General Assembly

Distr. GENERAL  

17 November 1995

ORIGINAL:
ENGLISH

Fiftieth session
Agenda item 20 (b)


          STRENGTHENING OF THE COORDINATION OF HUMANITARIAN AND DISASTER
          RELIEF ASSISTANCE OF THE UNITED NATIONS, INCLUDING SPECIAL
          ECONOMIC ASSISTANCE:  SPECIAL ECONOMIC ASSISTANCE TO INDIVIDUAL
COUNTRIES OR REGIONS

Financing of the Palestinian Police Force

Report of the Secretary-General


1.  From September 1994  to March 1995, the United Nations Relief and  Works
Agency for Palestine Refugees  in the Near East (UNRWA) disbursed a total of
$33.3 million  placed at its disposal  in voluntary  contributions by donors
for the  payment  of  the salaries  and start-up  costs  of the  Palestinian
Police  Force.  That  operation  was  undertaken   at  the  request  of  the
Secretary-General and in  accordance with General Assembly resolution  49/21
B  of 2  December 1994,  in which the  Assembly had requested  that a United
Nations agency  be designated to  fulfil that function  for a period  ending
not later  than the end of  March 1995.   The Secretary-General reported  on
the implementation  of the  disbursement operation  for the  above-mentioned
period in  a report  entitled "Financing  of the  Palestinian Police  Force"
dated 6 April 1995 (A/49/885).

2.   On 21  April 1995,  the General  Assembly adopted  resolution 49/21  O,
entitled  "Financing  of  the  Palestinian  Police  Force",  requesting  the
Secretary-General, inter  alia, to  designate once again UNRWA  to disburse,
with due  attention  to the  need  for  thorough accounting,  the  voluntary
contributions given by donors in the  light of the activities of  the Ad Hoc
Liaison Committee for salaries and other  start-up costs of the  Palestinian
Police Force, for a period ending not later than 31 December 1995.

3.  At  the request of  the Secretary-General  pursuant to that  resolution,
UNRWA  effected payment of salaries to the Palestinian  Police Force for the
month  of July  1995.   Contributions  for Police  Force salaries  were  not
received for the  months April to  June 1995  inclusive, nor  for any  month
subsequent to July 1995.


95-36204 (E)   221195/...
*9536204*
UNRWA was therefore not involved in  the disbursement of Palestinian  police

salaries during those months.   The July 1995  disbursement was conducted in
accordance  with  the  technical  mechanism  described  in  the   Secretary-
General's  report and in  full coordination  with the  Office of  the United
Nations Special  Coordinator in the  Occupied Territories  (UNSCO) in  Gaza,
following established practice.

4.  The July  1995 disbursement was for contributions from the Government of
the  Netherlands,  which  contributed  $3,434,066  net  of  UNRWA  programme
support costs;  the Government of Norway,  which contributed $1,995,335  net
of UNRWA expenses; and the Government  of Greece, which contributed  $89,286
net of  UNRWA programme  support costs.   Out of those  contributions, UNRWA
disbursed  $4,508,091 in net  salaries for  9,000 policemen  and $375,264 in
salary deductions for the Police Force  pension, health and social  security
funds.   The amounts  disbursed represented  full funding  of the  July 1995
bills  for  salaries and  salary  deductions.    The  unutilized surplus  of
$635,332 was paid  to the Police Force to cover other running costs for July
1995, as agreed to by the donors.

5.   The total  bill for  net salaries  (base salaries plus  allowances) for
9,000 policemen for  the period from September 1994  to March 1995 and  July
1995  amounted to $34,669,426,  of which  $34,281,847 was  funded, leaving a
shortfall of  $387,579.   During  the  same  period, salary  deductions  for
Police  Force  pension,  health  and  social  security  funds  amounted   to
$1,772,732,  of   which  $1,000,117  was  funded,  leaving  a  shortfall  of
$772,615.    Thus,  out   of  a  total  salaries  bill  for  the  period  of
$36,442,158, the funding  shortfall was $1,160,194.   As the July 1995  bill
for  salaries and salary  deductions was  entirely funded,  the total amount
unfunded   remained   unchanged  from   that   reported   earlier   by   the
SecretaryGeneral.   The total  amount transferred  to the  Police Force  for
other  running   costs  increased  with   the  July   1995  disbursement  to
$3,636,492.

6.  From the outset  of the effort to assist  the Palestinian Police  Force,
UNRWA  had  conditioned its  involvement  in  the  payment  exercise on  the
understanding  that  the  Agency  would  incur  no  costs  in  providing its
assistance.   In  the July  1995  disbursement,  direct and  indirect  costs
incurred by  UNRWA amounted to $15,000,  bringing total  direct and indirect
costs  incurred over  the entire  period  of  the disbursement  operation to
$149,383.   The amount received  by UNRWA in  connection with  the July 1995
disbursement  was $427,467.  That  outcome resulted from  the request of the
Government of  the  Netherlands and  the  Government  of Greece  that  UNRWA
subtract from  their earmarked  contributions the  Agency's standard 12  per
cent  to cover  programme support  costs,  in the  amounts of  $412,088  and
$10,714,  respectively,  instead   of  UNRWA  deducting  direct  costs.   In
addition, UNRWA was requested  by the Government of  Norway to deduct direct
and  indirect costs  incurred in  connection  with  the disbursement  of the
Norwegian  contribution for July 1995; those costs amounted  to $4,665.  The
amount  received by  UNRWA in  connection  with  the July  1995 disbursement
brought  the   total  amount  received  by   the  Agency   over  the  entire
disbursement operation - as reimbursement for  costs incurred by the Agency,
in programme support costs and in earned interest - to $948,186.

7.  In  August 1995 an  independent review  was conducted of the  10 million
European currency units disbursed  by UNRWA for the payment of salaries  and
running costs  to the Palestinian Police Force for December 1994 and January
1995.   The  review  was  carried out  by  Crown Agents  Financial  Services
Limited  on behalf  of the  European Commission.   In  so far  as UNRWA  was
concerned,  the report  concluded that  the  European  Union funds  had been
disbursed  in accordance  with the  relevant  agreements.   The  report also
concluded  that  controls   and  procedures  continued  to  be   implemented
effectively by  the Palestinian  Authority and  UNRWA in  months when  donor
funds were involved.


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