Sixty-fifth General Assembly

Fifth Committee

6^th Meeting (AM)

Under-Secretary-General for Management Briefs Budget Committee,

 

Describes ‘Mixed’ United Nations Financial Situation

 

Committee Also Approves Decisions on Office for Partnerships; Statistical

Report of Chief Executives Board on Financial Situation of UN System Organizations

The United Nations top management official told the Fifth Committee (Administrative and Budgetary) today that the Organization was facing a “mixed” set of financial indicators for 2010, as an expected year-end positive cash position hinged on whether Member States paid their outstanding assessed contributions for the fourth quarter.

Angela Kane, Under-Secretary-General for Management, gave the Committee a snapshot of the Organization’s current financial picture as delegates opened discussion on several budget matters and approved two decisions that took note of two financial reports presented this morning.

One decision invites the General Assembly to take note of the report of the Secretary-General on the United Nations Office for Partnerships (UNOP).  Another draft decision invites the Assembly to take note of the statistical report of the United Nations System Chief Executives Board for Coordination (CEB) on the budgetary and financial situation of the organizations of the United Nations system.

In her briefing, Ms. Kane opened with an overview of the regular budget, saying that unpaid assessed contributions totalled $787 million on 5 October 2010, down $43 million from the $830 million in assessed contributions outstanding on 13 October 2009.  A single Member State was responsible for 88 per cent of the $787 million still outstanding, while four other Member States were responsible for 9 per cent of the outstanding amount.

Compared to a year ago, unpaid assessments were down for all categories, except in peacekeeping operations.  She said the increase in unpaid assessments in peacekeeping were linked to the higher level of the 2010 assessments and that assessments for the last half of the 2009/10 peacekeeping fiscal year were issued at the start of 2010, after the Assembly had decided on the new rates of assessment.

The outstanding amount for peacekeeping operations on 5 October 2010 had been $3.2 billion, about $1.3 billion more than year-end 2009 and $1.1 billion more than 13 October 2009.  The cash balance in peacekeeping accounts as of 5 October 2010 had been $4.5 billion, divided between the accounts of several ongoing and closed operations and the Peacekeeping Reserve Fund.

Regarding the Organization’s debt to Member States that gave troops and equipment to peacekeeping operations, Ms. Kane said the amount outstanding at year-end 2010 would be about $430 million.  That was less that the projection made in May and less than the $775 million outstanding at year-end 2009.

Turning to the financing of the $1.9 billion Capital Master Plan approved by the Assembly in December 2006, she said that as of 5 October 2010, payments totalling $1.4 billion had been made against assessments due and payable.  That left $84 million still outstanding as 180 Member States were under a multi-year payments system and 12 Member States had opted for a one-time payment.

On the reports addressed in the decisions, Roland Rich, Officer-in-Charge of the United Nations Office for Partnerships, introduced the report of the Secretary-General on the Office.  Kenneth Herman, Senior Adviser on Information Management Policy Coordination in the Secretariat of the United Nations System Chief Executives Board for Coordination (CEB), introduced the CEB statistical report under the agenda item administrative and budgetary coordination of the United Nations with the specialized agencies and the International Atomic Energy Agency (IAEA).

The Fifth Committee (Administrative and Budgetary) will reconvene at 10 a.m. Friday, 15 October, to begin discussion on two agenda items: financial reports and reports of the Board of Auditors, and the Special Representative of the Secretary-General on Sexual Violence in Conflict.

Background

The Fifth Committee (Administrative and Budgetary) had before it a report of the Secretary-General on the United Nations Office for Partnerships (document A/65/347), that was submitted pursuant to General Assembly decisions 52/466 and 53/475, wherein the Secretary-General was requested to inform the Assembly, on a regular basis, about the activities of the Office, which oversees the United Nations Fund for International Partnerships, the United Nations Democracy Fund and the Partnership Advisory Services and Outreach.

The United Nations Fund for International Partnerships (UNFIP) was established by the Secretary-General in March 1998 to serve as the interface for partnership between the United Nations system and the United Nations Foundation — the public charity responsible for administering Robert E. Turner’s $1 billion contribution in support of United Nations causes.  As at 31 December 2009, the Office had programmed through UNFIP a total of over $1.089 billion, of which $438.5 million represents core Turner funds, and $651.2 million (59 per cent) was generated from other partners, for 479 projects implemented by 43 United Nations entities in 124 countries.

The Democracy Fund, established in 2005 to support democratization throughout the world, has channelled $75 million to 270 projects in 127 countries.  The Partnership Advisory Services was established in 2006 to provide advice on how to best develop and implement public-private partnerships.

The Office expects to continue to focus its work closely around the Millennium Development Goals, particularly relating to sustainable development in relation to climate change and the green economy, women’s empowerment, maternal and child health, HIV/AIDS, access to education and innovations for greater financial inclusion with a focus on the Middle East, South-East Asia and sub-Saharan Africa.

Also before the Committee was the note by the Secretary-General on the budgetary and financial situation of the organizations of the United Nations system (document A/65/187) which transmits the statistical report of the United Nations System Chief Executives Board for Coordination (CEB) on the budgetary and financial situation of the organizations of the United Nations system.  It is the only system-wide report on these statistics and is the fifth one to be presented by CEB.

The tables in the report are grouped under the following five subject headings: regular resources; extrabudgetary resources; total expenditure; assessed contributions; and working capital funds.  Regular budgets cover the period 1996‑2011. Extrabudgetary resources now include all sources and cover resources received 2002‑2009, as well as projected receipts for 2010‑2011.  These resources include trust funds, technical cooperation and contributions in cash and in kind.  Data on their sources is broken down by receipts from the European Commission, top five non-State donors and other non-State donors.

Total expenditure shows expenditure data against regular budget resources and extrabudgetary resources for 2002‑2009.  Assessed contributions cover the period 1996‑2011 and relate to regular budgets.  Assessed contributions relating to extrabudgetary activities, such as certain peacekeeping operations of the United Nations, are no longer included.  Working capital funds are shown in relation to the level of approved regular budget estimates for the period 2010‑2011.

Statement on Improving the Financial Situation of the United Nations

ANGELA KANE, United Nations Under-Secretary-General for Management, zeroed in on four main financial indicators — assessments issued, unpaid assessed contributions, available cash resources and debt to Member States — as she briefed delegates on the current financial position of the United Nations.

Turning first to the regular budget, she said assessments and payments were lower in 2010 than in 2009, by $332 million and $371 million respectively.  Unpaid assessed contributions had totalled $787 million on 5 October 2010, $43 million less than the $830 million outstanding on 13 October 2009.  As of 5 October 2010, the number of Member States that had paid their regular budget assessments in full was 119, one less than on 13 October 2009.

She noted that a single Member State was responsible for 88 per cent of the $787 million that remained outstanding.  Four other Member States were responsible for 9 per cent of the outstanding amount, and 3 per cent was owed by the remaining Member States.  “Clearly, the final picture for 2010 will largely depend on the action taken by these countries in the coming months,” she said.  Cash resources for the regular budget comprised the General Fund, to which assessed contributions were paid; the Working Capital Fund, approved at $150 million by the Assembly; and the Special Account.

The unpredictable nature of the demand for peacekeeping activities made it difficult to predict financial outcomes, she continued.  Peacekeeping operations ran on a different financial period, running from 1 July to 30 June, rather than 1 January to 31 December, and assessments were issued separately for each operation.  As those assessments could only be issued through the mandate period approved by the Security Council, they were issued for different periods throughout the year.

The total amount outstanding for peacekeeping operations on 5 October 2010 was $3.2 billion, about $1.3 billion more than year-end 2009 and $1.1 billion more than 13 October 2009.  That $3.2 billion outstanding amount included about $408 million in assessments for the United Nations Mission in Liberia (UNMIL), which had been issued on 29 September 2010 and were within the 30-day due period.  The higher level of unpaid peacekeeping assessments stemmed partly from the higher level of assessments in 2010, which totalled $9.5 billion, compared with $5.7 billion in 2009.  She thanked the 11 Member States — Australia, Azerbaijan, Canada, Chad, Democratic Republic of Congo, Denmark, Germany, Liechtenstein, South Africa, Switzerland and the United Republic of Tanzania — that had paid all their peacekeeping assessments.

Cash balance in peacekeeping accounts at 5 October 2010 was $4.5 billion, divided between the accounts of several ongoing and closed operations and the Peacekeeping Reserve Fund.

She expected that total cash available in peacekeeping accounts at the end of 2010 would total $3.4 billion, with about $2.8 billion in the accounts of active missions, $435 million in the accounts of closed missions and $141 million in the Peacekeeping Reserve Fund.  Those estimates were based on projected receipts and disbursements.  Of the $435 million expected to be available in the accounts in closed peacekeeping operations, $192 million was set aside to pay outstanding liabilities, such as troop and equipment payments and credits to Member States.  That left $243 million for possible cross-borrowing by active peacekeeping operations and other accounts, including the regular budget and international tribunals.

Turning to the Organization’s debt to Member States providing troops and equipment to peacekeeping operations, Ms. Kane said the amount outstanding at year-end 2010 would be about $430 million.  That was less than the projection made in May and less than the $775 million outstanding at year-end 2009.  New obligations in 2010 were up, due mainly to the deployment of troops in the African Union-United Nations Hybrid Operation in Darfur (UNAMID) and the deployment of additional military contingent and formed police units in the United Nations Stabilization Mission in Haiti (MINUSTAH).  Those were partly offset by reductions in the deployed military strength of the United Nations Interim Force in Lebanon (UNIFIL) and UNMIL.

Regarding the finances of the International Criminal Tribunals for Rwanda and the former Yugoslavia, she said their financial position had improved slightly, with 2010 assessments lower than the previous year and the amount outstanding at $13 million less.  The number of Member States that had fully paid their assessed contributions for both International Tribunals by 5 October was 88, five more than on 13 October 2009.  She thanked the Member States that had fully met their financial obligations to the Tribunals. The Tribunals’ final financial position would depend on the payment of the assessed contributions by Member States during the rest of the year.  The breakdown of unpaid assessed contributions for the Tribunals showed that one Member State accounted for 68 per cent of the total, three Member States accounted for 16 per cent and the remaining Member States accounted for 16 per cent.  “If recent trends continue, the Tribunals should end the year with positive cash balances,” she said.

Reporting statistics on the Capital Master Plan, she said the Assembly had approved the $1.9 billion budget on 22 December 2006.  In line with the resolution, 180 Member States were under the multi-year payments system and 12 Member States had opted for a one-time payment.  As of 5 October 2010, payments totalling $1.4 billion had been made against assessments due and payable, with $84 million still outstanding.  A number of Member States that had not opted for one-time payments had made advance payments.  She thanked the 113 Member States that had paid their Capital Master Plan assessments in full, as of 5 October 2010.

She paid special tribute to the 12 Member States — Australia, Azerbaijan, Canada, Democratic Republic of Congo, Denmark, Germany, Liechtenstein, the Netherlands, Singapore, Switzerland, South Africa and the United Republic of Tanzania — that had paid in full all assessments that were due and payable as of 11 October.

“The financial indicators for 2010 are mixed,” Ms. Kane said.  “Cash positions are projected to be positive at year-end for all funds, although the final outcome will be dependent on last quarter contributions.”

She termed the expected drop in the Organization’s level of debt to Member States — $430 million compared with $775 million at year-end 2009 — a “significant improvement”.  Compared to a year ago, unpaid assessments were down for all categories, except in peacekeeping operations.  The increase in unpaid assessments in peacekeeping were linked to the higher level of the 2010 assessments, as assessments for the last half of the 2009/10 peacekeeping fiscal year could only be issued at the start of 2010, after the Assembly’s decision on new rates of assessment.

She noted that even with the improvement in the level of unpaid assessments, the amounts outstanding continued to be highly concentrated among a few Member States for most categories.  There had been a gradual reduction in the degree of concentration in peacekeeping operations over recent years.

In addition, she was encouraged by the Member States’ use of an online portal that provided updated information about the status of contributions.  She urged Member States to meet their financial obligations to the United Nations in full and on time.

Introduction of Reports

ROLAND RICH, United Nations Office for Partnerships, introduced the report of the Secretary-General on the United Nations Office for Partnerships, highlighting three main components: UNFIP, the Democracy Fund and Partnership Advisory Services.

Regarding UNFIP, he noted that, in 2009, the $1 billion mark in funding to United Nations agencies had been passed.  That was due to co-funding from the Ted Turner Fund and other partners.  UNFIP, he stated, focused on child health — particularly through the prevention of malaria, measles and polio — world heritage conservation, population and women’s empowerment.  The Democracy Fund relied on voluntary contributions from Member States and had funded 207 individual projects in 99 countries, 47 regional projects and 17 global projects — for a total of 271 projects.  Those projects aimed to strengthen civil society leadership.  Partnership Advisory Services, he noted, works with UNFIP to implement partnerships and outreach to other non-State actors who wished to work with the United Nations, including the private sector.  In 2009, 1,400 requests had been received, representing a 40 per cent increase from the previous year.  That was an issue, he said, in terms of the organization’s small staff.

KENNETH HERMAN, United Nations System Chief Executives Board for Coordination, introduced the note by the Secretary-General transmitting the statistical report of CEB on the budgetary and financial situation of the United Nations system.  He noted that the report was the fifth to be presented by CEB and that the data contained therein was supported by the Finance and Budget Network of the High-Level Committee on Management, as well as information gathered from 32 United Nations organizations.  The CEB report on the budgetary and financial situation of the United Nations system, he stated, was “the most complete and comprehensive system-wide financial statistics database currently published, as well as publicly available through the CEB website”.

The current report, he said, specified data on extrabudgetary resources from Member States and non-State donors, including trends and distributions by country, organization and category of donors.  The tables in the report were grouped under five broad subject headings: regular resources, extrabudgetary resources, total expenditure, assessed contributions and working capital funds.

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For information media • not an official record