Sixty-fifth General Assembly

Fifth Committee

8^th Meeting (AM)

Budget Committee Approves Text Endorsing Recommendations of Committee on Programme

and Coordination on Strategic Framework, Setting Priorities for 2012-2013

 

Also Takes Up Overseas Construction Projects, After-Service Health

Insurance, Revised Budget Items for Economic and Social Council Resolutions

The Fifth Committee (Administrative and Budgetary) today set in motion the Organization’s strategic plan and budget process for the next biennium with the adoption by consensus of a resolution that backed the priorities laid out by the Committee for Programme and Coordination for 2012-2013.

The resolution laid out eight priorities — ranging from the maintenance of international peace and security to Africa’s development to disarmament — while stressing the role of Member States in this crucial strategy process.  With the resolution, the Committee also stressed the importance of Member States’ full participation in the budget preparation process and asked the Secretary-General to use these priorities to move ahead on the proposed programme budget for the biennium 2012-2013.

The Committee then turned its discussion towards the programme budget for the current biennium 2010-2011, as delegates backed the Secretariat’s ongoing plans to give Headquarters more power to oversee the construction, maintenance and management of the Organization’s overseas properties.

Representatives from Yemen and Côte d’Ivoire, representing the Group of 77 developing countries and China and the African Group, respectively, praised the progress made towards enhancing Headquarters’ oversight of construction projects.  They also welcomed the progress made in the construction projects of two Organization sites in Africa and backed the relocation of the subregional headquarters of the Economic Commission for Latin America and the Caribbean (ECLAC) in Mexico City.

The representative of Côte d’Ivoire, on behalf of the African Group, welcomed the progress made in constructing additional office facilities at the Economic Commission for Africa (ECA) and lauded the collaboration between the Commission and the Ethiopian authorities.  Both delegates noted the Commission’s conference facilities should be maintained at the highest international standards and the African Hall was a historical monument in dire need of renovation.

In introducing the reports on this issue, Warren Sach, Assistant Secretary-General for Central Support Services, said a contract that began running on 1 April 2010 set a maximum price of $7.5 million, with a contingency of about $800,000, for construction of the new ECA offices.  Mr. Sach said the cost of the proposed relocation of ECLAC’s Mexico City office would total $1.76 million and come out of the programme budget for the 2010-2011 biennium.  The Secretary-General’s report shows that the current site was at high risk from a major earthquake or fire and at medium risk in the event of a car bomb or illegal occupation.

The Committee then heard Secretariat officials outline the need for additional resources, to come out of the programme budget of the biennium 2010-2011, for several items, including the extension of the Ad Hoc Advisory Group on Haiti, the realignment of the functions of the United Nations Office on Drugs and Crime (UNODC), and the addition of six new members of the Committee on the Rights of Persons with Disabilities.

Sharon Van Buerle, Director, Programme Planning and Budget Division, said additional funds of $34,100 were associated with the Ad Hoc Advisory Group on Haiti.  She said the other Economic and Social Council resolutions covered in the report related to the realignment of UNODC, including the re-creation of an Independent Evaluation Unit and the redeployment of a post.  For its effective functioning, the Independent Evaluation Unit would require about $1.7 million per biennium in voluntary contributions for the proper undertaking of its strategic planning functions, for six posts and an operational budget.

Expanding the membership of the Committee on the Rights of Persons with Disabilities from 12 to 18 members would total about $321,500, under Section 23, Human rights of the programme budget, she said.  This would include $12,400 for a one-day induction course and the remaining $309,100 would be used for travel and per diem costs and the creation of a Human Rights Officer at the P-3 level.

Speaking on behalf of the Group of 77, the representative of Yemen said all mandates approved by all intergovernmental organs of the United Nations, particularly those related to development activities, had to receive predictable and adequate funding so the Organization could deliver on all three pillars:  peace and security; human rights; and development.

The Group backed the additional requirements related to the extension of the Ad Hoc Advisory Group on Haiti and the realignment of the functions of the United Nations Office on Drugs and Crime.  It also supported the provision of additional budgetary requirements associated with expanding the membership of the Committee on the Rights of Persons with Disabilities by six persons.

Also speaking on the overseas construction issue was the representative of Ethiopia.

Chandramouli Ramanathan, Director, Accounts Division, introduced the report of the Secretary-General on after-service health insurance:  medical and dental reserve funds.  Collen Kelapile, Vice Chair of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introduced his Committee’s related reports on the issues taken up today.

The Committee will reconvene at 10 a.m. Thursday, 21 October, to discuss improving the financial situation of the United Nations.

Background

The Fifth Committee (Administrative and Budgetary) had before it the report on overseas property management and construction projects in a progress report of the Secretary-General (document A/65/351) that was issued pursuant to section I of General Assembly resolution 63/263, requesting progress reports to be submitted annually to the General Assembly for all ongoing construction projects.

The report notes that the Office of Central Support Services has introduced an annual conference for facilities managers of offices away from Headquarters to focus on critical facilities management concerns.  Participants of the conference have agreed to plan a strategic capital review of facilities at all offices away from Headquarters in order to establish an Organization-wide perspective on their needs and priorities.  A consultant would be engaged to this end.  Participants also agreed to determine a funding mechanism that would best support a long-term maintenance programme for all United Nations Secretariat facilities.  Further, the Office of Central Support Services would develop guidelines in order to ensure consistency in the implementation of construction and maintenance projects for overseas properties.  A committee composed of all relevant components of the Secretariat was being established to this end.

The Committee also had before it the Revised estimates relating to the programme budget for the biennium 2010-2011 under section 20, Economic and social development in Latin America and the Caribbean, related to the relocation of the subregional headquarters in Mexico (document A/65/385).

The Secretary-General’s report notes that findings from both a seismic study and a security risk assessment in Mexico show that the current location of the Economic Commission for Latin America and the Caribbean (ECLAC) subregional headquarters in the region places United Nations staff at high risk in the event of a major earthquake and/or fire, and at medium risk in the event of a car bomb or an illegal occupation.  On that basis, the Secretary-General proposes to relocate the subregional headquarters in Mexico to a site that meets the minimum operating security standards, at an estimated cost of $1.76 million under the programme budget for the biennium 2010-2011.

A related report of ACABQ concerning relocation of the subregional headquarters in Mexico (document A/65/518) in response to the Secretary-General’s report on that matter emphasizes the importance of better projection of mid-term and longer-term Organization-wide needs, as well as financial requirements for the maintenance and new construction.  In this context, the report stresses the central leadership and support role of the Office of Central Support Services and underlines the role of the Senior Overseas Property Officer (P-5) in that regard.  It also stresses the importance of expeditiously developing guidelines for construction.

The report encourages the Secretary-General to seek to co-locate United Nations offices and recommends that the General Assembly authorize the Secretary-General to enter into commitments up to $1,758,800 for the biennium 2010-2011.

Also before the Committee was a report on after-service health insurance:  medical and dental reserve funds (document A/65/342) that was issued pursuant to General Assembly resolution 64/245, which requests the Secretary-General to provide information on the composition of the $83.1 million in medical and dental reserve funds.

The report notes that medical and dental reserve balances are the result of health insurance contributions made by plan contributors at different weightings over time, based on staffing levels and the programme of work of the related United Nations entities.  Thus, the report states that it is not possible to accurately allocate the reserve fund accumulations among the individual funding sources.  Instead, the United Nations uses a “premium holiday” to periodically distribute excess reserve amounts to all funding sources on the basis of current plan participant data.  That approach, the report states, should be used to return a part of the $83.1 million portion of the health insurance reserve funds to the various funding sources before the end of 2010.

A related Advisory Committee on Administrative and Budgetary Questions (ACABQ) report on the issue (document A/65/507) responds to the Secretary-General’s report (document A/65/342) and reverts back to his report on liabilities and proposed funding for after-service health insurance benefits (A/64/366).  The latter report proposes a one-time transfer of $425 million into an independent segregated after-service health insurance reserve fund to meet long-term funding goals, comprising $290 million from unencumbered balances in peacekeeping operations, $51.9 million from the compensation reserve fund and $83.1 million from the medical and dental reserves.

Upon consideration of the Secretary-General’s reports, the Advisory Committee recommends against the transfer of $290 million from the unencumbered balances of peacekeeping budgets, but does approve the transfers of $51.9 million and $83.1 million to the independent segregated special account.

As regards the “premium holiday” approach to return a part of the $83.1 million portion of the health insurance reserve funds, the report notes a lack of detailed information in this regard, but acknowledges that contributions could be returned to staff and Member States concurrently.  The report further states that even after the distribution of the $83.1 million, a considerable discrepancy would remain in the health insurance reserve funds.  Thus, the Advisory Committee recommends the establishment of guidelines to ensure greater consistency.

The Committee also had before it the revised estimates resulting from resolutions adopted by the Economic and Social Council at its substantive session of 2010 Report of the Secretary-General (document A/65/319) that details budgetary requirements resulting from resolutions adopted by the Council at its substantive session of 2010.  The additional expenditure requirements arising from those resolutions are estimated at $34,100 under the regular budget, all of which will be absorbed within the resources provided under the programme budget for the biennium 2010-2011.  For the biennium 2012-2013, it is proposed that the requirements under section 16, International drug control, crime and terrorism prevention and criminal justice, will be reviewed in the context of the preparation of the proposed programme budget for the biennium 2012-2013.

The General Assembly is requested to approve the redeployment of one P-5 post of Chief, Strategic Planning Unit, from subprogramme 2, Policy and trend analysis, to executive direction and management, as Chief, Independent Evaluation Unit, under section 16, International drug control, crime and terrorism prevention and criminal justice.

A related ACABQ report (document A/65/505), issued in response to the report of the Secretary-General on that topic (document A/65/319), states that the Advisory Committee has no objection to the course of action proposed by the Secretary-General in his report and recommends that the Assembly approve the proposal of the Secretary-General regarding the redeployment of one regular budget P-5 post of Chief, Strategic Planning Unit from subprogramme 2, Policy and trend analysis.

The Committee also had before it the revised estimates under section 23, Human rights, of the programme budget for the biennium 2010-2011, resulting from the increase in the membership of the Committee on the Rights of Persons with Disabilities Report of the Secretary-General (document A/65/400) that provides details on the additional budgetary requirements resulting from the increase in the membership of the Committee on the Rights of Persons with Disabilities from 12 to 18 members.  Those details are as follows:  (a) an amount of $321,500 for 2011; and (b) an amount of $946,600 for the biennium 2012-2013.

With regard to the estimated requirements of $321,500 for 2011, the report proposes that the estimated amount of $12,400 be met from within the approved appropriations under section 23, Human rights, for the biennium 2010-2011, and the remainder of $309,100 from the provisions of the contingency fund for the biennium 2010-2011.  The report states that the amount of $946,600 envisaged for the biennium 2012-2013 is to be considered in the context of the proposed programme budget for the biennium 2012-2013.

Finally, the Committee had before it the related ACABQ report (document A/65/506) that was issued in response to the report of the Secretary-General on that topic (document A/65/400).  The proposals of the Secretary-General in document A/65/400 relate to additional resource requirements resulting from the increase in the membership of the Committee on the Rights of Persons with Disabilities from 12 to 18 members, requiring an additional $321,500 for the biennium 2010-2011 and an additional $946,600 for the biennium 2012-2013, to be considered within the context of the proposed programme budget for the biennium 2012-2013.  The report notes that the Advisory Committee has no objection to the course of action proposed by the Secretary-General in his report.

Action on Drafts

The Committee resumed its discussion of programme planning and had before it a draft resolution (document A/C.5.65/L.5) titled “Programme Planning”.

The Committee adopted the resolution by consensus.  The resolution reaffirmed the role of the Committee for Programme and Coordination as the main subsidiary organ of the General Assembly and the Economic and Social Council for planning, programming and coordination.  It endorsed the conclusions and recommendations of the Committee for Programme and Coordination on the strategic framework for the period 2012-2013, contained in chapter II, section B.

Deciding the priorities for the period 2012-2013, the resolution stressed that the setting of the priorities of the United Nations was the prerogative of the Member States, as reflected in legislative mandates.  It also stressed the need for Member States to participate fully in the budget preparation process and asked the Secretary–General to prepare the proposed programme budget for the biennium 2012-2013 on the basis of the above priorities and the strategic framework, as adopted in the present resolution.

Introduction of reports

WARREN SACH, Assistant Secretary-General for Central Support Services, introduced two reports by the Secretary-General.  The first report — “Management of Overseas Properties, constructions at the Economic Commission for Africa (ECA) and United Nations Office at Nairobi (UNON)” — he noted summarized progress on the management of United Nations overseas properties and the construction of additional office facilities at the Economic Commission for Africa in Addis Ababa and at the United Nations Office at Nairobi.  The second report — “Relocation of Economic Commission for Latin America and the Caribbean (ECLAC) sub-regional headquarters in Mexico” — concerned the estimated requirements for the relocation.

He recalled that the General Assembly had endorsed the recommendations of ACABQ concerning the management of overseas properties and construction projects, including the Committee’s view that the role of the Office of Central Support Services should be stronger in taking a greater leadership role relating to construction, major maintenance and the overall management of overseas properties.  That fact, he stated, was reflected in both reports.

As regarded the management of overseas properties highlighted in the first report, the 20-year strategic capital review — launched in May 2009 — required additional professional expertise to accurately assess the long-term needs of the properties.  In order to aid the construction process, he noted that project guidelines were being prepared and would require the participation of all Secretariat offices.  Concerning the construction of the new ECA offices, he noted that a contract was entered into on 1 April 2010, ensuring a maximum price of $7.5 million, with a contingency of approximately $800,000.  He further noted that the United Nations Office to the African Union and the African Union-United Nations Hybrid Operation in Darfur (UNAMID) had expressed an interest in being located in the same building as ECA.  With regard to the United Nations Office at Nairobi, the construction of the additional offices was due to be completed by the beginning of December 2010, with full occupancy by mid-2011.

In terms of the ECLAC relocation project in Mexico City contained in the second report, the Secretary-General proposed to relocate the subregional headquarters to a new location that met the minimum operating security standards for an estimated $1.76 million, which would be sought in the current biennium.

COLLEN V. KELAPILE, Vice-Chairman of ACABQ, introduced two related (ACABQ) reports:  “Overseas property management and construction projects in progress” and “Revised estimates relating to the programme budget for the biennium 2010-2011 under section 20, Economic and social development in Latin America and the Caribbean, related to the relocation of the subregional headquarters in Mexico”. 

On overseas property management and construction, he emphasized the importance of better projection of mid- and long-term organization-wide needs and financial requirements for maintenance and new construction.  As the Advisory Committee, he said, stresses the role of the Office of Central Support Services in planning and budgeting for United Nations properties and management, it “urges the Secretary-General to conclude the strategic capital review expeditiously and the development of a comprehensive approach to facilities management”.

As regarded the need for consultancy services to support data collection for a first phase review, he stated the Committee did not generally object to the need for specific technical expertise, but underlined the role of the Senior Overseas Property Officer (P-5) that was being recruited and the importance of drawing upon lessons learned.

Concerning the revised estimates relating to the relocation of the subregional headquarters in Mexico, he said that the Committee concurred with commitments up to $1.76 million and that the actual expenditure should be reported in the context of the second performance report for the biennium 2010-2011.

WALEED M. A. AL-SHAHARI (Yemen) speaking on behalf of the Group of 77 developing countries and China, said the Group gave great importance to this issue and had previously stated its strong support for proper mechanisms and strong management structures to implement construction projects.

The Group welcomed the progress made in enhancing Headquarters’ role in coordinating and supporting overseas property management and construction projects.  International forums had helped develop strategic policy guidelines, share best practices and identify short- and long-term needs, which was crucial to developing a consolidated strategy to address these needs, for subsequent consideration by Member States.

The Group welcomed the progress made in implementing the construction of additional office facilities at ECA in Addis Ababa.  The Group strongly believed that the scope of the project as originally designed should be maintained, and the Secretary-General should spare no effort to ensure that conference facilities at ECA were maintained at the highest international level.  The Africa Hall at ECA was an example of a facility in dire need of major renovation.

The Group also appreciated the progress in implementing the construction project at the United Nations Office in Nairobi.  It was commendable that the project was to be completed by year’s end and was a clear example of the importance of proactive oversight by Headquarters and the results of dedicated daily project management capacity.

The Group also welcomed the Secretary-General’s proposals on the relocation of the subregional headquarters of ECLAC in Mexico and wanted all appropriate measures to be undertaken to ensure the security of staff and property.

BROUZ RALPH COFFI (C ôte d’Ivoire), speaking on behalf of the African Group, welcomed the progress made to enhance the role of Headquarters in coordinating and supporting overseas property management and construction.  Forums such as the Inter-Agency Network of Facilities Managers and the annual conference of facilities managers, for offices far away from Headquarters, were an important mechanism for sharing best practices, identifying short- and long-term projected needs and developing a consolidated strategy for meeting these needs for consideration by Member States.

The African Group welcomed the progress made in implementing the construction of additional office facilities at the United Nations Office in Nairobi.  The project was now on schedule, which indicated the importance of proactive decision-making, oversight by Headquarters and dedicated project management capacity responsible for the day-to-day execution of the project.  It was imperative that the lessons learned from implementing this project be shared across the Organization, he said.

The Group welcomed the progress made in implementing the construction of additional office facilities at ECA in Addis Ababa and commended the collaboration between the Commission and the Ethiopian authorities to support the construction project.  The Group believed that the Commission should continue working closely with the host authorities to ensure the project was completed on time.  The African Group strongly believed that the scope of the project should remain as initially designed, covering seven floors with three elevators.  No efforts should be spared to maintain the Commission’s conference facilities at the highest international standards, he added.  He also noted that the African Hall was a historical monument of great symbolic value to the Group and needed major renovation.

GRUM ABAY (Ethiopia) aligned with the statements delivered by Yemen and Côte d’Ivoire on behalf of the Group of 77 and China and the African Group, respectively, and noted that the Government had granted to ECA the exclusive use of 28,995 square metres of land located adjacent to the existing compound free of charge.  He further noted that the ECA was given value added tax (VAT) free status for local purchases of goods and services and that the city’s administration was doing its level best to expedite the project by, among others, constructing alternate public access roads, as well as relocating service utilities.

As regarded the supply of cement raised in the ACABQ report, he said that the Government was working closely to ensure its timely and predictable delivery.  Further, he emphasized the need to renovate the African Hall, “which occupies a unique place in Africa’s political history”, and maintain the conference facilities “to the highest international standards consistent with the stature and image of the United Nations”.

Mr. SACH — in response to a concern raised from the speaker on behalf of the Group of 77 and China on the outstanding issue of the additional floor for the new ECA office facilities — stated that, in view of the secured indications from UNAMID and the United Nations Office to the African Union that they would be participating, the add back option of the additional floor would be exercised within the next few weeks.

After Service Insurance, Economic and Social Council Resolutions

CHANDRAMOULI RAMANATHAN, Director of the Accounts Division, Office of Programme Planning, Budget and Accounts, introduced the Secretary-General’s report on after-service health insurance and medical and dental reserve funds (document A/65/342).  He said the current report dealt with the composition of the reserve funds, $83.1 million, that had been proposed to be transferred to an after-service health insurance reserve, in another Secretary-General’s report (A/64/366).  These reserves had been built up over several years and were used to stabilize the premiums payable by plan participants and mitigate premium volatility caused by variations in levels of claims expenses each year.  Several factors made it impossible to accurately determine the composition of any portion of the existing reserve balances based on the originating funding sources.

While it was not possible to accurately allocate reserve balances based on historical contributions and claims-related expenses, the premium holiday calculation approach, based on the composition of current plan participants and their employers, provide a very reasonable method for determining the composition of health insurance reserve accumulations.  Therefore, the composition of $83.1 million of reserve funds, across funding sources, had been derived using this methodology and was presented in the annex for the Secretary-General’s report that was now before the Committee, he said.

Mr. KELAPILE introduced the Advisory Committee’s report on the report of the Secretary-General on “After-service health insurance:  medical and dental reserve funds”, noting that the estimates given in the report were based on existing health insurance plan contributors and current sources of funding share.  Using that methodology, he said the contributions by the staff or retirees and of the Organization were estimated at $24.1 million and $59 million, respectively.  With respect to the question of returning a share of the reserve balances to Member States directly versus the use of the premium holiday approach, he noted that, although that was technically possible, a modality would need to be developed in order to do so.

The Committee had also taken note of the significant variation in the levels of reserve balances maintained for the different United Nations health insurance plans and was of the view that guidelines should be established in order to ensure greater consistency.

SHARON VAN BUERLE, Director, Programme Planning and Budget Division, introduced two reports:  the “Revised estimates resulting from resolutions adopted by the Economic and Social Council at its substantive session of 2010” and the “Revised estimates under section 23, human rights, of the programme budget for the biennium 2010-2011, resulting from the increase in the membership of the Committee on the Rights of Persons with Disabilities”.

In the case of the first report, additional expenditure requirements of $34,100 would arise for the implementation of the resolution on the Ad Hoc Advisory Group on Haiti.  Concerning the other resolutions covered in the report, she noted that an Independent Evaluation Unit was re-established and placed under the Office of the Executive Director of the United Nations Office on Drugs and Crime (UNODC) and a P-5 post for Head of the Unit was redeployed to serve as Chief, Independent Evaluation Unit, under section 16, International drug control, crime and terrorism prevention and criminal justice.  She further noted that the Independent Evaluation Unit would require an estimated $1.7 million per biennium in voluntary contributions, for the effective functioning of the six posts and an operational budget.

The second report, she noted, detailed the additional resource requirements for 2011 resulting from an increase in the membership of the Committee on the Rights of Persons with Disabilities from 12 to 18 members, totalling $321,500, under Section 23, Human rights — of which $12,400 was to be used for a one day induction course — with the remaining $309,100 to be used for, inter alia, travel and per diem costs, as well as the establishment of one P-3 Human Rights Officer post, effective 1 January 2011.

Mr. KELAPILE, Vice-Chair of ACABQ, concerning the “Revised estimates resulting from resolutions and decisions adopted by the Economic and Social Council at its substantive session of 2010”, said the Advisory Committee had no objection to the proposed course of action as regarded the additional estimate of $34,100 under the regular budget.  Further, the Advisory Committee recommended the approval of the proposal for the redeployment of a regular budget P-5 post in connection with the realignment of the functions of the United Nations Office on Drugs and Crime.

Concerning the “Revised estimates under section 23, Human rights, of the programme budget for the biennium 2010-2011, resulting from the increase in the membership of the Committee on the Rights of Persons with Disabilities”, he stated that the Advisory Committee had no objection to the proposed course of action regarding the additional requirements.

WALEED M. A. AL-SHAHARI (Yemen), speaking on behalf of the Group of 77 and China on the programme budget issue for the biennium 20120-2011, said that all mandates approved by all intergovernmental organs of the United Nations, particularly those related to development activities, had to receive predictable and adequate funding.  It was important that the Organization had the necessary resources and capacity to deliver on all three pillars:  peace and security, human rights and development.

In that regard, the Group supported the provision of the necessary resources to finance the resolutions and decisions adopted by the Economic and Social Council at its substantive session, in this particular case, the additional requirements related to the extension of the Ad Hoc Advisory Group on Haiti and the realignment of the functions of the United Nations Office on Drugs and Crime.  The Group also supported the provision of additional budgetary requirements resulting from the increase in membership, by six members, of the Committee on the Rights of Persons with Disabilities.

* *** *

For information media • not an official record