BUDGET COMMITTEE TAKES UP REPORT ON AUDIT OF TSUNAMI RELIEF OPERATIONS, AS IT OPENS 2007 RESUMED SESSION

GA/AB/3788
5 March 2007

BUDGET COMMITTEE TAKES UP REPORT ON AUDIT OF TSUNAMI RELIEF OPERATIONS, AS IT OPENS 2007 RESUMED SESSION

5 March 2007
General Assembly
GA/AB/3788
Department of Public Information • News and Media Division • New York

Sixty-first General Assembly

Fifth Committee

38th Meeting (AM)


Budget committee takes up report on audit of tsunami relief operations,


as it opens 2007 resumed session

 


Also Begins Consideration of Secretary-General’s Report on Compensation

For Judges on International Court of Justice; Rwanda, Former Yugoslavia Tribunals


As the Fifth Committee (Administrative and Budgetary) opened its first resumed session this morning with a review of the United Nations tsunami relief operations, several speakers expressed concern at a lack of coordination among the internal oversight bodies of the different United Nations programmes and funds and specialized agencies, stressing the need to strengthen the management of complex operations by putting in place measures to ensure transparency and avoid duplication and competition in responding to major disasters.


Describing coordination of relief operations totalling some $13 billion as “fragile and weak”, Pakistan’s representative, on behalf of the “Group of 77” developing countries and China, said the Group was particularly concerned that such a complex and multidimensional operation had been carried out without a cohesive internal control policy.  The United Nations would be well advised to put in place a comprehensive framework before it took over the responsibilities in other major operations.  Expressing regret that the funds and programmes had used procedural impediments to prevent the sharing of information with the Office of Internal Oversight Services (OIOS), the Group would pursue the reasons behind that lack of compliance.


He further regretted that the Secretary-General had not exercised his authority as Chair of the Chief Executives Board to facilitate the exchange of such information.  Deeply concerned over such perceived deliberate undermining of the Assembly’s oversight role, he requested the Secretary-General to initiate the formulation of a comprehensive internal control policy governing all aspects of large scale and complex operations in collaboration with the OIOS, the funds, programmes and specialized agencies.


The United States representative, also noting a “troubling” lack of coordination for sharing oversight information among the various United Nations entities, stressed the need to address the serious deficiency to ensure transparency and accountability in the receipt and use of donor contributions in response to future emergencies.  While the former Secretary-General and other senior officials bore the responsibility for failing to communicate clearly to the heads of the various United Nations bodies the need to cooperate and share relevant information with the OIOS in conducting audits and investigative reviews of the tsunami relief operation, Member States also needed to acknowledge their shortcomings in not having more forcefully demanded and legislated full collaboration among the oversight bodies of various United Nations entities.


Introducing the report of the OIOS, Under-Secretary-General for Internal Oversight Services Inga-Britt Ahlenius said it had been the OIOS ambition to provide the Assembly with a consolidated report, illustrating what the United Nations as one body had achieved on the ground and whether it had used its resources efficiently, effectively and ethically.  The OIOS had been unable to reach an agreement with funds and programmes and specialized agencies on a consolidated report, however, as those entities had declined to share their internal audit reports.  In that regard, the Secretary-General needed to formulate and submit to the Assembly for its approval an internal control policy for the United Nations system that made the commitment to transparency and accountability fully effective.


Turning to the conditions of service and compensation for members of the International Court of Justice and judges of the International Criminal Tribunals for the former Yugoslavia and Rwanda, several speakers emphasized the need for the Assembly to decide on their salaries and conditions of service.


Germany’s representative, on behalf of the European Union, noting the Secretary-General’s proposal to apply the same post adjustment system for remuneration for judges as used for Secretariat staff, said the Union was prepared to look into the proposals, while recognizing that the judges exercised a special function and were elected members of a principle organ, in accordance with the Charter.  He agreed that their salaries and conditions of service needed to be decided by the Assembly, also bearing in mind the ACABQ’s report.


Pakistan’s representative, on behalf of the Group of 77, expressed concern over the different treatment and disparities among the judges based in The Hague and those based in Arusha.  While the salaries of the judges in The Hague and those of the former Yugoslavia Tribunal had been protected against fluctuations in exchange rates and consumer price indices, no specific measures were in place to protect the salaries of the judges of the Rwanda Tribunal.  Any decisions reached with regard to the increase in the salary and other allowance of the judges of the International Court of Justice and the other Tribunals would not constitute a precedent for any other category of judges within the United Nations system.


The United States representative said he appreciated the Secretary-General’s efforts to address the Assembly’s concerns that the mechanism for adjusting the remuneration of the members of the Court and judges of the Tribunals be administratively simple and based on market exchange rates and local retail price fluctuation.  He agreed with the ACABQ, however, that the proposal would unduly inflate the remuneration.  Retirement benefits, he added, should be discussed in the General Assembly, as that body was the sole authority to set the conditions of service.


Also addressing the issue of retirement benefits, Japan’s representative said the existing difference between the pension benefits of the Tribunals’ judges and the members of the International Court of Justice reflected their different legal status.  While the Court was a Charter body, the Tribunals were ad hoc bodies established by the Security Council to serve specific purposes for limited duration.  Japan, therefore, saw no reason to change the Assembly’s policy in that regard.


In other business, the Committee adopted its work programme for the first resumed session.

Also participating in today’s meeting were the representatives of the Dominican Republic, on behalf of the Rio Group; Benin, on behalf of the African Group; Cuba; Switzerland; Russian Federation; and Rwanda.


Marianne Brzak-Metzler, Chief of the Conditions of Service Section of the Office of Human Resources Management, introduced the Secretary-General’s report on conditions of service and compensation for officials other than Secretariat officials.  The Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), Rajat Saha, introduced that body’s related report.


The Committee will continue its work at 10 a.m. Tuesday, 6 March.


Background


The Fifth Committee (Administrative and Budgetary) met this morning to begin the first part of its resumed sixty-first session.


The Committee had before it a report of the Office of Internal Oversight Services (OIOS) on the audit and investigative reviews of the tsunami relief operations conducted by the United Nations Secretariat, funds and programmes and specialized agencies (document A/61/669).  The report summarizes the results of OIOS activities to oversee the tsunami relief operations; discusses the general assessment by OIOS of the internal control and risk management frameworks relative to tsunami relief efforts; and highlights areas of concern regarding the oversight of complex inter-agency programmes being implemented by a number of agencies of the United Nations system.


The report also explains OIOS efforts, since May 2005, to finalize an agreement on preparing a consolidated report.  That had not been possible, however, as the funds, programmes and specialized agencies could not share their internal audit reports, which were restricted to their respective management and governing bodies in accordance with their mandates.


The Organization’s efforts to manage tsunami relief activities included the establishment of several mechanisms to ensure accountability, such as a common financial tracking system to account for donor contributions and their use; a coordinated procedure for monitoring and evaluating programmatic performance; independent oversight management of tsunami programmes by the Board of Auditors and other oversight entities; and systems and activities to promote risk management, transparency and accountability.


The design of some of those mechanisms, however, needed to be refined, the report states.  For example, expenditure tracking had not been planned to present a comprehensive and adequate picture of resource utilization.  While the consulting firm of PricewaterhouseCoopers, which agreed to provide pro bono services to strengthen fund management, made several contributions, its time could have been better used by first identifying critical needs by conducting an integrated risk assessment of all participating agencies and assisting them in dealing with the high-risk areas identified.


In the OIOS opinion, an internal control policy for the United Nations system that makes the commitment to transparency and accountability fully effective should be formulated by the Secretary-General and submitted to the Assembly for approval.  The policy should set out, among other things, the different components of internal control and management’s responsibility for controlling the Organization’s operations.  Such a policy should also include requirements for joint oversight.


On the issue of risk management, the report notes that several agencies have implemented their own mechanism to reduce the level of vulnerability to fraud and corruption in their programmes.  No risk management policy has been formulated by the Secretariat, funds and programmes and specialized agencies, however, and approved by the Assembly.  Efforts to identify and manage risks were taking place, therefore, in a piecemeal rather than an integrated manner.  An integrated risk management framework covering complex inter-agency programmes involving participation by various entitles of the United Nations system needed to be implemented.  That framework should delineate management’s responsibility for dealing with uncertainty and associated risks and opportunities, defining the major risk categories, outlining the elements of effective risk management and explaining the key principles and tools to identify, measure and control risk.


OIOS oversight of tsunami relief activities has included an audit of the Office for the Coordination of Humanitarian Affairs (OCHA) in Indonesia, the Office of the United Nations High Commissioner for Refugees (UNHCR) in Indonesia and a risk assessment of UNHCR in Sri Lanka.  Based on those oversight activities, OIOS made a number of recommendations for improving related programmes.  Most of the recommendations have been implemented.  In April 2005, OIOS submitted to the Secretary-General a report concerning an investigation of the risks of fraud and violation of the United Nations Staff Regulations and Rules in the tsunami disaster relief programmes in Jakarta and the Aceh province of Indonesia.


The report presents three recommendations to strengthen the management, oversight and internal controls and risk management of tsunami programmes, including that the Secretary-General create an institutionalized framework for management and oversight for future complex inter-agency programmes which involve the operations of more than one participating entity of the United Nations system, whether they be funded by multiple or single donors.  OIOS also recommends that the Secretary-General, in collaboration with the heads of the various funds and agencies, formulate an internal control policy document for inter-agency activities, including the requirements for joint oversight with respect to tsunami relief operations.


Finally, OIOS recommends that the Secretary-General, in collaboration with the heads of the funds and programmes, establish an integrated risk management framework for complex inter-agency programmes such as tsunami relief operations, involving multiple participating entities of the United Nations system.


Also before the Committee was a report on the conditions of service and compensation for officials other than Secretariat officials (document A/61/554), particularly Members of the International Court of Justice, and judges and ad litem judges of the International Tribunals in Rwanda and the former Yugoslavia.  The report’s submission was delayed owing to the need to conduct extensive consultations with the subject officials.


The first section of the report takes up the remuneration levels for the various types of judges within these bodies.  A particular problem identified was that the dollar’s value had slipped 26.8 per cent against the euro, so that the emoluments of the members of International Court of Justice had not kept pace with increases in the cost of living in the Netherlands, with the result that the salaries of the judges had lost 4.35 per cent.  The Secretary-General, therefore, proposed that the Member States might wish to consider increasing the annual emoluments of the members of the Court, the judges of the International Criminal Tribunal for the Former Yugoslavia, the judges of International Criminal Tribunal for Rwanda and the ad litem judges by 10.6 per cent, from $160,000 to $177,000, which was accepted by the Advisory Committee on Administrative and Budgetary Questions (ACABQ).  The General Assembly in turn decided as an interim measure to raise the annual salary of the members of the Court and the judges of the two Tribunals to $170,080 per annum, effective 1 January 2005.


The report also shows that that the floor/ceiling mechanism used to regulate emoluments against the weakening/strengthening of the dollar has served to limit the diminution of the emoluments of the members of International Court of Justice expressed in euros when the dollar weakened against the euro.  But, the Secretary-General recommends that application of the respective current adjustment multipliers for each post to the base rate above is an option that is administratively simple and responds to the General Assembly’s request for the establishment of a mechanism of remuneration based on market exchange rates and local retail price fluctuations that would limit the divergence of such remuneration from that of comparable positions of seniority within the United Nations.  The Secretary-General also recommends that the base salary for judges should be adjusted by the same percentage as the base scale for the Professional and higher categories.


The second section of the report looks at other conditions of service for the variety of judges:  the special allowance of the President and Vice-President when acting as President, the compensation of ad hoc judges, education allowance, health insurance, survivors’ benefits, travel and subsistence regulations and retirement benefits.  It also makes a number of recommendations based on these analyses.


First, the International Court of Justice seeks the General Assembly’s consideration by Member States of an increase of the special allowance of the President and the Vice-President of the Court and the Tribunals.  Next, the Secretary-General requests that an update of the levels of the education grant or changes in the provisions regarding disabled children by the International Civil Service Commission (ICSC) should be extended to the members of the Court and the judges of the Tribunals.  Third, the Registrar of the Court has proposed that the Travel and Subsistence Regulations for assignment grants should be revised to conform with the daily subsistence allowance applicable for the members of the Court, and the Secretary-General finds that the respective travel and subsistence regulations of the Court and the Tribunals should be updated to reflect current practice.


Finally, the report discusses the relationship between the pension fund and the Court and Tribunals.  First, it outlines the implications of some of these changes, particularly increasing the base salary, for the Court and Tribunal personnel’s participation in the pension system.  The Secretary-General shares the concerns of the Tribunal that their shorter terms of service than the International Court of Justice discriminated against them as regards the pension, and believed this matter should again be brought to the General Assembly’s attention.  Lastly, the Secretary-General is of the view that consideration should be given to applying a floor/ceiling mechanism to pensions in payment to former judges and their survivors residing in the euro zone countries to protect the level of their pensions.  No changes in this regard were proposed for Ad Hoc or Ad Litem judges.


If the Assembly approves an increase in the annual salary, an increase in the President’s allowance, increases in the costs of educating children and additional pension payments in respect of former judges and the widows of the judges of Court and the judges of the two Tribunals, the programme budget implications are estimated at $2.19 million for the biennium 2006-2007.


In connection with the Secretary-General’s proposal to introduce a post adjustment mechanism for the judges, the Advisory Committee on Administrative and Budgetary Questions, in a related report (document A/61/612), notes that the recommendation would lead to a net increase in the remuneration of 14 per cent for judges serving in The Hague and 33 per cent for those serving in Arusha.  In the opinion of the Advisory Committee, the proposal, which uses the current net remuneration as the base salary, unduly inflates the remuneration calculated under a post adjustment system.  Also, the current net remuneration already includes a cost-of-living component.


The report also notes that what is proposed for the judges is different from the reviews of the salary scale for staff in the Professional and higher categories: a net increase is envisaged.  It is up to the Assembly to decide whether an increase should be provided, but the consolidation of points from post adjustment to base salary for staff, which is on a no loss/no gain basis, is not relevant to a proposal whereby an increase would result.  The salaries of the members of the Court, which is the principal judicial organ of the United Nations, are sui generis (unique in their characteristics), and the system of emoluments and conditions of service applicable to the members of the Court is distinct from that of any other in the United Nations system.


In view of the above, the Advisory Committee recommends elaboration of alternative methods for adjusting remuneration according to market exchange rates and movement of the local cost-of-living index, with a view towards protecting the level of the remuneration, as requested by the General Assembly.  The new proposals should be presented to the Assembly at its sixty-second session.


While having no objection in principle to increasing the level of education grants for the judges and members of the Court, the Advisory Committee is of the view that all conditions of service should be considered together as part of the periodic review carried out by the Assembly and not linked to any developments with regard to staff.  Regarding another proposal, the ACABQ states that it is not convinced by the argument to increase the level of the special allowance for the President of the Court and for the Vice-President when acting as President; additional resource requirements should be justified on the basis of real needs and expenditure patterns.  Accordingly, it recommends against the proposal.


On travel and subsistence for International Court of Justice judges, the Advisory Committee notes that the regulations approved in 1982 provide for first-class accommodation for those officials.  Since then, standards of accommodation have evolved considerably, and first-class air travel is now restricted to a limited number of cases, with most senior officials authorized to travel at “the class immediately below first class”.  In light of this trend, the Advisory Committee is of the opinion that the travel and subsistence regulations approved for the Court by the General Assembly in 1982 should be reviewed and updated in line with the current standards of the Organization.


While fully understanding the need for simplified procedures for administering the small number of pension cases of former judges and their survivors, the Advisory Committee points out that care should be taken to adopt procedures that are sustainable and do not require frequent revision.  It recommends that the method proposed be adopted, on the understanding that retirees and survivors would be given a one-time option to request conversion of their pension into another currency, rather than on an annual basis.

In connection with the proposal that existing regulations be amended to determine the pension benefit of the Tribunals’ judges on the basis of actual years of service, the Advisory Committee concludes that the question of retirement benefits of the members of the Court and of the judges of the Tribunals is of long standing, and the pension benefits of the Tribunal judges should be decided by the General Assembly.


Organization of Work


As the Committee considered its work programme at the opening of the meeting, the representative of Germany (on behalf of the European Union and associated States) said that the Committee should be able to complete its agenda by 30 March without the need for meetings outside of regular working hours, since it was the body charged with promoting efficient management practices and use of resources.  Stressing the Committee’s responsibility towards United Nations staff, he said that, first and foremost, the Union looked forward to discussing the reform of the United Nations administration of justice.  Speedy and effective implementation of the reform decisions was a key priority during the session.  In discussing other proposals for better staff conditions, the Committee had a responsibility to ensure the safety and security of United Nations staff.  Priority should also be given to funding the assessed liabilities of after-service health insurance.


He also highlighted the theme of peace and security.  The Committee needed to decide on the requested allocation for special political missions, as well as the funding of peacekeeping.  And finally, the Organization was confronted with a multitude of tasks and expectations.  Transparency, accountability and internal controls were, therefore, vital to the United Nations.  A well-established mandate and effective functioning of the Independent Audit Advisory Committee and the strengthening of the operational independence of the OIOS should be among the main priorities.


Speaking on behalf of the “Group of 77” developing countries and China, Pakistan’s representative expressed the Group’s strong desire to maintain dialogue and constructive engagement with all its partners in order to conclude all agenda items before the Committee.  Concerned with the status of documentation for the session, he urged the Secretariat to rectify the recurring late submission problem, which often led to longer hours at the conclusion of the discussion.  Also, expressing appreciation to the Secretariat for useful briefings on various issues during informal meetings, he stressed that expeditious transmission of written responses to the questions raised by Member States would be very helpful in concluding the informal consultations on the issues before the Committee.


Given the sensitivity and complexity of some of the issues on the agenda, which additionally involved heavy financial costs, could call for extra efforts to seek their resolution.  The Group was determined to achieve maximum progress on such key issues as the administration of justice, strengthening of the OIOS, operationalization of the Independent Audit Advisory Committee and peacekeeping budgets.  The Group had an open mind on the other issues and would be ready to engage constructively to find consensual solutions.  The Group remained committed to strengthening the oversight role of Member States through the negotiating framework provided by the Committee.


The representative of the Dominican Republic, (on behalf of the Rio Group), supported the position of the Group of 77 and said the programme of work for the resumed session included further consideration of several processes already under way.  Attainment of those objectives was helped by the good discussions and a rejuvenated spirit of collaboration among delegations.  There was an urgent need to revamp an outmoded and dysfunctional system of internal justice at the United Nations.  Taking into account the groundwork set forth in resolution 59/283, he said the proposals of the Redesign Panel, the pertinent comments of the Secretary-General and the observations of the ACABQ, which he looked forward to receiving at the earliest possible date, should fuel a constructive debate and enable the Committee to take the necessary steps to advance reform.  The Group was aware of the benefits of having a strong informal system that would help to optimize the resources available and make the system more effective.


Among other important issues, he highlighted the discussions on the operationalization of the Independent Audit Advisory Committee, addressing the issues of after-service health insurance and the review of the conditions of service and compensation for the members of the International Criminal Court and judges of the Tribunals.  It was also important to address the issues related to the work of the Joint Inspection Unit (JIU) and peacekeeping budgets.  The Group was particularly mindful that adequate funding should be provided for the United Nations missions in Burundi, Timor-Leste and Lebanon.  He advocated the allocation of adequate time for informal consultations on those issues.  He also supported the use of information and communication technology as a strategic management reform tool.  A robust information and communication technology infrastructure, using best practices and experience available, would help to address the increasing dependency of United Nations activities on effective information management.


At its fifty-ninth session, the Assembly had requested the Secretary-General, as the Chairman of the United Nations System Chief Executives Board for Coordination (CEB), to submit a report to the Assembly at its sixty-first session on measures to improve the operational administration of existing cost-sharing arrangements.  He had also been asked to examine the possibility of further integration and rationalization of the security management and report on that issue during the sixty-first session.  In that connection, he recognized the importance of assuring good conditions of safety and security at Headquarters and in the field.  Although the security of the exterior perimeter of duty stations was the responsibility of the host country, internal security should be provided by the Organization.  On that understanding, he supported the activities of the Department of Safety and Security and affirmed that safety issues should be accorded the importance they deserved.  Adequate funds should be provided to ensure personnel were sufficiently protected to allow them to deliver the mandates with which they were entrusted.


The representative of Benin, on behalf of the African Group, associated himself with the Group of 77 and China and expressed concern over the late issuance of reports, which made it difficult for Member States to prepare for the session.  The time had come to address that perennial problem.  While the importance of all the items on the programme of work could not be overemphasized, the issue of the administration of justice was of particular importance.  The group trusted that efforts would be made to ensure successful deliberations on all issues and stressed its readiness to work constructively with others.


Cuba’s representative endorsed the statement by Pakistan on behalf of the Group of 77 and China and requested that, at the next formal meeting, a representative of the Office of Human Resources Management give explanation of the reasons why a report on human resources management, which had been requested by the Assembly, had not been submitted.


Secretary of the Committee, MOVSES ABELIAN, said that a memo containing an explanation on that matter had been made available to the Bureau.  The Secretary-General would present his report during the second part of the resumed session.


Cuba’s representative insisted that an Office of Human Resources Management representative provide such an explanation to the Committee.


The programme of work was then adopted by the Committee, on the understanding that it would be adjusted, as necessary, during the course of the session.


Introduction


INGA-BRITT AHLENIUS, Under-Secretary-General for Internal Oversight Services, introduced the OIOS report on the audit and investigative reviews of the tsunami relief operations conducted by the United Nations Secretariat, funds and programmes and specialized agencies.  Pursuant to Assembly resolution 60/259, the report summarizes the results of OIOS oversight activities of the tsunami relief operations; discusses OIOS general assessment of the internal control and risk management regimes relative to tsunami relief efforts; and highlights areas of concern regarding the oversight of complex inter-agency programmes implemented by a number of United Nations entities.


She said the OIOS ambition had been to provide the Assembly a consolidated report, which would show what the United Nations as one body had achieved on the ground in the damaged areas and whether it had carried out its activities and used its resources efficiently, effectively and ethically.  OIOS, however, had been unable to reach an agreement with funds and programmes and specialized agencies on preparing a consolidated report on tsunami relief operations, as those entities had declined to share their internal audit reports, which were restricted to their respective management and governing bodies.  In fact, there was no established protocol or coordination mechanism for sharing and consolidating oversight information among the various entities in the United Nations system.  OIOS noted with appreciation that the ACABQ, in its report A/61/605, had recommended that the Assembly request the Secretary-General, as Chairman of the Chief Executive Board, to make proposals to the Assembly on how to address that very issue.


It was the OIOS’ firm opinion that an internal control policy for the United Nations system, which made the commitment to transparency and accountability fully effective, should be formulated by the Secretary-General and submitted to the Assembly for approval, she said.  The policy should set out the different components of internal control, management’s responsibility for controlling the Organization’s operations, the activities that management should undertake to fulfil its responsibilities and its accountability in the use of public resources.


Statements


PETER WOESTE ( Germany), speaking on behalf of the European Union and associated States, thanked the OIOS for its efforts to coordinate a consolidated report as requested by the General Assembly in its resolution 60/259 of 8 May 2006.  The Union regretted that the OIOS, for various reasons, had faced difficulties in producing such a report in response to the Assembly’s request.  He welcomed, however, the effective cooperation between the Board of Auditors and the OIOS in order to avoid possible duplications.


Thanking OIOS for its recommendations to strengthen and coordinate management, oversight, internal control and risk management of inter-agency activities like the tsunami programmes, he said the Union was ready to consider those recommendations carefully, bearing in mind, among other things, the respective roles of the United Nations Secretariat, funds and programmes and specialized agencies and their governing bodies, as well as the internal and external oversight entities.  He also noted OIOS oversight with regard to the OCHA and UNHCR offices in Indonesia and the UNHCR office in Sri Lanka.  The Union was pleased to learn that most of the recommendations had been implemented by the respective bodies.


IMTIAZ HUSSAIN (Pakistan), on behalf of the Group of 77 developing countries and China, said the report provided useful insight into the fragile and weak state of coordination among internal oversight bodies across the United Nations family of institutions.  The United Nations funds and programmes and specialized agencies, in accordance with the United Nations Charter, were accountable to the Assembly, which provided a framework for a coordination mechanism for complex projects, such as tsunami relief operations.  He reiterated the Group’s strong support for the Assembly’s oversight role.  He deeply regretted that procedural impediments had been used by the funds and programmes to prevent sharing of information with OIOS, adversely affecting the presentation of a comprehensive report to the Assembly.  The Group would be pursuing the reasons behind that lack of compliance by the concerned entities.  It further regretted that the Secretary-General had not exercised his authority as Chairman of the Chief Executive Board for Coordination to facilitate the exchange of such information.  The Group was deeply concerned over such perceived deliberate undermining of the Assembly’s oversight role.


Continuing, he said the Group found it unfortunate that the Assembly had been deprived of critical information with regard to the extent of transparency and accountability measures that had been put in place by the funds and programmes in utilization of the public funds.  Lack of transparency in handling of public funds had caused a great harm to the Organization’s image and had contributed to the erosion of public confidence in it.  Given the constraints, the Group deeply appreciated its useful report.  While it fell short of responding to the Assembly’s mandate, it provided a sound basis for addressing some long-standing systemic issues.


Lack of transparency and adequate accountability in the management of the funds and programmes had been a matter of particular concern to the Group, he said.  The current report reinforced such concerns.  The report clearly indicated that, historically, there had been a problem in coordination between the oversight bodies of funds and programmes, specialized agencies and the United Nations Secretariat.  The arrangements proposed in the past by the Assembly, on the Secretary-General’s recommendation, including regular monthly meetings, the OIOS compilation of summary records of internal oversight issues of each fund and programme, the OIOS authority to obtain relevant information from the internal oversight entities and the establishment of internal audit committees had not been effective in ensuring a well-defined coordination arrangement among internal oversight bodies.


The Group noted with concern that the four major initiatives to ensure transparency and accountability in the context of tsunami relief operations had not been fully implemented, as they were not well-defined and not available in a single comprehensive document to all stakeholders.  Of equal concern was the fact that the financial tracking system had been applied to only some 8.4 per cent of the total $13 billion in contributions received for tsunami relief and reconstruction operations.  The Group supported coordination between the Board of Auditors and the OIOS, within their respective mandates, and regretted that the Secretariat had used the audit of the external auditors as reasoning for not cooperating with OIOS.  In that regard, he stressed that the Board of Auditor’s report should not have been seen by the Secretariat as a substitute for the consolidated report of the OIOS requested in resolution 60/259.  The Board’s observations regarding deficiencies in monitoring financial flows provided a strong basis for the comprehensive internal control framework.  The Group looked forward to considering the Board’s full audit report once it had been finalized.


He said the Group was particularly concerned that such a complex and multidimensional operation had been carried out without a cohesive internal control policy.  The United Nations would be well advised to put in place such comprehensive framework before it took over the responsibilities in other major operations.  It was essential to put in place measures to avoid duplication and competition between and among agencies in delivery of assistance during major disasters.  The experience during the tsunami experience could be valuable in that regard.


He strongly requested the Secretary-General to initiate the formulation of a comprehensive internal control policy that could govern all aspects of large-scale and complex operations in collaboration with the OIOS, the funds, programmes and specialized agencies, and report to the Assembly at its future sessions.  The Group fully supported the valuable recommendations of the OIOS.  He also requested a presentation by the Secretariat on the Group’s concerns in a formal meeting and at a fairly high level of representation.


ANDREW HILLMAN ( United States) said the very helpful report underscored the troubling lack of a coordination mechanism for sharing oversight information among the various entities of the United Nations system.  That serious deficiency must be addressed to ensure transparency and accountability in the receipt and use of donor contributions in response to future emergencies.  The former Secretary-General and other senior officials bore the responsibility for failing to communicate clearly to the heads of United Nations funds, programmes and specialized agencies the need to cooperate and share relevant information with the OIOS in conducting audits and investigative reviews of the tsunami relief operation.  However, Member States must also acknowledge their shortcomings in not having more forcefully demanded and legislated full collaboration among the oversight bodies of various United Nations entities.


He added that the OIOS had presented a number of recommendations to address the weaknesses of the current system and to strengthen management, oversight and internal controls among the Secretariat and the funds, programmes and specialized agencies.  It was imperative for the Assembly to take action on those issues as a matter of urgency to ensure that an effective framework was in place for managing and exercising appropriate oversight of future complex inter-agency programmes.


DANIELA PRETI ( Switzerland) thanked the OIOS for its efforts to prepare a consolidated report on the audits and investigative reviews of the tsunami relief operation, as requested by resolution 60/259.  She regretted that the OIOS had been unable to report in accordance with the mandated request.  As there were still some contradictory opinions in the report before the Committee, particularly regarding the rules governing the sharing of audit information, she would welcome further clarifications to better understand the OIOS failure in presenting a more compelling case.


Little progress had been made in establishing a formal oversight coordination mechanism among internal audit divisions of the funds, the programmes and the OIOS, she continued.  Unfortunately, the requested limited review of the tsunami relief operations could not serve as a model for future cross-agency collaboration of oversight activities, even though the cooperation between the Board of Auditors and OIOS apparently worked in an effective manner, as outlined in the report.  She welcomed the three recommendations of the OIOS aiming at further strengthening of management, oversight, internal controls and risk management of complex inter-agency activities, such as the tsunami relief operations.  Their implementation could set a framework and policy, although could not cope with all overarching issues in oversight coordination.


MAXIM GOLOVINOV ( Russian Federation) thanked the OIOS for its report.  His delegation, in general, commended the report, which contained important information and suggested a number of useful recommendations.  The issues of the need to improve interaction between the oversight services of the various entities required further consideration and the adoption of appropriate decisions by Member States.  In considering the issue, however, he stressed the need to take account of the prerogative of the management bodies in those organizations, which were responsible for considering all issues related to the management of the funds and programmes.  The proposals on ways to improve cooperation among the oversight systems within the United Nations should be discussed by the executive boards of the funds and programmes before submission to the Assembly for adoption by Member States of the appropriate decisions.  He was ready to discuss that and other issues on the agenda during informal consultations.


Introduction of reports


MARIANNE BRZAK-METZLER, Chief of the Conditions of Service Section of the Office of Human Resources Management, introduced the Secretary-General’s report on conditions of service and compensation for officials other than Secretariat officials; members of the International Court of Justice and judges and ad litem judges of the International Tribunals for Rwanda and the former Yugoslavia.


Introducing the related report of the ACABQ, its Chair, RAJAT SAHA, noted that the Secretary-General’s report contained a number of proposals in response to Assembly resolution 59/282 of 13 April 2005, including mechanisms for adjusting remuneration for currency fluctuations and cost of living expenses, education grants, special allowances, pensions in payment and retirement benefits.  While the Advisory Committee had stated its opinion on some of the proposals put forward in the Secretary-General’s report, it was for the Assembly to set the conditions of service for the members of the International Court of Justice and the Tribunal’s judges.


With respect to the remuneration of the members of the Court and the judges of the Tribunal, the Secretary-General proposed to introduce a post adjustment system, similar to that applied to the salaries of Professional and higher categories, for making adjustments for currency fluctuations and cost-of-living expenses.  In the ACABQ’s opinion, the Secretary-General’s proposal unduly increased remuneration because it used the current net remuneration as the base salary without taking into account that the current net remuneration already included a cost-of-living component.  It, therefore, recommended that the Secretary-General be requested to put forward alternative proposals.  The ACABQ had no objection to the Secretary-General’s proposal to extend to the members of the Court and the judges of the Tribunal the increases in the level of the education grant recommended by the International Civil Service Commission, which were approved by the Assembly in its resolution 61/239 of December 2006.


He said the Secretary-General had also proposed to increase the level of the special allowance of the President and Vice-President by some 30 per cent in order to bring its rate up to the 10 per cent level applied by the International Criminal Court.  Such increases should be justified on the basis of real requirements and expenditure patterns.  Regarding the protection of the level of pensions in payment, the ACABQ recommended acceptance of the Secretary-General’s proposal to apply a 36-month average exchange rate established by the United Nations Joint Staff Pension Fund for retirees and survivors residing in non-United States dollar countries.  However, a one-time option to request conversion of pension into another currency should be granted, rather than on an annual basis, as proposed.


Regarding pension benefits, the Presidents and Registrars of the Tribunals had made proposals for amending Annex II of Assembly resolution 58/264, whereby those benefits would be determined on the basis of actual years of service.  Pension benefits of the judges of the International Tribunals should be decided by the Assembly.


Mr. WOESTE ( Germany), speaking on behalf of the European Union and associated States, said that the rulings of United Nations judges had contributed to further development of public international law and ensured that the rule of law would reach all corners of the world.  The Union wanted to pay tribute to the judges, public prosecutors and all court personnel and assure them of its unreserved support in their precious work.  The Union noted that the comprehensive report contained information and proposals on all the elements requested by the Secretary-General in section III, paragraph 8 of resolution 59/282.  He noted, in particular, the argumentation regarding the proposal of the Secretary-General to apply the post adjustment system for remuneration for judges that was the same that was applied to the Secretariat staff.  The work of the judges of different courts and tribunals was equally valuable, and the Union was prepared to look into the proposals, while recognizing that the judges exercised a special function and were elected members of a principle organ, in accordance with the Charter of the United Nations.  Their salaries and conditions of service had to be decided by the Assembly, also bearing in mind the ACABQ report.


Mr. HUSSAIN (Pakistan), speaking on behalf of the Group of 77 and China, said that the Group attached high importance to the work of the International Court of Justice and the Tribunals and accordingly favoured a compensation package to the judges that was commensurate with their high status and responsibilities and ensured their independence.  Every effort had been made to ensure that the compensation package for different categories of judges was protected against factors that could undermine the net value of the salaries.  The Group supported the key principles enshrined in the statutes of the International Court of Justice and the Tribunals that the salary and allowance of the judges should be fixed by the General Assembly and that they may not be decreased during their term of office.  Bearing in mind the provisions of the statutes of the Tribunals, the Group generally supported the principle of equity in the benefits of the judges of the Tribunals with those of the International Court of Justice.  The Group would also like to ensure that the two Tribunals received the necessary support from the Assembly to complete their mandates.


The Group remained concerned over the different treatment and disparities among the judges based in The Hague and those based in Arusha, he continued.  While the salaries of the judges in The Hague and those of the former Yugoslavia Tribunal had been protected against fluctuations in exchange rates and consumer price indexes, no specific measures were in place to protect the salaries of the judges of the Rwanda Tribunal.  The report before the Committee shed light on some of those issues.  However, further clarification would be imperative on the application of floor-ceiling mechanisms, the differences in the salaries and allowances, and the disparities in the pension benefits to different categories of judges before reaching appropriate decisions.  The Group noted the issues raised in the report and would be engaging in informal consultations to clarify them.  The Assembly, in consultations with the International Civil Service Commission, should consider developing a concrete and well-defined mechanism to deal with that important issue, which came for its consideration periodically.


For the record, he also wanted to clarify that any decisions reached with regard to the increase in the salary and other allowance of the judges of the International Court of Justice and the Tribunals would not constitute a precedent for any other category of the judges within the United Nations system.  Those decisions should not be used as a basis for seeking similar or proportionate increases in salaries.  All other cases should be dealt with according to prescribed procedures within respective forums.


ERIC FRANCK SAIZONOU ( Benin) on behalf of the African Group, said it was in the best interest for the entire United Nations membership to ensure the establishment of a mechanism that would take full care of United Nations staff.  It was for that reason that the Assembly, in its resolution 59/282, requested the Secretary-General to submit a comprehensive report at its sixty-first session.  The African Group took note of the Secretary-General’s proposals and would appreciate further elaboration on remuneration proposals during informal consultations to enable proper decision-making.


He noted that the Secretary-General had laid down a mechanism before the Assembly with a programme budget implication for 2006-2007 to cover remuneration and other conditions of service.  While the African Group would support any mechanism to address disparities resulting from changes in consumer price indices and currency fluctuations, it would seek further clarification on the ACABQ’s comments.  He looked forward to discussing the report in more detail during informal consultations and concluding the item during the present session.  The African Group supported the Rwanda Tribunal’s valuable work and would consider proposals that would enable it to successfully conclude its mandate.


MARK D. WALLACE ( United States) paid tribute to the judges of the International Court of Justice and the International Tribunals for their service to the international community and the United Nations.  It was important to periodically review the compensation and conditions of service for those important posts.  While appreciating the Secretary-General’s efforts to address the concerns of the Assembly that the mechanism for adjusting the remuneration of the Members of the Court and judges of the Tribunals be administratively simple and be based on market exchange rates and local retail price fluctuation, he agreed with the ACABQ’s evaluation of the proposal.  The proposal, which was based on a net base salary, with corresponding post adjustment amount per index point equal to 1 per cent of net base salary, would unduly inflate the remuneration, since the current remuneration already included a cost-of-living component.  While recognizing that increases in costs of living and exchange rates could negatively impact the purchasing power of the remuneration of the Members of the Court and the judges, his delegation recommended that alternative mechanisms be investigated and presented to the Assembly during its sixty-second session.


Noting the proposal that the special allowances for the Presidents of the International Court of Justice and the Tribunals be increased from $15,000 to $20,000 and the allowance of the Vice-Presidents when acting as President be increased from $94 to $125 a day, he recalled that the same increases had been proposed during the review that had taken place during the fifty-sixth session of the Assembly.  At that time, and again in this review, the ACABQ had found that justification for such increases had been insufficient.  He concurred with that assessment.  He concurred with the Advisory Committee’s recommendation that all conditions of service should be considered together as part of a periodic review carried out by the General Assembly and not linked to any developments with regard to staff.  At this time, his delegation was satisfied with the provisions made for the judges of the Tribunals to participate in an appropriate medical insurance plan, at full premium.


The Travel and Subsistence Regulations for the members of the International Court of Justice had been approved by the Assembly in 1982, he added.  Considering the substantial period of time that had passed since then, his delegation strongly supported the view that such regulations should be reviewed and updated in line with current standards.  He appreciated the recommendation of the Secretary-General and ACABQ that retirement benefits should be discussed in an appropriate forum, the General Assembly, since that was the sole authority to set the conditions of service.  However, his delegation would appreciate the input of the Advisory Committee on that issue, and noted that it had neglected to offer a recommendation in its most recent report on the matter.


KEIKO KURODA ( Japan) said her delegation had found the ACABQ’s recommendations, in general, quite useful.  The report served as a good basis for the Committee’s deliberations.  Regarding the level of annual remuneration, she said that all the points raised by the ACABQ were valid.  It would be prudent, therefore, to invite the Secretary-General to come back to the Assembly next year with alternative methods that took into account the Advisory Committee’s recommendations, rather than the Committee spending undue time coming up with alternatives.


Regarding the retirement benefits of the judges of the former Yugoslavia and Rwanda Tribunals, she noted that the General Assembly endorsed the recommendations of the ACABQ.  The existing difference between the pension benefits of the judges of the Tribunals and of the members of the International Court of Justice reflected their different legal status.  The Court was a charter body, while the Tribunals were ad hoc tribunals established as subsidiary organ of the Security Council to serve for specific purposes for limited duration.  Japan, therefore, saw no reason to change the Assembly’s policy in that regard.


NICHOLAS SHALITA ( Rwanda) stressed the need for the Committee to be mindful of the completion strategies of both Tribunals, as well as the need to enhance their capacity to ensure that they fully implemented their strategies on time.  He took note of the ACABQ’s recommendations regarding remuneration of the Tribunal’s judges.  In that regard, he emphasized the need for equity in the two tribunals and between the Tribunals and the International Court of Justice.  The issues before those Courts were equally important.  The disparity in retirement benefits for the judges of the two Tribunals and the International Court of Justice also needed to be addressed.


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For information media • not an official record
For information media. Not an official record.