Speakers Voice Concerns about Staff Productivity as Budget Committee Discusses Flexible Working Space Project Under Way at Headquarters

GA/AB/4263
11 December 2017
Seventy-second Session, 22nd Meeting (AM)

Speakers Voice Concerns about Staff Productivity as Budget Committee Discusses Flexible Working Space Project Under Way at Headquarters

Putting into place the flexible working space project at Headquarters should itself be flexible and adaptable in responding to staff needs, speakers told the Fifth Committee (Administrative and Budgetary) today as it took up the Secretary‑General’s report on its ongoing implementation.

Greater staff productivity, enhanced collaboration and lower real estate costs were among the expected benefits of the project, first set out by the Secretary‑General in 2013, which would involve 26 floors in the 39‑storey Secretariat building as well as 8 floors in two subsidiary premises.

Speaking on behalf of the “Group of 77” developing countries and China, the representative of Ecuador, however, drew attention to complaints by staff members using flexible workspace that it hindered productivity and their ability to focus on their work or find colleagues and team members.  Recent surveys had exposed discrepancies between junior and senior managers in the way they viewed team productivity, she said, stressing that due regard must be given to the views of the people using the space.

Regarding the project’s financial implications, she noted that the “decrease” in project costs as reported by the Secretariat was really a decrease in projections.  In fact, the total project cost had risen 20 per cent from an initial projection of $45.6 million to an estimated reviewed total of $55 million.  She emphasized the need for a well substantiated, reliable and predictable business case, adding that the Secretary‑General should explore options for self‑financing the project.

China’s representative said she hoped that the Secretariat would conduct a detailed assessment of the pilot programme and address the low performance index on those floors housing flexible workspace.  The flexible workspace strategy must be forward‑looking and rolled out gradually, with enhanced budget management, she stressed.

Introducing the Secretary-General’s second progress report on the project, Patrick Carey, Officer‑in‑Charge of the Office of Central Support Services, of the Department of Management, said the initiative — estimated to cost $54.98 million and create additional capacity in the Secretariat building for 1,154 staff members — was increasingly turning the building into a truly modern work environment, on top of lowering the Organization’s annual rental costs by $16.3 million.  Presenting the view of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), its Chair, Carlos Ruiz Massieu, said it recommended that the Assembly authorize the Secretary‑General to enter into commitments up to $12.7 million in terms of project costs for 2018.  Future costs beginning in 2019 would be reviewed in the next project report.

In other business, the Committee considered the Secretary‑General’s report on the proposal to replace a collection of 1970s prefabricated office premises at the United Nations Office in Nairobi, known as blocks A‑J, with an all‑new building.  Sahle-Work Zewda, the Office’s Director General, speaking via video conference link from the Kenyan capital, reminded delegates that it would cost less to build the new structure than it would to maintain the existing ones, which were nearing the end of their useful life.

“The proposed UNON [United Nations Office in Nairobi] project is extremely good value for money,” she said, with a project cost of $69.9 million ensuring fully modernized office accommodation with no need for major upgrades for 20 years.  The New Office Facility in Nairobi was completed in 2010, before budget and on schedule, and it was considered one of the region’s most environmentally advanced office blocks.  She said the Secretary‑General was requesting the Assembly to approve the proposed scope, cost and implementation strategy for replacing office blocks A‑J as set out in option 2 in the Secretary‑General’s report.

Angola’s representative, speaking on behalf of the African Group, emphasized the importance of appropriate governance and oversight measures as the project moved forward, as well as the need to ensure no idle capacity.  He said the Group would follow with keen interest both the Nairobi project and the construction of new offices at the Economic Commission for Africa in Addis Ababa.

Kenya’s delegate welcomed the Secretary‑General’s proposal to replace office blocks A‑J within seven years, saying it was imperative to ensure a suitable working environment at the United Nations Office in Nairobi — home of the United Nations Environment Programme (UNEP) and the United Nations Human Settlements Programme (UN‑Habitat), as well as local and regional offices of several United Nations agencies, funds and programmes.

Mr. Massieu introduced the ACABQ’s corresponding report, which recommended that the Assembly approved the Secretary‑General’s proposal, set out as option 2 in his report. 

The Fifth Committee will meet again at a date and time to be announced in the Journal.

Construction and Property Management: United Nations Office at Nairobi

SAHLE‑WORK ZEWDA, Director General of the United Nations Office at Nairobi, speaking via videoconference link from Nairobi, introduced the Secretary‑General’s report on the proposal for the replacement of that Office’s blocks A‑J (document A/72/375).  She recalled that blocks A‑J, in the Gigiri complex, were constructed in the late 1970s as semi‑prefabricated buildings, intended as temporary accommodation.  They were approaching the end of their useful life and did not comply with prevailing life safety codes.  In fact, they were no longer safe, with sagging roofs, fire‑prone wiring and the risk of severe earthquake damage.  They also did not meet United Nations security requirements, nor were they fully accessible for persons with disabilities, she said, emphasizing that it would cost more to maintain the buildings that to replace them.  Blocks A‑J housed not only several offices of the United Nations Nairobi Office, but also those of the United Nations Children’s Fund (UNICEF), the World Food Programme (WFP) and the United Nations Educational, Scientific and Cultural Organization (UNESCO), which paid commercial‑level rent, she said, and the Nairobi Office had a duty of care to those organizations.

Noting that Nairobi was the only duty station in the Global South to host the global headquarters of a United Nations entity, namely the United Nations Environment Programme (UNEP) and the United Nations Human Settlements Programme (UN‑Habitat), she said the construction project would create new office space for the United Nations Nairobi Office, taking into account flexible workplace strategies, allowing extra space for other United Nations tenants.  She also drew attention to the Government of Kenya’s donation of 140 acres of prime real estate as well as significant investments in the Gigiri area, including major road upgrades, traffic lights and cycling lanes.  Too often, she said, Africa was viewed as helpless, where peace must be kept and humanitarian assistance provided.  However, Africa was also a vast, dynamic and talented continent that contributed more to global solutions than to global problems, she said, recalling that the Secretary‑General’s priorities including strengthening Africa’s place in the United Nations and vice versa.

“The proposed UNON [United Nations Office in Nairobi] project is extremely good value for money,” she said, emphasizing that the project cost of $69.9 million would ensure fully modernized office accommodation with no need for major upgrades for 20 years.  The New Office Facility of the Nairobi Office was completed in 2010, before budget and on schedule, and it was considered one of the region’s most environmentally advanced office blocks.  She said the Secretary‑General was requesting the General Assembly to approve the proposed scope, cost and implementation strategy for replacing office blocks A‑J as set out in option 2 in his report.  It was also being asked to approve the establishment of a project management team, to appropriate $604,000 for 2018 for design and management costs, and to approve the establishment of a multi‑year construction‑in‑progress account for the project.

CARLOS RUIZ MASSIEU, Chair of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introducing its corresponding report (document A/72/7/Add.28), said the Advisory Committee recommended that the General Assembly approve the proposed scope of the project and implementation strategy of option 2 for the replacement of office blocks A‑J.  Further, the ACABQ recommended that the Assembly take note of the proposed maximum estimated cost of the project at $69.9 million, and request that the Secretary‑General refine that estimated cost to be presented in the Secretary‑General’s next progress report, particularly in terms of the project contingency and cost escalation.  The Advisory Committee also welcomed the conducting of a space utilization survey, a study to identify space requirements and the inclusion of a comparative analysis of the three options proposed.  Furthermore, it welcomed applying flexible workspace strategies to all offices blocked in the complex in order to optimize the use of available space and reduce new construction requirements.  He also pointed out that the ACABQ had requested that the Secretary‑General provide additional information in his next progress report, including information on applying flexible workplace strategies by current non‑Secretariat tenants as well as on the activities and results of the working group on global rental practices.

AMÉRICA LOURDES PEREIRA SOTOMAYOR  (Ecuador), speaking on behalf of the “Group of 77” developing countries and China, noted that the proposal to replace the office blocks at the Nairobi Office was estimated to cost approximately $69.88 million.  That was one of the most important short‑term construction and maintenance projects articulated in the Strategic Capital Review.  The Group trusted that the project design would incorporate the possible impacts of the ongoing as well as proposed business transformational initiatives, including implementation of Umoja, flexible workplace strategies and the Global Service Delivery Model.  The Secretary‑General’s report also incorporated sustainability initiatives as well as proposals to address challenges faced by persons with disabilities.

Stressing the importance of project governance and oversight arrangements, she added that accountability and transparency measures should be put in place to ensure that the project would be completed in time and within budget and scope.  Noting the proposals to establish clearly defined coordination with the Office of Central Support Services and the team in Nairobi, as well as the project management team, steering, stakeholder committees, change management and corporate support, she emphasized the need for the Organization to use its existing in‑house capacity and avoid, as much as possible, the use of consultancy.  Further, during the design and implementation stages, all efforts should be made to use locally manufactured materials as well as local knowledge and technology.

MARCIO SANDRO ALEIXO PEREIRA BURITY (Angola), speaking on behalf of the African Group, expressed appreciation for the Secretary‑General’s initiative to develop the Strategic Capital Review which identified building deficiencies in advance in order to take corrective actions that would prevent future expenditure.  Noting that the Secretary‑General’s report contained information on accommodating non‑Secretariat entities as tenants, he stressed the importance of that in ensuring no idle capacity.  Also emphasizing the importance of appropriate governance and oversight measures, he added that Office of the Central Support Services should provide very useful and reliable coordination of the project.

He noted that the projected total cost amounted to $69.88 million and $604,000 was required to commence the preparatory work during the 2018 period.  The Group trusted that a separate account would be established and a multi‑year construction in progress account would be adopted by the General Assembly.  The Group would be following with keen interest the current project as well as the construction of new office facilities at the Economic Commission for Africa (ECA) in Addis Ababa.  Calling upon all involved with the management of those properties to closely follow and appropriately document their situation, he reassured the Committee of the Group’s readiness to engage in further deliberations.

KOKI MULI GRIGNON (Kenya), associating herself with the “Group of 77” developing countries and China, and the African Group, said that to ensure a suitable working environment for United Nations staff, the availability of appropriate office accommodation with requisite facilities was imperative.  She noted that to address the accommodation needs within the Organization, the Secretary‑General had developed the Strategic Revenue Capital, which was a 20‑year long‑term maintenance framework of the buildings owned or leased by the United Nations from 2018 to 2037.  She also welcomed the Secretary‑General’s proposal to replace office blocks A‑J at the United Nations Nairobi Office at Nairobi within seven years.  She believed that the Secretary‑General would continue to assess the conditions of buildings and infrastructural facilities at all locations, including the Nairobi Office, and schedule action as appropriate.

Implementation of Flexible Workplace at United Nations Headquarters

PATRICK CAREY, Officer‑in‑Charge of the Office of Central Support Services, of the Department of Management, introduced the Secretary‑General’s second progress report on the implementation of a flexible workplace strategy at United Nations Headquarters (document A/72/379), which provided an update on the project’s status since the first such report was issued in January 2016.  Since then, the project had further matured, increasingly transforming the Secretariat building into a truly modern work environment, he said.  Tailored contracts had been put in place reducing the estimated unit costs for project implementation.  Moreover, the additional capacity created by the project had enabled the vacating of the Daily News building lease, and would also allow the vacating of two further leases in 2018.  In so doing, by December 2018, the project would have delivered a $16.3 million reduction in annual recurrent rental costs for the Organization. 

He noted that the report presented a schedule and plan of flexible workplace implementation on 26 floors in the Secretariat building, to be completed in 2020.  The overall project cost was estimated at $54.98 million and would create additional capacity in the Secretariat building for 1,154 staff members.  Through the recurrent savings from vacating the three leases, the project would achieve financial breakeven in early 2021.  In terms of manager and staff feedback on project implementation, the report also provided details regarding the last survey and staff observations about working in a flexible workplace.  While those surveys highlighted areas where more effort was needed, staff members also reported a higher level of overall satisfaction compared to the baseline study conducted in 2014 before the project began. 

Further, he said that while the report provided a detailed plan through 2020, Member States had not yet considered other reforms, such as the Global Services Delivery Model.  The plan would be reviewed in the context of any General Assembly decisions that may affect accommodation needs at the Headquarters.  Any impact on the project plan would be presented in a third annual progress report on the flexible workplace to the seventy‑third session.  In the current report, the Assembly was requested to take note of the project plan and its revised estimated cost, approve project continuation as well as three temporary positions for the project team.  Also, it was asked to authorize the Secretary‑General to enter into commitments up to $25.4 million regarding project costs in 2018‑19 and appropriate $6.59 million. 

Mr. RUIZ introduced the ACABQ’s related report on progress on implementing a flexible workplace at United Nations Headquarters (document A/72/7/Add.29).  That report reiterated several of its previous recommendations, including the need for productivity assessments, a more detailed implementation plan and a review of cost estimates of the project.  He noted that the Secretary‑General’s next progress report might reflect adjustments arising from General Assembly decisions on the reform proposals and the proposed Global Service Delivery Model.  As such, the ACABQ recommended that the Assembly authorize the Secretary‑General to enter into commitments up to $12.7 million in terms of project costs for 2018.  Future costs beginning in 2019 would be reviewed in the next project report, he said.  The Advisory Committee also recommended continuing three temporary positions — one P‑5, one P‑4 and one General Service (Other level)  for the project team.  Finally, it recommended that the General Assembly request the Secretary‑General to explore options for project self‑financing. 

Ms. PEREIRA SOTOMAYOR (Ecuador), speaking on behalf of the Group of 77 and China, said transformational initiatives to make the United Nations more effective, adaptable and modern must be implemented in a well‑considered and measured manner.  Implementation of the flexible workplace project must itself be flexible and adaptable in responding to staff needs, she said, noting complaints about staff members’ ability to focus and to find colleagues or team members, feeling less productive, along with an under‑subscription of floors, which hindered the Organization’s efforts to improve productivity.  Particularly concerning were recent surveys and studies that showed discrepancies between junior and senior managers in the way they viewed team productivity.  In that regard, the outcome of the pilot programme should be examined meticulously to derive substantial lessons learned, especially in relation to productivity and staff performance, she said, stressing that due regard be given to the views of the people actually using flexible working spaces.  Observing that no assessment on the impact of a flexible workplace on productivity had been made, she said more details should be provided on implementation of each phase of the project, thus providing a holistic view of its full scope.

Turning to the financial implications of the project, she noted that the “decrease” in project costs as reported by the Secretariat was actually a decrease in projections.  In fact, the total cost of the project had risen 20 per cent from an initial projection of $45.6 million to an estimated reviewed total of $55 million.  She emphasized the need for a well‑substantiated, reliable and predictable business case, adding that the Secretary‑General should explore options for self‑financing the project.  For the period ahead, the Group would examine the revised estimates and consider the need for the flexible workspace project against the backdrop of a fuller consideration of all construction projects and regular budget requirements in 2018‑2019.  She went on to say that the Group would appraise the impact of the Umoja enterprise resource planning system, a study on the global service delivery project and long‑term accommodation needs on the scope and duration of the flexible workspace project, and that it would seek updates and clarification of the evolution of the Secretariat’s policies in that regard.

ZHANG JIARUI (China), associating herself with the Group of 77 and China, said it was important to keep improving the implementation of the flexible workspace strategy.  China hoped that the Secretariat would conduct a detailed assessment of the pilot programme and address the low performance index on those floors housing such workspace.  She added that the strategy must be forward‑looking and rolled out gradually, with enhanced budget management.

For information media. Not an official record.