Budget Committee Takes Up Proposal to Restructure Pensions for International Judges, Report of High-level Working Group on Programme Criticality

6 March 2012
GA/AB/4023

Budget Committee Takes Up Proposal to Restructure Pensions for International Judges, Report of High-level Working Group on Programme Criticality

6 March 2012
General Assembly
GA/AB/4023
Department of Public Information • News and Media Division • New York

Sixty-sixth General Assembly

Fifth Committee

27th Meeting (AM)

Budget Committee Takes Up Proposal to Restructure Pensions for International

Judges, Report of High-level Working Group on Programme Criticality

 

The Fifth Committee (Administrative and Budgetary) today weighed in on the Secretary-General’s proposal to restructure the pension schemes for incoming judges of three United Nations courts — a move that would save the Organization nearly $10 million in the next three decades.

The Secretary-General discussed the details of that proposal, which would apply to members of the International Court of Justice and judges of the International Tribunal for the Former Yugoslavia and the International Criminal Tribunal for Rwanda, in a report introduced today by Martha Helena Lopez, Director of the Strategic Planning and Staffing Division of the Office of Human Resources Management (OHRM).

Under the current two-tiered system, judges accumulated a pension of 5.56 per cent annually in the first nine years of service, followed by 1.85 per cent each year thereafter, until reaching a maximum of 66.67 per cent. 

The Secretary-General proposed replacing that with a linear system in which judges accumulated 3.7 per cent annually for 18 years and nothing thereafter.  As a result, the estimated liability for new judges projected to assume office over the next 30 years would be cut by $9.96 million.

Collen Kelapile, Chair of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), who supported that proposal and asked the Assembly to endorse it, said that changing to a linear system of accumulation would reduce the actuarial cost of funding the pension entitlement over a 10‑year period from 66 per cent of the judges’ base pay to about 44 per cent.  It could also encourage longer periods of service among the judges.

Mr. Kelapile introduced the Advisory Committee’s report on the matter, which backed the Secretary-General’s suggestion that the new arrangements should only apply to new Court members and Tribunal judges.

The representative of Algeria, speaking on behalf of the “Group of 77” developing countries and China, said the Organization’s pension scheme should give adequate after-service benefits to judges.  He was ready to discuss the various pension scheme options and stressed that any outcome should enhance the Court’s performance, not undermine it through decreased pension benefits.  Nor should it set a precedent for any other category of judges working in the United Nations.

Also today, the Committee discussed the merits of a new, emerging tool to determine “programme criticality” — or whether programme activities carried out by United Nations personnel were justified, taking into account the expected security and safety risks involved.

Gregory Starr, Under-Secretary-General of the Department of Safety and Security, introduced the Secretary-General’s report on the High-level Working Group on Programme Criticality, which was developing a programme to help the Organization better balance security risk to personnel and programme implementation.

Weighing in on that matter with its own report, which was introduced by Mr. Kelapile, the Advisory Committee supported the use of extraordinary resources to fund the initial roll-out of the programme in 12 countries by April 2013, saying that the Organization had an obligation to ensure predictable funding for ongoing initiatives to protect personnel.  Further, the Advisory Committee recommended that once the programme criticality framework was finalized, appropriate cost-sharing arrangements for its full roll-out should be set up.

Algeria’s representative, speaking again on behalf of the Group of 77 and China, stressed the need to develop standard criteria for the Department of Safety and Security to assess and respond coherently and in a timely way to security-related threats and other emergencies.  He asked for more information on the detailed phases, benchmarks and timelines of the programme criticality framework.

The Fifth Committee will reconvene at 10 a.m. on Tuesday, 13 March, to begin its review of efficiency, including on accountability and reports of the Joint Inspection Unit (JIU), and its consideration of appointments to fill vacancies in the Committee on Contributions and the International Civil Service Commission.

Background

The Fifth Committee (Administrative and Budgetary) met today to begin its consideration of conditions of service of judges and safety and security: programme criticality.

On the first topic, the Committee had before it the Secretary-General’s report on the comprehensive review of the pension schemes for the members of the International Court of Justice and judges of the International Tribunal for the Former Yugoslavia and the International Criminal Tribunal for Rwanda (document A/66/617), which gives background on the pension schemes, the terms of reference for the comprehensive review, an analysis of current retirement benefits, pension benefit design options and recommendations and their financial implications.  In line with General Assembly resolution 65/258, the Assembly will conduct its next comprehensive review of the schemes during its sixty-eighth session.  One annex to the report gives a year-by-year breakdown from 2011 through 2050 of the projected annual pension benefit payments for retired, active and prospective judges.  A second annex compares in detail the pension benefits of members of the Court and judges and ad litem judges of the Tribunals with those of judges in comparable judicial positions.

The report states that, while the Assembly has repeatedly affirmed that conditions of services and compensation for non-Secretariat officials shall be separate and distinct from those applied to Secretariat staff, the current defined-benefit pension scheme for Secretariat staff may, based on actuarial findings, be considered an appropriate retirement benefit scheme for new members of the Court and any new judges of the two Tribunals.  The Secretary-General recommends changing the current two-tiered system of accumulation from 5.56 per cent in the first nine years of service, followed by 1.85 per cent thereafter, not exceeding a maximum of 66.67 per cent, to a linear system of accumulation of 3.7 per cent per year for 18 years and nothing thereafter.

That move would reduce the front load, with members of the Court and judges of the Tribunals receiving a smaller pension for the final nine years of their service, thus reducing the overall liability of Member States.  It might also encourage longer periods of service and thereby reduce the term of payout of benefits, assuming that the average recruitment age remains at 58.  That would significantly reduce the estimated liability for new judges projected to assume office over the next 30 years by $9.96 million, as well as reduce the current actuarial cost of the pension entitlement, noted in paragraph 48, from around 66 per cent to around 44 per cent of the judges’ base pay.

Weighing in on the review with its own report (document A/66/709), the Advisory Committee on Administrative and Budgetary Questions (ACABQ) recommends that the Assembly endorse the Secretary-General’s recommendation, saying such a step is justified because it does to a certain extent take account of acquired pension rights, while also maintaining the long-standing non-contributory nature of the pension scheme.  The Advisory Committee also supports the Secretary-General’s suggestion that the new arrangements only apply to new Court and Tribunal members.

Also before the Committee was the Secretary-General’s report on the conclusions of the High-level Working Group on Programme Criticality (document A/66/680), which gives an interim update on the Working Group’s evolution and its work thus far to develop a programme criticality function.  Such a function reviews whether programme activities carried out by United Nations personnel are justified, taking into account the expected security and safety risks involved.  In September 2011, the High-level Committee on Management approved the programme criticality methodology and tool as a framework for decision-making within the guidelines for acceptable risk, and recommended that it be rolled out in at least 12 countries by April 2013.  It also called for a consolidated progress report, including lessons learned and recommended adjustments to the methodology and tool, to be submitted at the High-level Committee’s 2013 spring session.  During the second phase of the project, the programme would be rolled out to all remaining countries through an e-package.  The Assembly is asked to take note of the Secretary-General’s report.

Weighing in on that with its own report (document A/66/720), the Advisory Committee says that, since the programme criticality framework is still in an interim stage, it has no objection to using extraordinary resources to fund the initial 12-country roll-out.  It also stresses that in situations where lives may be at risk, the United Nations has an obligation to ensure predictable funding for ongoing initiatives to protect personnel.  It recommends therefore that once the framework is finalized, consideration should be given to create appropriate cost-sharing arrangements for its full roll-out that reflect its system-wide nature and similarity to the Organization’s other jointly financed activities.  The Advisory Committee further recommends that every effort be made to integrate programme-criticality training into existing training programmes for United Nations staff, and that the Assembly take note of the Secretary-General’s report.

Pensions for Judges

MARTHA HELENA LOPEZ, Director of the Strategic Planning and Staffing Division, Office of Human Resources Management (OHRM), introduced the Secretary-General’s report on the comprehensive review of the pension schemes for the members of the International Court of Justice and judges of the International Criminal Tribunal for the Former Yugoslavia and the International Criminal Tribunal for Rwanda (document A/66/617), which was organized into seven parts.

She discussed the report’s more substantive sections, starting with section II — the background on the pension benefits of the members of the Court and the judges of the Tribunals — which outlined the evolution of those benefits in the context of the Court and the two Tribunals.  Section III focused on the settings of the comprehensive review, she said, adding that the Secretary-General and the United Nations Pension Fund had carried out a review of the retirement pensions.  The Fund had suggested engaging an actuary and establishing a working group comprised of representatives of OHRM, the Court and the Tribunals.

She went on to describe section IV — an analysis of the current pension benefits scheme — saying that the comprehensive review did not consider ad litem judges, as they were not entitled to periodic retirement benefits.  The benefits for Court members and Tribunals judges offered a retiring judge, who had completed a nine-year term, the replacement ratio of about 50 per cent of his or her final salary at age 60.  The benefits were not prefunded.  Section V focused on pension benefits, she continued, noting that the review proposed four design options: the defined-benefit scheme; the defined-contribution scheme; the cash lump-sum through hybrid defined-benefit and defined-contribution schemes; and the status quo in maintaining the current pension benefit scheme.

She said the Secretary-General’s recommendation and the financial implications of the recommended option — the defined-benefit scheme — were set out in section VI.  The most favoured application of that option would reduce the estimated liability for new judges projected to assume office over the next 30 years by some $9.96 million.  It was suggested that any new scheme apply only to newly elected Court members, in line with the Court’s Statute, which provided that the salaries, allowances and compensation of Court members could not be decreased during a member’s term of office.  The same applied to the Tribunal judges, whose statutes referenced the same provision.

Finally, she conveyed the concerns of the Court regarding any changes from the status quo in the redesign of the pension benefits entitlement.  For the Court, the linear system of accumulation, as proposed among the options in the report, would encourage Court members to stand for re-election.  That could adversely impact the rotation of the bench.

COLLEN KELAPILE, Chair of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introduced that Committee’s report on the comprehensive review of the pension schemes for members of the Court and judges of the Tribunals (document A/66/709).  The Advisory Committee noted that, in the Secretary-General’s view and based on the findings of an actuarial study, the defined-benefit scheme — with a linear, rather than two-tiered system of accumulation — might be the most appropriate way forward.

He went on to say that the Advisory Committee also noted that, should the General Assembly endorse the Secretary-General’s recommendation, the estimated liability for new judges projected to assume office over the next 30 years would be reduced by some $9.96 million.  Further, changing to a linear system of accumulation would reduce the actuarial cost of funding the pension entitlement over a 10‑year period from 66 per cent of the judges’ base pay to about 44 per cent.

On the issue of acquired pension benefit rights, and the Secretary-General’s assertion that implementation of a pension scheme that considered the prior employment of Court members and Tribunal judges might face legal and practical difficulties, he said the Advisory Committee had been informed that the defined-pension scheme included an adjusted accrual rate intended to reflect the possibilities that individuals had had previous careers and had acquired pension benefit rights.

In sum, he said, the Advisory Committee recommended the Assembly endorse the Secretary-General’s recommendation for a defined-benefit pension scheme with a linear system of accumulation of 3.7 per cent for 18 years.  The Committee also agreed that new arrangements should apply only to new members of the Court and judges of the Tribunals.  Finally, as the question of acquired pension benefit rights should have been addressed in more detail in the Secretary-General’s report, the Assembly might wish to request him to further consider that issue and report back to it at its sixty-eight session, in the context of the next comprehensive review.

MOURAD BENMEHIDI (Algeria), speaking on behalf of the “Group of 77” developing countries and China, attached the highest importance to the work of the Court and the Tribunals, supporting the principles enshrined in their statutes that the salary and allowances of the judges should be fixed by the General Assembly and could not be decreased during the term of office.  The Group of 77 also supported the principle of equity in the benefits of Tribunals judges and Court members.

Regarding the proposals being considered today, he said the pension scheme should provide adequate after-service benefits to judges that had met the requisite eligibility criteria relating to retirement age and period of service, based on the premise that the pension benefit maintained a living standard as replacement income.

He went on to underline that the Group of 77 stood ready to discuss the options to design a pension scheme, respecting the statutes of the Court and the Tribunals, on the basis that such a scheme remained non-contributory, was determined by reference to years of service and which supported the high level of standards, impartiality and independence required during the judges’ tenure.  The Group strongly believed that any outcome should enhance the Court’s performance, not undermine it through decreased pension benefits.  It also should not constitute a precedent for any other category of judges working in the United Nations system.

Safety and Security: Programme Criticality

GREGORY B. STARR, Under-Secretary-General, Department of Safety and Security, introduced the Secretary-General’s report on the conclusions of the High-level Working Group on Programme Criticality (document A/66/680), recalling that, in 2009, the United Nations System Chief Executives Board for Coordination (CEB) had embraced the principle of balancing security risk and programme implementation.

By way of background, he said the United Nations had been criticized for years for applying security processes in an inflexible manner, making the Organization too risk averse.  At other times, the United Nations had been accused of placing personnel at unnecessary risk.  In response — and realizing the need to deliver results under difficult security circumstances — the High-level Working Group had developed tools to better balance security risk and opportunity.  The aim was to ensure that United Nations personnel did not take unnecessary risks and that those remaining in-country worked on the highest priority activities.

He went on to say that a programme criticality framework and methodology had been developed through extensive consultations at the Headquarters and field levels, with a broad spectrum of Secretariat, agency, fund and programme personnel, under the leadership of the United Nations Children’s Fund (UNICEF).  “[T]his is meant to be a programme-led effort and designed to be implemented at the country level by the collective United Nations presence on the ground,” he added.

Mr. KELAPILE then introduced the Advisory Committee’s report on the conclusions of the High-level Working Group on Programme Criticality (document A/66/720), noting that the Secretary-General’s report was an interim update and did not contain conclusions, which had yet to be reached.  The Advisory Committee had taken note of the Working Group’s programme criticality framework, he said, consisting of a methodology, electronic decision-making tool and proposed implementation plan.  In September 2011, the High-level Committee on Management had approved the methodology and tool as a framework for decision-making and had recommended that it be rolled out in at least 12 countries by April 2013.

He said indicative resource requirements for phase one of the roll-out, including training, amounted to $595,500, and should be met from extrabudgetary funds.  The Advisory Committee had been informed that, pending receipt of voluntary contributions from donors, the humanitarian agencies and the Department of Safety and Security each had agreed to contribute $10,000 to initiate the roll-out.

As work was still at an interim stage, the Advisory Committee did not object to using extrabudgetary resources to fund the initial 12‑country roll-out, he said.  But, in situations where lives were at risk, the United Nations was obliged to ensure that predictable funding was available for ongoing initiatives designed to protect personnel.  The Committee recommended that, once the framework was finalized, consideration should be given to establishing appropriate cost-sharing arrangements for a full roll-out that reflected the system-wide nature of the initiative.  They should be similar to those used in other jointly financed activities in the system.

In sum, he said, the Committee recommended that the Assembly take note of the Secretary-General’s report, bearing in mind its comments and recommendations, and on the understanding that a further report containing conclusions would be submitted once the Working Group had reported to the High-level Committee on Management in 2013.

Mr. BENMEHIDI ( Algeria), taking the floor again on behalf of the Group of 77 and China, stressed the importance of safety and security for all United Nations staff and operations worldwide.  He supported measures aimed at ensuring a coherent, effective, accountable and timely response to security-related threats and other emergencies.  Provisions for safety and security at the United Nations could not work in isolation or without due consultation with Member States.  All major United Nations activities followed a certain standard, but such a standard was still lacking in the field of safety and security.  “It is therefore imperative to establish clear criteria for determining security needs and certain basic standards for evaluating threat perception and risk assessment on a worldwide basis to ensure the Department of Safety and Security is able to respond to any emergency,” he said.

He expressed concern that the Secretary-General had yet to comply with the Assembly’s request in resolution 61/263 for a report on the comprehensive safety and security policy framework at the United Nations that provided the basis for threat and risk assessment, cooperation with host countries, cost-sharing arrangements and operations of the Department of Safety and Security.  He asked for some clarification from the Secretariat in that regard.  He sought more information on the detailed phases, benchmarks and timelines of the programme criticality framework and level.

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