Examining Ongoing Efforts to Run Ethical, Accountable United Nations, Delegates in Fifth Committee Urge Real Independence for Internal Oversight Body
As they gauged ongoing efforts to run an ethical and accountable Organization, delegates in the Fifth Committee (Administrative and Budgetary) today stressed the need for an independent Office of Internal Oversight Services (OIOS), the oversight body that carries out internal audits, investigations and evaluations of the Organization’s resources and staff.
The representative of Switzerland, also speaking for Liechtenstein, said the Office must have an appropriate level of real and perceived independence from the management of the Organization as well as UN funds and programmes, and be able to carry out its mandated activities impartially and objectively. Echoing that view, the Russian Federation’s delegate said the Office’s true independence is very important, and it must deal impartially with allegations of misconduct and abuse against all employees, regardless of their official position.
Speaking on behalf of the Group of 77 and China, Cuba’s representative reaffirmed support for OIOS’ operational independence and urged the body to keep coordinating its work with other oversight entities, including the Board of Auditors and the Joint Inspection Unit. He noted that though the number of issues reported by the OIOS from 1 July 2022 to 30 June 2023 decreased from 484 to 411, compared to the previous cycle, the Office’s overall recommendations increased from 883 to 1101.
The delegates spoke after Fatoumata Ndiaye, Under-Secretary-General for Internal Oversight Services, presented OIOS’ annual report and its addendum on non-peace activities for the 1 July 2022 to 30 June 2023 period, and Imran Vanker, Chair of the Independent Audit Advisory Committee, introduced that Committee’s report on its activities from 1 August 2022 to 31 July 2023.
In other business, Elia Yi Armstrong, Director of the Ethics Office, presenting the 2022 report on its activities, said the body continues to foster a culture of ethics, transparency and accountability. Cuba’s representative, speaking again for the Group of 77 and China, said ethics is critical for the Organization’s functioning, credibility and reputation. He noted that in 2022, the Ethics Office responded to 1,822 requests and 395 of them were related to the financial disclosure programme, an increase of 152 compared to 2021.
Chandramouli Ramanathan, Assistant Secretary-General for Programme Planning, Finance and Budget in the Department of Management Strategy, Policy and Compliance, and Controller of the United Nations, then introduced the Secretary-General’s financial performance report on the programme budget for 2022. Juliana Gaspar Ruas, Vice-Chair, Advisory Committee on Administrative and Budgetary Questions (ACABQ), introduced the Advisory Committee’s eponymous report.
In the first order of business today, the Committee, acting without a vote, approved a draft resolution, by which the Assembly would agree that the failure of Comoros, Sao Tome and Principe and Somalia to pay the full minimum amount of their assessments — necessary to avoid the application of Article 19 of the Charter — was due to conditions beyond their control. The Assembly would decide to permit those three States to vote until the end of its seventy-eighth session.
Action on Draft Resolution: Scale of Assessments, Requests under Article 19
DMITRY S. ALYAKIN (Russian Federation) said his delegation does not object to the establishment of the right to vote for Comoros, Somalia and Sao Tome and Principe, but the delegation dissociates itself from paragraphs 108, 113 and 122 of the report of the Committee on Contributions, which identify the war in Ukraine as among the factors that impact the ability to pay of those States in arrears. The economic problems that impact their ability to pay are systemic in nature and existed long before the special military operations in Ukraine.
The Committee then considered a draft resolution titled “Scale of assessments for the apportionment of the expenses of the United Nations: requests under Article 19 of the Charter” (document A/C.5/78/L.2).
By its terms, the General Assembly, reaffirming its role in accordance with the provisions of Article 19 and the advisory role of the Committee on Contributions in accordance with rule 160 of the Assembly’s rules of procedure, would agree that the failure of Comoros, Sao Tome and Principe, and Somalia to pay the full minimum amount of their assessments necessary to avoid the application of Article 19 of the Charter was due to conditions beyond their control. It would also decide that those three Member States shall be permitted to vote in the Assembly until the end of its seventy‑eighth session.
The draft was approved without a vote.
Report of Office of Internal Oversight Services (OIOS) Activities
FATOUMATA NDIAYE, Under-Secretary-General for Internal Oversight Services, introduced the annual report and its addendum on the non-peace activities of the Office of Internal Oversight Services (OIOS) for the 1 July 2022 to 30 June 2023 period (documents A/78/301(Part I) and Add.1). “During the report period, the Office prioritized the following areas: implementation of reforms; procurement and supply chain; missions in transition; and organizational culture, including addressing the risk of misconduct, such as sexual misconduct and retaliation, through investigations,” she said. The agency issued 240 oversight reports relating to non-peace operations, including seven reports to the General Assembly. These reports included 626 recommendations to improve risk management, governance and operations, of which seven (related to facilities, safety and security, and ICT governance) were classified as critical. A total of 1,349 OIOS recommendations remained open on 30 June 2022: slightly more than half had been open for less than 12 months.
“OIOS continues to work with management to assess the implementation progress to ensure that recommendations are not just implemented, but are implemented in a timely manner,” she stressed. Implementation of OIOS recommendations remains high overall. Outlining some of the trends and challenges regarding oversight, she said the Internal Audit Division continued to increase the integration of its risk-based planning processes with the Organization’s maturing enterprise risk management framework. “For example, to ensure a comprehensive approach to procurement related risks, the Division initiated the development of a procurement audit strategy, focusing on high-risk commodities and contracts, procurement-related fraud risks and cross-cutting procurement management issues — all of which was based on an in-depth analysis of Secretariat procurement data, as well as insights arising from OIOS investigations of procurement fraud,” she said. The Division issued 61 audit reports to non-peace operations entities, focusing on several areas of high-risk including: procurement; management reforms and strengthening the second line; and cybersecurity.
The Inspection and Evaluation Division continued to apply its new approach to evaluating outcomes achieved by subprogrammes, focusing on sustainable development, youth, peace and security, and coordination of humanitarian action and response, she said. Yet its biennial review of evaluation found that the number of evaluation reports prepared across the Organization decreased considerably, with few reports produced by the small operational and peacekeeping entities. “This impedes the greater use by programme managers of evaluation results to inform programme planning and to increase learning and accountability of departments and offices towards achieving the planned outcomes of their programmes of work,” she said. On investigations, 801 non-peacekeeping matters were reported to OIOS, of which 168 were assigned for OIOS investigation. The Division issued 159 investigation reports and closure notices and 10 advisory reports. At the end of the reporting period, investigations were taking 12.1 months on average, with significant increases in overall intake and investigation numbers impacting timeliness.
Report of Independent Audit Advisory Committee Activities
IMRAN VANKER, Chair of the Independent Audit Advisory Committee, introducing the Committee’s report on its activities from 1 August 2022 to 31 July 2023 (document A/78/286), said that having studied the implementation rate trends for recommendation by the Board of Auditors, OIOS, and the Joint Inspection Unit, his Committee “continues to see some improvement and encourages management to make further progress.” He, however, observed that several recommendations of oversight bodies remain outstanding for a long time. This is risky and requires proper management. He called on the OIOS to expedite implementation of accepted recommendations from the assessment of the Investigation Division, and welcomes OIOS’ decision to conduct a holistic review of the Office.
Highlighting the fact that, though the caseload of the Investigation Division has substantially increased since 2015, its staff strength has only enjoyed a 10 per cent boost, he said this is a concern to his Committee which reiterates its recommendation that the OIOS review resource needs of the Investigation Division so that investigators can complete their work in improved time. He welcomed resolution 77/278 by the General Assembly, mandating it to strengthen the accountability framework on the ethics function — a matter upon which it has commenced relevant consultations. Spotlighting risk management, he said that inadequate or delayed response to identified risks can render the process ineffective, calling on management “to ensure prompt development and implementation” of mitigation plans. He also called on the General Assembly to, in future sessions, revisit the issue of after-service health insurance liabilities.
RICHARD TUR DE LA CONCEPCIÓN (Cuba), speaking on behalf of the Group of 77 and China, expressed the Group’s position that implementation of reforms should go together with strengthening the Organization’s internal oversight. The Group therefore reaffirms its support for OIOS’ operational independence in line with resolution 48/218B of the General Assembly, alongside its “efforts to carry out its work with the highest standards of professionalism and efficiency.” The Group encourages further continuous coordination between the OIOS and other oversight entities including the Board of Auditors and the Joint Inspection Unit, urging all relevant UN entities to fully cooperate with the Office in discharging its responsibilities, at the same time encouraging the Secretary-General to not only continually report impediments to its work but take measures preventing same.
He observed that though the number of issues reported by OIOS from 1 July 2022 to 30 June 2023 decreased from 484 to 411 compared to the previous cycle, the overall recommendations of the Office increased from 883 to 1101. Pointing out that 10 issues out of 1,349 open recommendations are critical, he expressed the Group’s acknowledgement of the steps taken by OIOS to review how it rates and monitors its recommendations, reaffirming that its improved performance is tied to the Secretariat and its entities accepting or timeously implementing recommendations. The Group is pleased that over $2 million was realized in recoveries on account of implementing some recommendations. On the Internal Audit and Inspection and Evaluation Divisions, he said the Group recognizes their work towards carrying out the processes and programmes of the Organization, adding that it supports the efforts of the Investigation Division in reducing investigation time. “We will continue to attach great value to the IAAC's observations and recommendations,” he added, and further reiterated the imperative of staff’s physical presence in the Secretariat.
GINA ANDREA SCHMIED (Switzerland), speaking also on behalf of Liechtenstein, said OIOS plays a crucial role in continually improving the Organization's management and operations, and in efforts to combat violations of ethical standards and various types of misconduct, such as retaliation, discrimination, sexual exploitation and abuse, and sexual harassment. She noted the number of investigations carried out by its Investigations Division continues to increase. “This increase is a clear sign of the importance of the OIOS as the central body for various types of complaints, as well as of the confidence placed in this office,” she said, welcoming the external evaluation of the Investigations Division. OIOS must have an appropriate level of real and perceived independence from the management of the Organization, funds and programmes, and be able to carry out its mandated activities impartially and objectively.
VADIM N. LAPUTIN (Russian Federation) said his delegation gives great importance to the true independence of OIOS as it audits the Organization as well as the United Nations’ funds and programmes. OIOS must deal impartially and objectively with allegations of misconduct and abuse. Impartiality means the equal treatment of all employees, regardless of their official position, and complaints against representatives of the United Nations leadership and its funds and programmes should be scrutinized and, if necessary, investigated. He also expressed concern with the increased number of outstanding OIOS recommendations to 101 and supported the Independent Audit Advisory Committee’s conclusion that the root causes for the absence of implementation must be determined. OIOS needs to conduct an internal review and identify the causes of delays, as well as improve efficiency. He said he also shares the Independent Audit Advisory Committee’s doubts about the ability of OIOS to properly implement mandates in the face of high vacancy rates.
ELIA YI ARMSTRONG, Director of the Ethics Office, presenting the 2022 report on the Office’s activities (document A/78/91), said that the Office continued delivering on its mandate of assisting the Secretary-General in fostering a culture of ethics, transparency and accountability. During the reporting period, the Office responded to 1,822 requests, including 915 requests for ethics advice primarily relating to outside activities and other conflict-of-interest matters. It also continued to advise on gifts and honours, while the Department of Management, Strategy, Policy and Compliance continued to develop its global online registry. She also noted that, for the 2022 cycle of the UN Financial Disclosure Programme, 5,149 disclosure statements were reviewed. Further, more than 87 per cent of eligible senior officials participated in the Secretary-General’s voluntary public disclosure initiative — the highest level since the initiative’s inception.
She went on to report that the Ethics Office received 140 inquiries on the policy on protection against retaliation for reporting misconduct or cooperating with duly authorized audits or investigations. The Office also completed 45 preliminary reviews; referred 11 prima facie retaliation determinations for investigation; and determined one case of retaliation after investigation of a previously received complaint. She also noted that she chaired 11 sessions of the Ethics Panel in 2022, along with giving several presentations relating to protection against retaliation. Adding that the Secretary-General will propose measures to enhance the Office’s work in the field in response to General Assembly resolution 77/278, she thanked Member States for their support.
Mr. TUR DE LA CONCEPCIÓN (Cuba), speaking again for the Group of 77 and China, said ethics is critical for the Organization’s functioning, credibility and reputation. “Having a dedicated and effective ethics function is thus a prerequisite for accountability and integrity of UN system organizations,” he added. The Group believes a culture of ethics must contribute to ensure that staff members observe and perform their functions in a manner consistent with the highest standards of efficiency, competence and integrity, as required in Article 101 of the Charter of the United Nations. This also includes observing the principle of equitable geographical representation when considering the employment of staff and the determination of conditions of service. The Group notes that in 2022, the Ethics Office responded to 1,822 requests and 395 of them were related to the financial disclosure programme, an increase of 152 compared to 2021.
In this regard, he noted that OIOS will be implementing a planned internal audit of the United Nations financial disclosure programme and the findings will be reported after it is finished this year. He also recognized the potential of the Ethics Office’s enhanced work in the field, given the risk environments that field-based operations face. The Group also believes that the Ethics Office should look at the occupancy level at Headquarters and other Secretariat offices. Despite efforts and actions taken by the management structures, there are still a significant number of offices that remain empty because staff choose to continue working from home. “We reiterate that physical presence of the Secretariat staff is fundamental for the work of the Organization and meeting the requirements of Member States as per the UN rules and regulations,” he added.
Ms. FONINA (Russian Federation) reminded that the General Assembly agreed, in resolution 77/278, with some proposals to improve the independence of the Ethics Office. She expressed her delegation’s confidence that the new format for cooperation with the Office will enhance engagement of Member States in its activities, and the instruction of General Assembly to improve the policy on Ethics Office will be “unstintingly complied with”. The Russian Federation is also confident that the Ethics Office will contribute to ensuring full implementation of its mandates in line with its founding principles and Article 101 of the UN Charter. Spotlighting that activities of the Office in the field are fraught with heightened risks, amidst an increase in reports of inappropriate conduct and violations, she stated her delegation’s readiness to improve cooperation between Office representatives and UN field staff, noting that such cooperation must be accompanied by a comprehensive cost-benefit analysis.
CHANDRAMOULI RAMANATHAN, Assistant Secretary-General for Programme Planning, Finance and Budget in the Department of Management Strategy, Policy and Compliance, and Controller of the United Nations, introduced the Secretary-General’s financial performance report on the programme budget for 2022 (document A/78/89). During 2022, the COVID 19 pandemic’s impact on the implementation of the Organization’s programme budget subsided. “Within overall appropriations approved by the General Assembly, the Organization invested in upgrades to the enterprise network to support the communications and conferencing infrastructure, which facilitated uninterrupted operations of the Organization and ensured the provision of continuous support to intergovernmental proceedings and meetings of Member States,” he said. Final expenditure in 2022 totalled $3.24 million, against an appropriation of $3.26 million. The under-expenditure of $21.5 million comprises $13.0 million under regular budget operations, excluding special political missions, and $8.5 million under special political missions.
The under-expenditure of $13.0 million, under regular budget operations other than special political missions, was mainly under posts ($11.8 million) due to the higher-than-budgeted vacancy rates, he explained. Vacancy rates did not react quickly to the removal of the hiring freeze for the regular budget posts in May 2021, which was enabled by improvements in the collection of assessed contributions. Non-post expenditure in 2022 for regular budget operations, excluding special political missions, nearly reached the budgeted level with an implementation rate of 99.9 per cent. The under-expenditure of $8.5 million under special political missions mainly related to air operations, medical services, meeting services and lower expenditures for military contingents and military observers. The under-expenditures in these areas were partly offset by over-expenditure for international staff due to a lower than budgeted vacancy rate for some missions.
The 2022 expenditure also includes $35.4 million incurred in respect of unforeseen and extraordinary expenses, and commitment authorities (including subventions), for which no appropriations were approved. Since the commitment authority for $18.7 million for the United Nations Support Mission in Libya (UNSMIL) was already assessed to Member States, this amount will now be returned as part of the $113.6 million being returned as a credit against assessments for 2024. Other credits forming part of the $113.6 million arise from: (a) $25.6 million of income generated in excess of the estimates approved by the Assembly; (b) $47.9 million from cancellation of prior-period commitments; and (c) $21.5 million of unencumbered balance under the appropriation for 2022. Open commitments at the end of 2022 totalled $130.7 million, which was 4 per cent. It reflects a continuing trend of decline, in both absolute and percentage terms, since the introduction of the annual budget in 2020. “No special commitments were needed during 2022 due to the improved liquidity situation,” he noted.
JULIANA GASPAR RUAS, Vice-Chair, Advisory Committee on Administrative and Budgetary Questions (ACABQ), introducing its report on the financial performance of the programme budget for 2022 (document A/78/330), noted that the Secretary-General’s report “does not provide information on some of its previous recommendations endorsed by the General Assembly.” The Advisory Committee therefore recommends that the Assembly request that the Secretary-General complete the formulation of the criteria for future exceptional use of special fund commitments as soon as possible, and to also provide a clear timeline on the review process for the cost recovery fund service. Spotlighting the absence of information on transfers between sections in the financial performance report, the Advisory Committee recommends that the General Assembly request the Secretary-General to provide the information in his future budget performance reports. He should also include impact of re-costing in all future reports.
She noted that final expenditure for 2022 amounted to $3.26 billion, which represents 99.3 per cent of the total appropriations for the year, adding that it included an unappropriated $35.44 million authorized by the Assembly. Unliquidated commitments of $130.7 million, representing a reduction from 7.2 per cent in 2020 and 4.6 per cent in 2021, also constitute the expenditure. She further pointed out that Member States saw a return of $47.87 million following a 2022-ending cancellation of prior-period commitments. She expressed the Advisory Committee’s expectation of detailed information with justifications of these cancellations in future reports. Highlighting cumulative over-expenditure incurred for the past five years under furniture, equipment and other services, she said the Advisory Committee agrees with recommendations by the Board of Auditors that the Administration continually monitor budget implementation, particularly on entities with related over-expenditures.
On special fund commitments, the Advisory Committee notes that annex 11 of the report does not provide full information on the return of the special fund commitments established in 2019 and 2020, the commitments of which should have been included in the cancelled prior-period commitments for return to member states in the context of the 2020 and 2021 reports, respectively. She further expressed the Advisory Committee’s trust that the Secretary-General will update the General Assembly on the review of the forward purchasing of currency arrangements, adding that it also hopes that more information concerning the timing of the submission, for review and approval, of draft amendments to the Financial Regulations and Rules will be provided to the Assembly for guidance on the matter.
Mr. TUR DE LA CONCEPCIÓN (Cuba), speaking again on behalf of the Group of 77 and China, said assessing the performance for the previous year’s budget is important to ascertain the Organization’s efficiency, adding that the Fifth Committee’s role as the main body charged with oversighting administrative, financial, and budgetary matters requires it to “have an insightful examination on how the budget we approved was implemented.” This therefore makes it necessary that the Committee has all required information. Spotlighting some missing elements form the report, notably the provision of information on transfers between sectors, he said this impedes the General Assembly in carrying out its duties in accordance with Regulation 5.6 of the Financial Regulations and Rules.
Turning to special fund commitments, he said that though this issue was discussed during the previous main session, further information on management of these funds is needed, especially on the status of the $17.7 million balance of 2020 and the $21.7 million resulting from the transfer of the regular budget fund to the cost recovery fund by end of 2020. The Group calls for a revision of the current contract arrangements to forward purchasing of currencies. He further expressed surprise on the continued growth of the cost-recovery surplus of the regular budget. “At present, there is not detailed information on why this is happening and more importantly, what this money is being used for,” he said. The Group, therefore, once again, insists that “this Committee needs to have a clear understanding on this issue and to decide on the funds that have been accumulated,” he stressed. He also conveyed the willingness of the Group to closely follow these conversations.
In response to the delegate’s interventions, Mr. RAMANATHAN said special commitments have been explained at great length in the Fifth Committee. He holds the very firm view that no Financial Regulations or Rules have been violated. He has said repeatedly that when Member States do not pay in full and on time it puts the Organization “in an impossible situation of running the place”. He has repeatedly asked Member States to consider amendments to the Financial Regulations to make them fit for purpose. All the monies for 2019 and 2020 have been returned to Member States and fully accounted for and audited. Any suggestion that the Secretariat was not returning monies is completely misplaced, and he welcomed an in-depth analysis by the auditors of the process.
He did not want to leave the room with any impression that the Secretariat was not acting responsibly or financially prudently. “As we speak today, I do not have money for paying salaries for November… for staff,” he said. “That is my reality and I have to manage it.” The Secretariat is not helped by the way in which the Financial Regulations are set up. “You have to recognize the regulations are not working as they are supposed to,” he added. Noting the special presentation he has made to the ACABQ on special commitments and cost recovery, he said he was ready to brief the Fifth Committee on these issues as frequently as needed.
Mr. TUR DE LA CONCEPCIÓN thanked the UN Controller for his comments and said he did not mean to accuse anyone but wanted to obtain information to carry out the Group of 77 and China’s work. He said he has not seen enough information on the issue of cost-recovery.
OSAMA MAHMOUD ABDELKHALEK MAHMOUD (Egypt), Fifth Committee Chair, acknowledged the healthiness of this discussion and offered the possibility of holding a meeting on cost-recovery for the Committee. He also acknowledged the Controller’s repeated statements regarding the rigidity of the Organization’s Financial Regulations, adding that there seems to be a deficiency somewhere in the process.