PROCUREMENT REFORM, OUTSOURCING PRACTICES, PEACEKEEPING AIR SAFETY VITAL TO CURRENT, FUTURE UN OPERATIONS, BUDGET COMMITTEE TOLD

Fifty-ninth General Assembly

Fifth Committee

34^th Meeting (AM)

PROCUREMENT REFORM, OUTSOURCING PRACTICES, PEACEKEEPING AIR SAFETY

VITAL TO CURRENT, FUTURE UN OPERATIONS, BUDGET COMMITTEE TOLD

Resumed Session Begins at Headquarters;

Capital Master Plan, Peacekeeping Finance, Among Other Issues on Agenda

Three subject areas before the Fifth Committee (Administrative and Budgetary) -- procurement reform, outsourcing practices and safeguarding air safety standards for United Nations peacekeeping -- were vital to current and future United Nations operations, stressed the United States’ representative as the Committee began its resumed session this morning.

Without accountable, cost-effective, efficient and transparent procurement practices, the Organization would not have its essential goods and services, billions of dollars of contributions would be ill-spent or not properly accounted for, and the safety of United Nations peacekeeping air operations would be jeopardized, he said.  His Government would always insist on effective and transparent procurement as an ongoing management priority.  All personnel involved in procurement must be trained.  They needed to understand procurement practices and procedures, adhere to ethical practices and be held accountable for their actions.  If mismanagement, fraud or theft was alleged, it should be investigated as soon as possible and those found guilty punished accordingly.

Commenting on the achievements and shortcomings of the ongoing reform of the Organization’s procurement system, several speakers welcomed strengthened cooperation through the inter-agency and common services procurement working groups, which had been established to avoid duplication and increase efficiency.  Recognized in the debate were such initiatives as the comprehensive agency agreements, streamlined vendor practices and greater use of technology, with the goal of harmonizing and streamlining procurement practices throughout the system.  Many noted the launching of an Internet-based vendor registration system -- the United Nations Global Marketplace -- last year, as well as a number of measures to improve quality of procurement, particularly for peacekeeping missions, which now shared over 80 per cent of the Organization’s total procurement expenditures. 

The procurement service had effectively addressed many of the concerns previously raised by Member States, said the representative of Belgium, who spoke on behalf of the European Union.  One of the initiatives to increase efficiency allowed electronic processing of presentations to the Headquarters Committee on Contracts, thereby speeding up the procurement process.  Stressing the need to regularly update the revised Procurement Manual and information relevant to procurement on the web sites in all six official languages, he also agreed that training programmes could be focused on a train-the-trainers approach.  It was also important to meet specific training needs of staff, including at field missions.

Introducing the Secretary-General’s report on procurement reform, Joan W. McDonald, Director of the Facilities and Commercial Services Division, noted that over the last six years the volume of procurement had gone from $318 million to $850 million, an increase of nearly 300 per cent.  Although procurement service had become more efficient, there was a limit to how long staff could continue to handle that large volume within currently available resources. 

Jamaica’s representative, speaking for the “Group of 77” developing countries and China, argued for more diversity in the sources of procurement.  Welcoming progress in creating opportunities for vendors from developing countries and countries with economies in transition, the Group noted that only 27 per cent of the procurement volume had gone to developing countries.  At the same time, as pointed out by the representative of Cuba, developing countries represented more than one third of the Organization’s membership and should be taken into account more assertively in the procurement processes.

That concern was shared by the representative of South Africa, who insisted that more needed to be done to address the imbalance, as illustrated by the fact that 10 countries had supplied 42 per cent of the goods and services procured by the United Nations system in 2003.  The increase in procurement from developing countries was still largely limited to host countries of peacekeeping operations and their neighbours.  A more sustainable approach would ensure that vendors in those countries were able to conduct business with the United Nations system long after peacekeeping operations in their regions had been implemented.  The share of procurement by developing countries, particularly those in Africa, had to increase further in order to reflect the international character of the United Nations.

Among other needs, the representative of Turkey outlined the need to establish clear rules and regulations and firmly establish authority without duplication throughout the United Nations system.  Currently, the Inter-Agency Procurement Working Group’s relationship with the legislative organs of its member organizations and the Assembly was not clear, even though it had been the main information exchange forum for procurement professionals.  Its inter-agency cooperation mandate had a certain ambiguity.  Another entity, the Inter-Agency Procurement Services Office, had a broad range of inter-agency functions, as well.  Organizations, departments and units should have clear duties and responsibilities.  It would be wise to review units with blurred, conflicting and duplicative functions and reorganize them, establishing ownership and accountability for every task and responsibility.

Statements were also made by representatives of the Russian Federation, Republic of Korea, Syria, and Venezuela.

Approving its programme of work for the session, which is scheduled to conclude on 30 March, the Committee also agreed to address such important issues on its agenda as administration of justice at the United Nations, human resources management, the capital master plan for the refurbishing of the Headquarters complex in New York, and financing of several peacekeeping missions. The programme was approved on the understanding that it would be adjusted, as necessary, during the session. Statements on the Committee’s organization of work were made by representatives of Jamaica, on behalf of the Group of 77 and China, Belgium, on behalf of the European Union, Argentina on behalf of the Rio Group.

Numerous reports before the Committee were introduced by Under-Secretary-General for Internal Oversight Services, Dileep Nair; Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), Vladimir Kuznetsov; Chief of the Political, Legal and Humanitarian Service of the Programme Planning and Budget Division, Dennis Thatchairchawalit; and Chief of the Common Services Unit of the Programme Planning and Budget Division, Vladimir Belov.

The Committee will continue its work at 10 a.m., Tuesday, 8 March.

Background

At the opening meeting of its resumed fifty-ninth session, the Fifth Committee (Administrative and Budgetary) is expected to consider the agenda items “Review of the efficiency of the administrative and financial functioning of the United Nations” and “Programme budget for the biennium 2004-2005”.

Regarding its Review of the efficiency, the Committee had before it the Secretary-General’s report on procurement reform (document A/59/216), which details measures taken by the Secretariat in response to resolution 57/279 and other relevant texts, to increase transparency, fairness and responsiveness of the procurement process, encourage greater participation of vendors from developing countries and countries with economies in transition, and increase cost-effectiveness and efficiency of procurement within the Organization. 

Among the positive developments, the document lists increased information-sharing, improved technical and field support, capacity-building and the use of the Internet. The Procurement Division has continued its efforts to organize procurement seminars, particularly in developing countries and those with economies in transition, and improve vendor registration.  Participants of an Inter-Agency Procurement Working Group meeting last May created a standing working group to coordinate business seminars and training, develop guidelines and consider prioritization of requests.

According to the report, work also continues towards harmonizing procurement practices within the system.  The Secretariat has engaged in a series of Headquarters system contracts open to all United Nations funds and programmes based in New York in such areas as office supplies, photocopiers, digital archiving and computers.  Also concluded has been a series of direct agreements with manufacturers, including Motorola, for the provision of radio equipment and EMC for data storage.  A report on a comprehensive review of vendor management, which was presented to the Inter-Agency meeting this year, makes recommendations to simplify and streamline the vendor registration process and share responsibilities among various organizations of the system.

The Advisory Committee on Administrative and Budgetary Questions (ACABQ), in a related report (document A/59/540), recommends that follow-up mechanisms be considered to further increase procurement opportunities for vendors from developing countries and countries with economies in transition, and encourages exploration of other avenues through inter-agency facilities, including an analysis of the current approach to seminars in order to make them more results-oriented.  The Advisory Committee further welcomes a number of initiatives to improve efficiency and review vendor management, as well as the implementation of related recommendations to simplify and streamline vendor registration.

Also according to the report, the Advisory Committee has held an exchange of views with the representatives of the Secretary-General regarding the issue of accountability within the procurement reform framework, taking into account the weaknesses identified by the Board of Auditors and the Office of Internal Oversight Services (OIOS) in relation to the process of vendor registration.  It was informed that, although there was a mechanism to review exceptions (a committee that looks at vendor registration), a system (Mercury II) was being developed to address the issue.  The Advisory Committee recommends that the weaknesses in the process be addressed, taking into account the comments and observations of the Board of Auditors and the OIOS.  It also requests that information regarding the accountability factor within the procurement reform framework be provided in the next report of the Secretary-General.

On the training programmes, the report states that they should focus on a train-the-trainers approach, by means of which large numbers of junior personnel could be trained in a more cost-effective and efficient way.  Also noted in the document is the need to monitor and evaluate training needs.

Having inquired about delegation of authority, the Advisory Committee was informed that the new delegation of authority mechanisms, which are to be issued in the near future, are in line with those issued by the Controller for financial authority.  The proposed delegation will be given, on a “personal” basis, to the Chief Administrative Officer who may delegate downwards to the Chief Procurement Officer, individual procurement officers and Field Service staff, but he/she will remain accountable for the appropriate use of the authority, thus, addressing the need to strengthen monitoring, oversight and accountability.

The ACABQ notes that it is also proposed to delegate authority to the field for requirements which, by their nature, lend themselves to local procurement, such as leasing of premises, provision of fresh food, laundry and cleaning services, local utility services and so forth.  These core items, of a value up to $1 million, require knowledge of local market conditions and in-theatre sources of supply, for which Headquarters cannot add significant value to the process of procurement.  However, the initiative will incorporate a reporting mechanism and will be closely monitored.  Core items with an estimated value of over $1 million will continue to be submitted to Headquarters for review and approval.

The Committee also had before it the Secretary-General’s report on outsourcing practices (document A/59/227), which provides information on the implementation of the provisions of its resolution 55/232 and activities outsourced during the years 2002 and 2003, including their location and type.  The list of outsourced activities contained in the annex specifies the reasons for outsourcing a particular requirement following the four basic criteria endorsed by the General Assembly.  Those criteria allow outsourcing when technical skills, technologies or expertise are not readily available within the Organization; to achieve cost savings; to provide a service more effectively or expeditiously; or to provide an activity, which is not required on a long-term basis.  Heads of departments and offices, funds and programmes have been instructed to ensure strict adherence to the criteria and requirements for outsourced activities.

Responding to a question by the Advisory Committee regarding outsourcing of the maintenance and installation of software at the United Nations Headquarters, the Secretary-General states, while the activity in question (essentially a help-desk activity) has been managed by staff at the Offices in Geneva, Vienna and the Office of the United Nations High Commissioner for Refugees (UNHCR), it has been outsourced at Headquarters, given the scale, complexity and diversity of hardware and software requiring technical support.

Commenting on this issue, the ACABQ, in a related report (document A/59/540) recommends that instead of just providing a list of outputs, the reports on outsourcing should present information through a thematic approach by locality, and include data on trends, which would provide a better picture of the interests of the Organization.

Under the same item, the Committee was to consider a report of the OIOS on the audit of safeguarding air safety standards while procuring air services for the United nations peacekeeping missions, transmitted through a note by the Secretary-General (document A/59/347) in which he concurs with the 20 recommendations made in the report.  Those recommendations concern:  delegation of authority and staffing issues; monitoring of safety occurrences; pre-registration of air service vendors and certification of cargo aircrafts for transporting passengers; technical evaluation of bids; and contract management.

According to the OIOS audit, the Department of Peacekeeping Operations (DPKO) deployed 136 aircraft to peacekeeping missions as of 31 January.  It is projected that over 200 aircraft will be deployed in 2004.  The Peacekeeping Department has taken significant steps to improve air safety, notably by jointly developing the Aviation Standards for Peacekeeping and Humanitarian Air Transport Operation with the World Food Programme (WFP).  The Department stopped procuring cargo aircraft to transport passengers, based on increased safety considerations.

The OIOS found, however, that significant efforts are still needed in the areas of air safety policy setting, procurement and organization and staffing of the Department and peacekeeping mission units responsible for air safety.  The report notes that DPKO management agreed with all 20 recommendations and has started to implement them.

Under the agenda item “Programme budget for the biennium 2004-2005”, the Committee had before it an OIOS report on the review of the operations and management of United Nations libraries, conveyed in a note by the Secretary-General (document A/59/373).

The report states that an accurate assessment of the staffing requirements of United Nations libraries is not possible because the libraries have not fully adapted their operations to the use of advanced technologies.  The Dag Hammarskjöld and United Nations Office at Geneva Libraries have already implemented state-of-the art automation systems and have begun providing electronic access to their bibliographic databases to users throughout the world.  Most other libraries, however, lag in that regard.

Under new management, the report continues, the Dag Hammarskjöld Library is moving its focus from “collections to connections”, where libraries act as facilitators rather than gatekeepers of information and knowledge.  That new approach, if adopted by all libraries, will require them to redirect their activities in order to better organize and disseminate information.  In 2003, the United Nations Office at Geneva Library completed a massive retrospective conversion of its old card catalogues and is now considering acquisition of capability to transfer older documents to electronic formats. The Dag Hammarskjöld Library currently uses large staff resources for digitization, conversion of card catalogues and indexing of pre-1979 documents.  That process should be treated as a separate project with a time-frame and resources.

According to the report, the weakness of performance management systems also impeded an assessment of staffing requirements.  The review identified large disparities in productivity levels between the Dag Hammarskjöld Library and the United Nations Office at Geneva Library, which indicate the need for harmonization of working methods and performance management.  Establishment of the Steering Committee for the Modernization and Integrated Management of United Nations Libraries in 2003 under the leadership of the Department of Public Information (DPI) was a major step towards implementing a more comprehensive library policy and organization.  In order to achieve its goals, the Steering Committee needs to prepare a timetable for expected results in its action plan, and that action plan should be supported with necessary resources.

The OIOS recommends that the Steering Committee develop a new library policy for approval by the Assembly that should address, among other things, the future role of the United Nations libraries and seek to clarify the mandate of the Steering Committee and its funding sources.  In developing the policy, the Steering Committee should address the issue of further harmonizing and collaborating on the use of technology and the Internet in all United Nations libraries, establish a timetable for each action and ensure compliance with deadlines.

The OIOS further recommends that the Dag Hammarskjöld Library and Geneva Library develop common productivity standards and maintain a mechanism to assess actual performance.  Consideration should be given to reviewing the new performance indicators for the strategic framework (2006-2007) developed by Geneva.  The two Libraries should treat the transfer of older documents to electronic format as a special project, which would involve resource-sharing.   The full extent of the tasks should be accurately determined, a strategy and a timetable for completing the tasks formulated, and the amount of resources determined and mobilized.

The DPI and the United Nations Office at Geneva concurred with the OIOS recommendations.

Another Secretary-General’s report (document A/59/395) reviews the structure and functions of all the offices in New York that are tasked with liaison for or representation of United Nations system organizations that have headquarters elsewhere and are funded from the regular budget.

The Secretary-General concludes that representative offices in New York provide substantive contributions to the work of their parent offices, while maintaining a much smaller portion of traditional liaison functions.  Their activities focus on matters requiring representatives’ participation in meetings at the intergovernmental level and within the Secretariat.  Those offices are operating with the benefit of modern technology and are striving to be as effective as possible within the limited budgetary resources available to them.

A related report of the Advisory Committee (document A/59/552) contains information on all the posts and level of staff of these offices, including those funded from extrabudgetary resources.

The Advisory Committee notes that, in some instances (e.g., UN-HABITAT), the description of activities provided by the Secretary-General is very limited and appears not to be concomitant with the number and level of staff resources available to the offices.  Regarding travel to New York of staff of organizations with offices in York, the ACABQ was informed that trips were often combined with travel for other purposes and visits to other destinations.

The Advisory Committee recommends that the Assembly take note of the report of the Secretary-General, but intends to examine the functions and level of staff resources of the liaison offices in New York in the context of its examination of the proposed budget for 2006-2007.

The report of the Secretary-General on the information and communications technology (ICT) strategy (document A/59/265) summarizes the outcome of work during the past year on the implementation of initiatives related to four main elements, identified as “building blocks” of the ICT strategy, as well as the efforts to strengthen the governance aspects of the strategy.  It also provides information on the impact of investment in ICT on the operations of the United Nations.

According to the document, the experience of the last few years has clearly demonstrated a high level of dependency of the Organization on the ICT infrastructures and services in its daily operations. Such structures and services are now treated as essential utilities.  Further progress has been made through further standardization and unification of infrastructures and ICT processes.  This work will continue in the context of the ICT strategy elaborated by the Secretary-General.

Addressing the issue in a related report (document A/59/558), the Advisory Committee recalls that it joined with the Board of Auditors in its recommendation that a more proactive approach needed to be taken in the coordination of ICT efforts in the United Nations system to ensure cost-effectiveness and meet the requirements of organizations and Member States.  In this connection, the Advisory Committee was informed that while the Information Technology Services Division had assumed a role of the lead agency in several initiatives within the United Nations system, the current strategy did not intend to overlap with each organization’s individual ICT strategic framework.  Also important was the programmatic alignment of the strategy with objectives that were common to the whole system and not specific to individual organizations.  The investments to implement the strategy should be offset by the benefits achieved through expected cost-reduction.

The ACABQ was also informed that, although aggregate figures on the positive return of ICT investments could not yet be produced, the methodology and mechanism in place would allow the quantification of the return on investment at the individual project level.  However, at the time of preparation of the budget for the current biennium, the Programme Planning and Budget Division had made an attempt to identify efficiency gains and savings arising from investment in information technology, organizational improvements and other initiatives.  Such savings were identified within 17 sections of the proposed programme budget for a total estimated savings of $33.3 million.

An analysis of the efficiency gains arising from the investment in information technology made at that time showed that gains were primarily in the administrative and conference services area.  These gains in some cases enabled programme managers to accommodate a higher level of workload with the same or smaller capacity; in other cases, programme managers were able to redeploy resources released as a result of such efficiencies to other areas.

According to the Secretary-General’s report on the construction of additional office facilities at the Economic Commission for Africa (ECA) in Addis Ababa (document A/59/444), the project has experienced a delay of some 20 months in the original implementation schedule reported in 2001.  The report notes initial delays owing to a need for rebidding of the design contract and for further negotiations with the host Government on security measures at the compound.  Nevertheless, the design activities of the project are now near completion, the final construction cost estimates are expected to be available by December 2004, the selection of a construction contractor is to be done by May 2005, and the construction is to be completed by the second quarter of 2007.

The delay in project implementation, compounded by certain security-related enhancements to the building design, may result in additional project costs, however.  The full financial impact of those changes will be better known upon receipt of the final construction estimates in December 2004.  Every effort will be made to keep the total costs of the project within the initial budget approved by the Assembly in resolution 56/270.  However, should the cost of the design revisions be in excess of the initial project budget, this will be reported to the Assembly at its resumed fifty-ninth session for appropriate action.

The Advisory Committee, in a related report (document A/59/572), notes the delays and notes that the project is to provide for additional meeting rooms in the new building.  In that connection, the ACABQ recalls that the purpose of the new building was to provide office space for the use of staff.  Given the unavoidable additional requirements for security, as well as the cost of delays experienced thus far, it is, in the opinion of the Advisory Committee, imperative to make maximum use of the building for the purpose for which it was initially intended.  Clear understandings should be reached in advance with the various United Nations agencies, funds, programmes and other entities, in order to allow priority-oriented planning and ensure the most efficient and realistic allocation of space.

The Secretary-General’s report on the standards of accommodation for air travel (document A/59/523) covers a two-year period ended 30 June 2004 and presents comparative statistics for the preceding biennium.  It contains information on the travel by delegations and the President of the General Assembly, as well as exceptions to allow first- and business-class air travel when special circumstances warrant it.

According to the document, in the past, certain categories of exceptions to the standards have been established, including the following:  travel of eminent persons; travel of prominent individuals who are donating their services to the Organization free of charge; travel under circumstances that have been deemed to be arduous or under which, for medical reasons, it has been deemed appropriate to upgrade the accommodation of air travel; travel of the personal aides and security officials travelling with the Secretary-General, his wife or his personal representatives; and travel under circumstances when the normal standard of accommodation is not available.  In April 2002, the Secretary-General issued new guidelines for the designation of goodwill ambassadors and messengers of peace, who are now entitled to the standard of travel normally accorded to senior officials of the Secretariat.  A higher standard of travel may also be authorized by the Under-Secretary-General, Department of Management.

A summary of all exceptions authorized during the period under review is contained in the document.  Among other recent developments, the Secretary-General mentions the fact that the practice of granting exceptions for a traveller of an advanced age has been discontinued.  Regarding exceptions for personal aides or security guards to the Secretary-General, his wife or any other official authorized to travel above the standard accommodation, the report states that there has been an increase in the number of such trips, from 24 in the two-year period ended 30 June 2002 to 26 in the period under review.

Payment of first-class accommodation by air is limited to the heads of delegations of the least developed countries to the sessions of the Assembly.  From 1 July 2000 to 30 June 2002, 45 first-class trips were approved for such representatives, at a cost of $275,062, compared with 53 trips during the two-year period ended 30 June 2004, at a cost of $369,552.  This translates into an increase in the number of trips by eight at an additional cost of $94,490.

Also under existing rules, the President of the Assembly has full authority to use the budget funds provided for his Office.  During the reporting period, seven trips were authorized under this authority, at an additional cost of $22,517, representing a slight increase over the number of trips in the previous two-year period, but a 40 per cent decrease in the additional cost of air travel.

The Advisory Committee, in a related report (document A/59/573), notes that the number of exceptions to the standards of accommodation for air travel and additional costs had increased significantly during the reporting period.  For 2002-2004, 236 exceptions representing an additional cost of $442,482 were reported, as compared with 161 exceptions at an additional cost of $320.791 for 2000-2002.

The ACABQ further points out that in strict conformity with existing procedures, travel should always be by the most direct and economical route and that itineraries should not be manipulated to provide for a higher standard of accommodation.  Exceptions for eminent persons are generally applied to former heads of State or prominent international figures in the political, humanitarian or cultural arenas.  The Advisory Committee notes that this definition is fairly broad and that the list of eminent persons travelling first class continued to increase in the reporting period.  Also increasing was the number of exceptions authorized for prominent persons donating their services to the Organization.

As there appeared to be a blurring of terms, with the same person sometimes listed under different categories for different trips, the Advisory Committee is of the opinion that definitions need to be tightened and that they should be consistently applied.  Notwithstanding that statement, the ACABQ further insists that time has come to reconsider the whole question of first-class travel.  In recent years, many airlines have significantly cut back, if not entirely eliminated, first-class sections on their aircraft, having developed several varieties of enhanced business-class travel.  The Assembly may wish to give further guidance to the Committee on the future use of first-class travel with a view to its use in only the most exceptional circumstances.

And finally, the Committee had before it a report of the Secretary-General on the United Nations Fund for International Partnerships (UNFIP) -– a focal point for collaboration with the United Nations Foundation in connection with Ted Turner’s contribution in support of the Organization’s causes (document A/59/170).  Since the partnership between UNFIP and the UN Foundation was launched in 1998, $563 million had been programmed as of 31 December 2003 to fund 292 projects with activities in 121 countries involving 35 United Nations organizations.

The Secretary-General reports that a total of $73.7 million has been programmed for the year 2003, including $44 million for nine children’s health projects; $6.2 million for 14 projects in the area of population and women; $18.4 million for 18 environment projects; $2.9 million for five peace, security and human rights projects; and $2.2 million for four other projects.

According to the document, UNFIP has become a clearing house for partnership information and a facilitator of funding opportunities for the United Nations.  It often assists specialized agencies in building key networks, alliances and partnerships.  Ted Turner’s approach now serves as a model for other partners to engage in United Nations causes.  The Foundation’s extrabudgetary contributions can be used in ways core funds cannot, opening up possibilities for innovation and creativity that the Organization alone would not be able to provide.

Organization of Work

Upon opening the session, the Chairman of the Committee, DON MACKAY (New Zealand), said that, in the proposed programme of work, two days had been set aside for an informal discussion of the practices and working methods of the main Committees, as requested by the General Assembly in its resolution 58/316.  By the terms of that text, each Committee was to give specific attention to the rationalization of its future agenda by biennialization, triennialization, clustering and elimination of items, and make recommendations to the plenary for its decision by 1 April this year.

The representative of Jamaica, speaking on behalf of the “Group of 77” developing countries and China, noted that, although most of the documents had already been prepared for previous sessions, there were still outstanding reports for items to be considered during the current session.  She regretted that the Group once again had to express its concern regarding the lateness of documentation, which affected timely preparation and effectiveness of the work of the Committee, especially regarding time-bound issues.  The decision on items to be considered or deferred rested with the Committee, and she expected that the pertinent documentation would be prepared and submitted in keeping with the mandates given by the General Assembly.  She stressed the importance of allocating adequate time to the priority items to ensure their successful conclusion.

She believed that priority should be accorded to the item on the administration of justice, for there were fundamental policy issues that had been awaiting consideration by the Committee.  The Group also attached great importance to the review of the regular programme of technical assistance and the Development Account.  The Group regretted that the report on the redeployment of 50 posts experiment had not been issued.  She also trusted that the Secretariat would be able to provide the Committee with an update on the administrative costs of the Capital Master Plan, when that item would be considered this month.

Belgium’s representative, on behalf of the European Union, expressed hope that the session would be crowned by success.  He hoped that work could be completed before the end of March.  The Union was committed to a full and productive discussion during the session.

Speaking on behalf of the Rio Group, the representative of Argentina associated himself with the position of the Group of 77 and China and added that, while there had been some improvement of the availability of documentation, that was mostly due to postponement of items from the regular session.  However, there was still a considerable delay in the publication of documentation in advance of the session, and he urged the Secretariat to implement specific mandate by the Assembly through timely issuance of documents.  Administration of justice was an issue that had been deferred for many years for lack of appropriate documentation.  In that connection, he reaffirmed the need to guarantee the independence of the Administrative Tribunal and reinforce the mechanisms to ensure transparency and accountability within the Organization.

As for the common system, he stressed the need to ensure the independence of the International Civil Service Commission (ICSC) to improve the conditions of service of the United Nations staff.  The Group would be paying attention to the presentation of a report on the redeployment of 50 posts experiment.  He also addressed the issue of the procurement reform, emphasizing the need for an effective accountability there.  He believed that information seminars had had a positive effect, and he encouraged the Secretariat to continue that practice.  Other important issues in that regard were enhanced coordination and cooperation, as well as enhanced participation of developing countries.

Turning to air safety, he encouraged the Secretariat to reduce the level of exceptions and fully carry out the existing provisions.  Among other issues of importance to the Group, he mentioned the need to provide necessary resources to ensure execution of mandates of peacekeeping operations.  At the same time, the Group was concerned at the overall level of budgetary resources required for peacekeeping, for it placed an increasingly difficult burden of Member States.  The budgets of peacekeeping operations must be fully justified.  As for the United Nations Assistance Mission in Iraq (UNAMI), the Group would work constructively on the item, although it would have preferred to have been informed in advance that the item would be taken up during the current session.  He also addressed the issue of the Capital Master Plan and called on all delegations to engage in the work of the Committee constructively.

The representative of Cuba said that the first resumed session did not face the documentation problem that the Committee had encountered last year.  However, the delay in issuance of several documents, including those on the administration of justice, was unacceptable.  At the same time, it was inconceivable for Member States not to have exact information on the Capital Master Plan.  He asked that the situation be clarified during the meetings scheduled for that item.  He attached great importance to the regular programme of technical cooperation and the Development Account and regretted that the ACABQ had not given due attention to that matter.  For that reason, he requested that the Chairman of the Advisory Committee provide reasons why the report on technical assistance had not been studied in time.

The Committee then approved the proposed programme of work, on the understanding that it would be adjusted, as necessary in the course of the session.

Cuba’s representative insisted that the Chairman of the ACABQ respond to his question.

VLADIMIR KUZNETSOV, Chairman of the ACABQ, said that he could now provide preliminary comments on the report on technical cooperation and the Development Account (document A/59/397).  The document contained a great deal of information on the legislative history and operating modalities of the technical cooperation programme and the Development Account.  It also described a number of issues that concerned policy and programming methods that had traditionally been in the purview of the Committee for Programme and Coordination (CPC) and the General Assembly and had not been addressed in detail by the ACABQ. The Advisory Committee had been heavily involved in the establishment of the Development Account, where it focused on the technical budgetary considerations.  As far as the regular programme of technical assistance was concerned, the ACABQ had traditionally taken the matter within the context of its consideration of the proposed programme budget.  Even so, it had always “treaded lightly” in that area.  For example, that was the only section of the budget where the Advisory Committee did not take a position, but rather transmitted the estimates to the Assembly.

One issue in the Secretary-General’s report directly related to the ACABQ, he continued.  That was possible consolidation of budget sections 23 and 35.  That arose from the recommendation by the ACABQ in its first report on the proposed programme budget for 2004-2005.  The Advisory Committee intended to revert to that issue during its consideration of the proposed budget for 2006-2007, taking into account the information contained in document A/59/397.  In that connection, he pointed out that the implementation date of any such consolidation would be in January 2006, whether the decision was made now or as part of the consideration of the proposed budget.

Introduction of Reports

JOAN W.MCDONALD, Director, Facilities and Commercial Services Division, introducing the Secretary-General’s report on procurement reform (document A/59/216), said that, while striving for excellence in provision of procurement services, it should be noted that over the last six years the volume of procurement had gone from $318 million to $850 million, an increase of nearly 300 per cent.  Although procurement service had become more efficient, there was a limit to how long staff could continue to handle that large volume within currently available resources.  That issue should be considered within the context of the Support Account budget.

She said the procurement service had initiated a number of measures to improve efficiency and quality, particularly for the peacekeeping missions, which now shared over 80 per cent of the Organization’s total procurement expenditure in 2004.  The service had conducted training programmes and played a key role in development of the system-wide procurement initiatives, including the development of the United Nations Global Marketplace, establishment of lead agency procurement and direct agreements with manufacturers.  The revised Procurement Manual promulgated in February 2004 contained a chapter on ethics and professional responsibility.  During the first quarter this year, a Declaration of Independence for use by United Nations staff involved in procurement would be promulgated.  By June 2005, a Code of Conduct for United Nations vendors would be finalized.  Electronic procurement monitoring tools had also been introduced.

While improving processes, professionalism and accountability, procurement services tried to respond to the frequent exhortation to ensure that developing countries and countries with economies in transition were given equal opportunity.  The procurement services continued to work hard to increase opportunities for suppliers from such countries by disseminating information and by providing assistance in registering suppliers through the United Nations Global Marketplace and accessing information through the UNBIZ web portal.

Ms. McDonald then introduced the Secretary-General’s report on outsourcing activities, contained in document A/59/227.

DILEEP NAIR, Under-Secretary-General for Internal Oversight Services, introducing the OIOS report on safeguarding air safety standards while procuring air services (document A/59/347), said that an audit conducted pursuant to General Assembly resolution 57/279 had noted that, with regard to development of air safety standards, the DPKO, with the World Health Organization (WHO), had developed the Aviation Standards for Peacekeeping and Humanitarian Air Transport Operations, which was a significant step towards improving air safety.  Recently, the Department had stopped procuring cargo aircraft to transport passengers.  However, improvements were still needed regarding air safety policy setting and specific areas of procurement such as vendor pre-qualification.  The Peacekeeping Department should also increase efforts at implementing its accident prevention programme.  The OIOS was concerned that the Department had not yet looked into and issued trend analyses or lessons learned.

He said sizable air operations at some landing sites in the United Nations Monitoring, Verification and Inspection Commission (UNMOVIC) were taking place in the absence of basic ground terminal services and personnel.  Sixty per cent of the mission’s flights were non-routine for urgent requirements, which was an unacceptably high volume of such flights.  There was concern that within the DPKO, the positions of Chief, Air Transport Section, and Chief, Aviation Safety Unit, were frequently vacant for prolonged period.  Furthermore, there was only limited progress in implementing the International Civil Aviation Organization (ICAO)’s recommendations to the Department.

Regarding the peacekeeping missions in Sierra Leone, Liberia and Côte d’Ivoire, he said a regional aviation safety office would be a more effective arrangement than having separate aviation safety offices.  While acknowledging that the establishment of a vendor pre-qualification process was a crucial step in ensuring adherence to air safety standards, the OIOS was concerned that visits by Peacekeeping Department staff to vendor sites were infrequent, reportedly because of budgetary constraints.  Furthermore, the DPKO needed to agree on the requirements for pre-qualification to allow wider participation of vendors.  The OIOS had issued 20 recommendations in order to enhance policies and procedures on safeguarding air safety standards.

Mr. KUZNETSOV, ACABQ Chairman, introduced the ACABQ report on the matter (document A/59/347).  He drew attention to the fact that, since issuance of report, another report on procurement for the DPKO had been issued, which dealt with a number of the same issues and was under ACABQ consideration.

Statements

NORMA ELAINE TAYLOR ROBERTS (Jamaica), speaking on behalf of the Group of 77 and China, said the issue of procurement reform was very important as questions related to both transparency and accountability were critical to the integrity of the Organization.  Welcoming progress achieved in addressing many concerns expressed by General Assembly resolution 57/279, she said the Group of 77 and China was interested in achieving more diversity in the sources of procurement.  According to the report, only 27 per cent of the procurement volume had gone to developing countries.  The Group requested updated information on the status of the discussions on the remaining technical aspects of the question of the rules of origin.

On the issue of simplifying and streamlining the registration process for vendors, she asked for details on the implementation of the recommendations in the report of the Inter-Agency Procurement Working Group at its annual meeting in 2004.  She would also like to receive information on the use of means other than the Internet, taking into consideration the difficulties in accessing the Internet by many developing countries.  She stressed the importance of accountability.

Regarding outsourcing practices, she emphasized the need to adhere to the criteria for outsourcing contained in the pertinent General Assembly resolutions.  Outsourcing should not compromise the international character of the Organization and should be in full conformity with the financial rules.  Many outsourced activities could be performed by in-house expertise.  Noting that translation and text processing for United Nations documents, publications and treaties had been outsourced on the basis that outsourcing achieved savings and provided a more efficient service, she asked for details of the basis on which those costs had been calculated and whether outsourcing had achieved the highest quality.

KARL VAN DEN BOSSCHE (Belgium), speaking on behalf of the European Union and associated States, welcomed the positive developments and measures that had been introduced in the procurement reform.  He noted with appreciation the progress made towards strengthened cooperation within the United Nations system through the Inter-Agency Procurement Working Group and the Common Services Procurement Working Group with a view to avoiding duplication and increasing efficiency.  He also recognized the progress in the harmonization and streamlining of procurement practices.  In order to simplify the registration process, a newly designed Internet-based vendor registration system, the United Nations Global Marketplace, had been launched last year.  He urged all organizations of the United Nations system, including the field missions and offices, to participate in that system.  The Union welcomed the recommendation to carry out a review of vendor management, which had already been undertaken.  Sharing responsibility enabled eliminating duplication of administrative effort and making the registration process more efficient and timely.  He also appreciated the efforts to share best practices through the procurement message board.

The Union welcomed increased participation of vendors from developing countries and countries with economies in transition, he continued.  He looked forward to further improvement with a view to increasing the supplier diversity.  While stressing the importance of such trend, the Union continued to underline the necessity of maintaining the principle of awarding contracts to the most economical bids, assessed with due regard to quality and best value for money.  In that connection, he also recognized the increase in the number of seminars and the creation of a standing working group.  He concurred with the ACABQ regarding the need to make the seminars more results-oriented.

The procurement service had effectively addressed many of the concerns previously raised by Member States and developed a number of initiatives to improve efficiency, he continued.  One of those initiatives allowed electronic processing of presentations to the Headquarters Committee on Contracts, thereby speeding up the procurement process.  The revised Procurement Manual and information relevant to procurement on the Web sites should be updated regularly in all six official languages.  He also welcomed the efforts to simplify and streamline the vendor registration process and looked forward to the issuance of the ethical guidelines for procurement staff and their distribution to United Nations members.  Information regarding the accountability factor within the procurement reform should be provided in the next report.  He welcomed the increasing extent to which the principles of the Global Compact were taken into account in the procurement process.

The European Union agreed that training programmes could be focused on a train-the-trainers approach, he said.  It was also important to meet specific training needs of staff, including at field missions.  He welcomed the development of a system-wide procurement training and certification programme.  It was necessary to enhance further cooperation between the procurement service and the Department of Peacekeeping Operations to improve field procurement.

Turning to air safety, he welcomed the recommendations of the OIOS and expressed his appreciation for the progress already make in that regard.  All the recommendations must be fully implemented.  It was also necessary to establish a time-frame for that purpose.  As for outsourcing practices, he took note of the cost-savings and emphasized the importance of programme managers being guided by the basic criteria for outsourcing.

In conclusion, he noted with interest that the volume of procurement had increased significantly in recent years and, therefore, the Union stood ready to take further steps, as needed, to ensure best practices and standards in the process.

VLADIMIR A. IOSIFOV (Russian Federation) noted with satisfaction the progress in the area of procurement and steps to enhance transparency and objectiveness with a considerable increase in the procurement from developing countries and countries with economies in transition.  He also pointed to the use of the Internet to improve United Nations procurement and noted with satisfaction the Secretariat’s efforts to harmonize procurement procedures.  His delegation welcomed the first steps to introduce the “division of labour” among various organizations of the United Nations system.  Such cooperation should allow various bodies of the United Nations to jointly benefit from preliminary results of vendor selection and common databases of vendors.  That work should continue.  It was important to share information and avoid duplication of work in that regard.  In that connection, he noted the initial positive experience of the procurement service in introducing systematic contracts and direct agreements with suppliers on behalf of several organizations of the system simultaneously, which enabled the Organization to reduce procurement costs due to the large volume of purchases.

He hoped that the Web site created for the United Nations Global Marketplace would, in the future, turn into an integrated procurement centre that would meet the needs of all users, he continued.  Necessary attention should be given to ensuring its transparency and accessibility to all interested parties. At the same time, his delegation was concerned over the degree of training of staff involved in procurement, especially in peacekeeping.  Some of that staff were not familiar with the basic principles of procurement within the United Nations, and it was necessary to take steps to improve their professional training.  The initiative in delegating responsibility should be carried out in tandem with strengthening oversight and accountability and improvement of professionalism and ethical behaviour of staff.

Regarding air safety, he drew attention of the Secretariat to the inconsistencies in the air safety standards of the United Nations and the standards and practice as advocated by ICAO.  It was clear from the reports before the Committee that the Secretariat had taken upon itself the responsibility of observing the internationally accepted standards set by ICAO, but the divergence led to conflicts between certain air carriers and the Secretariat.  In that connection, he supported the OIOS recommendation on the need to prepare precise criteria of air safety in accordance with ICAO standards. He also emphasized the importance of introducing a balanced system of registration of companies which should be aimed not only at broadening the base of registered companies, but also at ensuring the quality of the verification of applications, including their financial and legal aspects.  All providers should be in equal position, and contracts should be awarded only after careful verification.

In general, in the procurement reform, he stressed the importance of the active use of innovative approaches and advantages of new technologies and methods of work.  Despite successes, it was important that each stage of the reform was accompanied by a careful analysis of all pluses and minuses of the newly introduced measures, taking into account the opinion of oversight bodies and recommendations of the ACABQ.  He noted with satisfaction that most of OIOS and Board of Auditors recommendations were either being considered or implemented.  He welcomed the intention of the Secretariat to look at the practices undertaken at the United Nations, taking into account best practices worldwide.

In conclusion, he said that he would appreciate further information on the implementation of new financial rules and regulations of the United Nations from the point of view of maximizing the profitability of expenditures and ensuring cost-effectiveness.  He would like to what extent the principle of best value for the money had been implemented.

BENJAMIN GARCIA (United States) said that three subject areas before the Committee -- procurement reform, outsourcing practices and safeguarding air safety standards for United Nations peacekeeping -- were vital to current and future United Nations operations.  Without accountable, cost-effective, efficient and transparent procurement practices, the Organization would not have its essential goods and services, billions of dollars of contributions would be ill-spent and/or not properly accounted for, and the safety of United Nations peacekeeping air operations would be jeopardized.

On procurement, he said that his Government would always insist on effective and transparent procurement as an ongoing management priority.  All personnel involved in procurement must be trained and needed to understand procurement practices and procedures, adhere to ethical practices and be held accountable for their actions.  In that regard, he wanted to know about the status of the Secretariat’s effort to develop and implement a specific code of conduct for those involved in United Nations procurement.

As for the opportunities for vendors from developing countries and countries with economies in transition, he noted that, since 1999, there had been a demonstrable increase in their share of procurement.  He applauded the efforts of the Secretariat to reach out to vendors through seminars and increased vendor registration.  The efforts of the Inter-Agency Procurement Working Group would further improve supplier diversity.  He concurred with the ACABQ that follow-up mechanisms should be considered to monitor progress.  The Secretariat, in conjunction with the Common Systems Procurement Working Group, and Inter-Agency Group and individual United Nations agencies, continued to pursue initiatives, such as comprehensive agency agreements, streamlined vendor practices and greater use of technology, with the goal of harmonizing the procurement process for all United Nations bodies.  His Government supported those efforts and encouraged all United Nations organizations to work together to obtain the best value for the money.

Continuing, he called on the Secretariat to implement the recommendations of the OIOS and the Board of Auditors as soon as possible.  Pursuant to those recommendations, the Secretariat had placed its procurement manual on the Internet and would shortly be publishing its ethical guidelines and implementing its declaration of independence procedures for procurement personnel.  For years, his Government had insisted that personnel involved in procurement be adequately trained and held to a higher standard of personal and professional conduct.  Their actions must be accountable and beyond reproach.  Additionally, if mismanagement, fraud or theft was alleged, it should be investigated as soon as possible and those found guilty punished accordingly.

The Secretary-General’s report on outsourcing contained over 300 outsourced activities for 2002-2003 and noted cost-savings of over $12 million, he said.  He urged the Secretariat to strictly enforce the commitment to its basic criteria and the main goals for outsourcing that resolution 55/232 called for.  Simply stated, the United Nations must operate within existing resources, by eliminating programmes that were no longer efficient or cost-effective.

As for the audit of air safety standards, he said that his delegation shared the concerns raised by the OIOS in its report and noted that the DPKO and the Procurement Division had concurred with its recommendations.  The Department had begun implementing those recommendations, and he urged full compliance with them without further delay.  Accountable, cost-effective, efficient and transparent procurement practices were not a luxury, but a mandatory requirement for effective resource management.

Mr. BERTI OLIVA (Cuba), aligning himself with the statement made on behalf of the Group of 77 and China, said the report on procurement reform, although improved in format, should include more figures to reflect the trends in the process.  The increase in the list of suppliers from developing countries and countries with economies in transition was a positive development.  He would have wished to see more specific measures listed intended to increase participation from vendors in developing countries.

He asked if criteria applied for procurement were based on rules that made it difficult for companies from developing countries to compete, because there had only been modest advances in that regard, noting that the framework contracts mentioned in paragraph 7 of the report were all with firms from developed countries.  He wondered whether companies from developing countries had been included when computers and software acquisition had been opened for bidding.  He agreed with the need for all staff working procurement to sign a declaration of independence and underscored that the issue of staff mobility should be in compliance with General Assembly measures on that matter.

Regarding the report on outsourcing practices, he noted that the Annex described outsourcing activities in need for review for the coming biennium, such as guard services.  He said such services should be provided for under the internal staffing table.  Furthermore, some activities mentioned in the report did not correspond to mandates given by Member States.

Referring to an OIOS report on the Headquarters Contract Committee, he requested the Secretariat to give an oral update.  He rejected the practice of “ex-post facto” contracts.  In conclusion, he said that developing countries represented more than one third of the Organization’s membership and should be taken into account more assertively in the procurement processes.

YOO DAE-JONG (Republic of Korea) said significant progress had been made in the reform process of procurement, including increase in participation of vendors from developing countries.  He asked how issues of the registration system of vendors were being addressed and what steps were being taken to increase accountability.

He also asked for an annex to the report providing detailed information about the type of commodities procured.  He said the United Nations Development Programme (UNDP) issued its Annual Statistical Report on Procurement, which provided information on the procurement of goods and services for the United Nations system as a whole.  Incorporations of such statistics into the Secretary-General’s report would give delegates a complete picture of the amount and volume of United Nations procurement activities.

KAREN LOCK (South Africa) associated herself with the position by the Group of 77 and said that the Assembly in its previous resolutions on procurement reform had recognized the importance of ensuring a more fair and equitable distribution of procurement between developed and developing countries.  Those texts were based on the belief that it was unacceptable to maintain a system where more than half of the goods and services were procured from less than a quarter of the membership.

Her delegation was thus encouraged by the measures taken by the Procurement Division over the past few years to increase procurement opportunities for vendors from developing countries.  However, more needed to be done to address the imbalance, as illustrated by the fact that 10 countries had supplied 42 per cent of the goods and services procured by the United Nations system in 2003.  The increase in procurement from developing countries was still largely limited to host countries of peacekeeping operations and their neighbours.  It was imperative to ensure that procurement opportunities in developing countries were further diversified.  A more sustainable approach would ensure that vendors in those countries were able to conduct business with the United Nations system long after peacekeeping operations in their regions had been implemented.

Turning to other aspects of the reform, she recognized that the Secretariat had made significant strides in developing the necessary guidelines and policies aimed at improving the system.  She welcomed the progress achieved in harmonizing and streamlining the procurement practices, simplifying the vendor registration process, promulgating and posting the procurement manual, developing ethical guidelines for staff and implementing the findings of oversight bodies.  Those measures should reduce excessive lead times in the procurement cycle, ensure timely submission and effective use of procurement plans and prevent renewal or extension of contracts in the absence of vendor evaluations.

On air safety standards, she said that her delegation took note of the findings of the audit conducted by the OIOS and the comments of the Administration in that regard.  She welcomed such recent positive developments as the dissemination of the Aviation Standards for Peacekeeping and Humanitarian Air Transport.  However, she was concerned that some peacekeeping missions were not always completing liability waiver forms, conducting aviation surveys or submitting performance evaluation reports, which made it difficult to monitor the performance of vendors or verify compliance of air operators with the terms of the contracts and safety standards.  It also placed the Organization and the personnel at risk.  While some steps had been taken to improve air safety, all necessary steps should be taken to ensure that contractors met the necessary technical requirements to ensure safety and cost-effectiveness of air operations.

In conclusion, she said that the share of procurement by developing countries, particularly those in Africa, had to increase further in order to reflect the international character of the United Nations.

NAJIB ELJI (Syria), aligning himself with the statement made on behalf of the Group of 77 and China, remarked that his country had been among the first to raise concerns about procurement reform.  He noted progress achieved in diversification and standardization of the procurement process.  He welcomed the fact that the Working Group had organized business seminars in developing countries and had decided to hold its meetings in developing countries.  It was, however, a matter of concern that the share of developing countries in procurement was less than desired.  There had even been a decrease in procurement from developing countries in 2003 as compared to 2002.  He, therefore, asked for a follow-up mechanism to increase procurement from developing countries.

He said the absence of full transparency regarding procurement in the field, especially in peacekeeping missions, would require more discussion.  He stressed the principle of cost-effectiveness, transparency and quality, but noted that safety should not be undermined.  Regarding outsourcing practices, he said some outsourced services could not be warranted given the nature of the services performed.  Giving cost-effectiveness as a reason for outsourcing was not always warranted.  That reason raised questions about causes for inefficiency within departments.  He also asked why the report of the Joint Inspection Unit had only been published in English.

CIHAN TERZI (Turkey) said that introduction of multiple and simultaneous reform efforts in every part of the Organization, even though difficult to manage, was the only way to accomplish transformation through a focused and integrated approach.  He expected that reform efforts on many fronts would converge and create a transparent, accountable, efficient, fair and responsive system.  Procurement was a very important component of the functioning of the United Nations system.  Secretariat procurement expenditure had increased significantly over the years.  Given the new missions established in 2004 and about to be established this year, the increasing trend would continue.  Numbers clearly reflected that procurement was a strategic function of the organization and a high-risk area in the governance process.

Among the achievements in the field of procurement, he listed an increase in the number of seminars conducted and creation of a standing working group to coordinate seminar-related activities throughout the United Nations system.  As a result of increased efforts of the Organization, there had been an increase in the total procurement share of the developing and least developed countries from 15.7 per cent in 1999 to 27.3 per cent in 2003.  Considering the field presence, low-cost production and location advantage, perhaps there was more room to increase procurement opportunities for vendors from developing countries without compromising procurement principles of best value for money and cost-effectiveness.

United Nations organizations should design a common technical assistance strategy and programme to build and increase public procurement capacity in developing countries, he continued.  The World Bank Group’s experience could be useful in that respect.  Extensive and structured training programmes, review and recommendations for regulatory designs should be considered at the outset.  On harmonization and simplification of procurement, he welcomed such efforts as development of Headquarters system contracts, a common supply database, a user-friendly Internet-based vendor registration process and measures to utilize pre-qualification of vendors.  Cooperation and coordination between the Procurement Division and the DPKO should be further clarified and strengthened to make sure the field procurement process followed the procurement principles.  The Division had been working with the DPKO to develop a common procurement management system, which must be compatible with IMIS.  He would appreciate information from the Secretariat about the status of work in that regard.

Despite achievements, more remained to be done, he said.  Many United Nations organizations were operating in the same environment and with compatible goals, using more or less similar resources.  Thus, efficiency and effectiveness were required not only inside each organization, but also system-wide.  Besides inter-agency cooperation, he advocated consolidation of some functions under inter-agency units, for example.  Such measures should not be seen as centralization, but as unification and rationalization, with a view to optimal use of resources.  The United Nations Secretariat and the funds and programmes had huge amounts of procurement expenditures every year, and they were governed by the same Charter and decisions of the Assembly.  The Charter provided the basis for administrative coordination with specialized agencies in Articles 57 and 63.  That framework gave the Organization an opportunity to create coordination, cooperation, common standards, streamlined procedures and common structure to increase efficiency, transparency and fairness.

The Inter-Agency Procurement Working Group’s relationship with the legislative organs of its member organizations and the General Assembly was not clear, even though it had been the main information exchange forum among procurement professionals of the system.  Its inter-agency cooperation mandate had a certain ambiguity.  Another entity, the Inter-Agency Procurement Services Office, had a broad range of inter-agency functions, as well.  An efficient and accountable organizational system should have clear rules and regulations.  Organizations, departments, and units should have clear duties and responsibilities.  It was necessary to firmly establish authority without duplication.  It would be wise to review units with blurred, conflicting and duplicative functions and reorganize them, establishing ownership and accountability for every task and responsibility.

He also noted the fact that the option for merging all procurement services at Headquarters into a single entity had not been exercised.  Organizations cited such reasons as each entity’s corporate identity, specialized operations, or procedural differences specific to their situation.  Organizations needed to use a more analytical approach to decide on strategic changes, taking into account the benefits and cost analysis.  Overall, it was feasible to integrate procurement overhead services at headquarters under one roof, using an incremental approach.

Electronic procurement was an important tool, which needed to be explored to increase efficiency, transparency and fairness throughout the procurement process, he said.  At present, the Inter-Agency Procurement Services Office was the only organization to have an entirely automated procurement process operating successfully.  In general, technology, and particularly e-procurement, was a powerful tool for United Nations organizations to accomplish multiple goals easily, and it should be pursued relentlessly.

ASDRUBAL PULIDO LEON (Venezuela) supported the position of the Group of 77 and the Rio Group and commended the Secretariat on the progress made in the streamlining of procurement and harmonization of efforts in that regard.  In particular, the Secretariat had entered into a number of direct agreements with manufacturers to achieve economies of scale.  Agreements had been signed with such companies as SISCO and Microsoft. While appreciating savings achieved as a result, he was concerned that such measures would hinder participation of small firms from developing countries. At the same time, the Assembly had decided that there should be increased participation from developing countries.

Regarding the United Nations Global Marketplace, he said that there was an understanding that it would be extended to United Nations offices in the field.  He wanted to know when those measures were expected to be implemented.  He also addressed the efforts to check the quality and safety of air transportation services.  Among other questions, he also asked about the ethical guidelines for all personnel involved in procurement, the review of the Peacekeeping Department in connection with certain missions, and the results of the advance training programme for procurement in the field, which had been carried out in the first part of 2004.

According to the report on the procurement reform, a contract for the provision of purchasing card to the departments and offices was being finalized, and he asked for additional information in that regard.  In paragraph 23, the report addressed a policy to invite all registered vendors to tender for specific products and services that had been registered, unless invitations to all vendors became unmanageable owing to the large number of vendors registered for a specific product or services.  In that connection, he stressed the importance of ensuring equal opportunities for all vendors and wondered why, in this case, the Procurement Division did not apply the same practice as the one described in paragraph 6 of the report in relation to major corporations.  It seemed that the policy of equal opportunities was being applied in a discriminatory fashion, depending on the product or company involved.

Turning to air safety, he said that the post of Chief had been vacant since 2003, as well as the position of the head of air transport section.  That made it difficult to apply a robust air safety policy, and he inquired about the current situation in that respect.  He also noted the recommendation on the establishment of a regional safety office, which would be more cost-effective than sending specialists to each mission.  In view of that recommendation, how did the Secretariat intend to resolve problems with such missions as the United Nations Organization Mission in the Democratic Republic of the Congo (MONUC), which did not have enough qualified candidates in the field of air safety. How often were

accident-prevention instruments provided to peacekeeping and who in the Department was responsible for such measures?  How often was the database of previously registered vendors updated to ensure that they still maintained safety standards?

Continuing, he expressed concern over the use of cargo aircraft for transporting passengers, for those planes did not have the necessary certification to transport passengers.  He hoped the DPKO would put an end to that practice.

Responding to delegates’ questions and comments, Ms. MCDONALD, Director, Facilities and Commercial Services Division, said that, as many issues raised would require dialogue in informal consultations, she would address those issues at that time.

The Committee SECRETARY, responding to question by Syria’s representative about a Joint Inspection Unit report, said the report had only been recently submitted for translation and would be issued on 31 March as document A/59/721.

Mr. PULIDO LEON (Venezuela) said he had no objection to receiving answers in writing during the period of informal consultations, but hoped that the answers would be given sufficiently in advance of the time when consultations on the specific issue would occur.

Programme Budget for Biennium 2004-2005

Mr. NAIR, Under-Secretary-General for Internal Oversight Services, introduced the OIOS report on the review of the operations and management of United Nations Libraries (document A/59/373).

DENNIS THATCHAICHAWALIT, Chief, Political, Legal and Humanitarian Services, Programme Planning and Budget Division, introducing the Secretary-General’s report on review of the structure and functions of all liaison offices or representation in New York of organizations headquartered elsewhere funded from the regular budget (document A/59/395), said the offices performed substantive functions as part of the parent organizations.  Those functions could be categorized as: intergovernmental functions; participation in interdepartmental and inter-agency meetings; and outreach activities such as maintaining contacts with delegations, non-governmental organizations and other civil-society organizations.  They also worked closely with the Office of the Spokesman for the Secretary-General and had availed themselves of facilities such as conference services.

VLADIMIR BELOV, Chief, Common Services Unit, Programme Planning and Budget Division, introducing the Secretary-General’s report on construction of additional office facilities at the Economic Commission for Africa (ECA) in Addis Ababa (document A/59/444), said since issuance of the report, design work had been affected by certain issues, causing a delay.  A technical soil survey had not been sufficiently carried out, so the foundation design could not be completed.  The ECA had contracted a company in 2004 which would soon submit a report.  A second issue affecting design was a survey on threat analysis.  That survey had been done by ECA itself and the projected schedule for project implementation had been based on the findings of that survey.  In the meantime, however, the survey had been reviewed by Headquarters, which had recommended that ECA should have the survey redone by an outside expert.  A report on the issue was expected in the weeks to come.  Those two issues had delayed implementation of the project for several months.

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