SECRETARIAT SHOULD SUBMIT NARRATIVE OF DETAILED PROPOSALS FOR USE OF DEVELOPMENT ACCOUNT, SPEAKERS STRESS IN FIFTH COMMITTEE
Press Release
GA/AB/3342
SECRETARIAT SHOULD SUBMIT NARRATIVE OF DETAILED PROPOSALS FOR USE OF DEVELOPMENT ACCOUNT, SPEAKERS STRESS IN FIFTH COMMITTEE
19991111Committee Concludes Part-By-Part Consideration of Proposed 2000-2001 Programme Budget
There was an urgent need for the Secretariat to submit a narrative containing detailed proposals for the use of the Development Account during the current session of the General Assembly, the Fifth Committee (Administrative and Budgetary) was told this afternoon as it completed its initial part-by- part consideration of the programme budget for 2000-2001.
The representative of Guyana, speaking on behalf of the "Group of 77" and China, during the discussion devoted to Part XIII on the Development Account, said the Group would not be in a position to conclude consideration of the budget until information on Development Account projects was provide. He stressed that the information must be provided in time for a thorough examination of all relevant issues.
The representative of Brazil said he believed that the narrative could have been submitted before the Assembly took a decision on the modalities for the Account. United Nations development practices had not met Member States' ideals, and this was partly due to a lack of resources. He expected that the Development Account would be operated in accordance with the rules and regulations, he added.
The Development Account was very important, the representative of Mexico explained, in part because of the great expectations that it had awoken. He hoped there would be no great disillusionment. He added that the Latin American region should not be forgotten in any proposals.
Warren Sach, Director of the Budget Division, explained that it had been hard for the Secretariat to proceed on this matter before Member States reached consensus on the Accounts modalities. A misstep, or action that moved ahead of the process, could have harmed the negotiations, so the Secretariat had held back.
Extensive work had, however, been done, he continued, and a package of 16 proposals had been developed. A final financial examination of them was underway. Details of all projects would be available very soon, and action would be possible on this budget section.
Fifth Committee - 1a - Press Release GA/AB/3342 36th Meeting (PM) 11 November 1999
The Committee completed its initial reading of the programme budget proposal by concluding discussion of the Development Account (Part XIII), as well as Part X, on jointly administered activities and special expenses, Part XI, on capital expenditures, Part XII, on construction, alteration, improvement and major maintenance, and the budgets income sections.
The representatives of Canada, United States, Australia, Japan, Pakistan, Cuba, Uganda, Guyana (, speaking on behalf of the "Group of 77" developing countries and China), Mexico, Algeria, Chile, Brazil, Ecuador, Israel, Dominican Republic and the United Republic of Tanzania also spoke.
The Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), C.S.M. Mselle, presented that bodys comments on Parts XI through XIII and the income sections.
The Committee will meet again tomorrow morning at 10 a.m. to take up the administrative expenses of the United Nations Joint Staff Pension Fund under agenda items 119 and 121.
Committee Work Programme
The Fifth Committee (Administrative and Budgetary) met this afternoon to continue its part-by-part consideration of the programme budget for 2000-2001, commencing with budget Part X on jointly financed administrative activities and special expenses.
[For a general introduction to the programme budget proposal and the general response of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), see Press Release GA/AB/3322 of 27 October. Further parts of the Secretary-General's proposed budget and the relevant ACABQ responses are summarized in the Press Release covering the meeting at which the Committee commences considering them. For background on Parts X, XI, XII and XIII, and on the income section of the budget proposal, see Press Release GA/AB/3341 of 11 November.]
Statements on Proposed Programme Budget
JOHN ORR (Canada) said, under section 29, Jointly financed administrative activities, that he was disappointed that the presentation here was on the basis of object of expenditure, as was section 26, Public Information. Expected accomplishments should also be included. On the budget for the International Civil Service Commission (ICSC), he was disappointed with the lack of a computerized management information system. He felt that the Committee should be cautious on this issue.
He noted that the recommendation of the Board of Auditors carried a number of caveats. The General Assembly needed assurance that any computer system on which it spent money would indeed work and produce savings. He agreed that the Information Systems Coordination Committee not be funded for the time being.
THOMAS REPASCH (United States) asked for more details of the new management information system and asked why the ICSC had decided to develop its own system rather than use an existing one. He agreed with the representative of Canada that the actual working of the system and anticipated savings had not been established.
He said the work programme of the Joint Inspection Unit (JIU) showed only nine reports in a year and a half - a dramatic decline in productivity. He urged immediate action to reverse this trend. There had also been a large increase in travel expenses. He asked how much of the request had been earmarked for travel to Headquarters by inspectors to attend meetings of intergovernmental bodies. He asked when the JIUs Web site would be operational.
On the Consultative Committee on Programme and Operational Questions, he asked how many meetings had been scheduled and held in the last two years. He noted travel expenses for staff to travel to Headquarters and asked if it had used technology to reduce travel expenses.
HENRY FOX (Australia) said it was not clear to him what the United Nations was buying with the proposed sums of money for these organizations under this budget part. He supported the representative of Canadas statement on the ICSC.
On the Information Systems Coordination Committee, he said he had been calling for a coordinated strategy on information technology. A not insignificant amount of money for this technology was being requested. Therefore, it was extraordinary to read the ACABQ comment that the effectiveness of this Committee was not apparent. He endorsed the ACABQ recommendation that the United Nations share of the apportionment for this Committee be withheld, pending a review of the Committee.
KOJI F.X. YAMAGIWA (Japan) said he too had noted the ACABQ view about the apportionment for the Information Systems Coordination Committee, and he shared its views.
He said his country was concerned about the security of United Nations staff at various duty stations, and he endorsed the ACABQ comment about an urgent need for careful coordination of United Nations system security activities. He paid tribute to the critical role of the United Nations Security Coordinator, and expressed his delegations appreciation of the Coordinators work.
WARREN SACH, Director of the Budget Division, then responded to questions. He said, on the appropriateness of budget procedures for the JIU, that the procedure was the same as had been used in the past, so he had not foreseen any difficulties. He was surprised to hear that there was anything remiss in the interpretation of the JIUs statute. It was within the purview of the Fifth Committee to determine the correct interpretation.
On the use of objects of expenditure, he said that the accomplishments aspect had not been used for the support functions in this budget proposal. He hoped to be able to provide them for these areas in future proposals. He noted that this absence might be particularly important in the case of the ICSC, where it was not clear from the material what benefits would accrue from cooperating with other organizations.
On the Information Systems Coordination Committee, he had read the ACABQ criticism, but also noted the ACABQ statement that there was a strong need for information systems coordination. The question being posed was whether this need was being met. He would provide much more detailed information on the Information Systems Coordination Committee in informal consultations, to assist them in judging its use in meeting that need.
On the phased implementation of the system for the International Civil Service Commission, he explained that this Commission was a data intensive body. It was also a crucial area in determining the costs of running the United Nations and common system agencies. It was the need for data management that was being addressed by the Board of Auditors when it made its recommendation on this matter.
A consultant had been hired to review the best way for the ICSC to meet the needs identified by the Board of Auditors, he said, and he would make the consultants report available to Member States in informal consultations. It was a phased, conservative introduction that was being proposed. The Committee might decide it was too gradual, but there had been balancing of the need against the resources available.
Regarding the question on the JIUs productivity, he said he would provide names and details of that bodys reports to Member States to allow an assessment of its productivity to be made. He would also provide details of meetings and travel anticipated in the related resource requests.
Mr. ORR (Canada) said under section 30 on special expenses noted that after-service health insurance costs were a very significant amount. However, there had been a rebate of premiums based on a surplus in the account, and he asked whether the administration had reviewed the current provision to see whether it could be reduced. He also asked whether there had been comparisons with other international organizations on the subject of cost-sharing.
Mr. SACH said that it had been possible to realize some economies on health insurance in the current biennium and that had affected what was calculated for after-service health insurance. Some benefits had been reflected in the overall level sought for 2000-2001. On Canadas other question, he didnt believe there had been a recent study on cost sharing.
AMJAD SIAL (Pakistan) asked whether certain Office of Internal Oversight Services recommendations for the 2002-2003 budget had policy implications.
Mr. SACH replied that he thought they did not, but he would check further.
The Chairman of the ACABQ, C.S.M. MSELLE then took the floor to present that bodys comments on the parts of the budget proposal under consideration.
Mr. REPASCH (United States) noted the 26 per cent increase for this section, which he said was quite high given other increases. For that reason, he could not support it. On the Economic and Social Commission for Asia and the Pacific (ESCAP) conference centre, he asked what the amount of usage projected for the centre was, as it was undergoing major maintenance in the next biennium.
DULCE BUERGO RODRIGUEZ (Cuba) said she was seriously concerned about the state of the United Nations building and believed careful consideration should be given to the use of resources for this section. There were dangers and difficulties associated with the deterioration of the building. She cited a number of examples of damage. The resources related to the master plan were to be presented to the General Assembly, she pointed out, and she wished to support the previous comments of the representative of Costa Rica on the cafeteria.
Mr. SIAL (Pakistan) said that a marginal growth in resources was proposed, and he sought assurances that the amount requested would be adequate to meet all the maintenance requirements of the buildings. He asked whether the master plan mentioned by the ACABQ had been submitted to the Assembly as requested.
The ACABQ had said it sought assurances that funds appropriated for this purpose were spent for it, he noted. He sought explanation for this comment, given that any other option would be in breach of the Financial Rules and Regulations.
JUICHI TAKAHARA (Japan) said that all Member States and the Secretariat shared an interest in the maintenance of the buildings. It was reasonable that the ACABQ had requested that the scope, duration and cost of any proposed multi-year project be included in future budget proposals.
This was a section on which the Secretariat should be able to easily express weaknesses, accomplishments to date and expected results of benefits, he said. Their inclusion would facilitate the quantitative assessment by Member States.
Mr. SACH, Director of the Budget Division, said the resources requested for maintenance were adequate only on the assumption that they would be complemented by a separate request for additional resources for long term needs, to be presented independently.
The level of the increase was considerably lower than the amount that was being spent on construction earlier in the decade, he said. In 1994-1995, $50 million had been spent. In 1996-1997, $27 million had initially been appropriated, and this had later been reduced to $25 million. Expenditures had risen in the current biennium, but the latest proposal was for a figure not yet up to the level of spending in 1994- 1995, for buildings worth several billions.
The reduction in available resources had a long term deleterious effect on the buildings, he said, and the master plan would be presented in this context. He doubted the master plan would be presented before the end of the year. Much of the construction portion of the plan was complete, but essential financial elements had not been finalized. He expected it would be available before the resumed fifty-fourth session.
On the ACABQ comment that funds should be spent for the purpose, he believed this was a response to a belief that not enough of the money allocated was actually spent. It was not that the money would be spent elsewhere, but that it would not be spent at all. He saw it as an encouragement to the Secretariat to actually expend the apportioned funds. There had been a slight underspending in 1996-1997, he noted.
The Committee then turned its attention to section 32, staff assessment.
Mr. ORR (Canada) said he would prefer not to see this section at all. It was not true that Member States received the staff assessment paid by their nationals. The credit that Canada received from staff assessment in no way related to staff assessment paid by Canadians. Staff assessment was, in essence, a paper exercise. He had doubts about what was contained on the United Nations Web site on setting the record straight on staff assessment, which stated that United Nations employees were not paid tax free. Canada felt that staff assessment was neither a true expenditure nor a true income item -- it artificially inflated the United Nations budget.
Mr. ODAGA-JALOMAYO (Uganda) asked whether the Budget Director had any views on the subject.
Mr. SACH said if section 32 were abandoned the United Nations would have to find a different way of assessing Member States to ensure that the burden of tax reimbursement fell proportionately on the countries concerned.
The Committee then turned its attention to section 33, Development Account.
GARFIELD BARNWELL (Guyana), speaking on behalf of the "Group of 77" developing countries and China, said that the Secretariat had attempted to tie efficiency measures to the Development Account. The Group failed to understand why the Secretariat would include specific measures in the programme budget with a view to identifying savings. The frugal use of resources was highly desirable, but the current budgetary procedure and rules and regulations did not provide for the identification of savings in the formulation phase of the budget.
The Group wished to stress that the operation of the Development Account should be strictly in accordance with the United Nations regulations and rules and the relevant resolutions. It was of the utmost importance that the mandated activities be provided with the necessary resources. The savings to be transferred to the Development Account should not have an adverse impact on programme delivery in other areas of the budget.
The Group underscored the need for the submission of a narrative containing proposals on the Development Account during the current session so that the Fifth Committee could conclude its work on the programme budget in a comprehensive manner. He stated that the Group would not be in a position to conclude consideration of the proposed programme budget for 2000-2001 until the information he had asked for was provided, in time for a thorough examination of all relevant issues.
Mr. SIAL (Pakistan) said that the regulations on the budget stated that the Secretariat must submit budget proposals to the Committee for Programme and Coordination (CPC) and the ACABQ, and that the Fifth Committee must then consider the comments of these bodies.
The Fifth Committee had done its job on the Development Account, he said. Despite repeated requests by the Assembly, in which it was stressed that the Account must be operated in accordance with all relevant rules and regulations, there was no narrative on this matter. The CPC had also requested that a programme narrative be submitted to the Fifth Committee. He was disappointed that it had not been submitted, and asked how the Fifth Committee could meet the requirements in the regulations, if it could not justify its decisions according to programme planning rules. He asked for an explanation of the correlation between the modalities of the Account and the programme narrative.
Pakistan was also disappointed at the ACABQ observations on this budget part, he said. The section was so important that the Assembly had spent more than two years discussing it before adopting a final resolution, only to see the superficial observations made by the ACABQ, on the Accounts name and other peripheral issues. The ACABQ had not even mentioned Assembly resolution 53/206 in which the some $13 million was approved for the Account. He sought specific clarification of the ACABQs observation that should such an agreement not be reached, the Assembly would have to decide on the treatment of the $13 million. He asked what purpose the skepticism expressed in this remark served, and why the ACABQ had not, instead, drawn the attention of the Secretariat to the rules.
ERNESTO HERRERA (Mexico) said the Development Account was very important, in part because of the great expectations that it had awoken. He hoped there would be no great disillusionment.
He would like to see a proposed narrative to replace the list of actions taken in the Assembly in the budget proposal, he said. He would also like to receive, in the near future, the proposed projects for which the Account could be used. The Latin American region should not be forgotten in any proposals, he added.
DJAMEL MOKTEFI (Algeria) said he was surprised that the Secretariat had not been able to provide a list of projects. The CPC had drawn attention to this fact. He wondered if there was a procedural problem. No action could be taken without the narrative part, he stressed.
ALVARO JARA (Chile) said everything should be done to ensure that necessary information was forthcoming. He was waiting impatiently for a list of projects, and he hoped that the Latin American and Caribbean Group would feature prominently.
CARLOS ALBERTO MICHAELSEN DEN HARTOG (Brazil) welcomed the consolidation of the Development Account into a permanent budget section for the United Nations. He believed, however, that the narrative could have been submitted, pending an advance on the modalities for the Account. It had to be said, frankly, that the practice in the development field by the United Nations had not met the ideals of Member States, and this was partly due to a lack of resources. Section 33 was, therefore, a welcome addition to the budget. He said that once a new level of productivity was achieved, savings would remain, provided the productivity did as well. The generation of surpluses was not an end in itself. An inflow of resources from the non-implementation of mandates was not an option. He expected that the Development Account would be operated in accordance with the rules and regulations.
Mr. TAKAHARA (Japan) said that the Development Account should be operated in a timely manner. He asked for clarification on the timing of the submission of proposals on the use of this amount.
Ms. BUERGO RODRIGUEZ (Cuba) said it was important to bear in mind that the implementation of the Development Account should not lead to either budget reductions or staff reductions. She wondered why there were no concrete proposals on the use of relevant resources for the next biennium. In the past few months, no information had been received on this question and this was regrettable.
There was a distinction between the actual projects planned and considerations of the modalities of the Account, she said. The General Assembly had finally adopted a resolution recognizing that all savings achieved should become a base for maintaining the Development Account in future biennia. She reaffirmed the permanent nature of this section, and the need for it to be permanently reflected in the programme budget. She reiterated the need for concrete proposals under this section for the consideration of the General Assembly.
Mr. ORR (Canada) said he repeated Canadas support for the account as a key aspect of the Secretary-generals reform proposals. He hoped that this Assembly session would see action on a large number of the Secretary-Generals proposals.
He associated himself with the representatives of Guyanas assertion that the submission of the programme narrative should not have been contingent on the modalities, as they were separate. He hoped that the narrative would be available soon.
DENYS TOSCANO (Ecuador) said the Development Account was of political and practical importance. He was awaiting impatiently the information on the proposed uses of the resources for this Account, where Latin America and Caribbean should be included.
RON ADAM (Israel) said he noted with concern the delay in implementation of the Development Account. He hoped that the amount of some $13 million would soon be spent on agreed mandated activities, in full and without conditions.
OLIVIO FERMIN (Dominican Republic) said he also endorsed the need for proposals and the importance of this item.
Mr. SACH, Director of the Budget Division, said discussion on this section had been interesting. It had been hard for the Secretariat to proceed on this matter without potentially endangering the efforts of Member States to reach consensus on the modalities of the Account, and thereby jeopardizing the Secretary-Generals proposal. In the budget proposal, certain required acts were listed. These included the listing of proposed projects, the identification of efficiency savings, and the identification of modalities for the Account.
A misstep, or action that indicated movement ahead of the process of the establishment of modalities could have harmed the negotiations underway, he said. So the Secretariat had held back on the Development Account. In the recent decision on modalities, Member States had said that savings should be identified in the context of the performance report. This meant that the savings did not need to be identified in advance, but after they had been made.
On the project proposals, extensive work, under the auspices of the Under- Secretary-General for Economic and Social Affairs, had been done on this, he said. The Under-Secretary-General had been in contact with the United Nations Offices in Vienna and Geneva, as well as the regional commissions, and a package of 16 proposals had been developed.
It would be put to Member States very shortly, he said, and well before a budget decision was required. Details of all projects would be available before an appropriation must be made. He regretted that the proposals had not been available earlier, but they required a great deal of coordination between departments. However, that had now taken place and a final financial examination was in process.
He was confident that what had been recognized as an anomaly in the budget would soon be resolved, at which point action would be possible on this section, in the same manner as it was with all other sections.
The Committee then turned its attention to Income Sections of the proposed programme budget.
Mr. REPASCH (United States) asked about the reduction in income from television and other related services in exchange for access to broadcasters facilities - how good a deal was this? he asked. On services to the public, he noted the proposed abolition of two General Service posts at the bookshop at the Palais des Nations and said he opposed the ACABQs recommendation that the posts be retained.
Mr. ORR (Canada) asked about apparent inconsistencies in distribution of staff handling public visitors to the main United Nations offices. He emphasized that tour operations also should not be run at a loss.
Mr. REPASCH (United States), on the United Nations postal operations, said that there had been a decline in net revenue and asked what was causing this. He was in favour of revenue-producing activities, but only if they actually produced revenue. Also, he asked about the deterioration in the quality of service in the delegates dining room.
Ms. BUERGO RODRIGUEZ (Cuba) said she was concerned about the payment of local taxes for sales of gifts items in the United Nations shop, which was on international territory. She also supported the recommendation of the Advisory Committee to review the abolition of the two posts in Geneva. She was also concerned about the increase in price and deterioration in quality of food in the cafeteria.
Mr. SIAL (Pakistan) said he was concerned that bank interest such as the current sum had not been earned in the past. Why was it only now included as an income factor? he asked. He also wondered whether promised substantial capital improvements to the catering facilities had actually been made; again, prices had gone up and quality had deteriorated. Who, indirectly, was providing the $500,000 the contractor had to pay the United Nations annually? he asked. Was it just staff?
MUHAMMED YUSSUF (United Republic of Tanzania) said the ACABQ had said the costs in the cafeteria were high, but he had never seen any ACABQ members eating there, and he ate there almost every day. There had been a deterioration in service. Trays and tissues and forks were not always available and sometimes he was obliged to wait for these. There was now, however, a good variety of food on offer.
On the cost, he noted that the United Nations was in New York, and in that context the price of food was quite reasonable. The kind of food that was available in restaurants in New York was not provided, but it was reasonably priced. Socialism no longer existed in the cafeteria. He felt the people in the cafeteria were doing their best to help; however, the services should be improved. There were long queues for trays, and it had never been like this in the past.
Mr. MOKTEFI (Algeria) said he shared the concern of the ACABQ about the matter of sales tax being paid on gift items. He asked on what grounds a tax was gathered in the United Nations building, which was a tax-free area.
Mr. FOX (Australia) said the cafeteria was of great concern to the Committee. The representative of Costa Rica, who originally raised this matter, was not in the room, and he wished to ensure that she had every opportunity in a formal meetings to pursue her concerns.
He aligned Australia with the request made by the United States representative for information on the basis of ACABQ comments on the high cost of food in the cafeteria.
The Acting Chairman, AHMED DARWISH (Egypt) explained that the ACABQ, including the representative of Costa Rica, were currently meeting on the International Tribunals. Mr. SACH, Director of Budget Division, then answered Member States questions. Regarding the new arrangements for television services, he would provide the answers to the questions raised in writing, as he had done for the ACABQ.
On the stamps, he said that profits were expected. The indication was that a profit of some $2.3 million would be forthcoming in the biennium; however, he noted that this was not as great as the profit expected from the current biennium. It was declining because of loss of interest in philately. However, the postal service still contributed a net revenue to the Organization.
He noted that Income section three of the budget had once been titled "revenue earning activities," but that the assembly had changed the name to "services to the public" so that it better reflected the purpose of the activities, which aimed to deliver a service while attempting to cover the costs of that service. The postal service and the guide operation fell into this category of activities.
The guide operation spent more than was received in fees, he said. However, the benefits it delivered could not be easily calculated, as it raised public awareness of the Organization, and also, by attracting people to the United Nations building, contributed to the sales made in the gift shop.
On the cost structure of guide operations, he said that more visitors came to Headquarters than to Geneva, and therefore the distribution of posts and general temporary assistance differed in the two operations. The guide service made a significant use of general temporary assistance. Certain of the posts that applied to the service, however, were not actually occupied by guides, but were used for organizational aspects of the services, such as bookings, administration and so on.
Regarding the bookshop in Geneva, he said the new contractual arrangement was somewhat similar to the arrangements that had been made in New York some time ago, where contractors were used, but the United Nations retained some control. The Secretariat had reexamined the two posts it had originally proposed to abolish, and now proposed that one post be retained to monitor the work of the contractor. Under the new arrangement, the services provided would expand, with a view to securing more profit for the United Nations in the future.
On the sales taxes charged in the gift shop, he said that in the past the gift shop had been run by United Nations staff members. There had been certain difficulties with that arrangement, and so a switch to a contractor-run service had been made. The contractor was required to file tax returns in the United States, so the matter of sales tax had arisen. It was still under legal review, but there was no outcome yet.
Responding to questions about the cafeteria, he explained that a price rise of 5 per cent had occurred following an announcement in September. This rise was written into the contract between the United Nations and the contractor. He noted that in past contracts, any loss or profit was borne or gathered by the United Nations. This sounded reasonable, but there always seemed to be a loss. Now the trading risk was with the contractor.
Regarding bank interest increases, he said that worldwide relationships with banks had been somewhat more relaxed in the past. As the banking environment had changed, banks had become more precise on charges and customers had become more precise on the management of balances.
The United Nations was now taking advantage of sophisticated software to monitor balances and arrange the movement of money from accounts to maximize the interest it received. The software was costing about $50,000 per biennium, and several millions in extra interest was resulting. The software had not been available in the past, he added.
Mr. ORR (Canada) said he still wondered why the United Nations was providing services at a loss. He would appreciate a breakdown of the tour guide staff in the three main centres.
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