Speakers Express Concern over Potential $6 Billion Price Tag, as Fifth Committee Examines First Performance Reports of 2014-2015 Budget
Delegates Also Discuss Financial Outlays for Special Political Missions
As the Fifth Committee (Administrative and Budgetary) began its examination of the first performance reports of the United Nations regular budget for the two years ending 31 December 2015, some delegates expressed concern over escalating costs, which could exceed $6 billion, a highest ever for the Organization.
The 2014-2015 expenditures were now expected to exceed the initial appropriation by $34.7 million, or 0.6 per cent, to hit $5.573 billion, according to Chandru Ramanathan, Officer-in-Charge of the Department of Management’s Office of Programme Planning, Budget and Accounts, who introduced the Secretary-General’s report on the subject.
The primary purpose of a first performance report is to pinpoint budget adjustments required at the end of the first year of the biennium because of variations in the rates of inflation, shifting exchange rates and standards used to calculate appropriation, as well as unforeseen and extraordinary expenses and decisions of policymaking organs.
Japan’s representative said that only a year ago Member States had agreed on a regular budget for the current biennium at a level 0.63 per cent lower than for the previous two-year cycle. The current budget could now total $5.886 billion, up $321 million from the previous one and the largest in the Organization’s history, despite the severe financial constraints that many Member States faced.
Further, with possible additions from some special political missions, it could surpass $6 billion, he warned, calling on Member States to explore how the Organization could prioritize its activities and its commensurate staffing to tackle urgent issues, such as the establishment of United Nations Mission for Ebola Emergency Response (UNMEER) while discontinuing obsolete activities. It was also vital to correct the habits of managers expecting more funds at the end of the budgetary cycle rather than operating within the resources initially approved.
A representative of the European Union Delegation said that the Secretary-General’s proposal was simply a list of additions to the budget rather than a real assessment of resource needs, voicing concern at such an incremental approach leading to automatic budget growth. Reform was needed for the current practice of recosting, a method of revising the initial budget based on variations in inflation and exchange rates.
Bolivia’s delegate, speaking for the “Group of 77” developing countries and China, however, said that the General Assembly had the responsibility of determining the necessary assessment to cover legitimate expenditures already incurred by the Organization. Recosting was an integral part of the budget procedures established by the Assembly, she said, rejecting any attempt to change the rules.
Carlos Ruiz Massieu, Chair of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introducing that body’s related report, recommended that the Assembly approve the revised estimates set forth in the Secretary-General’s report, subject to adjustments that might be necessary as a result of matters still under consideration by the 193-nation body.
Turning to the question of budgeting for special political missions, Mr. Ramanathan introduced the Secretary-General’s report on the matter, noting that total requirements for the 35 missions in 2015 was $485.9 million, net of staff assessment. ACABQ’s related report was presented by Mr. Ruiz Massieu.
Singapore’s representative, speaking for the Association of Southeast Asian Nations (ASEAN), expressed concern that the Fifth Committee had failed to implement the recommendations of the Secretariat and ACABQ on holistic reform of the funding and backstopping of special political missions, whose budget was increasing exponentially while the regular budget was not growing in real terms. The Secretariat projected that without those missions, the Organization’s regular budget for 2016-2017 would decrease by 0.1 per cent. It was not reasonable, she stressed, to compromise mandate delivery in other areas such as the development pillar just to accommodate growth in funding of those missions.
Togo’s delegate, speaking for the African Group, expressed concern about the continued piecemeal approach to budgeting for the missions. The presentation of estimates for the United Nations Assistance Mission in Afghanistan (UNAMA) and the United Nations Support Mission in Libya (UNSMIL) for six months only was unacceptable, he said, calling for the budget proposal covering the full 12-month financial period.
Several speakers called for the establishment of a separate account for the missions, with Costa Rica’s delegate, speaking for the Community of Latin American and Caribbean States (CELAC), asserting that the current financial arrangements were unable to adequately sustain the volatile nature of mandates related to the peace and security agenda. Instead, those missions should work under a 1 July to 30 June budget cycle for those missions, and financed on the same terms as peacekeeping operations, he said.
The Fifth Committee also discussed budget implications of the Second Committee (Economic and Financial) draft resolution on the establishment of a multilateral legal framework for sovereign debt restructuring. Mr. Ramanathan said that by the terms of the text, the Assembly would decide to establish an ad hoc committee, which should meet three times in New York in 2015 and present a proposal to the Assembly during its sixty-ninth session. To carry out those activities, an additional appropriation of $251,900 should be approved for the biennium 2014-2015.
Also speaking today were representatives of the Russian Federation, Mexico, Iraq, Guatemala, Cuba and Syria.
The Fifth Committee will meet again at 10 a.m., on Thursday, 18 December, to discuss the programme budget for 2014-2015 relating to UNMEER, financing of African Union-United Nations Hybrid Operation in Darfur (UNAMID), revised estimates resulting from Human Rights Council decisions and resolutions, the programme budget implications of the investigation into the conditions and circumstances resulting in the death of Dag Hammarskjöld, and the contingency fund.
Sovereign Debt Restructuring & First Performance Report
CHANDRU RAMANATHAN, Officer-in-Charge, Office of Programme Planning, Budget and Accounts, Department of Management, introduced the Secretary-General’s statement (document A/C.5/69/13) containing the programme budget implications of draft resolution A/C.2/69/L.4/Rev.1 on modalities for the implementation of resolution 68/304, entitled “Towards the establishment of a multilateral legal framework for sovereign debt restructuring process” and the Secretary-General’s report titled “First performance report for the biennium 2014-2015” (document A/69/612).
By the terms of the text on sovereign debt restructuring, he said, the General Assembly would decide to establish an ad hoc committee, which should hold three meetings in New York in 2015, and request that body to present a proposal to the Assembly during its sixty-ninth session. To carry out those activities, an additional appropriation of $251,900 should be approved for the biennium 2014-2015 and charged to the contingency fund.
On the first performance report, he said that its primary purpose was to identify adjustments required, as of the end of the first year of the biennium, due to variations in the rates of inflation and exchange, and in standards and vacancy rates since the initial appropriations were calculated. It also took into account the decisions of policymaking organs, as well as unforeseen and extraordinary expenses.
The revised estimates for expenditures amounted to $5.573 billion, up $34.7 million, or 0.6 per cent, from the initial appropriation for the biennium, including $22.8 million for unforeseen and extraordinary expenses and $11.9 million for recosting, which reflected a decrease of $24.5 million in the exchange rates, a decrease of $5.3 million due to inflation, an increase of $32.1 million in standard costs and an increase of $9.6 million due to vacancy rates. The revised estimates for income for the biennium amounted to $533 million, up $9.1 million, or 1.7 per cent.
CARLOS RUIZ MASSIEU, Chair, Advisory Committee on Administrative and Budgetary Questions (ACABQ), introducing the Advisory Committee’s related report sovereign debt restructuring processes (document A/69/658), said that body had no objection to the proposed amount of $251,900 and therefore recommended that the Fifth Committee inform the Assembly that, should it adopt that draft, an additional appropriation in that amount would be required, representing a charge against the contingency fund under section 2, General Assembly and Economic and Social Council affairs and conference management, of the programme budget for the biennium 2014-2015. The Advisory Committee intended to examine the costing model for the processing of official documents at the Organization’s four Headquarters — New York, Geneva, Vienna and Nairobi — in the context of consideration of the proposed programme budget for 2015-2017.
Introducing the Advisory Committee’s report on the “First performance report on the programme budget for the biennium 2014-2015” (document A/69/661), he said it recommended that the Assembly approve the revised estimates set forth in the Secretary-General’s related report, subject to adjustments that might be necessary as a result of matters still under consideration by the Assembly. He further recommended that more detailed background information be submitted to the Assembly concerning unforeseen and extraordinary expenses incurred under the terms of resolution 68/249, totalling $6.9 million and expressed concern that the $8 million limitation specified under the resolution had been exceeded by $905,000. That had necessitated a reversal of a $2 million charge for start-up activities at the United Nations Mission for Ebola Emergency Response (UNMEER). The Assembly should ask the Secretary-General to observe the limits and provisions it had established.
He noted further, concerning the movements of currency exchange rates, that a comprehensive assessment on the utilization of forward purchasing arrangements was overdue from the Secretary-General. He also pointed out that income estimates arising from services to the public had been consistently revised downward for the past three bienniums. The Advisory Committee questioned the validity of the initial budget assumptions and would keep the matter under review.
DAYANA ANGELA RIOS REQUENA (Bolivia), speaking for the “Group of 77” developing countries and China, said that the Assembly had the responsibility of approving the corresponding appropriation and determining the necessary assessment to cover legitimate expenditures already incurred by the Organization. Recosting was an integral part of the budget procedures established by the Assembly. Expressing concern that some previous decisions had jeopardised the implementation of programme activities, the Group rejected any attempt to undermine the compromise achieved more than 20 years ago regarding the budget procedures.
On the budget implications arising from the draft resolution, she said that the Group attached great importance to resolution 68/304 on the establishment of a multilateral legal framework for sovereign debt restructuring processes, through intergovernmental negotiations at the Assembly, with a view to increasing the efficiency, stability and predictability of the international financial system and achieving sustained, inclusive and equitable economic growth and sustainable development. The Group fully supported the provision of the resources requested by the Secretary-General, which were endorsed by the Advisory Committee.
CARMEL POWER, a representative of the European Union Delegation, pointed out that the revised requirements of $5.57 billion represented an increase of $34.7 million compared to the appropriation that had been approved last December, which did not include revised estimates and statements of programme budget implications arising from resolutions considered by the Assembly’s main Committees. At the time of the report’s publication, that amount was some $312.5 million. She stressed that it was important to comply with the relevant rules and procedures on programme budget implications and for the Secretariat to ensure the necessary due diligence to enable negotiators in other Committees and the Plenary to make fully informed decisions.
Thus, she said, a complete picture of the revised requirements for the current biennium was lacking. The proposal was simply a list of additions to the budget rather than a real assessment of resource needs. She reiterated concern at such an incremental approach to budgeting, which led to automatic budget growth. The budget process must be made more efficient and reflective of the Organization’s needs. That would require reform of the current practice of recosting. Thus she reiterated a call for the Assembly to address that outdated and unsustainable practice. Noting the observations of ACABQ on the use of unforeseen and extraordinary expenses and the decline in income, she looked forward to receiving further clarifications on those matters.
SHO ONO (Japan) stated that if the Assembly approved the figure presented for the current biennium, the $5.886 billion budget would not only be larger than the previous budget by $321 million but would also be the largest budget in the history of the United Nations, despite the severe financial constraints that many Member States faced. With possible additions from the special political missions, the total amount of the biennium budget could exceed $6 billion. Japan called on Member States to explore how the Organization might prioritize its activities and its commensurate staffing to tackle urgent issues, such as the establishment of UNMEER while discontinuing obsolete activities. It was also vital to correct the habits of managers who had become accustomed to expecting that more resources would always come at the end of the budgetary cycle rather than operating within the resources initially approved. Japan emphasized the importance of meeting additional recosting requirements through efficiency and cost-saving measures.
VLADIMIR PODLESNYKH (Russian Federation), commenting on the first performance report, noted that the revised requirements under the expenditure sections increased by $34.7 million, or 0.6 per cent, over the appropriation level of $5.538 billion approved by the Assembly. The Secretary-General went beyond the budgetary limit specified under Assembly resolution 68/249 in 2014, he said, urging the Secretary-General to observe the limits and provisions established by the Assembly.
Special Political Missions
Mr. RAMANATHAN introduced the Secretary-General’s report titled “Estimates in respect of special political missions, good offices and other political initiatives authorized by the General Assembly and/or the Security Council” (document A/69/363) as well as its corrigenda and addenda (documents Corr.1, 2, 3, Add.1, Add.2, Add.3, Add.3.Corr.1, Add.4 and Add.5), which contained the 2015 budget proposals for 35 special political missions. The total requirements for the 35 missions in 2015 amounted to $485.9 million, net of staff assessment. Of that, an amount of $435.1 million, net of staff assessment, would be charged against the undistributed balance of $1.081 million in the provision for special political missions under Section 3, Political Affairs, of the 2014-2015 programme budget.
Pending further development and clarity on the mandate and operations of the United Nations Assistance Mission in Afghanistan (UNAMA) and the United Nations Support Mission in Libya (UNSMIL), the present report reflected six-month interim resource requirements for 2015 for those two missions, based on a technical roll-over of 50 per cent of the level of projected expenditures during 2014, he said. Detailed budget proposals for 2015 for those two missions would be prepared for consideration during the second resumed part of the Assembly’s sixty-ninth session.
He also drew attention to the first performance report for the biennium 2014-2015, in which $1.7 million was requested for the Joint Mission of the Organization for the Prohibition of Chemical Weapons (OPCW) and the United Nations for the elimination of Chemical Weapons Programme of the Syrian Arab Republic. The Assembly was requested to approve $37.1 million, net of staff assessment, in additional appropriation for special political missions for the biennium 2014-2015, after taking into account $12 million in expenditures during 2014. The Secretary-General had recently directed an internal holistic review of the activities of special political missions, in the context of the programme budget, as current realities could merit an assessment on how best to structure the United Nations presence in a number of countries. The review could, in the future, lead to proposals to Member States for changes.
Mr. RUIZ MASSIEU, introducing the related ACABQ report (document A/69/628), said that the Advisory Committee’s recommendations would reduce the Secretary-General’s proposals for 2015 by $9.7 million (gross). The budget proposals for 2015 were not comprehensive since there were no detailed proposals for UNAMA and UNSMIL, which would be submitted at a later date. At that time any additional resources they required would entail an additional appropriation. The Secretary-General’s budget proposals should, to the extent possible, cover the full 12-month financial period. The Advisory Committee recommended that the full budget proposals for the two missions for 2015 be submitted as soon as possible.
The format and proposed budget for the special political missions for 2015 should be improved and standardized, he said. ACABQ was awaiting the completion of a lessons learned study on the deployment of United Nations guard units, to be undertaken by mid-2015, which would review those that had been deployed, including their command and control structures. Regarding the global field support strategy (GFSS), he reiterated that any proposal for global shared services architecture that would support all field missions should be integrated with the pending global service delivery model and must be approved by the Assembly, also taking into account any lessons learned. Efforts were needed to address the proliferation of high-level positions, which should be based on operational requirements on the ground, functions of the positions and job classification standards. Noting that the three new Special Envoys appointed by the Secretary-General in 2014 would be based at locations different from their predecessors’, he said that senior representatives working full time for the Organization should be based with the missions they led.
On the 2015 budget proposals for the special political missions, he noted that the proposed requirements for the 32 continuing missions represented an increase of some $13 million, excluding the new United Nations Electoral Observer Mission in Burundi (MENUB), as well as UNAMA and UNSMIL. The Secretary-General had not provided sufficient information on those increases. One factor given for the increase related to new cost-sharing arrangements for fixed-wing aircraft among the United Nations Office for West Africa (UNOWA) and three other missions without adequate justification for the significant increase in flight hours. In reaching cost-sharing arrangements, optimal ways should be identified to achieve efficiencies and cost-effectiveness. The Assembly should ask the Secretary-General to monitor actual flight hours and keep the new cost-sharing arrangement under review.
He then detailed specific recommendations on resource requirements for a number of missions, by cluster. For cluster I, ACABQ recommended approval of the Secretary-General’s proposed staffing changes except those for the Offices of the Special Envoys for Syria and for the Sudan and South Sudan, keeping under review the location of the Special Envoy for Syria, and that of the Special Envoy for the Great lakes Region. Further, the structure of the Great Lakes Region Office, with both the Under-Secretary-General and Assistant Secretary-General positions, should be reviewed.
KODJOVI DOSSEH (Togo), speaking for the African Group, expressed deep concern about the lateness of document issuance, urging the Secretary-General to address the issue. The Group strongly believed that the allocation of adequate resources to special political missions was a critical element for the efficient and effective discharge of their mandates. It, however, remained concerned about the continued piece-meal approach to budgeting for special political missions. The presentation of UNAMA and UNSMIL estimates for six months only was unacceptable. The budget proposal for 2015 should cover the full 12-month financial period. The Group shared ACABQ’s view that the comparative analysis of the 2014 and 2015 expenditures for special political mission could not be done at this stage and that the final appropriation may exceed the original one to reach $1.25 billion.
He sought clarification on the question of the location of special envoys and support staff. The United Nations Office at the African Union was a separate entity with dedicated responsibilities and needed to be given serious and separate attention. It was hard to understand the reason why the Head of Office and Assistant Secretary General had not been appointed despite that the Assembly had fully allocated required resources. The existing arrangement where the Special Envoy for Sudan and South Sudan had been given additional temporary responsibility to head that Office would negatively impact the mandate delivery of the two offices. The Group also reiterated the importance of establishing the separate and special account for special political missions, whose funding had distorted the regular budget.
KAREN TAN (Singapore), speaking for the Association of Southeast Asian Nations (ASEAN), expressed concern that the Fifth Committee had failed to take action on the recommendations of the Secretariat and ACABQ on holistic reform of the funding and backstopping of special political missions. The problems resulting from their lack of a separate account were being considered for the fourth year. While the regular budget had not grown in real terms for the last few bienniums, the budget for the special political missions had grown exponentially. The Secretariat projected that the regular budget for 2016-2017, excluding those missions, would decrease by 0.1 per cent. The budget for special missions would increase by 15 per cent, or $160 million, from the previous biennium.
If the overall budget level was essentially frozen, she continued, increases in the mandates for those missions affected other parts of the budget, such as the development pillar. It was not reasonable to expect the Secretariat to compromise mandate delivery in other areas just to accommodate growth in funding those missions. Furthermore, 33 of the 35 special missions had been created by the Security Council. Thus primary responsibility for their financing lay with the permanent members of that organ. “If those who have the most influence over SPMs find the modest costs of an appropriate scale of assessments too onerous to bear, serious consideration should be given to the expansion of the permanent membership,” she said. “The general membership of the Organization should not be unduly taxed if they have inadequate representation in the creation and mandate-setting of SPMs.”
PAULA COTO-RAMIREZ (Costa Rica), speaking on behalf of the Community of Latin American and Caribbean States (CELAC), stated that her regional organization was disappointed by the lack of willingness of some delegations to engage effectively to improve current arrangements for special political missions. Noting that the proposed $40 million additional appropriation for those missions in the 2014-2015 budget only included a six-month interim resource requirement for 2015 for the United Nations Assistance Mission in Afghanistan (UNAMA) and United Nations Support Mission in Libya (UNSMIL), she expressed concern about the distortion caused to the regular budget by their financing.
The current financial arrangements for special political missions, she added, were unable to adequately sustain the special and volatile nature of mandates particular to the peace and security agenda. Approved special political missions’ budgets rarely addressed the needs of Missions for the entire biennium and often required revised appropriations. Therefore, CELAC strongly supported the establishment of a separate account that would be budgeted, funded, and reported upon an annual basis with a financial period of 1 July to 30 June, as well as financed on the same terms as peacekeeping operations, in order to enhance the efficiency, transparency and fairness of the Organization’s budget process.
YANERIT MORGAN (Mexico), associating with CELAC, said that the greatest contribution the Organization could make to the special political missions would be to seriously consider their most pressing needs and take action to support their respective mandates. In the past decade, those missions had grown exponentially, both in number and in size. The current administrative and budgetary arrangements were “inadequate” and impacting the regular budget, as well as the United Nations accountability, transparency and governance. There was also concern regarding the disproportionate increase of those missions’ resources, as well as the absence of adequate oversight. The initial estimated resources in the approved programme budget had never reflected the full biennial requirements. A special and separate account with annual budgets covering the financial period from 1 July to 30 June needed to be established for those missions.
ALI MOHAMEED FAEQ ABDALAZIZ AL-DABAG (Iraq) expressed appreciation to the Secretariat handing the increasing workload, but stressed that reports should be issued in a timely manner for Member States to review them. He also underscored the importance of financing the United Nations Assistance Mission for Iraq (UNAMI), which was undertaking important activities in his country. His Government was keen to provide the best possible services to UNAMI and looked forward to participate cooperatively and constructively in Fifth Committee consultations.
HIROSHI ONUMA (Japan) noted that the proposed $485.91 million budget allocation for special political missions for 2015 did not take into the account the funding requirements for the second half of that year for UNSMIL and UNAMA. Stressing that the total amount for those missions in 2014-2015 should be contained within the approved $1.08 billion budget envelope, in line with Section 3 of the proposed 2014-2015 budget, he expressed concern that the total would exceed the approved envelope by approximately $164 million. That matter should be discussed in informal meetings in order to seek more efficient use of resources. He emphasized the importance of responding to demands in the field of peace and security by utilizing the best configuration of tools, including peacekeeping operations, special political missions, United Nations country teams, as well as regional and bilateral support functions. Such considerations could help achieve right-sizing and the best allocation of limited financial and human resources. Further, Japan was concerned that the establishment of a separate account for special political missions would negatively affect the Organization’s financial discipline and result in an increase in its budget.
FERNANDO CARRERA CASTRO (Guatemala), associating himself with CELAC, expressed concern that the budget to finance the special political missions was being introduced late, and contained considerable resources requirements. While he expressed support for the missions, he said that the lateness caused distortion in determining the regular budget. A separate account should be established for those missions, with greater accountability and transparency. The establishment of such an account would help to mitigate the situation.
JORGE ANTONIO GONZÁLEZ SÁNCHEZ (Cuba), associated himself with CELAC, and took due note of elements raised by the African Group. The late introduction of the reports undermined their consideration by delegations and an informed decision-making process. He demanded that all the resources requested be duly considered despite the lateness. He further objected to financing the special political missions from the regular budget, especially as they were created by the Council and should be funded as peacekeeping missions were. Their costs amounted to 23 per cent of the regular budget, or some $500 million, creating distortion of the regular budget. He further rejected the Secretary-General’s proposal regarding his Special Advisor on the Prevention of Genocide arising from the “responsibility to protect” in connection with the special political missions. It was unclear from the information provided which actions related to the Special Advisor on the Prevention of Genocide and which to the Special Advisor on the responsibility to protect. The Advisor on genocide did not have a mandate relating to the responsibility to protect. He said that his delegation would formulate amendments to the Secretary-General’s proposal.
BASHAR JA’AFARI (Syria) said his Government fully support the activities of Staffan de Mistura, the Secretary-General’s Special Envoy for Syria, receiving his visits twice in Damascus. Highlighting two priorities — national reconciliation and defeating terrorism, he said the Syrian crisis must find a Syrian-led solution without any foreign intervention. Support for terrorists in Iraq by some States, including those in the League of Arab States, should be banned. He requested removal of any mention of the League from the Secretary-General’s report on the special political mission for Syria as it had nothing to do with the mandate of the Special Envoy.