Secretary-General Presents $5.2 Billion 2012-2013 Budget to Fifth Committee, Says Figure Acknowledges Ongoing Global Financial Uncertainty, Austerity
Secretary-General Presents $5.2 Billion 2012-2013 Budget to Fifth Committee, Says Figure Acknowledges Ongoing Global Financial Uncertainty, Austerity
|Department of Public Information • News and Media Division • New York|
Sixty-sixth General Assembly
13th Meeting (PM)
Secretary-General Presents $5.2 Billion 2012-2013 Budget to Fifth Committee,
Says Figure Acknowledges Ongoing Global Financial Uncertainty, Austerity
Speakers Say ‘Arbitrary’ 3 Per Cent Cut Ignores Development Agenda;
Others Warn ‘Systematic Overspending’ Reveals Deep Flaws in Budget Process
The Fifth Committee (Administrative and Budgetary) today heard Secretary-General Ban Ki-moon formally unveil an initial budget proposal of $5.197 billion for the 2012-2013 biennium that begins on the first of January.
The proposal, which was 3.7 per cent below the $5.396 billion budget framework laid down by the General Assembly this year, was the product of a careful exercise undertaken by the Secretariat’s senior managers, the Secretary-General said in his address to the Committee. Those managers had received a clear challenge to fulfil their mandates, rethink business practices, reduce overlap, embrace innovation and help modernize operations in the midst of a difficult global financial climate.
Though 3.2 per cent less than the current two-year biennium that was set to tally $5.37 billion at year’s end, the proposed budget and the detailed process behind the Secretariat’s number-crunching was criticized by several Member States. As in years past, additional expenditures and last minute revisions for currency fluctuations and inflation, the so-called recosting, meant the proposed budget would undoubtedly grow by hundreds of millions of dollars by the time it went before the General Assembly in December.
“The budget before you reflects a central challenge: how to resource this Organization at a critical time,” he said, stressing that the ongoing financial crisis was crippling many countries. The package was prepared against the backdrop of global financial austerity and uncertainty as Governments — and especially people — were struggling. “In these difficult circumstances, the world is turning more and more to the United Nations for answers and help,” he said, adding that the Organization must meet the needs of the peoples of the world while making the best possible use of the resources provided by its Member States.
Thanking delegations in advance, for what would be “hours and hours” of effort in the weeks ahead, and for the hard decisions they would have to take to reach a deal on the budget, he pledged to do everything possible to support the endeavour. “All I ask is that throughout this process, we never lose sight of why we are here: for the peoples of the world; so they can enjoy greater peace and security, human rights protections, development and a sustainable future. I count on your leadership and commitment,” the Secretary-General said.
Speaking on behalf of Liechtenstein, Switzerland’s delegate said an overhaul of the budget process was key to shaping a strong and modern United Nations. The 2010-2011 budget had increased by 10 per cent after the ritual recosting and add-ons, he said. “We can therefore safely predict that by the end of the 2012-2013 period, the current reduction of 3.7 per cent will have become a net increase,” he added.
Echoing that sentiment, the United States’ delegate called for ending the flawed practice of automatically adding to the previous budget cycle’s appropriations, which assumed that all previous mandates needed the same funding level and all new mandates required new resources. He called for a budget that was truly “final, comprehensive and stable for the full biennium” and reforming the budget process this year so the budget for the next biennium in 2014-2015 was prepared, presented and debated very differently.
Meanwhile, Chile’s delegate was concerned about proposed cuts in development programmes that would affect the Organization’s regional commissions, such as the Economic Commission for Latin America and the Caribbean (ECLAC). Speaking on behalf of the Rio Group, the Chilean delegate appealed to Member States to maintain the balance between the Organization’s three basic pillars — peace and security, human rights, and development — and guarantee that ECLALC and other United Nations bodies received adequate resources to meet their mandates.
The representative of Argentina, speaking on behalf of the Group of 77 developing countries and China, expressed deep concern over the “arbitrary” 3.2 per cent budget cut imposed on programme managers, saying that it could potentially jeopardize effective implementation of their mandates. “The impact of the global economic and financial crisis can not be used as an excuse to cut back and review intergovernmental mandates and priorities,” he declared, stressing that, on the contrary, the United Nations should redouble efforts to help the world’s poorest and most vulnerable.
Argentina’s delegate was among several Member States also expressed their concern about the tenfold expansion in the budgets of special political missions over the past decade. He said the budgets for these missions distorted the regular budget, as they now accounted for 20 per cent of the regular budget. “We will not acquiesce to priority activities funded by the regular budget to be jeopardized by the special political missions.”
Introducing the reports of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), Chairman Collen Kelapile said the Advisory Committee was also concerned about the impact that those special political missions would have on the budget.
During his address the Secretary-General said: “Special political missions have critical, life-saving mandates and often operate under extremely difficult conditions.” He added that detailed, individual budgets for each will be presented during the current session.
Also speaking today were delegates from Côte d’Ivoire, on behalf of the African Group, Belize (on behalf of the Caribbean Community (CARICOM)), Canada (on behalf of Australia and New Zealand), Mexico, and Nicaragua.
The Head of the Delegation of the European Union also addressed the Committee.
The Fifth Committee will reconvene on Friday, 28 October, at 10 a.m., to resume its discussion of the budget.
The Fifth Committee (Administrative and Budgetary) met this afternoon to begin its consideration of the budget of the United Nations for the coming biennium, and several related issues. Delegations had before them some three dozen documents related to the proposed 2012-2013 budget.
Issued 27 May 2011, Proposed programme budget for the biennium 2012-2013 foreword and introduction (documents A/66/6 Introduction, Sections 1-37, and Income Sections 1-3) includes a foreword by Secretary-General Ban Ki-moon and lays out a biennial budget of nearly $5.2 billion, before recosting. That figure is about $200 million, or 3.7 per cent, less than the approved budget outline level of nearly $5.4 billion set out in paragraph 9 of resolution 65/262. It is $170.24 million, or 3.2 per cent less, than the revised appropriation of the 2010-2011 biennium of $5.37 billion.
The 2012-2013 biennium budget includes a proposed staffing level of 10,263 posts, compared to 8,989 in 2000-2001 and 10,307 in 2010-2011. The decrease of 44 posts from the 2010-2011 budget cycle consists of a net increase of 23 Professional posts and a net decrease of 67 General Services and related categories posts.
The distribution of the Organization’s financial resources into 14 budget parts is laid out in a table found on page 7 of this document. The 14 sections of the budget are compared with the revised appropriations for the 2010-2011 budget cycle. This includes Section I, Overall policymaking, direction and coordination; Section II, Political affairs; Section III, International justice and law; Section IV, International cooperation for development; Section V, Regional cooperation for development; Section VI, Human rights and humanitarian affairs; Section VII, Public information; Section VIII, Common Support Services; Section IX, Internal oversight; Section X, Jointly financed administrative activities and special expenses; Section XI, Capital expenditures; Section XII, Safety and security; Section XIII, Development Account; Section XIV, Staff assessment.
With recosting, the proposed budget would total $5.34 billion at preliminary 2012-2013 rates, the 55-page report says. In accordance with established practice and methodology, the proposed programme budget will be recosted prior to its adoption by the Assembly during its sixty-sixth session. At that time, the latest data on actual inflation experience, the outcome of salary surveys and the movement of post adjustment indices in 2011 would be taken into account. The approved programme budget will then be issued as Official Records of the General Assembly, sixty-sixth session, Supplement No. 6 (A/66/6/Add.1).
In addition, the Committee had before it more than a dozen documents on various issues. These included the Secretary-General’s report Implementation of projects financed from the Development Account: seventh progress report (document A/66/84), which looks at implementation of the Account’s fifth tranche of projects. These projects fall under the theme “supporting progress towards the internationally agreed development goals, through knowledge management, networking and partnership”, implemented from 2006 to 2009. The report also gives updates on managing and coordinating the Account, which was created to provide essential funding for the Secretariat’s operational activities for development.
The Advisory Committee on Administrative and Budgetary Questions (ACABQ) weighs in on the issue with its 344-page survey on the proposed programme budget for the biennium 2012-2013 (document A/66/7, along with documents A/66/7/Corr.1 and A/66/7/Add.5), issued 11 August 2011. In the first 50 pages that make up Chapter I, the Advisory Committee lays out its general comments, observations and recommendations on issues from monitoring and evaluation, to personnel matters and training, to information and communications technology. Detailed recommendations are then provided for each of the 14 sections of the proposed budget in Chapter II.
In its overall position, the Advisory Committee by and large accepts the budget level proposed by the Secretary-General. In Chapter II, it issues specific recommendations regarding posts and expenditures that do not significantly affect the overall level of the budget. The Advisory Committee did not provide a final costing for these recommendations since, if accepted by the Assembly, they will be recalculated by the Secretariat and then sent to the Fifth Committee before the budget is adopted.
The Advisory Committee notes that the overall proposed budget level, and its position on the overall proposals, will be possible only after the Secretariat submits a number of separate reports that carry financial implications. These are to be sent to the Assembly during the main part of its sixty-sixth session. There also will be proposals for special political missions that will impact the overall level of resources for the biennium 2012-2013. It points out that provisions for such missions during the biennium will hinge on decisions made by the Assembly and/or the Security Council to establish or renew mandates.
Because resource proposals for 2012 for special political missions have yet to be prepared, the Advisory Committee believes that the additional reduction of $35 million in the estimate for ongoing missions can be considered only as a preliminary projection. The level of cuts reflected in the Secretary-General’s projections for special political missions during this biennium may be optimistic, and will not necessarily translate into savings. The Advisory Committee believes it is essential that the Secretary-General demonstrate restraint when presenting the budgetary proposals for special political missions.
Acknowledging that unforeseen requirements arise and need to be addressed outside the normal biennial regular budget cycle, the Advisory Committee believes that issues that were foreseen during preparations for the proposed programme budget could have been included in the Secretary-General’s proposals. At a minimum, the indicative estimates could have been provided.
Even though the Advisory Committee understands the Assembly will have the additional reports when it considers the proposed programme budget for the biennium 2012-2013, the Advisory Committee says in its report that it is concerned that a piecemeal approach does not give it the full information it requires to provide the Assembly with advice.
Further to the report, the Advisory Committee says it has consistently emphasized the importance of the ongoing review of programmes and business processes to ensure the most effective and efficient delivery of mandates. The Advisory Committee believed the proposed programme budget should reflect an increased emphasis on results, not only in programme delivery, but regarding the efficiency with which resources approved by the General Assembly are used. As such, the Committee has made a number of recommendations with that objective in mind.
The Advisory Committee particularly believes that future proposed programme budgets should include more information on the status and results of major reform initiatives, the demonstrated impact of efficiency measures being undertaken and the conclusions drawn from monitoring and evaluation activities. The Committee trusts that its recommendations and observations will help ensure that resources are used efficiently and effectively to deliver on the mandates of the Organization.
Also before it was the Secretary-General’s Progress report on the implementation of the recommendations of the report of the Office of Internal Oversight Services (OIOS) on the efficiency of the implementation of the mandate of the Office of the United Nations High Commissioner for Human Rights (OHCHR) (document A/66/74). This report notes that almost half of the recommendations have been implemented, particularly those relating to OHCHR’s strategic focus and the strengthening of partnerships. An annex to the report lists the status of all the recommendations. The report points to substantial progress in the overarching field strategy, work with human rights bodies, internal coordination and communication, and critical work processes. Based on the substantial progress made on the outstanding recommendations, the Secretary-General expects that all of them will be fully implemented on target by year’s end.
The Committee was also expected to take up the report of the Independent Audit Advisory Committee on Internal oversight: proposed programme budget for the biennium 2012-2013 (document A/66/85), which reflects the Audit Committee’s comments, advice and recommendations on the proposed programme budget for the 2012-13 biennium of OIOS. It calls for particular attention to filling OIOS vacancies quickly and recognizes the merit in supporting the Under-Secretary-General in overall departmental strategy, intradepartmental cooperation initiatives, and monitoring of divisional activities. Supporting systematic assessment of residual risk, it backs the proposal for the audit of key controls as contained in the OIOS budget and says future budgets should be based on residual risk.
In the light of the call for revised funding arrangements for OIOS, the Audit Committee believes the issue of funding, including programmes funded from extra-budgetary resources, should be revisited. It supports the proposed organizational restructuring within the OIOS investigation subprogramme. Given the fact that OIOS had yet to complete a fully risk-based plan or adequately show the value-added component of its services, coupled with the significant number of OIOS vacancies and budgetary pressures in the United Nations, the Advisory Committee says it would not object to an Assembly decision to subject OIOS to the same across-the-board budget cuts as other United Nations entities. But it believes the Under-Secretary-General for Internal Oversight Services should be allowed to exercise discretion over how to allocate such cuts.
The Committee was also set to review the Report of the Committee for Programme and Coordination (document A/66/16), which highlights the work of the Committee for Programme and Coordination during its fifty-first session, held 6 June to 1 July 2011. Issued 5 July 2011, the report focuses on two topics. The first topic focuses on Programme questions, including the programme budget for the biennium 2010-2011 and the proposed programme budget for the biennium 2012-2013, and evaluation. The second topic focuses on Coordination questions, including the annual overview report of the United Nations System Chief Executives Board for Coordination for 2010/2011, and the United Nations system support for the New Partnership for Africa’s Development (NEPAD).
Also before the Committee was the report of the Secretary-General, Consolidated report on the changes to the biennial programme plan as reflected in the programme budget for the biennium 2010-2011 and the proposed programme budget for the biennium 2012-2013 (document A/66/82). The report, issued 18 May 2011, responds to Assembly resolutions that ask the Programme Committee to review the programmatic aspects of new and/or revised mandates after the adoption of the biennial programme plan. The Programme Committee also looks at any differences that emerged between the biennial programme plan and the programmatic aspects of the proposed programme budget.
The Committee had before it a note by the Secretary-General, Review of management and administration in the United Nations Office on Drugs and Crime (document A/66/315), transmitting the Joint Inspection Unit report of the same name (document JIU/REP/2010/10). The Joint Inspection Unit’s review of the United Nations Office on Drugs and Crime (UNODC) is one of a series of reviews completed in recent years to produce improvements in participating organizations in areas from management to budgeting.
In one of its main findings, the report notes the difficult situation UNODC faces with an increasing number of mandates and activities and insufficient financial and human resources. While its tightly earmarked voluntary contributions are increasing, the Office lacks regular funding to meet its core functions.
The Joint Inspection Unit also concludes that UNODC has to deal with complex financial management issues through two separate trust funds. Set up in 1997 by merging various United Nations entities, the Office’s two original governing bodies — the Commission on Narcotic Drugs and the Commission on Crime Prevention and Criminal Justice — and their trust funds were kept unchanged. The Joint Inspection Unit urges the exploration of opportunities to merge the two trust funds.
In an addendum (document A/66/315/Add.1), the Secretary-General transmitted his comments on the Joint Inspection Unit’s recommendations. In response, the two original governing Commissions will begin holding joint meetings in December 2011 and the Assembly may address the recommendation to fund the Office’s core functions with its regular budget resources within the context of the proposed programme budget for the biennium 2012-2013. The Secretary-General accepted all but one of the 12 recommendations addressed to the Executive Director. He did not accept the call for the Office’s Executive Director to place the Secretary of the International Narcotics Control Board directly under his responsibility.
Also before the Committee was a note by the Secretary-General on Policies and procedures for the administration of trust funds in the United Nations system organizations (document A/66/348) transmitting the Joint Inspection Unit report of the same name (document JIU/REP/2010/7) and an addendum (document A/66/348/Add.1). The Joint Inspection Unit’s report contains 13 recommendations after reviewing the policies, rules and regulations surrounding the management of these trust funds and the major trends.
Finally, the Committee considered a report of the Office of Internal Oversight Services on the Review of the organizational framework of the public information function of the Secretariat (document A/66/180) issued on 25 July 2011. Mandated by the Assembly with resolution 62/236, the review included all departments of the Secretariat, all duty stations, field missions and entities subject to OIOS oversight.
The review showed that the organizational framework of the public information function was larger than the original department established for that role. There were now 2,113 full-time posts, or 4 per cent of the Secretariat staff, and nearly $50 million in non-post resources directly devoted to the public information functions. Seventy-four per cent, or 1,571 posts, were located away from Headquarters, including 823 posts in peacekeeping missions.
The report stated it was “clearly time” to review the approach to the department’s framework in order to lay out an overall vision, the roles of its respective entities, and the amount of desired coordination. OIOS recommends that department develop and present to the Committee on Information an action plan that would look at the roles and responsibilities for coordinating the public information function in the Secretariat.
This would include: the role of the Department of Public Information; the role of other Secretariat entities; priorities of any coordination activities; the need for a strategic plan for public information and communications in the Secretariat that outlines a vision and broad priority issues and addresses the priorities and vision of the Secretary-General; and the need to maintain data on post and non-post resources with levels and funding sources.
Introduction of Budget
Presenting his 2012-2013 budget proposal, United Nations Secretary-General BAN KI-MOON said the budget reflected the challenge of providing the Organization with sufficient resources as a financial crisis crippled many countries and Governments and when many people were struggling. “In these difficult circumstances, the world is turning more and more to the United Nations for answers and help”, he said, adding that the Organization had a responsibility to make the best use of the resources provided by Member States. The budget was the product of a careful exercise during which senior managers received a clear challenge to fulfil their mandates, rethink business practices, reduce overlap, embrace innovation and help modernize operations, he said.
Reflecting a wide range of adjustments based on efficiencies, improvements and investments, he said the proposed 2012-2013 budget of $5.197 billion, before recosting, was 3.7 per cent below the approved budget outline of $5.396 billion. That represented a savings of nearly $200 million as the Organization delivered fully on its mandates. The new budget was 3.2 per cent less than the current 2010-2011 biennium. In line with established practice, it included a preliminary recosting which would add $147 million, bringing regular budget requirements to $5.344 billion.
Continuing, he said there was a net decrease of 44 posts, reached by abolishing 147 posts, adding 63 new posts, and converting 40. The Secretariat had cut costs for travel, consultants, general operating expenses, supplies, materials and equipment. The proposal also included a provision of more than $1 billion for special political missions, related to peace and security, which were expected to be extended or approved during the biennium. That was slightly more than was initially approved for the 2010-2011 budget, but below the current revised level.
“Special political missions have critical, life-saving mandates and often operate under extremely difficult conditions,” said the Secretary-General, adding that detailed, individual budgets for each will be presented during the current session. He went on to explain that the budget proposal also included resources to strengthen the management capacity of the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA), and to let the Office of the High Commissioner for Human Rights meet new and expanded mandates.
The Fifth Committee would receive other reports at this session on essential requirements, including a proposal to strengthen the administration of justice and prepare for the Strategic Heritage Plan, he said.
Noting that the budget was prepared against a global backdrop of “financial austerity and uncertainty,” the Secretary-General said the Secretariat had paid attention to technical and mechanical issues and ways to best meet the mandate set by Member States. Managers had full discretion to review their business processes and find the optimal approach to funding their operations, he added.
Information and communications technology would generate substantial efficiencies once fully deployed, making the Organization’s operations more modern, accountable and effective. The Secretariat was fully committed to implementing an Enterprise Resource Planning system, as well as the International Public Sector Accounting Standards. The Organization would have its first International Public Sector Accounting Standards-compliant financial statements by 2014.
“I will continue to update and improve the way we operate, including through the Change Management Team,” said the Secretary-General, adding that Member States would receive information on this project.
He urged the Fifth Committee to find compromises that would strengthen the Organization and pay attention to the fine working details. “Without the Fifth Committee’s painstaking labour, it would not be possible to implement the work of the other Committees,” he said. Thanking the Committee members in advance for their hours of work in the weeks ahead, Mr. Ban added: “All I ask is that throughout this process, we never lose sight of why we are here: for the peoples of the world; so they can enjoy greater peace and security, human rights protections, development and a sustainable future”.
COLLEN KELAPILE, Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introduced that Committee’s reports on the proposed programme budget for the biennium 2012-2013 (documents A/66/7 and A/66/7/Corr.1), as well as the document for the proposed resources for the International Trade Centre, International Trade Centre, Sixth report of the Advisory Committee on Administrative and Budgetary Questions on the proposed programme budget for the biennium 2012-2013 (document A/66/7/Add.5).
While largely agreeing with the proposed programme budget initially presented by the Secretary-General, the Advisory Committee believed the short time that programme managers had had to carry out the reviews requested by the Secretary-General meant the reviews were not completed in a comprehensive manner. As a result, the proposed reductions were neither significant nor structural and were unlikely to be sustainable. In addition, programme managers were given full discretion to decide how to reach the cutbacks, without specific direction to use any particular efficiency measures throughout the Organization. As a result, the reductions were reached through disparate measures, ranging from the abolition of posts to delaying the normal replacement cycle of furniture.
The Advisory Committee believed that future proposals should have more focus on results and the budget proposal should have provided information linking the particular efficiency measures to the resource proposals.
He noted that the budget’s final level would be known when additional proposals were placed before the Assembly. Since its review of the initial budget, the Advisory Committee had received separate reports with financial implications for the biennium 2012-2013. For the reports it had considered to date, the Committee had learned that additional requirements of about $23.5 million had been proposed for 2012-2013.
The Advisory Committee was concerned about the impact of special political missions on the budget, as well as proposed reductions in the Secretariat departments and offices that were given additional resources, under Assembly resolution 63/260, to strengthen the Organization’s development-related mandates. With regard to staffing, he said the Advisory Committee was concerned that the Secretary-General’s overall profile on relevant proposals would contribute to “grade creep” and the increased vacancy rate in General Services posts and related categories.
The Advisory Committee pointed to the Organization’s significant resources being spent on information and communications technology and it recommended a comprehensive picture of the total resources proposed for that technology be included in the budget’s introduction in the future. He said the Advisory Committee was disappointed with the delays in the implementation of the Enterprise Resources Planning System (Umoja). Understanding that the Secretary-General intended to implement the project in phases, focusing initially on launching the International Public Sector Accounting Standards, he stressed that the other management improvements that Umoja was intended to enable were essential. It expected that the project would also be delivered within budget.
DIEGO LIMERES (Argentina), speaking on behalf of the Group of 77 and China, expressed deep concern over the “arbitrary” 3.2 per cent budget cut imposed on programme managers, saying that it could potentially jeopardize effective implementation of their mandates. “The impact of the global economic and financial crisis can not be used as an excuse to cut back and review intergovernmental mandates and priorities,” he declared, stressing that, on the contrary, the United Nations should redouble efforts to help the world’s poorest and most vulnerable.
The clear tendency to cut funds for development was a “tragic situation”. The Secretary-General’s proposed budget must be improved to adequately reflect the General Assembly’s priorities. It was currently unbalanced to the detriment of development-related activities, thus hindering the Organization’s ability to carry out its mandate. The regular budget should fund a more ambitious role for development in the Secretariat and a stronger role for the Economic and Social Council’s regional commissions.
The Development Account was a suitable tool for coping with the evolving needs of the development agenda, but it comprised just 0.4 per cent of the overall regular budget, far short of the Assembly’s original intention to establish a true dividend for development at $200 million. He strongly supported creating an appropriate funding mechanism for that account through the regular budget, including, but not limited to, the savings from implementing the enterprise resource planning system.
He also expressed worries over the growing imbalance between assessed and voluntary contributions that had created “privileged” mandates, which benefited from a steady flow of funds from assessed and voluntary contributions; and “neglected” ones, which were constantly under-funded and scrambling for a few “crumbs” from the regular budget. He firmly rejected that double standard. All mandates approved by intergovernmental organizations, particularly those related to development, must receive predictable, adequate funding.
The time had come to set up an effective, inclusive governance framework in the Assembly to ensure oversight and accountability over voluntary contributions, he said. The increase in the budgets for the special political missions, which now accounted for 20 per cent of the regular budget, distorted it. “We will not acquiesce to priority activities funded by the regular budget to be jeopardized by the special political missions,” he said. The Group looked forward to examining, as a matter of priority, the Secretary-General’s thorough review of current funding and backstopping arrangements for such missions, with a view to identifying possible alternatives. The funding of reform initiatives could not divert much-needed resources to finance the Organization’s substantive areas.
He asked the Secretary-General to abide the Assembly’s mandate to not abolish the post of the Special Advisor for Africa, but rather fill it as a matter of priority without further delay. To increase accountability, transparency and inclusiveness in the Organization, he asked that all formal meetings during the Committee’s current session be broadcast live and that sound recordings of its previous formal meetings during the current session be made immediately available on the United Nations website. Live webcasting should be extended to all meetings of the Assembly’s main Committees henceforth.
MANAHI PAKARATI (Chile), speaking on behalf of the Rio Group, said her delegations had seen an increasing lack of balance in the treatment of the three basic pillars of the Organization in recent decades. The Group disagreed with “indiscriminate cutting” and believed that budget allocations for the United Nations and its subsidiary organs should ensure the Organization was able to properly perform all its mandates. It was particularly interested in ensuring adequate financing for the development pillar, particularly the Economic Commission for Latin America and the Caribbean (ECLAC). That body had successfully fought poverty and inequality, improved access to education and health, upheld the rights of indigenous people and promoted sustainable development in the region.
Concerned about proposed cuts in the Commission’s resources, she said the Rio Group found it “discriminatory” that the proposed 3 per cent cut had not been applied uniformly to all units in the United Nations system. While some departments had maintained their original proposed budgets, others had actually increased their budgets. The regional commissions were most affected by that measure, particularly regarding development programmes. She appealed to Member States to maintain the balance between the Organization’s three basic pillars — peace and security, human rights, and development — and guarantee that ECLAC and other United Nations bodies received adequate resources to meet their mandates.
The Rio Group also was concerned about the tenfold expansion in the budgets of the special political missions over the past decade. Those missions now accounted for 20 per cent of the regular budget. In addition to producing inefficiencies, duplication and wasting resources, the current financing arrangements for these missions did not consider the special responsibilities of the permanent members of the Security Council for maintaining peace and security, she added.
BROUZ RALPH COFFI (C ôte d’Ivoire), speaking on behalf of the African Group, expressed concern over the 3 per cent “arbitrary” budget cut imposed on programme managers and the fact that the resources proposed by the Secretary-General might be insufficient to effectively address the Assembly’s priorities, particularly in the context of the global economic and financial crisis, humanitarian crises due to climate change, threats to peace and security, and the development agenda. The noble goals of efficiency, transparency and accountability should not be confused with indiscriminate cost-cutting that could “haemorrhage the Organization to the point of ineffectiveness”. He expressed disappointment that while the United Nations should rightly be taking the lead in promoting development, the Secretary-General’s proposed programme budget was manifestly skewed, as only 10 per cent of funds were earmarked for development-related activities.
He regretted that the current budget proposal did not provide for resource growth in the Development Account and that the envisioned goal of providing that Account with $200 million remained a “distant dream.” The African Group was prepared to explore additional ways to enhance that mechanism’s financing. He expressed deep concern that the post of Special Advisor on Africa remained vacant and called on the Secretary-General, in line with five consecutive Assembly resolutions, to fill it without further delay. He looked forward to discussing how to further strengthen the regional economic commissions. The Secretary-General should bolster efforts to bring the financial situation of the United Nations Office at Nairobi in line with those of similar administrative offices.
He called for enhanced transparency and accountability in staff recruitment and for urgently addressing the lack of proper representation of the African Group among the Organization’s senior ranks. Extra-budgetary resources were important, but they should not provide an avenue for circumventing or re-aligning governmental priorities or mandates. He called for proper mechanisms to enhance transparency and accountability in approving, utilizing and reporting on those resources, which should not provide a way for donors to facilitate recruitment of their nationals to United Nations posts, thus exacerbating the Organization’s current geographic and gender imbalance.
He went on to express concern over the distorting effect of integrating funding for the special political missions into the regular budget. The budget for those missions had ballooned from $100 million in 2000 to $1.2 billion currently. He looked forward to the Secretary-General’s report on review of the current funding and backstopping arrangements for those missions.
JANINE ELIZABETH COYE-FELSON (Belize), speaking on behalf of the Caribbean Community (CARICOM), said the budget was an authoritative statement that should reflect the strategic vision of the Secretary-General. CARICOM member States shared the widespread concern for the continued global economic upheaval. While the more advanced countries had managed to implement counter-cyclical measures to address the impact of the crisis, many others were left without fiscal or policy options. Indeed, CARICOM States had largely been forced into a recession. Indeed, the gains its Member States had made were now “tenuous at best, slipping at worst”. In the midst of such uncertainty, she stressed: “It is ever more important to invest in the United Nations”.
CARICOM Member States were therefore greatly concerned with the “arbitrary” cut of 3.7 per cent in resources, especially since that decision was taken without any formal approval from the General Assembly. That cut aimed to “appease the desire of only a few Member States”, she added, pointing out that the budget assigned less than one dollar to each of the world’s inhabitants. The argument that the financial and economic crisis warranted such action was untenable, she continued, asking why trillions should be spent to salvage domestic banks while pennies were taken away from programmes for the poor. “Why should the United Nations, an Organization that remains a beacon of hope for the most vulnerable across the globe, pay the price for poorly regulated markets and industries?” she wondered.
Among CARICOM’s specific concerns with regard to the proposed budget were the proposals to cut funding available to the regional commissions; the fact that the development account amounted to only 0.4 per cent of the overall regular budget, falling short of the original intent of the General Assembly to establish a true dividend for development at $200 million; and the ever-increasing imbalance between assessed and voluntary contributions. While the funding of development activities had been reduced, the budget of special political missions — which was integrated into the level of the regular budget — had grown dramatically from $100 million in 2000 to $1.2 billion, she said. Such disproportionate growth engendered the false impression that the regular budget was somehow spiralling out of control, which could not be further from the truth. CARICOM also took the opportunity to insist that the post of Special Advisor for Africa be filled as a matter of priority.
GUILLERMO RISHCHYNSKI (Canada) took the floor on behalf of Australia and New Zealand and said his delegation was concerned about the practice of introducing additional, often significant, expenditures beyond the initial budget proposals, particularly when such add-ons could have been foreseen. The additional process of adjusting the budget to account for inflation and exchange rates also had led to final budget levels that were higher than original proposals. The delegation looked forward to a report of the Secretary-General on the practice of recosting and a serious review of the matter, which was long overdue.
Ever watchful for potential areas for savings, his delegation believed the delivery of conference services offered an opportunity for greater efficiency and cost-effectiveness. While acknowledging the hard work and dedication of all United Nations staff, he said his delegation supported controlling growth in personnel costs. It would scrutinize the budgets of the special political missions to be sure they had the resources to deliver their mandates while remaining subject to strong financial discipline.
He was concerned by the delay in implementing Umoja and potential requirements for additional resources, and that funding requests for information and communications technology continued to increase. Recognizing that budget discipline had to go hand-in-hand with strong organizational accountability, the delegation fully supported the efforts of the Office of Internal Oversight Services (OIOS) to strengthen its role, including the proactive investigation of serious corruption, he added.
THOMAS GUERBER (Switzerland), speaking also on behalf of Liechtenstein, said that while the two countries welcomed a budget proposal that was 3.7 per cent below the amount authorized in the budget outline, they were nevertheless aware that the budget was certain to grow. If the proposed programme budget and revised appropriation of the 2010-2011 biennium were compared, the 2010-2011 budget increased by 10 per cent as a result of the impact of ritual re-costing and add-ons. “We can therefore safely predict that by the end of the 2012-2013 period, the current reduction of 3.7 percent will have become a net increase,” he added.
The inability to avoid this “systematic overspending” revealed the basic flaw of a budget process that no longer met the requirements of an Organization that had changed greatly in recent years. Neither the Secretariat nor Member States seemed able to exert any strategic oversight of the process, he added. “The Member States end up practicing micromanagement with regard to a budget which is presented to them piecemeal, having to negotiate on questions of resources with every budget fascicule, while no real consideration is given to the Organization’s strategic orientation,” he added.
Switzerland and Liechtenstein wanted a strong and modern United Nations, and structural reform of the budget process — closely based on strategies and results — was a necessary part of achieving this goal. He called upon the Secretariat to demonstrate leadership in this area and hoped the Change Management Team would make a contribution.
THOMAS MAYR HARTING, Head of the delegation of the European Union, welcomed the Secretary-General’s efforts to prioritize funding requests and identify more cost effective ways to deliver. The Union remained a staunch supporter of the Organization and its adequate funding but still saw substantial opportunities for improving efficiency, through rigorous implementation of a results-based management and budgeting approach. On the ACABQ’s review of the proposed budget, he seconded the Committee’s positive response to the Secretary-General’s efficiency review initiative, but also shared the ACABQ’s view that there was scope to propose efficiencies that were more significant and structural in nature, as well as sustainable in future budgets.
Until now, he added, the necessary dialogue had not taken place on ensuring the greatest efficiency in the use of resources, according to principles of budgetary discipline and coherence in conformity with the highest international standards. He looked forward to engaging constructively with the Secretariat and all Member States on adjusting the proposed budget to a level that respected the current economic realities of Member States, including their actual capacity to contribute to the United Nations budget according to their share of the world gross national income (GNI). The current scale of assessment did not fully respect the principle of capacity to pay, which was clearly recognized by General Assembly resolution 64/248. The establishment of a new methodology for the scale of assessments, reflecting a fairer and more balanced distribution of financial responsibilities among States according to their capacity to pay, was a key European Union priority.
All measures needed to be taken to avoid a “piecemeal approach”, he said, reiterating the importance of considering how to reform the United Nations budget process so as to achieve greater discipline, transparency, flexibility and accountability, while moving away from incremental budgeting. In that light, he regretted the practice of attaching add-ons to the proposed budget, even before negotiations had started, which kept Member States from seeing the overall picture of their contributions. New and creative approaches to other “questionable” budgeting habits, such as the lack of prioritization in funding requests, the automatic replacement of retiring officials and recosting were needed. At the same time, he continued to support management reform processes that sought to modernize the Organization. As much had been invested in those initiatives, it was fair to expect substantial benefits, yet more investment had been requested.
JOSEPH M. TORSELLA (United States) supported the Group of 77 and China’s call, in the interest of transparency and accountability, for live webcasting all the Fifth Committee’s formal meetings. He lauded the Secretary-General for seeking to halt a 10-year trend of budget increases and “for courageously telling this Organization not what it wants to hear but what in needs to hear: that these are not ordinary times”. He lauded the Department of Public Information’s proposed $5 million in budget cuts, to be accomplished by introducing modern information management technologies, wider Internet use and online reporting and management tools.
It was urgent to set the United Nations on a path of real fiscal discipline by passing a budget with substantial and sustainable reductions, in particularly by tackling escalating personnel costs, which now accounted for 74 cents of every dollar the Organization spent. He called for a freeze on pay for United Nations staff while the comparator salaries of the United States federal civil service were frozen. He also repeated his call for repealing the nearly 3 per cent raise given to New York employees through the cost-of-living adjustment in August. The trend of upwardly classifying posts should be reversed. The Secretariat should comprehensively review all current employee benefit programmes and costs.
The new budget must be binding and prevent the United Nations from spending more than was actually approved during the current Assembly session, he said. Expressing concern over continued add-ons at considerable cost and large additions to the budget due to recosting, he sought further details and analysis on options, such as currency hedging, to address that. The United Nations budget was too complex and opaque, with “too much data, but too little useful information”. Managers should be required to have greater accountability, but they should also be given more flexibility to redeploy some resources within and among budget sections.
The United Nations results-based budgeting process required a major overhaul from process and outputs to results and outcomes. He called for ending the flawed practice of adding to the previous budget’s appropriations with the assumption that all previous mandates be met in the same way and required the same funding level, and that all new mandates required new resources. He called for a budget that was in fact “final, comprehensive and stable for the full biennium” and for reforming the budget process this year so that the 2014-2015 budget was prepared, presented and debated very differently.
JULIO CAMARENA VILLASEÑOR (Mexico) said his delegation rejected the “piecemeal” approach that had characterized the Organization’s budgeting exercise in recent years, which only justified new requirements and presumed its baseline as a given. Such a technique inevitably led to constant increases and prevented an in-depth analysis of overall requirements. Mexico recognized the Secretary-General’s efforts in presenting a proposal that sought reductions on the basis of the budget outline approved by the General Assembly. But, he agreed with the Advisory Committee that the proposed reductions were not significant or structural and such cuts would be unsustainable in future budgets.
He was concerned that many proposed reductions that would be considered by the membership were difficult to materialize due to the fact that they were based on unrealistic assumptions. Such was the case of the proposed cuts to the special political missions, or those that were proposed without the consent of the appropriate intergovernmental bodies. Additionally, he was still expecting “add-ons” to the budget. He proposed postponing consideration of the Strategic Heritage Plan of the Palais de Nations in Geneva, as well as the information and communications technology proposals.
An issue that did not allow further delays was the financing of the Special Political Missions. Those operations, which were mandated mainly by the Security Council and represented one quarter of the regular budget, had evolved to become something rather different from the “small and efficient” good offices missions and special envoys of the Secretary-General to become field missions virtually non-differentiated from Peacekeeping Operations. In that regard, it was a priority to establish a separate account and decide on the apportionment of the expenses for such Missions. The global financial crisis had prompted a great number of Member States to take specific measures to reduce public spending. The United Nations could not be isolated from this reality and its budget must reflect the budgetary austerity of its membership.
DANILO ROSALES DIAZ (Nicaragua) was “amazed” by the unbalanced proposed budget. Development continued to be the “Cinderella” of the regular budget and there were attempts to take away from the strengthening of the development pillar. The Secretary-General’s call on programme managers to cut 3 per cent of their budgets flouted legislative mandates. The cuts were applied selectively and harmed development goals. But the Department of Management called for an increase of 25.6 per cent, rather than practicing what it preached. That was unjustifiable, especially in light of the serious governmental crisis of the enterprise resource planning project and the fact that the Director of Management and the Under-Secretary-General for Management had rejected the Chair of the project’s Steering Committee. It was inconceivable that the Development Account only comprised 0.4 per cent of the proposed regular budget, quite far from goal set in 1997 to fund it with $200 million dollars by 2002.
The highest budgetary increase, in absolute terms and in terms of percentage, was for the special political missions, whose budget rose by 1,200 per cent from $100 million in 2000 to an estimated $1.2 billion at the end of 2010, he said. That adverse distortion to the regular budget must be eliminated. He expressed concern that voluntary contributions were twice as great as the assessed contributions. Such voluntary funds should gradually be incorporated into the regular budget. He expressed concern that the voluntary funds were used as a way to create posts outside the Assembly’s mandate, thus exacerbating the Organization’s current geographic and gender imbalance. The budget imbalance reflected the Organization’s lack of global vision. The budget must be a true reflection of the Assembly’s mandates. Nicaragua would refuse any attempts to impose artificial limits on necessary expenses, which would continue to increase with the approval of new mandates.
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