquarters.

The new Y2K-compliant version of IMIS was tested and was programmed for introduction in July. An information circular on potential problems associated with the transition to the year 2000 was issued on 29 April. The Year 2000 Team will coordinate the development of contingency plans for each of the principal mission-critical operations where there is a risk of failure. Offices away from Headquarters were contacted and guidance provided on matters such as the Y2K management structure to be put in place, identification of mission- critical activities and establishment of a work programme. A network of Y2K focal points was activated.

In order to address the security issues which might arise, the Office of the United Nations Security Coordinator requested security management teams at duty stations to conduct a risk assessment.

The Committee had before it the report of the Advisory Committee on Administrative and Budgetary Questions (ACABQ) on the programme budget for 2000-2001 (document A/54/7), which, among other matters, takes note of, summarizes and comments on previous Secretary-General’s reports on many of the matters dealt with in the above reports, including use of conference facilities at Nairobi, the impact of economy measures on mandated conference services and the provision of interpretation services to meetings of regional and other major Member State groups.

Reports on Review of Efficiency

The Committee had before it the report of the Office of Internal Oversight Services (OIOS) on the review of common services in the United Nations (A/54/157). The expansion and strengthening of common services is one of eight strategies in the Secretary-General’s new vision for management set out in his programme for reform.

An inspection by the OIOS was conducted at United Nations Headquarters and at the United Nations Offices at Geneva and Vienna to review progress achieved in strengthening common services in the areas identified in the Secretary-General’s report. The inspection also assessed efforts to improve the effectiveness and efficiency of the support services of the United Nations in these areas.

The inspection confirmed that the Secretary-General’s reform measures gave new impetus to the need to seek cost-effectiveness through possible expansion of common services. Specific actions have been taken to mobilize implementation of the Secretary-General’s strategy in New York. It is also essential to ensure that the United Nations Offices at Geneva and Vienna are included in the overall implementation strategy and that the other overseas duty stations are kept informed of lessons learned and best practices identified, the report says.

The delegation of authority to programme managers and the decentralization of monitoring and policy functions to the United Nations Offices at Geneva and Vienna are crucial factors in enhancing the efficiency and timeliness of support services. The processes required to implement these mechanisms need to be urgently acted upon by the Department of Management.

The recommendations in the report aimed at enhancing central support services and removing some of the barriers to the expansion of common services. It notes that a successful expansion of common services and enhanced support services requires a shift in the approach and thinking at the level of individual staff members and programme managers in all sectors of the Organization so that they too will take the initiatives and risks required to effect change.

The Committee also had before it the comments of the Joint Inspection Unit (JIU) on the Oversight Office report (A/54/157/Add.1). It states that the OIOS report would have been more valuable had it been undertaken at a later date so that it could have reviewed more thoroughly the status and results of implementation of the Secretary- General’s common services initiatives and of the pertinent recommendations contained in the JIU’s two latest reports on the subject with respect to the New York and Geneva duty stations. The OIOS team had been handicapped in its assessment of the quality, results and cost- savings impact of the work in progress.

Also, the report would have benefited greatly from also including the perspective of the specialized agencies, which would be an important factor in expanding and strengthening the common services, in particular at Geneva and Vienna.

The JIU report recommends that the General Assembly adopt a resolution encouraging the Secretary-General and the Administrative Committee on Coordination (ACC) to take concrete steps to enhance common services and report back to the Assembly at its fifty-sixth session on the measures taken, with a provision that the legislative organs of other organizations be invited to take similar action on the basis of the Assembly resolution.

The Committee also had before it the report by the OIOS on the review of the Office for the Coordination of Humanitarian Affairs (OCHA) (A/54/334). The inspection concluded that streamlining and reorganization within OCHA have enhanced its capabilities to respond to emerging humanitarian crises. The OCHA has strengthened its coordination with departments of the United Nations Secretariat, as well as with United Nations funds and programmes, other humanitarian agencies and non-governmental organizations (NGOs). Furthermore, OCHA has established dialogue with donors and with the humanitarian community and is displaying greater sensitivity to the specific mandates of other humanitarian agencies.

The report finds that additional efforts are required to enforce a more action-oriented approach in addressing issues of coordination within the Executive Committee on Humanitarian Affairs, and that there is need for a strategic management framework to further enhance the appeals process. On the basis of the findings, the report makes five recommendations which include enhancing the functioning of the Executive Committee, establishing more effective monitoring of the consolidated appeals process and strengthening the advocacy role of OCHA with the general public.

The Committee also had before it the comments of the Joint Inspection Unit (A/54/334/Add.1) on the above report. The JIU found that the OIOS review should have placed more emphasis on the non- operational nature of the role of OCHA at the beginning of the report rather than at the end. It also considered that the very detailed description of the diversified activities of OCHA could have justified more substance in the concluding recommendation, which should be more action-oriented.

The JIU recommends, among other things, that the issue of coordination should be better analyzed in the case of complex emergencies where a military component is present on the ground, that more attention should be devoted to lessons learned and that the human rights component in complex emergencies should receive the attention it deserves.

The Committee also had before it the report of the OIOS on the investigation into the field office in Lebanon of the UNRWA (A/54/367).

Beginning in 1998, the Investigations Section of OIOS reviewed a variety of allegations concerning the UNRWA, particularly its field office in Lebanon, the report states. These included allegations of financial impropriety committed by a finance officer in establishing an official United States dollar account with a commercial Lebanese bank, and the embezzlement of a substantial amount of medical supplies by an unidentified person.

The report says the evidence disproved those allegations of financial impropriety by a finance officer and embezzlement of medical supplies. On the issue of alleged endemic corruption in construction procurement activities of UNRWA, the evidence showed that these allegations were unsubstantiated as well.

Consequently, and in order to safeguard UNRWA against such allegations in the future, OIOS reviewed UNRWA tendering procedures and issued recommendations for improvement in these areas in order to reduce the risk of both fraud and public exposure to sweeping suspicion of corruption. In order to reduce the jeopardy to UNRWA financial interests, the OIOS report also recommends that, apart from a reaffirmation of the existing UNRWA anti-bribery policy in writing, UNRWA should further encourage staff members to report all cases of attempted bribery.

The Committee also had before it the management audit of the conference centres at the Economic Commission for Africa (ECA) and the Economic and Social Commission for Asia and the Pacific (ESCAP) (A/54/410).

The report states that the decision to construct two facilities of this magnitude, at a combined cost of $161.7 million, was flawed. The physical capacity requirements were vastly over-estimated and the ongoing financial implications for the Organization were not properly assessed. To date, the proper use and management of the two centres has not been a matter of priority for United Nations Headquarters, despite the increasing financial burden that the centres impose on the Organization. The management of the ECA and of the ESCAP have been left to manage the facilities in isolation, as an adjunct to their substantive work programmes, with little operational guidance or support.

The current estimated annual operating costs for the centres are $1.16 million for the ECA and $1.53 million for the ESCAP. Revenue from external users covers no more than one eighth of either centre’s annual operating costs. In the next five years, both facilities will require still more resources, as large-scale capital maintenance and replacement expenditure becomes necessary.

At the time of the audit, the five major meeting rooms at both centres were empty between 60 and 85 per cent of the time. Neither centre was established as a legitimate revenue-producing operation for the Organization, and no resources were earmarked for the marketing and promotion of the centres within or outside the United Nations system.

The report’s main recommendations are that the Executive Secretary of ESCAP should develop a comprehensive proposal to the General Assembly for the management and promotion of the Centre at Bangkok, and that the new Conference Centre Chief at the ECA should finalize a marketing cost plan and determine the feasibility of implementing additional service and facility enhancements.

The Committee also had before it a report on the investigation of the Office of Internal Oversight Services into allegations concerning an electronic commerce project at the UNCTAD (A/54/413). The OIOS received reports of illegal exportation and improper retention of intellectual property by a Melbourne-based project of the UNCTAD. In the course of the investigation that followed the receipt of those earlier reports, investigators uncovered serious problems with the project, including extensive and unauthorized solicitation of funds and resources; the entering into unauthorized commercial agreements with private sector interests; private sector interests engaged in unauthorized activities for the United Nations-sponsored project; a failure of supervision of the project; and the expansion of the project into commercial agreements and into electronic transactions via such agreements without notification of or authorization by UNCTAD senior management. As a result of those uncontrolled activities, the United Nations has been exposed to liability and is now facing claims from unauthorized private sector partners involved.

The investigation concluded that while the aim of involving the private sector in the project to assist in the development of secured electronic commercial transactions for developing countries was a sound concept, it had been sabotaged by the utilization of unauthorized foundations and the involvement in them of non-United Nations staff without authorization from UNCTAD senior management.

Reports on Financing Peacekeeping Operations

The Committee also had before it a report of the OIOS on the investigation into the award of a fresh rations contract in a United Nations peacekeeping mission (A/54/169).

The findings of the investigation indicated mismanagement and abuse of authority, including violations of the United Nations procurement policy and financial rules, the report says. Specifically, the OIOS found efforts by the Chief Administrative Officer and the Chief Financial Officer to manipulate the Local Committee on Contracts in connection with the selection of a fresh rations contractor to favour the incumbent contractor. The resulting delays in awarding a new contract caused financial damage to the Organization in the range of $17,000.

In June 1996, the OIOS submitted a report on the investigation to the Department of Peacekeeping Operations recommending that disciplinary charges be filed against the Chief Administrative Officer and the Chief Financial Officer.

The Committee also had before it the report of the OIOS on the audit of the management of service and ration contracts in peacekeeping missions (A/54/335). The report notes that there has been a general trend in peacekeeping operations to move towards large-scale contracts for the provision of support services and rations. This was seen as an economical and efficient way of providing support to missions. The OIOS review of six service contracts in five missions found, however, that the contract management needed to be improved.

Most of the missions reviewed did not have a contract management unit, which had resulted in an uncoordinated approach to managing complex contracts. The report also says that standard systems had not been developed to enable missions to track ration deliveries and that no comprehensive training programmes had been established by the Department of Peacekeeping Operations (DPKO) to train personnel in contract management techniques.

Inadequate monitoring of invoice payments could result in loss of early payment discounts -- in one case, an amount of $3.25 million owed to one contractor had been unjustifiably withheld. In one mission, indecision on contract arrangements had led to delays in awarding a contract and resulted in additional costs of $7.7 million.

The Committee also had before it the report by the OIOS on its audit of the liquidation of peacekeeping missions (A/54/394), which was carried out between 1996 and 1999 on eight missions.

The audits showed that in virtually every case the liquidation process could be streamlined further by developing standard operating procedures in key areas, more efficiently planning and organizing the liquidation process and ensuring the availability of adequate staff resources. The OIOS also concluded that good management during the operational period of a mission was crucial to successful completion of the liquidation in a timely manner.

Among the major findings of the report are that guidelines need to be updated and further developed, that the Department of Peacekeeping Operations has not established a formal mechanism to consolidate lessons learned, that standard procedures to control receipt, movement and disposal of United Nations-owned equipment are needed in all missions, and that the transfer of low-value assets, such as computer equipment, to the United Nations Logistics Base for upgrading is uneconomical.

Statements on Board of Auditors Reports

O.T. Prempeh (Ghana), Chairman of the United Nations Board of Auditors, introduced that body’s reports. He said he hoped that the Assembly would consider at this session the Board’s 1994 proposal to extend the terms of its members to four or six years.

On the United Nations High Commissioner for Refugees (UNHCR), the Board found that the agency’s financial statements generally conformed to United Nations accounting standards, except for income for trusts and funds and disclosure of liabilities for end-of-service benefits. Financial reports for some $92.8 million advanced to implementing partners had not been received as of 31 March. Audit certificates had been received for some $97 million advanced to government partners and some $234.5 million advanced to other partners.

The projects reviewed at UNHCR headquarters and in the field had not contained work plans or milestones for project implementation, he noted. Of 2,565 projects implemented between 1994 and 1997, 83 per cent had not been closed as of November 1998. As a consequence, large amounts of cash remained with implementing partners for long periods. Some components of a framework for change process, called Project Delphi, were yet to commence in April 1999 despite being scheduled for completion in October 1997. The Board recommended that the UNHCR treat advances to implementing partners as accounts receivable and clear them on receipt of satisfactory financial reports. It should also persevere in efforts to clear outstanding balances expeditiously.

It should determine the reasons for non-compliance and draw up a strategy for securing audit certificates, he said. It should also ensure work plans were programme-specific, and prepared as an integral part of the planning and monitoring processes, and it should update Project Delphi plans and prioritize activities to ensure the plans were implemented.

Regarding the report on implementation of its recommendations, he said, this gave the Board the opportunity comment annually on the status of its recommendations. The Board planned to submit a comprehensive report on implementation at the end of the first year of the biennium but, to avoid duplication, it would not do so at the end of the second year, when implementation comments would be included as annexes to its specific reports.

Overall, the Board noted that of 156 recommendations in respect of 13 organizations, 48 had been fully implemented, 100 had been partially implemented, four had not been implemented and four more had been overtaken by events, he said.

On the hiring of consultants, the Board was pleased to note the Secretary-General had issued comprehensive policy guidelines which substantially addressed issues and concerns it had raised, he said. The Board intended to monitor the application of the guidelines by departments, and the implementation of linked recommendations.

Under-Secretary-General for Management, JOSEPH E. CONNOR, introduced the reports of the Secretary-General on implementation of the recommendations of the Board of Auditors. The reports focused on the status of recommendations that were not fully implemented. The Secretary-General had been considering the most effective mechanism to follow up on recommendations, and an Oversight Support Unit in the Department of Management had been established as a first step.

The content of the report was self-explanatory, he said. He assured Member States that the administration placed importance on implementation of recommendations. Actions would be monitored and reports provided as required. Responsibility for implementation of agency recommendations belonged to their respective executive heads, but the Secretariat was prepared to offer assistance as required.

In a report on Year 2000 computer compliance (Y2K compliance), the ACABQ requested all administrations to report by May 1999 on progress on the Y2K compliance issue. The Secretariat was to coordinate the preparation of the report, and that was now before the Committee. While the report provided information on critical elements, the situation was dynamic. Of 62 important business applications, only 12 were still being implemented. All had started.

Contingency plans had been completed in support departments and were currently being implemented, he continued. Two task forces, on telecommunications and on Y2K compliance had been established. At present a report updating information was being finalized. This additional report was in response to General Assembly resolution 53/86.

He was confident that the United Nations would achieve Y2K compliance on time, he said. There were external factors that were outside the Organization’s control, and they were being taken into account in contingency plans, but a massive disruption outside could affect the Organization.

TRYGGVE GJESDAL (Norway) said Norway continued to be impressed by the quality of work of the Board of Auditors, and that the Board had taken into account the difficult conditions under which organizations like the UNHCR operated. He joined the UNHCR in supporting an annual audit cycle for that organization to streamline financial management and improve transparency and efficiency.

The report of the Board confirmed that the UNHCR continued to be a well-managed agency, he said, and that media allegations to the contrary were unproven. The individual findings of the Board were mostly of a recurrent nature and related to increasing implementation of humanitarian assistance programmes through implementing partners -- a practice Norway supported. He noted UNHCR efforts to monitor aspects of the performance of implementing partners.

The problem of timely receipt of audit certificates, particularly from government implementing partners, continued, he said. While it could assist in obliging NGOs to comply, the UNHCR’s influence on governments was more limited. The UNHCR had suggested that it be authorized to pay for government audits to allow priority to be given to UNHCR-funded activities. Norway believed the implications of this needed to be thoroughly considered, and it supported ACABQ recommendations that the UNHCR formulate criteria and conditions under which such assistance could be granted.

As a significant contributor of voluntary funds, Norway had noted that it might be difficult for the UNHCR to take further measures to improve compliance without jeopardizing its mandate activities, he said. Although audit certificates were important there were other compensating controls, such as periodic review of records of implementing partners.

He said the Board of Auditors first regular biennium report on implementation provided a succinct overview with regard to follow up. While implementation remained uneven, the picture on the whole was fairly encouraging. He appreciated the Secretary-General’s response, which was an improvement over previous years. Norway was particularly interested in tracking follow-up with regard to operational funds and programmes. He hoped editorial layout of various organizations’ responses would be fully harmonized in the future.

ANWARUL KARIM CHOWDHURY (Bangladesh) said Bangladesh urged timely implementation of the Board’s recommendations, and noted that the Secretariat had responded well in the areas of the IMIS and Y2K. The establishment of an Oversight Support Unit was hopefully giving this process a helpful push. However, more than two-thirds of the Board’s recommendations had yet to be implemented fully. The hiring and use of consultants in the Secretariat was one such area. The Secretary-General had issued comprehensive guidelines on consultants, but he wanted to hear how effectively they had been adhered to.

The Board had recommended that prospective bidders have sufficient time to respond, but the Secretariat had not elaborated on how this could be achieved. He also requested interim reports of the task force set up for cost apportionment by users for availing common services.

AMJAD HUSSAIN SIAL (Pakistan) said he hoped that management would take appropriate action to implement the recommendations of the Board and welcomed the establishment of the Oversight Support Unit. He noted with satisfaction the measures taken by the Secretariat on the Y2K compliance issue, and looked forward to receiving up to date information on the issue.

Pakistan also appreciated the issue of guidelines on the use of consultants and individual contractors, he said. That should be kept under review to ensure that these guidelines were fully complied with. Pakistan was also concerned at the irregularities identified by the Board on the accounts of voluntary funds administered by UNHCR. He hoped the Secretariat would take urgent measures to rectify the situation. On deficiencies in the field of procurement, remedial action should be taken in the light of financial regulations and rules and the relevant decisions of the General Assembly.

THOMAS REPASCH (United States) said that with reference to the UNHCR, a recurring problem had been the lack of solid and accurate record keeping. That had led to discrepancies between funds advanced and the audit certificates received to cover expenditures. Further action was needed in this area.

He said the United States also sought follow-up answers on details contained in the reports on the UNHCR. He asked if further action had been taken to follow up the question of defaulting implementing partners, and also asked why so little had been made of the fact that losses reported and written off in 1998 were three times more than in 1997. One finding of great concern was that 83 per cent of projects implemented during 1994-1997 had not been closed. He echoed the observation in the ACABQ report that the auditors’ findings needed to be taken seriously and their recommendations implemented.

On the auditors’ report on the implementation of recommendations, he asked what had been done to ensure compliance with the crucial requirement that organizations be held accountable for their action, or inaction. He also asked whether there were any organizations that had failed to meet the completion date for Y2K readiness procedures. He welcomed the Board of Auditors’ comments on the issue of consultants and was pleased that the Secretariat had taken action to implement their recommendations.

Statements on Office of Internal Oversight Services

Under-Secretary-General for Internal Oversight Services, Karl Paschke, presented the Secretary-General’s reports. Speaking about an Investigations Section inquiry into theft from the UNCTAD, he said the evidence proved that a P-5 staff member had perpetrated at least 59 separate instances of theft from 1984 to 1996, without triggering any internal alarm. Findings had been provided to the Swiss judiciary. Sixty-eight per cent of the amount stolen had been recovered.

The scheme was simple, he said. The staff member had received payments for six fictitious experts. By virtue of his authority and post he had been able to expand the theft over a long period of time. The former staff member had made partial restitution, including full liquidation of his assets and pension fund. At the conclusion of the trial, he had received 18 months imprisonment, and had been ordered to repay money not recovered. Substantial changes had been made to management of UNCTAD since the perpetration of the crime.

On the report on common services in New York, Geneva and Vienna, he said the review covered 11 areas -– procurement, information technology and telecommunications, IMIS, personnel services, financial services, legal services, transportation and traffic operations, security and safety services, facilities management, printing facilities and archives and record management. The report confirmed that the Secretary-General’s reform had improved common services, but further coordination needed support of Member States through adoption of unified positions at the respective intergovernmental mechanisms of each member of the United Nations system.

On the Oversight Office report on OCHA, he said that that Office had strengthened its relationships and displayed greater sensitivity to mandates of other humanitarian agencies. It was taking measures to reduce duplication and the disagreement between agencies that had beset the humanitarian community in the past.

The report recommended enforcing a more action-oriented approach in joint committees and the need for a strategic management framework to enhance the appeal process and the strengthening of the advocacy role OCHA was expected to play.

On the Oversight Office report on its investigation of the UNRWA field office in Lebanon, he said the Investigations Section had reviewed a variety of allegations, including financial impropriety and embezzlement of medical supplies. Additional allegations of bribery by construction companies and others had been raised. Those allegations of endemic corruption had also been circulated in local media. The evidence uncovered by the Oversight Office disproved the allegations.

To assist in avoiding such allegations in the future, the Oversight Office had worked with UNRWA to develop procedures to deal with transparency, and the handling of complaints of malfeasance.

On the report on a management audit of conference centres at the ECA and the ESCAP, he said the review showed that the establishment of the conference centres was overly ambitious. Major United Nations conference rooms now sat empty much of the time, and the centres had become a burden. He was confident trends could be reversed, in part because the Oversight Office recommendations were being implemented. A cost-benefit analysis must be undertaken.

By the time they were fully operational, the Organization had spent some $162 million in construction costs, he said. The cost of maintaining the centres had not been properly considered in the decision to build them. That was now estimated at some $2.6 million annually. About 10 per cent was now recovered from user fees. Although both offered excellent services, the Department of General Assembly Affairs and Conference Services did not normally consider them for conferences.

The United Nations Secretariat needed to ensure that the two centres were fully integrated into the conference venue system, he said. The ECA and the ESCAP should be provided with stronger incentives to ensure their use, by, for example, formally recognizing them as revenue- generating and therefore provided with resources for marketing and promotion.

These two magnificent facilities presented both a challenge and an opportunity, he said. That was because their efficiency and sustainability depended on innovative policy guidelines and a departure from traditional facilities management approaches, and yet they provided an opportunity to improve the visibility of the Organization and to generate revenue.

Regarding an investigation into allegations about an UNCTAD electronic commerce project in Melbourne Australia, serious problems had been uncovered with the project, he said. The United Nations had thus been exposed to liability. This had occurred partly because the growth of the trade point electronic commerce programme had exceeded expectations, and partly because foundations had been attached to the programme without legal advice from either UNCTAD or the Secretariat, and without approval of UNCTAD senior management.

The investigation concluded that the aim of including the private sector was sound, he said, but it had been sabotaged by the use of unauthorized foundations and the involvement of non-United Nations staff without senior management authorization. The project had now moved to Geneva and was under careful review. Activities on secure electronic commerce had been terminated. He had been advised that companies participating would exercise the right to recover their investments.

The Chairman of the Joint Inspection Unit, LOUIS DOMINIQUE OUEDRAOGO (Burkina Faso), introduced that body’s reports.

Mr.PASCHKE then introduced the OIOS report on the award of a fresh rations contract in a United Nations peacekeeping mission. The findings of the investigation had indicated mismanagement and abuse of authority, including violations of United Nations procurement policy and financial rules. Upon receipt of the information provided by the investigators, the Mission’s Force Commander had taken prompt action to correct the problems with the fresh rations contract.

He next introduced the OIOS report on the audit of the management of service and ration contracts in peacekeeping missions. The report pointed to areas where contract management could be improved to ensure the economical and effective use of the Organization’s resources. It had come to five significant conclusions, covering the reduction of procurement time-frames, establishing standard operating procedures, the establishment of contract management functions, the assessment of training needs by the DPKO and proper assessment of “lowest” bidders.

He then introduced the report on the audit of the liquidation of peacekeeping missions. There had been significant progress by the Department improving the management of the liquidation of peacekeeping missions, but there were six areas where further progress could be made, including the further development of existing provisional guideline, the establishment of a formal mechanism to make use of past experience and the introduction of an all-missions Field Asset Control system.

He also introduced the OIOS report on the audit and investigation of the International Tribunal for the Former Yugoslavia (A/54/120), which covered the years 1997 and 1998. In general, the Tribunal’s operations were being managed in an efficient and effective manner. Areas where there was room for improvement included: cash management, recruitment, promotion and placement practices, procurement planning and bidding practices, accountability for expendable and non-expendable assets and improved communication. The report also concluded that the three organs of the Tribunal were being run on a sound managerial basis.

DEMETRIOS THEOPHYLACTOU (Cyprus) thanked the Under-Secretary General for his effort and noted that he was about to depart from his post.

Regarding the Oversight Office report on peacekeeping missions, he said that, as a host country for a mission, Cyprus followed those reviews with interest. Improvements in contract management would enhance the overall performance of peacekeeping missions. The coordination of players other than the missions themselves was also a key. The Oversight Office recommendations were useful and would assist in efforts to upgrade the contracts management process. Given the increasing demand for peacekeeping missions, sufficient resources should be available to ensure improvements in the process. Other Matters

The Acting Chairman, AHMED DARWISH (Egypt), told the Committee he had received a communication from the Presidents of the Coordinating Committee for International Staff Unions and Associations (CCISUA) and the Federation of International Civil Servants’ Associations (FICSA) seeking permission to address the Fifth Committee when it discussed its agenda items on human resources and on the common system.

The Committee then decided to invite them to make oral statements at the relevant meetings.

Assistant Secretary-General for Central Support Services, TOSHIYUKI NIWA, then responded to questions raised at the third meeting of the Committee during the current session, on the United Nations cafeteria. The representative of Costa Rica had requested information on the terms of contract of the caterer.

In July 1994 and December 1995, the Assembly had asked the Secretariat to identify the costs to the Organization of catering, he said. It had found that about $1 million a year was being spent, but also that the infrastructure –- for which the Organization was responsible -- was ageing and significant capital expenditures were expected.

In 1996, a proposal for a different contract for catering to be provided at no cost to the United Nations was circulated, he said. He noted that the operation was the largest catering operation in New York and also the most diverse and complex. Four bidders had responded to the proposal, but only one response to an invitation to tender was received, from Restaurant Associates.

A new contract had been signed in May 1997, he said. Regarding price increases, these had been previously automatically linked to the Consumer Price Index, and as a result there had been price increases every year from 1990–1993. Now price increases were limited to three over the term of the contract.

Discussions had been held with the Contractor to improve the service, he said. In response to negative comments on quality, the Contractor had agreed to establish an efficient mechanism for customer feedback. Mechanisms for dialogue existed with the Secretariat, and the possibility of establishing dialogue between the Contractor and delegates was being explored. The current contract was financially advantageous to the Organization, he said, but there was no question of diminution in quality of food.

NAZARETH INCERA (Costa Rica) said her information did not dovetail with that provided by the Assistant Secretary-General. She did not wish to explore the issue in depth at present, however would like to receive a copy of the most recent contract given to the Contractor to allow her to study it in depth. She did not want a summary, she stressed, but a complete copy of contract.