Explore Alternative Financing, Reconsider Flexible Workspace Plan, Delegates Stress as Budget Committee Examines Status of Geneva Office Renovation
Delegates at today’s Fifth Committee (Administrative and Budgetary) meeting aired their concerns on the financing of the proposed renovation of the historic Palais des Nations in Geneva – estimated to tally nearly $1 billion - and the Secretariat’s first year of work in carrying out a comprehensive information and communications technology strategy.
In introducing the Secretary-General’s report, Michael Møller, Director-General of the United Nations Office at Geneva, said the renovation project aimed to make the historic structure safer, more accessible and more energy efficient, while giving the United Nations and other global institutions more modern conference facilities. Up to now, the project’s proposed budget and scope had not been increased and 41.2 million Swiss francs (SwF) had been spent, with SwF 795.5 million needed to carry out the project.
South Africa’s delegate, speaking for the “Group of 77” developing countries and China, said the project’s estimated cost had been revised slightly downward from SwF 837 million to SwF 836.5 million, with a SwF 92 million contingency fund. The contingency fund had to be woven into the overall budget to curb any unexpected changes as the multi-year project was carried out, he said.
While appreciative of the Swiss Government’s offer of a SwF400 million, zero-interest rate loan to finance half of the project’s cost, several delegates wanted the Secretariat to fully investigate alternative financing mechanisms. That could include extra-budgetary contributions, advance rental income and assigning value to United Nations properties.
The United States delegate pointed out that the Swiss Government’s loan principle had to be repaid with Member State assessments. The United States believed the Secretariat had not seriously investigated alternative financing mechanisms. “We must see specific, timely and actionable proposals before taking a financing decision,” she said, adding that the United States supported the overall project.
The project’s intent to create more flexible and open work space also raised some delegates’ concerns. Iran’s representative, for example, associating with the Group of 77, said the Secretariat had to account for the historical sensitivities of the existing buildings at the Palais as well as the high cost of converting to open office space. The Secretariat should, therefore, reconsider the introduction of flexible workspace at the existing buildings.
Carlos Ruiz Massieu, Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introduced that body’s related report, which recommended approving the proposed project cost as the maximum overall price tag. The Advisory Committee noted that other financing options, such as voluntary contributions from Member States and rental income from existing and anticipated tenants at the Palais des Nations, needed to be explored. It objected to the creation of a $20 million working capital reserve.
Delegates then aired their concerns with the Secretariat’s initial execution of a five-year strategy to modernize, transform and integrate the delivery of information and communications technology (ICT) services throughout the Organization. Switzerland’s representative, speaking also for Liechtenstein, said it was essential to ensure the ICT strategy was meshed properly with the Global Service Delivery Model, now being considered. Along with other delegates, he regretted that the five-year ICT budget projection excluded resource requirements for peacekeeping operations, which made up about 70 per cent of the Organization’s overall ICT costs. The Group of 77 was also concerned about the report’s lack of information and analysis on ICT peacekeeping resources. It supported the Advisory Committee’s recommendation to avoid a “two-track” approach for the strategy’s development, one for peacekeeping and one for remaining Secretariat entities. That would undermine other major reforms meant to shape an integrated global Secretariat.
Introducing the Secretary-General’s report, Atefeh Riazi, Assistant Secretary-General and Chief Information Technology Officer in the Office of Information and Communications Technology, said the Secretariat had made significant progress over the last 11 months even as it faced substantial challenges. She noted the strategy for the complex project was in transition as Umoja was implemented.
Mr. Ruiz Massieu took the floor again to introduce ACABQ’s related report, which recommended the Secretary-General provide a comprehensive picture of plans to reduce the ICT system’s fragmentation and consolidate the remaining ICT functions across the Secretariat.
The Fifth Committee then reviewed a request by the Secretariat for $584,600 during the 2016-2017 budget cycle for the United Nations Institute for Disarmament Research (UNIDR), as recommended by the Institute’s Board of Trustees.
Bettina Tucci Bartsiotas, Assistant Secretary-General and Controller, introduced the Secretary-General’s note on the issue. Mr. Ruiz Massieu took the floor for a third time to introduce ACABQ’s related report, which recommended the General Assembly approve the requested amount, before recosting, from the United Nations regular budget for that biennium.
Also speaking today were delegates from Japan, Cuba, the United Republic of Tanzania (on behalf of the African Group) and Israel, as well as the European Union.
The Fifth Committee will reconvene at 10 a.m. Thursday, 19 November, to discuss Umoja, the Enterprise Resource Planning Project; the Joint Inspection Unit’s review of the management and administration of the Office of the High Commissioner for Human Rights (OHCHR); and a draft resolution on the Report of the Office of Internal Oversight Services (OIOS) activities.
United Nations Office at Geneva
MICHAEL MØLLER, Director-General of the United Nations Office at Geneva, introduced the Secretary-General’s report titled “Second annual progress report on the strategic heritage plan of the United Nations Office at Geneva” (documents A/70/394 and Corr.1). He said the project involved a historic building that included 34 conference rooms and was the largest United Nations centre after the Secretariat building in New York. The Geneva Office served as the operational hub of the United Nations international system. He noted the key role the facility would play as the Sustainable Development Goals, adopted in September, were carried out by the many organizations and institutions based in Geneva. The facility needed to be fully functional and efficient.
The renovation project had many goals, including the preservation of the historic site, making the building safer, more accessible, and more energy efficient, providing more modern conference facilities and flexible workplaces, he said. Up to now, SwF 41.2 million had been spent, and SwF 795.5 million were needed for the project. There had been no increase in its proposed budget or scope. The provision of adequate contingency funding was essential to handle procurement risk and other issues. The project amount had been reduced from previous estimates and any unused contingency fund would be returned to the Member States. Yet the contingency funds had to be made available for the full duration of the project. The Swiss Government had offered to make a SwF 400 million zero-interest loan to the United Nations for the project. The application had to be submitted in January 2016 in order for the monies to be available for use in January 2017, when construction would begin.
The renovation project would increase the building’s capacity by 25 per cent and the number of people it could house would increase from 2,800 people to 3,500 people. The project would provide more collaborative and open office space, open office space plans, and a safer building. He said it was urgent that the Fifth Committee make decisions to keep the project on schedule. The General Assembly was asked to approve the overall scope and schedule of the project and a financing mechanism.
The report provided a comprehensive overview of the work and the information requested by the Assembly in its resolution 69/262. It set forth revised cost estimates for the project and information on the results of the negotiations with the host country for a loan package, as well as possible alternative funding mechanisms, including the use of future rental income and valorization of United Nations-owned land.
CARLOS RUIZ MASSIEU, Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introduced that body’s related report (document A/70/7/Add.8), which recommended that the Assembly ask the Secretary-General to ensure that any change impacting the scope of the Heritage Plan be presented for the Assembly’s consideration and decision, while expressing support for the proposed establishment of an advisory board for project governance. ACABQ also recommended that the respective roles and responsibilities of the Steering Committee and the advisory board be delineated more precisely and clearly. Drawing on the lessons learned from the Capital Master Plan at New York Headquarters, the Advisory Committee stressed the need for the Steering Committee to ensure continuous monitoring of progress on the project within the established timeline.
The Advisory Committee also recommended approval of the proposed project cost as the maximum overall cost for the project, he said, also proposing that the Assembly ask the Secretary-General to refine the estimation of project contingency by identifying risks associated with the different phases of the project, and to present the estimated contingency, and the base project cost, separately in his next progress report. ACABQ noted a loan package of SwF 400 million offered by the host Government at zero-interest rate, covering both the construction and renovation parts of the project. It also noted other financing options, such as voluntary contribution from Member States and rental income from the existing and anticipated tenants at the Palais des Nations. The Advisory Committee objected to the creation of a $20 million working capital reserve.
LYLE P. DAVIDSON (South Africa), speaking for the Group of 77 developing countries and China, said effective and efficient management of United Nations facilities worldwide was important for the Group. It was paying close attention to the renovation and upgrading of the Palais des Nations in Geneva to address health and safety issues, as well as usability and access concerns. The Group would seek clarity on the rationale for using an independent risk management firm, rather than an in-house or host government expertise. Regarding the flexible workspace strategy, the Group emphasized that the concept should take into account real estate needs and the impact on staff’s well-being, and local standards and working cultures. “The Group notes in this regard that the aim of the project is to improve the working condition for all staff and delegations,” he said.
He noted the revised work schedule and stressed the importance of adhering to it to avoid any potential cost overruns. The Group expected the project team would pay attention to the recommendations of the Advisory Committee and Board of Auditors. The Group noted that the project estimate had been revised slightly downward from SwF 837 million to SwF 836.5 million, with a contingency fund of SwF 92 million. That fund should be treated as a part of the overall budget level to mitigate any unexpected changes during the project’s implementation. Mechanisms must avoid, to the extent possible, using the fund, and any withdrawals must be necessary and in line with established principles. The Group welcomed the host country’s revised loan offer of SwF 400 million, about 50 per cent of the loan project, and noted the preferential terms and modalities for the loan’s repayment. The Group stressed that the loan only provided temporary relief for Member States' assessment and backed a timely payment plan for the project. The Group had noted other financing mechanisms, such as extra-budgetary contributions, advance rental income and valorization of United Nations lands. It was open to discussing all options, but was concerned about the sale of United Nations land. Several host countries had donated land to the United Nations for expansion of activities and it was premature to sell land for short-term gain, when the Organization’s future needs were not yet clear.
FRANCESCO PRESUTTI, a representative of the European Union, voiced concern about the late issuance of the documents under consideration. The time had come to decide on the way forward. The Union would seek an agreement on the pending issues, and requested that the Secretary-General revise and re-submit detailed project cost estimates during the current session to ensure that the proposed requirements were based on real needs and sound assumptions. The Union looked forward to discussing in greater detail the concrete steps by the Secretariat intended to secure all possible alternative funding mechanisms in order to reduce the overall assessment on Member States. The Union would look into the possibility of increasing rental income from other United Nations entities to be hosted at Palais des Nations.
A good governance structure would be crucial, and that would require strong internal and independent external oversight mechanisms to avoid a cost run-up, he said, welcoming the interim arrangements put in place. Regrettably, the use of flexible workspace strategies was not yet incorporated in the implementation of the Heritage Plan. The Union looked forward to further discussion with the Secretariat on the matter. Regarding the Swiss Government’s offer of a loan package to finance the project, the Union wanted to discuss the issue of negative interest rates to ensure that it did not adversely impact project financing.
CHERITH A. NORMAN CHALET (United States) said the country recognized that the proposed renovation to the Palais des Nations was necessary and an improved United Nations campus in Geneva would benefit United Nations officials and the thousands of Member States’ delegates who depended on the facilities for major international conferences and assemblies each year. Yet her delegation was focused on the project’s cost as the United Nations faced unprecedented financial demands. While thanking the Swiss Government for its offer of a no-interest loan, the United States noted the loan principle had to be repaid using Member State assessments. It believed the Secretariat to date had not undertaken serious, systematic feasibility studies of alternative financing mechanisms, such as public-private partnerships, nor applied any of those mechanisms to the financial alternatives outlined in the report. While supporting the project overall, the United States could not approve the project’s financing until it had seen alternative project financing mechanisms to reduce the cost to Member States. “We must see specific, timely and actionable proposals before taking a financing decision,” she said. In addition, the Secretariat should continue to define a more robust, long-term vision and road map for how the Organization would maximize space while maintaining staff efficiency and productivity.
ERIKO UEMURA (Japan) said that the Heritage Plan was another huge project, which would not allow Member States to “take a breath” following the Capital Master Plan. Cognizant of the urgency of the project, her delegation was ready to scrutinize the Secretary-General’s project proposal and minimize the financial burden it might impose. She reiterated the importance and necessity of continuously exploring all possible alternative funding mechanisms, including public-private partnership, with the aim of reducing the overall assessment on Member States. Regarding the Assembly’s request to incorporate flexible workspace strategies in the design of the Heritage Plan, her delegation trusted that the Secretary-General was making a genuine effort to do so at an early stage of the project to avoid additional costs later.
JÜRG LAUBER (Switzerland) said that the Palais des Nations, originally built for the League of Nations from 1929 to 1937, was the largest United Nations conference centre in Europe, hosting more than 10,000 meetings a year, including those of the Human Rights Council, and accommodating such entities as the Economic Commission for Europe (ECA), the United Nations Conference on Trade and Development (UNCTAD), the Office for the Coordination of Humanitarian Affairs (OCHA) and the Conference on Disarmament. Over the last several years, broad consensus had emerged among Member States about the pressing need for renovating the Palais. With construction work set to commence in early 2017, according to the Secretary-General’s project schedule, it was now time to make a decision on the overall financing of the project. The renovation would improve accessibility for persons with disabilities, make more efficient use of space and could enable the Office of the High Commissioner for Human Rights (OHCHR) to consolidate its personnel at the site. The project was also expected to lead to a significant decrease in costs for maintenance, energy and rental of office space outside the Palais. The SwF 400 million loan package his Government was offering would cover both construction and renovation, and would come on top of a donation of SwF 50 million made in 2011 for energy efficiency measures.
ABBAS YAZDANI (Iran), associating himself with the Group of 77, welcomed the progress made on key project tasks of the Heritage Plan, including completion of in-depth site assessment and surveys, confirmation of the project scope, as well as completion of the design master plan, feasibility study and the concept design. As for the issue of office space utilization, it was extremely important for the Secretariat to take into account the physical characteristics and “heritage sensitivities” of the existing buildings at the Palais, as well as the high cost of conversion to open office space. The Secretariat should therefore reconsider introducing flexible workspace at the existing buildings.
JAVIER ENRIQUE SANCHEZ AZCUY (Cuba), associating himself with the Group of 77, welcomed the Swiss Government offer of a loan package as a good practice of a host country. He stressed that Member States had a shared responsibility to safeguard the historic facilities. As for the financing options, it must be taken into account that decisions would affect other long-term accommodations and needs of the Organization.
JUSTIN KISOKA (United Republic of Tanzania), speaking on behalf of the African Group, aligned himself with the Group of 77, and said the African Group had been paying close attention to capital projects within its borders. It supported the Heritage Plan and would provide its expertise to assure the Secretary-General moved forward to address the health concerns, including the issue of asbestos, in the Geneva facility.
Responding to delegates’ concerns, Mr. MØLLER assured those worried about flexible workspace and open space arrangements that the issue was being fully considered. The new building would lend itself to changes more readily than the historic facility. The project team had looked at alternative financing options very carefully. He said the difficulty of public-private partnerships would be explained during the Fifth Committee’s informal discussions on the matter. He understood the concerns of Member States to find alternative financing solutions in order to reduce costs. That would be easier once a green light on the project had been received. It was difficult to undertake fundraising activities when there was no physical project to show donors. He would provide more details during the informal discussions.
Status of United Nations Information and Communications Technology Strategy
ATEFEH RIAZI, Assistant Secretary-General, Chief Information Technology Officer, Office of Information and Communications Technology, introduced the Secretary-General’s report titled “Status of implementation of the information and communications technology strategy for the United Nations” (documents A/70/364 and Corr.1). The Secretariat had made significant progress in implementing the Organization’s ICT strategy over the last 11 months as it faced significant challenges. The initial stages were in transition, not least because of the intensive efforts related to Umoja implementation, and the complexity of the endeavour. Some flexibility was needed to address priorities as the Secretariat worked to rationalize ICT structures and resources through the established budget process. The strategy would be implemented against a comprehensive benchmarking data to validate it and achieve the necessary business transformation. A budget with a five-year horizon was a management tool to help the managers think ahead, strategize and plan future investments.
Ms. Riazi gave delegates an overview of the progress during the first year of the strategy’s implementation in areas from governance to mainstreaming Umoja, which was on track and on schedule, to the establishment of an enterprise data centre and enterprise service desk. The desk was a single point of contact for service requests and handling Umoja-related service calls in-house. Last year, the Secretariat had discussed the legacy of fragmentation in the ICT system, which ran deeply throughout the United Nations. There were more than 70 ICT shops, 44 data centres, 2,400 applications, 130 help desks and many other redundant structures. The ICT strategy was a vehicle to address the fragmentation with coherence, effectiveness and efficiency. While there was still much to do, the Secretariat had established its probable future investment needs and was encouraged by the accomplishments. Ms. Riazi urged the Fifth Committee to consider the progress made during the first year of the five-year strategy as a positive step toward delivering the ultimate goal: comprehensive, reliable and efficient ICT services throughout the United Nations.
Mr. RUIZ MASSIEU introduced ACABQ’s related report (document A/70/7/Add.18), which recognized that the initial process of transforming the highly fragmented ICT environment across the Secretariat had begun. Given that such an infrastructure enabled development of other major business transformation initiatives, such as Umoja and shared services, the Advisory Committee considered it essential to implement project elements in a timely manner. In the absence of a comprehensive analysis and holistic view of relevant resource requirements, the Advisory Committee was not ready to comment on the merits of the indicative five-year budget projections for implementing the ICT strategy. Therefore, the Advisory Committee recommended that such a projection be included in the Secretary-General’s next report.
To reduce fragmentation and redundancies, he said, the Advisory Committee recommended that the Secretary-General further refine his analysis and provide, in his next report, the total number of existing applications, how many could be decommissioned and how many could be replaced by Umoja. As for the regional technology centres and regional cooperation arrangements in peacekeeping such as the ICT service at the Regional Service Centre at Entebbe, the Advisory Committee stressed the need to optimize and integrate use of the Organization’s ICT infrastructure and avoid duplication.
The Advisory Committee recommended that the Secretary-General provide a comprehensive picture of efforts to reduce fragmentation and plans to harmonize and consolidate the remaining ICT functions across the Secretariat, he said. As for the human resources and skills assessment to be presented in the next report, the Advisory Committee stressed that it should be based on a comprehensive analysis that included the peacekeeping information and communications technology workforce and covered all categories of personnel under all funding sources, including consultants, contractual personnel and any other third-party personnel.
Mr. DAVIDSON (South Africa), speaking on behalf of the Group of 77 developing countries and China, supported management reform initiatives aimed at strengthening the Organization’s efficiency, effectiveness, transparency, oversight and accountability. All reform measures had to support the Organization’s work in the areas of peace and security, development and human rights. The Group observed the Secretary-General’s efforts to align the ICT strategy with United Nations goals and would seek additional information during the informal consultations. The Group regretted the lack of adequate cost-benefit analysis of ICT initiatives which would help evaluate the project over time as the implementation strategy progressed. It welcomed initiatives to maximize transparency in ICT investments and major acquisitions across the Secretariat and encouraged the Secretariat to ensure risk management was properly embedded within the strategy. The Group believed initiatives to address information security were very important and supported the Advisory Committee’s view to apply a common security policy across the Secretariat, including all peacekeeping entities.
On disaster recovery, the Group was concerned by the continued systemic weakness in 129 critical systems and applications supporting critical processes, he said. The Group believed the fragmentation of ICT applications and infrastructure must be addressed in a targeted, inclusive manner and welcomed the establishment of enterprise application centres in New York, Vienna and Bangkok as part of a multi-phase harmonization plan. There was a need for additional harmonization to drive a comprehensive process of transformation, which would make the Organization a more effective and responsive service provider. The Group was concerned about the level of under-reporting on the five-year overall budget projection for the Secretariat, particularly the report’s lack of information and analysis on ICT peacekeeping resources, which made up 75 per cent of the overall ICT expenditures. It supported the Advisory Committee’s recommendation to avoid a “two-track” approach for the strategy’s development — one for peacekeeping and one for remaining Secretariat entities. A two-track approach would undermine other major reforms undertaken to establish an integrated global Secretariat.
Mr. PRESUTTI, speaking again for the European Union, concurred with ACABQ that a comprehensive, secure, reliable and efficient ICT infrastructure was a critical enabler for a number of major Secretariat-wide business transformation and change management initiatives, including the Umoja enterprise resource planning system. The streamlining of information technology systems and the harmonization of existing data processing functions and technology units were integral to ensuring a coherent and effective structure free of overlap, disconnect or redundancy of purpose. On governance, the Union welcomed the promulgation of guidance on managing data, resources and tools, but noted the need for further efforts. The Union looked forward to receiving the Board of Auditors’ follow-up report on the handling of ICT affairs in the Secretariat, as well as updates from the Secretariat on the global sourcing plan, with a view to consolidating and leveraging buying power in order to negotiate the best rates and discounts for ICT goods and services.
MATTHIAS DETTLING (Switzerland), speaking also for Liechtenstein, said that it was critical to ensure maximum synergy between implementation of the ICT strategy, and the Global Service Delivery Model currently under consideration. He also recalled Assembly resolution 69/262, in which Member States suggested possible harmonization and sharing of services with other United Nations entities, particularly at field locations. Regrettably, the five-year ICT budget projection excluded resource requirements for peacekeeping operations, which accounted for 70 per cent of the Organization’s overall ICT resources. His delegation called on the Secretary-General to issue a revised budget projection as well as the issuance of a new bulletin for the ICT Office. The next report should be more accessible to Member States by reducing the use of jargon and providing a clearer business case. Senior management must show support for a more centralized ICT strategy to be able to successfully transform the Organization.
Ms. NORMAN (United States) said the Organization needed an integrated ICT strategy that let the United Nations meet its complex, diverse needs – whether letting a doctor in Liberia brief the Security Council in the midst of the Ebola crisis or Force Commanders in northern Mali communicate with Headquarters - in an efficient and effective way. The Secretariat update, requested by the Assembly, indicated that a comprehensive ICT strategy that incorporated the entire Organization was yet to be realized. “Every change initiative presents challenges as new ways of working are required,” she said. “Strong leadership is necessary to break down silos and create a new framework with clear roles, responsibilities and accountability.” The United States noted the Advisory Committee’s conclusion that the prerequisites for success were not in place one full year after the strategy was approved and if nothing changed, the strategy would not succeed. The United States could not accept that outcome as ICT was essential for the Organization’s effectiveness and accounted for a significant share of spending. The United States called on the Secretary-General and senior leadership across the Secretariat to take the necessary steps to ensure the strategy’s success.
HAJIME KISHIMORI (Japan) said that his delegation concurred with ACABQ that further consolidation and coherence were needed throughout the different departments in the United Nations, including in the field, such as peacekeeping operations. Recalling Assembly resolution 69/262 in which the Secretary-General was expected to ensure that all Secretariat entities report to the Chief Information Technology Officer on issues relating to all ICT activities, he stressed the need for the resolution to be fully implemented in due course. Efficiency and transparency were the two most important elements to making the ICT strategy work. It was time to centralize the various efforts to yield efficiencies in ICT services, which should be reflected as reduced requirements in the overall budget projections. Transparency should be secured through further clarification and detailed explanations of the five-year budget projection.
YOTAM GOREN (Israel) said that a forward-thinking, comprehensive and well-managed ICT strategy was essential for the United Nations. His delegation was encouraged that the ICT Office was committed to taking full advantage of the latest technological developments and working with all corners of the Secretariat to leverage technology for the benefit of all. It was imperative for the ICT strategy to serve as a bridge for the different parts of the Secretariat, not as a barrier. His delegation agreed with ACABQ that a common security policy be applied across the Secretariat, both in the Headquarters and in the field.
Subvention to United Nations Institute for Disarmament Research
BETTINA TUCCI BARTSIOTAS, Assistant Secretary-General and Controller, introduced the Secretary-General’s note titled “Request for a subvention to the UNIDR resulting from the recommendations of the Board of Trustees of the Institute on the work programme of the Institute for 2016-2017” (document A/70/349), noting that the Assembly was requested to approve the proposed subvention of $584,600 for the biennium 2016-2017 as recommended by the Board of Trustees of the Institute.
Introducing ACABQ’s related report (document A/70/7/Add.9), Mr. RUIZ MASSIEU recommended that the Assembly approve the subvention of that amount, before recosting, from the United Nations regular budget for that biennium. The report also contained information related to the financial sustainability of the Institute, as well as the challenges encountered by the Institute due to Umoja implementation.
Mr. DAVIDSON (South Africa), speaking for the Group of 77, expressed support for the proposed subvention, and reaffirmed its commitment to ensuring the financial sustainability of the Institute to guarantee effective and efficient delivery of its mandate.