FIFTH COMMITTEE TAKES UP PROPOSED PROGRAMME BUDGET FOR 2000-2001 BIENNIUM

Press Release
GA/AB/3322

FIFTH COMMITTEE TAKES UP PROPOSED PROGRAMME BUDGET FOR 2000-2001 BIENNIUM

Secretary-General Introduces $2.535 Billion Budget Proposal

It was no longer possible to downsize and deliver on all mandates, the Secretary-General, Kofi Annan, told the Fifth Committee (Administrative and Budgetary), as it commenced its consideration of the proposed United Nations programme budget for 2000-2001. Something, somewhere would have to give should further reductions be made.

Stringent budgeting was one thing, but a starvation diet was another. Despite no increase in the United Nations budget for five years, he said, the United Nations had persevered. But further cuts would seriously compromise the mandates of Member States.

His proposal was for a budget of some $2,535 million; virtually the same in real terms as the 1998-1999 budget, he explained. This included some small but important increases for priority areas.

His budget proposal was solid, reasonable and rational, he concluded, and represented value for money. It would help build a strong United Nations and a peaceful, more humane world for the twenty-first century.

The level of the 2000-2001 budget must be brought down to the 1998-1999 level of $2.533 billion, the representative of the United States told the Committee. Mandated activities could be fully implemented within that level, and the United States would not support it being any higher. Continued efficiency efforts should be more than sufficient to offset any increases in costs.

He also called for the budget proposal to be less input-oriented, noting that while effort had been made, it fell short of what was necessary. The United States wanted a more results-based approach. He also announced a payment made yesterday of about $47 million towards United States arrears.

Fifth Committee - 1a - Press Release GA/AB/3322 17th Meeting (PM) 27 October 1999

The representative of Guyana, speaking on behalf of the “Group of 77” developing countries and China, welcomed the partial payment of arrears by the United States. The Group was concerned that the Secretary-General was proposing a budget figure that was less than the $2.545 billion suggested to him by the General Assembly last year. Member States’ approval of that outline figure had been a consequence of fine political compromises.

The Group would consider each of the different budget sections and propose increases where necessary, he added, but a minimum budget of $2.545 billion would have to be restored before accounting for inflation and currency exchange rates.

There was evidence that many mandates were not currently being implemented effectively because of a lack of adequate resources, the representative of Tanzania, speaking also for Kenya and Uganda, stated. Past assertions that more could be done with less were no more than suspicious public relations soundbites, he stressed.

In effect, the Secretary-General was proposing a zero growth budget, he added, and it was very difficult to understand the rationale behind it, given that the Committee on Programme and Coordination and the Advisory Committee on Administrative and Budgetary Questions reports suggested more resources should have been proposed for a number of areas.

The representative of Japan said that zero nominal budget growth was attainable by maximizing efforts to reduce additional spending. It was essential for the United Nations to constantly review its budget priorities in order to meet the requirements of the international community. Japan’s contributions to the United Nations were exposed to increasingly critical scrutiny in Japan, he added, as its share of the budget approached 20 per cent, second only to the United States.

The representative of Guatemala pointed out that some Member States advocated modest real growth, the Secretariat and the ACABQ advocated zero real growth, and some advocated zero nominal growth. Whatever the outcome, the world would not end and the United Nations would not collapse. However, the discussion was not about resources, but about political commitment to the United Nations, he said.

A modest increase in resources struck the proper balance between the twin Member State roles of ensuring maximum mileage from resources through discreet vigilance, while providing the resources needed for optimal functioning, through a constructive and proactive attitude.

The representatives of Finland (on behalf of the European Union and associated States), Norway, Saudi Arabia, Bangladesh, Philippines (on behalf of the Asean), Pakistan, Burkina Faso, China and Cameroon

Fifth Committee - 1b - Press Release GA/AB/3322 17th Meeting (PM) 27 October 1999

also spoke. The Chairmen of the ACABQ, C.S.M. Mselle, and the Committee for Programme and Coordination, Tommo Monthe, introduced their respective reports.

When the Committee turned to other matters, the representatives of Norway and Guyana, on behalf of the Group of 77 and China, spoke and the Committee Chairman, Penny Wensley of Australia, the ACABQ Chairman, and the Director of Budget Division, Warren Sach answered questions.

The Committee will meet again on Thursday, 28 October at 10 a.m. to commence its consideration of its agenda item on the United Nations common system.

Programme of Work

The Fifth Committee (Administrative and Budgetary) met this afternoon to take up the proposed United Nations programme budget for the biennium 2000-2001.

The Committee had before it the Secretary-General's three volume proposed programme budget for the biennium 2000-2001 (document A/54/6 Rev.1). [This proposal is for what is called the 'regular' budget -- that part of the Organization's finances that is used for most of its core activities other than peacekeeping missions. The regular budget cycle is biennial. The budget amount eventually approved by the Member States is then apportioned among them based on a formula called the scale of assessments.]

The Secretary-General proposes a level of resources before recosting of some $2.535 billion, or 99.6 per cent of the budget outline approved at the Assembly's last session as a guideline for the preparation of his current proposal. This represents a 0.2 per cent real growth -- a $5.7 million real increase -- on the budget for the previous 1998-1999 biennium.

[Recosting, which of necessity takes place throughout the budget process, involves adjusting the budget figure to account for expected inflation and currency exchange rates.]

He states that this budget proposal has been prepared in accordance with priorities identified by the General Assembly for 2000- 2001. These are the maintenance of international peace and security, the promotion of sustained economic growth and sustainable development, the development of Africa, the promotion of human rights, the effective coordination of humanitarian assistance, the promotion of justice and international law, disarmament, and drug control, crime prevention and combating international terrorism.

For each of the priority areas, the report indicates the percentage of real growth in resources and the number of additional posts proposed to meet the Assembly's prioritization. Among those proposals, the Secretary-General recommends: a 15 per cent increase in resources allocated under budget section 10 to United Nations activities concerned with African development; a 9 per cent increase for effective coordination of humanitarian assistance under budget section 25; and 15.6 and 11.2 per cent increases under the relevant sections on drug control and crime prevention respectively.

According to the report, $11 million is included for convening conferences and special sessions and reinforcing the United Nations Office at Nairobi -- down from the $20 million suggested in his budget outline proposals. A provision for $86.2 million has been made for special political missions due to end in 1999, but whose mandates may be extended into the new biennium (down from $100.9 million in the current 1998-1999 biennium budget).

The report includes a table that compares 1998-1999 appropriations with those proposed for the new biennium for each of the 13 budget parts. An abbreviated version of that table follows. Secretary-General's Proposed Budget Arranged by Budget Part

------------------------------------------------------------------------ | | | | | | |Part|Title |1998-99 |Change|2000-2001| | | |US$ |per |US$ | | | |million |cent |million* | ------------------------------------------------------------------------ | | | | | | | 1. |Overall policy-making, direction and | 468.99 | 0.1 | 469.48 | | |coordination | | | | ------------------------------------------------------------------------ | | | | | | | 2. |Political affairs | 239.57 |(5.7) | 225.84 | ------------------------------------------------------------------------ | | | | | | | 3. |International justice and law | 53.11 | 3.1 | 54.74 | ------------------------------------------------------------------------ | | | | | | | 4. |International cooperation for | 266.73 | 1.9 | 271.82 | | |development | | | | ------------------------------------------------------------------------ | | | | | | | 5. |Regional cooperation for development | 355.92 | 0.2 | 356.61 | ------------------------------------------------------------------------ | | | | | | | 6. |Human rights and humanitarian affairs | 125.27 | 2.6 | 128.50 | ------------------------------------------------------------------------ | | | | | | | 7. |Public information | 135.57 | 1.5 | 137.58 | ------------------------------------------------------------------------ | | | | | | | 8. |Common support services | 446.30 |(0.9) | 442.12 | ------------------------------------------------------------------------ | | | | | | | 9. |Internal oversight | 17.94 | 5.3 | 18.88 | ------------------------------------------------------------------------ | | | | | | |10. |Jointly financed administrative | 58.51 |(1.2) | 57.80 | | |expenses and special activities | | | | ------------------------------------------------------------------------ | | | | | | |11. |Capital expenditures | 34.17 | 26.2 | 43.13 | ------------------------------------------------------------------------ | | | | | | |12. |Staff assessment | 314.75 | 0.4 | 316.04 | ------------------------------------------------------------------------ | | | | | | |13. |Development account | 13.06 | - | 13.06 | ------------------------------------------------------------------------ | | | | | | | |TOTAL |2,529.50| 0.2 |2,535.60 | ------------------------------------------------------------------------ * Before preliminary recosting

The Secretary-General proposes a staffing table of 8,802 posts; an increase of 61 posts in 1998-1999 but considerably less than the 10,021 approved for 1-1. The report details the areas and levels of proposed new and converted posts. In the professional category, a slight relative strengthening at the P-3 and P-4 levels is proposed, while the ratio of General Service to Professional level posts would decrease slightly. Of the 61 new posts, 36 represent conversions from general temporary assistance to established posts, and the total also takes into account 19 posts he recommends be abolished. However, he reports that the most significant change proposed to the staffing table is the redeployment of 584 posts, on recommendations of programme managers seeking to more efficiently deploy their available resources.

The Committee plans to discuss each of the 13 parts of the budget during subsequent meetings. The related Press Releases will include details of the various parts under discussion at each meeting.

Also before the Committee is the related report of the Advisory Committee on Administrative and Budgetary Questions (ACABQ) (document A/54/7). Chapter I deals with its general observations about the budget proposal, and is summarized here. Chapter II provides the ACABQ recommendations about the 13 specific parts of the budget and will be covered as the Committee takes up those parts of the proposal.

The ACABQ draws attention to the Secretary-General's estimates of the additional extrabudgetary resources anticipated for the new biennium. These would total some $3.660 billion, comprising $217 million for support, some $175.89 million for substantive activities and some $3.266 billion for operational activities, leading to a total budget for 2000-2001 of some $5.945 billion. This figure does not include resources for peacekeeping missions, nor for the two International Tribunals (for the former Yugoslavia and Rwanda) which are funded separately.

Responding to the Secretary-General's proposed budget, the ACABQ states that it has no basis to change the figure Mr. Annan proposes. It cautions that the level of unfilled posts in the Secretariat (the vacancy rate) is too high, but notes the Secretariat's assurances that this will be addressed.

Further, the Advisory Committee recommends reducing estimates in certain budget parts [which will be detailed in the part-by-part comparisons] but also identifies areas where additional resources would be required.

The last two bienniums have been marked by stringency and restraint, with the impact somewhat reduced by fortuitous resource gains courtesy of currency exchanges and low inflation, the ACABQ reports. It repeats its caution expressed about the 1998-1999 programme budget: that decreased resources could lead to deterioration in quality of services and delays in implementation of mandated programmes.

The Committee also had before it a report by the Committee for Programme and Coordination (CPC) on the work of its thirty-ninth session, 7 June to 2 July 1999 (document A/54/16). The CPC makes recommendations on the review of the efficiency of the administrative and financial functioning of the United Nations, on programme questions and on coordination questions. In the second of these, under programme planning, it covers programme performance of the United Nations for the biennium 1996-1997; regulations and rules covering programme planning, the programme aspects of the budget, the monitoring of implementation and the methods of evaluation; and the medium-term plan for the period 1998-2001.

Regarding the programme budget for the year 2000-2001, it states its appreciation for the improved format and timely submission of the proposed programme budget in all official languages. It takes note of the Secretary-General's efforts to meet the new requirements of the revised Regulations and Rules Governing Programme Planning, the Programme Aspects of the Budget, and the Monitoring of Implementation and the Methods of Evaluation.

The Committee reports concern that not all sections of the proposed programme budget had been prepared on the basis of the standard format. It notes the general level of resources proposed is lower than indicated in the proposed budget outline, and identifies a trend towards increasing use of extrabudgetary funds for activities that should be funded under the regular budget. It also reaffirms that all Member States should pay their assessed contributions, and expresses concern about increases in middle and higher echelon post numbers, while the number of posts at the entry level was decreasing.

Under coordination questions, the Committee covers the report of the Administrative Committee on Coordination (ACC) and the United Nations System-wide Special Initiative for the Implementation of the United Nations New Agenda for the Development of Africa in the 1990s.

The report also comments on Joint Inspection Unit (JIU) reports, on improving Programme and Coordination Committee working methods and procedures, and includes a consideration of the provisional agenda for the fortieth session of the Committee.

The Committee also had before it the report of the Secretary- General on the outline of the proposed programme budget for the biennium 2000-2001 for the International Trade Centre UNCTAD/WTO (document A/54/127), containing the budget outline of the International Trade Centre (ITC), with the requirements expressed in Swiss francs (SwF). The report states that the proposed outline represents an increase of 1.4 per cent, in real terms, over the current appropriation. This increase would be used to support better understanding among developing- country business sectors of the evolving multilateral trading system, and to thereby avoid their further marginalization.

The proposal states that emphasis will be placed on capacity- building in least developed countries in the context of the multi-agency Integrated Framework for Trade-Related Technical Assistance to least developed countries. The ITC requirements are estimated at SwF 29,516,000 for 2000 and SwF 29,688,600 for 2001, expressed at 2000-2001 rates. It is projected that an amount of SwF 405,000, representing income from various sources, would be available to the ITC annually. On this basis, the annual contribution of UNCTAD and the World Trade Organization (WTO) is estimated at SwF 14,555,500 and SwF 14,641,800 for 2000 and 2001 respectively.

The Committee also had before it the report of the Standing Committee of the United Nations Joint Staff Pension Fund on the administrative expenses of the Fund (document A/54/206). This contains general information on the United Nations Joint Staff Pension Fund and its budgetary arrangements and the revised budget estimates for the biennium 1998-1999. Among the studies considered by the Standing Committee which impacted on the proposals for the proposed programme budget for the biennium 2000-2001 are: organizational and staffing structure of the Fund secretariat; enhancement of the role of the Geneva Office; computer systems and operations -- enhancement and modernization; office space in New York and Geneva; delegation of personnel and procurement decisions to the Chief Executive Officer/Secretary; and outsourcing of local pension secretariat services to the Fund secretariat.

There are also sections on the Standing Committee’s review of the proposed programme budget for the biennium, the proposed budget for the biennium 2000-2001 as recommended by the Standing Committee and the Emergency Fund.

The Committee also had before it a statement by the Secretary- General on the administrative and financial implications of the decisions and recommendations contained in the report of the International Civil Service Commission (document A/54/30) (document A/54/434).

This report points out that the twenty-fifth annual report of the International Civil Service Commission (ICSC) will contain decisions and recommendations with financial implications for the regular budget for the biennium 2000-2001 related to the base/floor salary scale and staff assessment scale in the professional and higher categories, and to a survey of best prevailing conditions of employment for the General Service and related categories in Paris.

The report says that increased regular budget requirements resulting from the ICSC recommendations and decisions are estimated to be some $1.72 million net of staff assessment. These will be reflected in recosting of the programme budget proposals done prior to its adoption by the General Assembly.

The Committee also had before it the report of the Secretary- General on the revised estimates resulting from resolutions and decisions adopted by the Economic and Social Council at its substantive session of 1999 (document A/54/443).

The Secretary-General reports that requests contained in Economic and Social Council resolution 1999/61 and decision 1999/287 give rise to requirements for the biennium 2000-2001 under the 2000-2001 budget sections on trade and development, and human rights. No provisions have been made to cover these requirements.

The General Assembly has established procedures for a contingency fund to accommodate additional expenditures arising from legislative mandates not provided for in the programme budget. Where additional expenditures arise that exceed the contingency fund resources, activities must be implemented only through redeployment of resources from low-priority areas or modifications of existing activities, or deferred to a later biennium.

The report says it is not possible, at this stage, to identify activities within the 2000-2001 budget proposal sections on trade and development or human rights that could be terminated, deferred, curtailed or modified to finance the additional activities recommended.

The Committee also had before it a note by the Secretary-General on the proposed abolition of two General Service posts under income section 3, Services to the public (document A/C.5/54/14). In view of relatively high personnel costs for operating the bookshop at the Palais des Nations in Geneva, the note recalls, the Secretariat had explored the possibility of engaging an outside contractor. However, it would appear appropriate to retain one General Service post within the Sales and Marketing Section. The related costs would amount to $157,600 for the biennium 2000-2001.

The Committee also had before it a note by the Secretary-General on proposed programme budget for the biennium 2000-2001: section 23., Protection of and assistance to refugees (document A/C.5/54/15). This stated that the General Assembly may wish to take note that a review of the funding of the United Nations High Commissioner for Refugees (UNHCR) from the regular budget –- taking place on the basis of the outcome of the new categorization of posts in the UNHCR, the evolution of UNHCR requirements and the desirability of streamlining and simplifying the budgetary process -- would continue in 2000, and that its outcome will be submitted to the General Assembly in due course through the ACABQ.

The Committee also had before it a note by the Secretary-General on the internal and external printing practices of the Organization (document A/C.5/54/18). The report, describing itself as provisional, covers the current printing practices of the Organization and compiles the cost information and other financial data that are readily available. It also describes the process that the Secretariat intends to follow in order to provide the requested information in a more comprehensive way, at a later date, as recommended by the Advisory Committee.

The note points out that the Secretariat intends to submit a comprehensive report to the General Assembly at its fifty-fifth session, with data gathered in both New York and Geneva. It is expected that the information will provide a sufficient basis for any decision on the printing policies of the Organization that the General Assembly may wish to take.

The Committee also had before it a note by the Secretary-General on temporary assistance for meetings: requirements for 2000-2001 (document A/C.5/54/19). Estimated conference-servicing workloads for the biennium 2000-2001 project a level of demand for conference services broadly equivalent to the current biennium's servicing requirements, the note says. Assuming that services provided in 1998-1999 have been adequate, the note proposes that staffing of conference services at Headquarters, the United Nations Office at Geneva and the United Nations Office at Vienna, both permanent and temporary, be maintained during the next biennium at current levels. Therefore, actual expenditure for temporary assistance for meetings in 1998-1999 was considered a sound basis to estimate requirements for the biennium 2000-2001.

Perceived problems in the delivery of conference services are being addressed through managerial efforts to enhance quality control and better use of capacities, the note says. Some shortcomings are outside the responsibility of conference services. While increased levels of temporary assistance could help overcome those problems, it concludes, this approach would have to be considered in relation to relevant provisions of General Assembly resolutions and to concerns about cost-efficiency.

The Committee also had before it a note This highlights a number of implementation issues connected with the Secretariat’s efforts to simplify complex personnel arrangements and develop a new recruitment and placement procedure. These were: a need for more flexibility for the Secretary-General in conducting P-3 examinations; inconsistency between the requests to make existing recruitment procedures more timely and the request to double the time for circulation of vacancy announcements; a lack of flexibility given to the Secretary-General in assigning staff hindering the development of managed reassignment systems for junior staff; and the inclusion of equitable geographic distribution as a factor in the General Service to Professional examinations.

The Committee also had before it a report by the Secretary-General on the administrative and financial implications arising from the report of the Standing Committee of the United Nations Joint Staff Pension Board (document A/C.5/54/22). This report identifies financial implications that would arise for the regular budget should the Assembly adopt the recommendations submitted to it in the report of the Standing Committee.

Total additional requirements would be $421,500 for staffing changes and $146,300 for computer and related costs. Of the staff costs, 39.5 per cent ($166,400) would be reimbursed by the United Nations Development Programme (UNDP), the United Nations Population Fund (UNFPA) and the United Nations Children's Fund (UNICEF). The additional appropriation required under the regular budget would therefore be about $401,400 after recosting. An increase of $18,400 is also projected in the estimates of income from rental of premises, the report says.

The Committee also had before it a letter dated 11 October 1999 from the Chairman of the Committee on Information to the Chairman of the Fifth Committee (document A/C.5/54/23), which states that a further Secretary-General's report on the integration of United Nations Information Centres with UNDP field offices will be considered by the Committee on Information at its May 2000 session, and recommendations will be submitted to the fifty-fifth General Assembly session.

The Committee also had before it a note by the Secretary-General on the rental of United Nations premises by press and other entities (document A/C.5/54/25). The ACABQ had asked the Secretary-General to survey the terms of agreements under which press and other entities occupied space free of charge, or at less than commercial rates, in buildings owned and rented by the United Nations, and report to the Assembly by December 1999. Following this review, the Secretary-General believes these practices are based on established policies and take into account the nature of the tenant and local conditions. He therefore intends to continue to apply these practices.

The Committee also had before it a note by the Secretary-General on the request for a subvention to the United Nations Institute for Disarmament Research (UNIDIR) resulting from the recommendations of the Board of Trustees of the Institute on the work programme of the Institute for 2000 (document A/C.5/54/26). This transmits to the General Assembly for its approval, and in accordance with the provisions of the statute of UNDIR, the Board’s recommendation on the subvention of $213,000 from the regular budget of the United Nations. A related provision to finance this subvention, the note adds, has already been incorporated in section 4 of the proposed programme budget for the biennium 2000-2001, and no additional provision would be required under that section.

Statements

KOFI ANNAN, Secretary-General of the United Nations, introduced his proposed budget for 2000-2001.

He was proposing a budget of some $2,535 million; virtually the same in real terms as the 1998-1999 budget, he said. He was calling for small but important increases in priority areas, such as peace and development for Africa, humanitarian assistance delivery, the promotion and protection of human rights, the fight against organized crime and drug trafficking and staff training.

To accommodate those increases, savings would be achieved in administration, common support services and through efficiencies, he said. Internal oversight and capital expenditures would increase modestly, and provision for special political missions with mandates due to expire in 1999 but expected to continue into 2000 or beyond.

He was proposing that more than 500 posts be redeployed in response to Member States' priorities, he said. Given the changing nature of the United Nations work it was essential that the right person be put in the right place at the right time, and that resources be applied where they were most needed.

The budget also reflected ongoing reform, he said, noting with pleasure that the Fifth Committee had approved a draft resolution on the modalities of the Development Account last week. This budget would enable that Account to be built up, and savings to be used for development activities.

The proposed budget represented the first steps of the shift towards another crucial element of reform -- results-based budgeting, he said. In the disarmament section he had set out expectations covering negotiating processes, publications and outreach programmes and even some region-specific efforts.

That was just the first step, however, and he would put separate proposals before the Committee to complete the shift with widespread use of performance indicators, he added. With the Committee's support and approval, this session could see the United Nations much closer to full implementation.

For five years there had not even been a nominal increase in the United Nations budget, he said. In each of those years, spending had been cut to cover the cost of inflation, for a total decrease of $350 million since 1994. Special mission costs of some $100 million had been absorbed at the same time, within a budget smaller than in 1994-1995.

Despite this rigorous discipline, he said, the United Nations had persevered, and had carried on doing more with less across the breadth of its agenda. A point had now been reached where further cuts would seriously compromise the delivery of services mandated by the Member States. Stringent budgeting was one thing, but a starvation diet was another.

The ACABQ in its analysis had found no basis to reduce the budget proposal, he noted. The Fifth Committee had also reiterated its concerns about the effect of reductions on the quality and timeliness of services, and the postponement of programmes.

It was no longer possible to downsize and deliver on all mandates, he said. Should further reductions be made, the Organization would need to examine closely what could and could not be done. Something, somewhere, would have to give.

If one looked around and thought about the twentieth century, he said, it became clear why the international community continued to turn to the United Nations for its unique and universal services.

The United Nations agenda was long, demands continued to rise and expectations were high, he said. The United Nations must respond, and the budget he proposed sought to do so. His proposals to the Fifth Committee were solid, reasonable and rational, and represented value for money. And they would help to build a strong United Nations and a peaceful, more humane world for the twenty-first century.

The Chairman of the ACABQ, C.S.M. MSELLE, introduced that body’s report, saying it was constantly reviewing its reporting effort with a view to introducing further improvements. He said he thought two key elements of the report were likely to feature prominently in the negotiations: recosting and the $86.2 million for special missions.

He said that average vacancies at the time the Committee examined the budget were 8.9 per cent for Professional posts and 2.1 for General Service. Whether to appropriate the full $26.5 million for vacancy adjustment would depend on the actual rates that the General Assembly approved. The Committee had refrained from recommending higher vacancy adjustments because it had been informed that measures were under way to speed up recruitment.

He said that if the proposed funding for special missions was reduced from $86.2 million, there should be a clear understanding that should requirements for special missions exceed the authorized appropriation, the necessary additional resources would be approved by the General Assembly. That would avoid the uncertainties experienced in previous years.

The Advisory Committee had been at the centre of change in the format and presentation of United Nations budgets, and would continue this tradition when it reviewed the proposals on results-based budgeting, he said. If the General Assembly decided to change the current budget format, he hoped that Member States and the Secretariat would agree on an orderly timetable.

He hoped that an atmosphere of realism and cooperation would prevail in the search for broad agreement on the budget proposals now before the General Assembly.

The Chairman of the CPC, TOMMO MONTHE, then introduced that body’s report. He said that the CPC’s work had not been easy. The Committee had noted with approval the improved structure of the programme budget, but more work remained to be done. As far as mandates were concerned, the Committee had considered the proposed activities carefully. All the conclusions and recommendations of the CPC had been adopted by consensus.

At the dawn of the new millennium, the United Nations was being called on to perform tasks at an unprecedented rate, one made complex by the concept of the global village. The United Nations in turn called on the Committee to give it effective means for thought and action. The budgetary tool was one such means –- and he called for it not to be blunted.

PETER BURLEIGH (United States) said the budget consideration was important because without resources mandates could not be fulfilled, but also because it provided an opportunity for Member States to assess how the Organization had used resources in the past and to agree on how they should be used in the future. The United States preliminary analysis suggested that the proposal was consistent with the medium-term plan priorities. He was pleased that funds for special political missions were included, as this allowed for greater predictability in funding priority areas. It was also notable that more than 25 per cent of resources were allocated for development matters.

However, the budget was still too input-oriented, he said, with insufficient emphasis placed on expected accomplishments and performance indicators that could be used to assess progress in achieving objectives with the resources requested. Effort had been made to do this, but fell short of what was necessary to make the budget more results-based. He noted that the administrative areas of the budget did not include expected accomplishments, and, in some other areas, the accomplishments appeared vague to the extent that it would be extremely difficult to determine progress in achieving them. The budget was impressive in size and weight, but this was not a proper measure of achievement. Similarly, judging the success of programme activities by the number of documents produced or meetings held was not useful.

The level of the budget must be brought down to that of the current biennium, he said. The United States wanted to make clear that it believed that mandated activities could be fully implemented in the next biennium within the current budget level of $2.533 billion, and it would not support a higher level. Continued efficiency efforts should be more than sufficient to offset any unanticipated increases in costs.

While he noted efficiencies in some budget sections had made resources available for others, he was not convinced that this represented the full extent of economies and improvements that could be achieved in a budget of more than $2 billion. Some agencies had adopted zero nominal growth budgets for the next biennium, and the United Nations should do the same, he said. Agreement must be reached among Member States on budget control.

He announced that Ambassador Richard Holbrooke of the United States had deposited somewhat more than $47 million in the United Nations account yesterday, as partial payment towards its arrears.

SAMUEL INSANALLY (Guyana), speaking on behalf of the “Group of 77” developing countries and China, said the budget had to be considered in the light of the financial crisis, largely caused by non-payment of its assessment by the Organization’s largest contributor. Member States were responsible for the Organization’s expenses, and the Group urged all Member States to honour their legal and contractual obligations under the Charter, although those that could not pay deserved special consideration.

The Group welcomed the announcement by the representative of the United States of yesterday’s payment, which was a small step forward, he said. The Group’s Foreign Ministers had declared that there should not be any ceiling on the budget and that the Secretary-General should be provided with adequate resources to carry out all mandated activities.

The Group was concerned that the proposal was less than the budget outline figure agreed on by Member States in the Assembly’s last session. The approval of that outline by the Assembly was a consequence of a fine political compromise by Member States, and should have been respected by the Secretariat.

The Group would review the proposal taking the requirement for full implementation of all mandates into account, he said. But it held that a minimum of some $2.545 billion would have to be restored as the budget basis before recosting. The Group shared the concern of the ACABQ that there were several areas where additional resources could be required during the biennium. The Group would consider each of the different budget sections and propose increases where the comments of the ACABQ were deemed valid.

It would insist on strict compliance with the priorities of medium-term plan and legislative mandates, he said. That was important, as the medium-term plan was the principal policy document of the Organization. It would ask for the Secretary-General and external bodies to monitor compliance with the plan and suggest remedial measures where it was not complied with.

The Group generally appreciated that the reports of the CPC had been adopted by the Assembly without changes, he said, but it was concerned that there was interference with the budget process by United Nations entities with no visible role in budget procedures. The Economic and Social Council had adopted a resolution on the budget. The Group would like the Secretariat’s clarification on rules concerning whether other bodies were in fact authorized to consider the programme budget.

The programme budget should be considered under existing rules, he said. Any attempt to use results-based budgeting and “sunset provisions” without the express approval of the General Assembly would be wrong and would be resisted. The Group emphasized the need for the proposed budget to be considered in fascicle form, and that it should not be issued in final form until it had been approved by the General Assembly.

The inclusion of the phrase “within existing resources” in resolutions of subsidiary bodies was a serious violation of current budgetary procedures, he said. The use of such phrases had a negative impact on the implementation of mandated activities. All committees should refrain for using that phrase.

The Group reaffirmed its support for the inclusion of funding for special political missions, he said, which facilitated the timely approval of such missions. Additional requirements for those missions should be treated according to the relevant Assembly provisions. Current provision for treatment of exchange rates and inflation should be maintained, he added. The Group noted that the level of the contingency fund was over and above the level of the budget approved.

It was convinced that heavy reliance on extrabudgetary resources should not occur, he said. Once mandates were approved, it was the collective responsibility of Member States to provide the resources to carry them out. The Group regretted that the budget proposal did not reflect the priorities set by the Assembly, he continued. More resources should be allocated to economic and social development. The Group would also seek further elaboration on increases proposed for non- priority areas.

The Group believed that vacancy rates should not be used to achieve savings or decrease the level of the budget, he said. They were strictly a management tool and should not be used for any other purpose. Overall vacancy rates for General Services should not exceed 2.5 per cent, and for Professional posts they should not exceed 5 per cent.

Human resource management must be improved, he said. The Group shared the concern of the ACABQ regarding the use of general temporary assistance to perform functions of a continuing nature. That practice should be discontinued. It also expected more information on the use of consultants. Consultants should only be used where in-house expertise was not available. Where necessary, their recruitment must reflect the international character of the Organization and be done on as wide a political basis as possible. In addition, increased delegation of authority should only take place when a system of responsibility and accountability was in place.

The Group considered the Charter provisions on the role of General Assembly to be very important, he said. Charges that the Assembly was micromanaging were cause for concern. It was also concerned about non- compliance with Assembly resolutions on the format of reports.

Finally, he stressed that all provisions of Assembly resolution 41/213, including those on the adoption of the budget, remained valid and should be fully respected.

MARJATTA RASI (Finland), speaking on behalf of the European Union, Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, Slovenia, Cyprus and Malta, said the overriding objective of the Committee must be to make available the resources to implement the Organization’s agreed objectives, mandates and programmes at the start of a new era. At the same time, if the United Nations was to perform effectively, budgetary discipline, efficiency and an overall approach of value for money were essential.

The Union considered the proposed programme budget to be a good basis for negotiations, and she welcomed the fact that it reflected both the medium-term plan and the priorities of the Organization, as specified in the budget outline approved last December. However, she regretted that in many priority areas core functions continued to be funded by extrabudgetary resources.

The Union reiterated its support for the budgetary reforms that the Secretary-General had put forward, she said. She looked forward to the introduction of his comprehensive and analytical report on results- based budgeting.

The Union was concerned that the vacancy rate should be used only as a tool for what was achievable from a budgetary point of view, that the post structure continued to be top heavy, that budget narratives could be made more concise and transparent and that the culture of information technology continued to be inculcated throughout the Secretariat.

OLE PETER KOLBY (Norway) said he generally endorsed the proposed distribution of resources in the budget proposal, which also reflected the Secretary-General’s commitment to make the Secretariat more responsive, effective and efficient. The level of resources proposed and the level of posts were not unreasonable, given the lack of even nominal budget growth and the elimination of 900 posts in the past five years. Norway believed the proposal was also in keeping with the priorities of the medium-term plan.

He said the inclusion of provisions for special political missions was particularly important, as their financing should not be dependent on exchange rate gains, vacancy rate management and trust funds. He also welcomed inclusion of funds for “perennial” political activities.

Norway supported the emphasis placed on development, he said. The focus on Africa also had Norway’s support, as it would enable the United Nations to be a catalyst, and to better coordinate and promote African development activities, as well as play an essential advocacy role. Increased resources for human rights were also welcome, but he believed the proposed resources for that area would not be sufficient to implement all mandated activities. Staffing in this area should also be less dependent on extrabudgetary resources.

It also supported the gradual inclusion of core peacekeeping support staff into the regular budget funded staffing table, he said, and proposed budget increases for internal oversight, which, while not an external programme, was an important management tool. Norway had made a contribution two years ago for refurbishment of the Security Council Chamber, and it called for an ongoing programme for maintenance and renewal of United Nations Headquarters.

The recourse to extrabudgetary funding that accompanied the decline in real value of the United Nations budget was not a welcome trend, he said. Priority activities should not depend on voluntary contributions, which made planning and management more difficult and time-consuming. Extrabudgetary funding was not a cost-effective way to tackle global issues, and it undermined the principle of collective responsibility for common global tasks.

He supported the use of results-based budgeting, which would make management more efficient, and also the introduction of “sunset provisions” on new mandates, without which it would be difficult to shed “past luggage”. He supported reform, and was particularly pleased at efforts at gender mainstreaming.

He said he would not stand in the way of viable solutions for reaching agreement on the budget, but it remained Norway’s firm view that zero budget growth was no longer a necessary incentive for reform. In the long run, it would inevitably lead to downsizing of institutional capacity to meet new challenges at a time when globalization had increased such challenges.

YUKIO SATOH (Japan) said that his country’s contributions to the United Nations had come to be exposed to increasingly critical scrutiny in public and political debates in Japan, as its share of the assessed budget was reaching 20 per cent, second only to the United States. But it was because of a broadly shared sense of commitment to the causes for which the United Nations stood that Japan had been making financial contributions fully and without conditions.

Japan, he said, believed that zero nominal budget growth was attainable by the next millennium through maximizing the effort to reduce anticipated additional spending. He drew attention to the fact that the funds and programmes themselves were already trying to curtail their administrative and management costs for the coming millennium.

Japan also considered it essential that the General Assembly apply more strictly than before the existing rules and regulations for prioritization and review of programmes. It was essential for the United Nations to constantly review its budget priorities in order to meet the requirements of the international community.

He said it was greatly disappointing that the actual number of Japanese nationals employed in the Secretariat under the assessed budget was 102, when the desirable range stood at 250. This was also seen in other parts of the United Nations system. Rectifying the under- representation of Japanese nationals was critically important to ensure firm political support in Japan for that country’s financial contributions to the Organization.

FAWZI BIN ABDUL MAJEED SHOBOKSHI (Saudi Arabia) said his delegation fully supported the proposed programme budget and praised the orientation of the Organization towards greater use of information technology and training of staff. He also supported the activities of internal oversight bodies, but was concerned about the increase in expenditure on external consultants.

Geographical distribution was important and greater opportunities should be given to developing countries, he said. The private sector in Saudi Arabia wished to participate in the procurement committee for 2001. Saudi Arabia also suffered from the lack of equity in geographical distribution and recruitment, and the country’s share of posts was too low relative to its contribution to the budget. He hoped that the Secretariat would create more opportunities for his country's nationals.

ANWARUL KARIM CHOWDHURY (Bangladesh) said that recent years had witnessed a falling real growth rate in the budget for the Organization, and there was growing concern that reduction in staff might hamper the proper implementation of approved programmes. Such a situation gave rise to concern, particularly in the context of increased focus on social and economic issues. Bangladesh wished to underscore the need for greater United Nations strength in meeting rising needs –- especially in the social, economic and humanitarian fields.

Bangladesh wished to reiterate certain aspects of the ACABQ’s report, particularly that the budget document be made more user- friendly, with an increased use of graphs, charts and tables, and that the introduction of results-based management in some agencies of the Organization be considered.

He welcomed the Secretary-General’s commitment to “creating an organizational culture that is responsive and results-oriented, that rewards creativity and innovation and promotes continuous learning, high performance and managerial excellence”. But he added that for this vision to be implemented in letter and spirit it was also necessary that the central role of the General Assembly be recognized.

FELIPE MABILANGAN (Philippines), speaking on behalf of the Association of South-East Asian Nations (ASEAN), said the group wished to seek assurances that the proposed level of resources would be sufficient to effectively and fully implement all mandated programmes and activities. The ASEAN shared the concern of the Secretary-General that any further reduction in the budget level would seriously compromise the ability of the Organization to deliver the services expected by Member States.

The ASEAN had always been supportive of the Secretary-General’s reform initiatives and measures that would improve cost-effectiveness, provided that such measures did not affect the full implementation of mandated activities. However, he said real savings were achieved through improved efficiency and cost- effectiveness in the full implementation of mandates, rather than delay, reformulation or even the curtailing of implementation. He urged the Secretary-General, when preparing his report on the Development Account, to take into account ASEAN’s views and the provisions of the draft resolution on the Development Account which the Committee had recently adopted.

He said the most vital asset of the Organization was its staff and noted with appreciation the ACABQ’s continuing interest in personnel practices and policies, which had a major impact on the good management of the Organization and the efficient use of its resources. He also welcomed the Secretary-General’s efforts to mainstream a gender perspective in the preparation of the budget proposals.

SEIF IDDI (Tanzania), speaking on behalf of the East Africa Cooperation of Kenya, Tanzania and Uganda, said that in effect it was a zero resource growth budget and it was very difficult to understand the rationale behind it. The reports of the CPC and the ACABQ led to the conclusion that more resources should have been proposed for a number of sections in the proposed programme.

He said that there was evidence that many activities and programmes were not being implemented effectively because of a lack of adequate resources. He mentioned,as a first example the level and quality of the maintenance of the Headquarters premises. This and other examples reminded delegates of similar pressures to fund more peacekeeping operations –- a core function of the Organization –- using voluntary contributions. He felt that past assertions that more could be done with less were no more than suspicious public relations soundbites.

He added that the situation of the four regional commissions and the centre at Nairobi was a source of concern. As indicated in the report of the Advisory Committee, the Economic Commission for Africa (ECA) still lagged behind many parts of the United Nations in automation and information systems, and it was not clear why more resources had not been allocated to it. As for the United Nations Conference on Trade and Development (UNCTAD), it was evident that more resources should have been allocated to the cost of coordinating activities for the least developed, landlocked and island developing nations. He added that he was disappointed with the budget’s proposal for the United Nations centre in Nairobi, and that it was his intention to pursue the matter further when the related section was taken up.

INAM UL HAQUE (Pakistan) said the medium-term plan, as the principal policy directive of the Organization, must enjoy paramount importance in the preparation and improvement of the budget. The large number of amendments suggested by the CPC led him to the conclusion that the Secretariat had not adhered strictly to the medium-term plan. The Fifth Committee must ensure that mandated programmes were considered in the budget and that adequate resources were provided.

At its previous session, the General Assembly had approved a budget outline of some $2.545 billion, he said. The Secretary-General had now submitted a proposal for some $2.535. Reports from senior staff had left him with the impression that a paucity of resources had adversely impacted on programme delivery by the Organization. He, therefore, sought a clear statement from the Secretariat that the resource level proposed by it would be adequate for the implementation of all mandated programmes and activities.

He also noted the heavy reliance on extrabudgetary resources in the proposal, he said. It was not prudent budgetary practice and negated the principle of collective responsibility to aim to finance approved mandates from such funds. The Secretary-General must provide for all mandates from predictable and reliable sources of funding. Member States had a collective responsibility to finance all mandated activities and programmes. This must be respected to ensure a continuous and predictable supply of resources.

The correlation between the Development Account and efficiency measures mentioned in the budget proposal forward and introduction were not germane, he said. Improvements in efficiency were essential to strengthen the capacity of the Organization, and could not be allowed to become a budget exercise.

The ACABQ had stated that, for long-term efficiency, reform projects must be well thought out, and a coherent programme of change management and reform must exist, he said. Too many reform projects seemed to have been implemented without careful consideration.

Pakistan attached great importance to the established budgetary process as set out in Assembly resolution 41/213 and the rules and regulations of the Organization, he said. He agreed with the ACABQ statement that regular legislative scrutiny of the budget should be maintained. That recommendations of the CPC were mostly endorsed by the Fifth Committee and the Assembly reflected the Assembly’s confidence in it. Despite an important contribution to the budget process, the Fifth Committee had, at times, to side-step ACABQ recommendations. This called for a review of its working methods, and the Fifth Committee might wish to consider an interactive dialogue with that Committee to address those issues. All mandated programmes should be carried out by United Nations staff, he said, and the mandated phasing-out of gratis personnel should be implemented in full. Proposed time limits for initiatives should not be acted upon without input from the ACABQ, other expert bodies, and the Fifth Committee. Two reviews of the ongoing relevance of mandates already existed -- by the Assembly and by the CPC. It would be arbitrary to set time limits at the establishment stage of initiatives.

Results-based budgeting also raised questions, and proposals to adopt this method should not be implemented without Assembly consideration and approval, he said. It seemed that it might not be suitable for the United Nations, as it was often impossible to quantify results in the political arena. The Secretariat had made reform proposals, but it must await the outcome of the legislative process before implementing them.

He noted that certain ACABQ reports were not in line with decisions of the Assembly contained in its resolution 53/12B, which must be read in association with paragraph 12 of its resolution 53/208B, and called on the Advisory Committee to ensure its reports were in accordance with those Assembly decisions.

GERT ROSENTHAL (Guatemala) said that the approval of an intergovernmental budget was not a matter to be taken lightly, as it measured the degree of commitment of Member States and provided a roadmap for the institution. It was also the main point of intersection between those who formulated policies –- the Member States -– and those who implemented them –- the Secretariat.

Member States were not in agreement among themselves about the level, he said, but the divergence did not seem unbridgeable. Some advocated modest real growth, the Secretariat and the ACABQ advocated zero real growth, and some advocated zero nominal growth. Whatever the outcome, the world would not end and the United Nations would not collapse.

The discussion was not about resources, but about political commitment to the United Nations, he said. If, as Guatemala did, a Member State believed that the Organization mattered then it must provide the necessary resources to achieve the goals. Member States could not, on the one hand, deny it resources to perform mandates that, on the other hand, it had entrusted to it.

For the past 10 years there had been successive budget cuts, he said. At the beginning, excess capacity and overlap had made such cuts easy to absorb. However, now the Organization did not address matters of great relevance because of a lack of resources, and the cuts and air of permanent austerity had a perverse effect. As time went by, Member States were witnessing a decline in the lowering of the qualifications of the Secretariat. The time had come to halt a downward spiral by making reasonable provisions to allow the United Nations to fulfil its objectives.

Committee members had a two-fold role, he said. As contributors they must ensure they got maximum mileage for resources from the Organization, to achieve which they should adopt an attitude of discreet vigilance. However, as users of its services, they must provide it with the resources needed to function optimally. For this, they should be understanding, constructive and proactive. A modest increase in resources struck the proper balance between those two positions, allowing financial leeway to allow the Organization to renew itself for the twenty-first century, without disregarding the sound management principles that would be demanded of any government or business enterprise.

HILAIRE SOULAMA (Burkina Faso) said his delegation was somewhat surprised by the amount proposed in the budget, which only authorized an apparent increase of $129 million. For a decade there had been urgent calls on the United Nations and a growing number of activities had been placed on its agenda. Burkina Faso had always supported reform to enable the Organization to carry out its mandated tasks. Resources should be allocated which were commensurate to the tasks mandated.

The Secretariat should not be able to deviate from the medium-term plan, he said. As the current allocation of resources in no way reflected this plan, he would be interested to hear the rationale. He hoped that the areas of cooperation and development would not be affected by what appeared to be a reduction in resources. He concluded by stressing that all Member States should pay their contributions in full and on time. Any claim to enjoy the rights of membership implied a concomitant recognition of duty.

SUN MINQIN (China) said her delegation welcomed the efforts to improve the efficiency of the Organization to reduce costs, but it had also noted that successive reductions in recent years had begun to affect the implementation of mandated programmes and the efficiency of United Nations activities. She noted with concern the Secretary- General’s written statement to the CPC earlier this year that the United Nations had “reached the point where further cuts would seriously compromise our ability to deliver the services that Member States expect. In other words, we are down to the bones”.

She said that the Secretary-General’s proposed appropriation for some sections of immediate interest to developing countries, such as the environment, crime prevention and African development, were still inadequate or contained only an insufficient increase as compared with the resources of the current biennium. In contrast, increases for sections such as human rights and internal oversight for the biennium 2000-2001 had been dramatic compared to the current biennium. The Chinese delegation was concerned at this situation and hoped that economic development could be given increased attention and resources.

MARTIN BELINGA-EBOUTOU (Cameroon) said that at the dawn of the millennium it was the duty of States, in a spirit of consensus, to endow the Organization with the means to support and nurture the hope that would bring peace, security anddevelopment to the world. States, therefore, should provide the United Nations with sufficient resources.

He stressed the need to provide adequate resources for the financing of development. This was one of the most important innovations introduced into the budgetary process of the United Nations. The true goal was to allow States to become involved at an early stage in the process in order to achieve the greatest possible consensus on the pivotal elements of the budget.

The rate of growth of the budget was decreasing year by year and was now somewhere around zero, he said. Was there still a need, he asked, to emphasize the incredible consequences that this would have on the programmes and personnel of the Organization? If the budget continued to mark time, or actually moved backwards, the Organization was likely to be unable to cope with the enormous challenges it would meet in the twenty-first century. Cameroon, therefore, believed there had to be a reversal of this trend. The United Nations needed a budget with a positive rate of growth which would lead to the implementation of all mandated programmes, above all for development activities.

Other Matters

Mr. KOLBY (Norway) asked when five addenda to the Secretary- General’s report on results-based budgeting would be issued, and whether the bureau of the Committee had scheduled discussion of them. It was important for Norway that this be dealt with during the main part of the fifty-fourth session of the General Assembly.

The Committee was told by the Director of the Budget Division, WARREN SACH, that the addenda were in translation and would be available soon.

The Chairman of the ACABQ, C.S.M. MSELLE, said that he could not give a date for the ACABQ’s comments as he intended to hold a thorough discussion of the report before commenting and the ACABQ did not, as yet, have the full report.

The Chairman of the Fifth Committee, PENNY WENSELY (Australia), said no decision had been taken yet on when the Committee would discuss the report.

Mr. BARNWELL (Guyana), speaking on behalf of the Group of 77 and China, said he wanted to reiterate that, given the sensitivity of the issue of results-based budgeting, careful thought and consideration should be given to it by the CPC, the ACABQ and other oversight bodies before any action was taken on the matter.

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