PROPOSED UN BUDGET FOR 2004-2005 TO REACH $2.9 BILLION,
ACCORDING TO OUTLINE PRESENTED IN FIFTH COMMITTEE
NEW YORK, 9 December (UN Headquarters) -- As the Fifth Committee (Administrative and Budgetary) took up the preliminary outline of the Organization’s requirements for the next biennium, the representative of the United States said that the proposed budget outline for 2004-2005 was a step backward in what should be an evolving process to make the Organization more effective and efficient in the use of its resources.
He said that he looked forward to a thoroughly revised budget reflecting the highest priorities of Member States, saying that the proposal presented to the Committee seemed to add a layer of resources to the existing budget, rather than shifting and realigning resources from low-impact activities to new priorities.
Australia’s representative, speaking on behalf of Canada and New Zealand, said that the effects of reprioritization and efficiency gains needed to be felt in the budget proposals for 2004-2005. Reform was not a cost-cutting exercise: it was about getting better value for money and about adapting the Organization to changed circumstances. The realignments of resources flowing from reform should allow the Organization to do more to serve the priorities that Member States had set.
The representative of Denmark, on behalf of the European Union and associated States, said that reform and enhanced efficiency should go hand in hand with agreement on new priorities for the United Nations, and that strict budgetary discipline remained a key requirement to contain the rate of the budget’s growth. It was only possible to ensure that all funds were well spent through full implementation of results-based budgeting and identification and discontinuation of obsolete programme activities.
As the Committee moved on to discuss the programme budget implications of a number of resolutions, several delegates supported the recommendations of the Working Group on the International Research and Training Institute for the Advancement of Women (INSTRAW), including the allocation of resources amounting to some $500,000 out of the contingency fund for its core activities, and an additional amount of some $1.31 million from voluntary contributions. The Republic of Korea’s representative, however, said that INSTRAW had continuously faced financial and managerial problems, and his delegation felt that providing the Institute with extra resources would not be a viable solution to its problems.
Costa Rica’s representative stressed the importance of the programme budget implications for the Permanent Forum on Indigenous Issues, and said that the most urgent task to be carried out was the establishment of a secretariat for that Forum.
Also addressing the Committee this afternoon were the representatives of Cuba, Dominican Republic, Canada and Norway.
Jean-Pierre Halbwachs, United Nations Contoller, Conrad S.M. Mselle, Chairman of the Advisory Committee on Administrative and Budgetary Questions, and Warren Sach, Director of the Office of Programme Planning and Budget Division also addressed the Committee.
The Committee will meet again tomorrow, 10 December, at 3 p.m., to continue its consideration of items related to the proposed budget outline for the biennium 2004-2005 and the programme budget for the biennium 2002-2003.
This afternoon, the Fifth Committee (Administrative and Budgetary) was expected to take up the proposed programme budget outline for 2004-2005 and continue its consideration of the programme budget implications of several drafts before the Assembly.
The Committee had before it a report of the Secretary-General on the proposed programme budget outline for the biennium 2004-2005 (document A/57/85), which contains a preliminary indication of the resources that the Organization may require in the coming biennium. In establishing such an estimate, the report takes as a starting point the current level of appropriations and related commitments, amounting to some $2.7 billion. On that basis, the Secretary-General proposes a preliminary estimate of resources for the biennium 2004-2005, expressed in initial 2002-2003 prices, amounting to some $2.86 billion. That amount, excluding special political missions, reflects real growth of $47.8 million or 1.8 per cent, compared with the approved appropriations for 2002-2003. Once account is taken of the full inclusion of required provisions for special political missions, the total preliminary estimate would represent an increase of $158 million, or 5.8 per cent.
Also according to the report, an amount of $25.3 million would be required for full biennial provision in 2004-2005 for posts that are partially funded in the current biennium. These are new posts at the Professional level and above, which had been costed at 50 per cent in 2002-2003. The Secretary-General proposes that consideration be given to costing all new posts on a full-cost basis. The estimate also includes a provision of $29.8 million to ensure that information technology and common services facilities infrastructure are brought to levels which will not prejudice programme delivery. These resources are envisaged to be distributed across the parts of the budget affected by this year’s economy measures, which were instituted following the adoption of the 2002-2003 budget.
The proposed budget outline is also being considered in the report by the Committee on Programme and Coordination (CPC) (document A/57/16). The Committee recommended that the Assembly approve all the priorities identified in the Secretary-General’s report on the matter, and pointed out that the estimates should be adequate for full implementation of all mandated programmes and activities.
The CPC also recalled that provisions should be made for special political missions approved or extended in the course of the biennium. While noting that the budget submission would reflect cost-effectiveness measures and simplified procedures, the Committee recommended undertaking a review of obsolete activities, pointing out that such a review should remain within the context of relevant rules and regulations. The Committee recommended that the size of the contingency fund should be 0.75 per cent of the budget outline total, and reaffirmed the provision which requires reprogramming of activities when that fund is fully utilized.
In a related report (document A/57/636), the Advisory Committee on Administrative and Budgetary Questions (ACABQ) recommends that the General Assembly adopt a preliminary estimate of $2.92 billion for the biennium 2004-2005 at the revised 2002-2003 rates. Commenting on particular proposals by the Secretary-General, the Advisory Committee finds no convincing arguments for changing the current costing parameters for new posts at the Professional level and above, in view of the delays in recruitment for new posts experienced by the Secretariat, and to preserve the transparency inherent in separating the delayed recruitment factor for new posts from the vacancy rate for continuing posts.
While not questioning the need for adequate investments in technological innovations and facilities infrastructure at the United Nations, the ACABQ is of the view that more information should have been provided in support of the estimated requirements of $29.8 million, especially on the programmatic impact of the reductions it is intended to offset.
Regarding special political missions, the ACABQ points out that the requirements in the amount of $223.3 million gross were estimated about six months ago, and that according to updated requirements for 2002-2003, some $215 million gross would be required. Related recommendations of the Advisory Committee, subject to the approval of the Assembly, would entail their further reduction to $206 million. The question is currently under consideration by the Assembly, and the Advisory Committee states that any projection of this estimate for 2004-2005 should take into account the fact that it includes requirements for missions which could be terminated or altered in scope. On the other hand, there also may be new mandates for unforeseen missions. Under the circumstances, the ACABQ believes that the provision for special political missions in the outline should not exceed $170 million gross.
Also before the Fifth Committee was a document transmitting the programme budget implications of draft resolution A/57/L.27 on the United Nations Verification Mission in Guatemala (document A/C.5/57/30). The General Assembly is considering the extension of the mandate of the United Nations Verification Mission in Guatemala for one year, from 1 January to 31 December 2003. Should the General Assembly extend the mandate by adopting draft resolution A/57/L.27, requirements for 2003 of $11.63 million net ($12.99 million gross) would arise for the programme budget for the biennium 2002-2003. These estimates reflect a reduced level of activity as compared to 2002, and hence are approximately $3 million lower in net 2003 terms.
The ACABQ in its report (document A/57/7/Add.21) states that the Fifth Committee may wish to inform the Assembly that, should it adopt draft resolution A/57/L.27, additional appropriations would be required for the current programme budget in the amount of $11.63 million, under section 3, Political affairs, and some $1.36 million under section 32, Staff assessment, to be offset by the corresponding amount under Income from staff assessment.
There was also a report before the Committee (document A/C.5/57/27) transmitting a statement by the Secretary-General on a draft resolution (A/C.3/57/L.48) related to the situation of human rights in Myanmar. Under the terms of paragraph 6 of the draft, the General Assembly would, inter alia, request the Secretary-General to continue to provide his good offices and to pursue his discussions on the situation of human rights and the restoration of democracy with the Government and people of Myanmar; to submit additional reports to the Assembly during its fifty-seventh session on the progress of those discussions; and to report to the Assembly at its fifty-eighth session.
Those efforts would be carried out as part of the activities of the Secretary-General’s good offices through his Special Envoy in Myanmar, and would include contacts and consultations with various parties in the region.
Should the Assembly adopt draft resolution L.48, additional provisions in the amount of $163,900 would be required under section 3, Political affairs, of the programme budget for 2002-2003. Furthermore, an amount of $65,200 would be required under section 32, Staff assessment, to be offset by corresponding amount under Income section 1, Income from staff assessment.
In a related report, the ACABQ (document A/57/7/Add.23) concurs with this estimate.
A further report before the Committee is entitled the situation in Central America: procedures for the establishment of a firm and lasting peace and progress in fashioning a region of peace, freedom, democracy and development (document A/C.5/57/28). The report transmits a statement by the Secretary-General on the programme budget implications of a related draft resolution (document A/57/L.20).
Under the terms of the draft resolution the Assembly would, inter alia, request the Secretary-General, the relevant bodies and programmes of the United Nations system and the international community to continue to support and verify the implementation of the Guatemala peace agreements, and to consider the implementation of the peace agreements as the framework for their technical and financial assistance programmes and projects in the context of the United Nations Development Assistance Framework for Guatemala.
The Assembly would also request the Secretary-General to continue to lend his fullest support to the initiatives and activities of the Central American Governments, particularly their efforts to consolidate democracy, and to report to the Assembly at its fifty-eighth session on the implementation of the resolution.
Should the Assembly adopt the resolution, additional provisions in the amount of $182,900 would be required under section 3, Political affairs, of the programme budget for 2002-2003. Furthermore, an amount of $41,400 would be required under section 32, Staff assessment, to be offset by a corresponding amount under Income section 1, Income from staff assessment.
In this connection, the Advisory Committee (document A/57/7/Add.20) states that the Fifth Committee may wish to make those recommendations to the Assembly.
Also before the Committee was a report on the Khmer Rouge trials (document A/C.5/57/29), transmitting the Secretary-General’s statement on the programme budget implications of a related draft resolution (document A/C.3/57/L.70). Under the terms of the draft resolution, the General Assembly would request the Secretary-General, if necessary, to send a team of experts to Cambodia as may be required for the preparation of a report. Should the Assembly adopt the resolution, there would be financial implications of up to $44,800 arising for the regular budget under section 8, Legal affairs, in the biennium 2002-2003.
The provision would represent a potential charge against the contingency fund, which would need to be considered in the context of the consolidated statement to be presented at the end of the current session of the General Assembly.
In a related report, the Advisory Committee (document A/57/7/Add.22) recommends that, at this stage, should the Assembly wish to adopt the draft, the additional requirement of $44,800 should be met within existing resources under section 8, Legal affairs, of the current programme budget. Any requirement for an additional appropriation could be indicated in the second performance report on the programme budget for 2002-2003.
Introduction of Reports
JEAN-PIERRE HALBWACHS, United Nations Controller, introduced the report of the Secretary-General on the proposed budget outline for the biennium 2004-2005.
CONRAD S.M. MSELLE, Chairman of the ACABQ, introduced the Committee's related report.
DAVID DUTTON (Australia), also speaking on behalf of Canada and New Zealand, wished to make clear his expectation that the effects of reprioritization and efficiency gains needed to be felt in the budget proposals for 2004-2005. Reform was not a cost-cutting exercise: it was about getting better value for money and about adapting the Organization to changed circumstances. The realignments of resources flowing from reform should allow the Organization to do more to serve the priorities that Member States had set.
He agreed with the ACABQ that there was insufficient justification in the Secretary-General’s report for the proposed $29.8 million for information technology and common services infrastructure. The Organization did need to invest in information technology, and that must be considered in conjunction with the revised information technology strategy. There was also insufficient explanation of the additional requirements foreshadowed for enhancing the Organization’s capacity to meet the Millennium Declaration Goals. With respect to special political missions, he reiterated Canada's, Austalia's and New Zealand's view that they should stay in the regular budget.
Although previous resolutions had invited the Secretary-General to prepare a budget at a specific level, he wondered whether it might be preferable to adopt a slightly different formulation this year. That formulation could invite the Secretary-General to prepare a budget which took into account existing and new mandates, the priorities of the Organization, the need for fiscal restraint, and the decision of the Assembly on reform. That might help avoid a premature discussion of issues which remained uncertain and could not be resolved now. Those issues could then be dealt with when detailed proposals were received, in the context of the full proposed budget.
PATRICK KENNEDY (United States) said that the proposed budget outline for 2004-2005 seemed to convey a scenario whereby the next budget would simply add a layer of resources to the existing one, rather than shift and realign resources from low-impact activities to new priorities. That was a step backward in what should be an evolving process to make the Organization more effective and efficient in its use of resources. The budget for 2004-2005 must reflect the initiatives contained in the Secretary-General's reform plan, rather than the backward approach shown in the proposed budget outline. Although the new programme budget was already being prepared, there was still ample time for programme managers to engage in the required reviews and establish clear priorities consistent with the Secretary-General’s vision for the Organization.
With regard to the ACABQ report, he took note of its observations and said that his delegation would be curious to learn the basis for its recommended budget level. There appeared to be a proposed reduction on the allocation for special political missions, but no proposed reductions for efficiency measures and the phasing out of obsolete mandates. Proposed cuts to a core operation of the United Nations -- special political missions -- stood in stark contrast to the ACABQ’s proposed increases for unspecified and therefore unjustified programmes and activities. He would like to know why, in the light of the Secretary-General’s clear intent to review all activities of the Organization for their continuing relevance, the Advisory Committee had proposed a total that did not take account of those essential factors.
Member States’ resources were not unlimited, and the projected rate of growth for the regular budget was unsustainable for many of the largest contributors. With the active process of prioritization required of the United Nations, as adopted by the Assembly in the programme planning rules and regulations, as well as the streamlining and efficiencies to be gained from the Secretary-General’s reform proposals, the current level of expenditure of the budget was sufficient for the United Nations to carry out its priorities, fulfil its essential and relevant mandates, and cover eventual recosting. With diligence and a disciplined approach, the United Nations could successfully implement its most important activities without placing an undue financial burden on its membership.
OLE E. MOESBY (Denmark), speaking on behalf of the European Union and associated States, supported the priorities outlined in the Secretary-General’s report and stressed the importance of strengthening the implementation capacity and effectiveness of the United Nations, in particular in developing countries, so that the Organization could better assist Member States in implementing the Millennium Declaration and other mandates, including the follow-up to the Monterrey and Johannesburg summits.
The 2004-2005 budget must reflect the Organization’s stronger policy focus on Africa, he continued. It was necessary to strengthen the United Nations commitment towards supporting the New Partnership for Africa's Development (NEPAD), which should materialize in specific proposals for reprioritization within the Department of Economic and Social Affairs. In that connection, it was important to clarify the division of labour between Headquarters and field stations, in order to achieve efficiency gains and especially improve technical cooperation at country level. Continued high priority must be given to the special political missions, which had become one of the most important features in the regular budget. The European Union fully concurred with the ACABQ on that question.
Over the last 10 years, he said, the budget of the United Nations had remained at more or less the same level, while more priority areas had been added to the medium-term plan. The workload of the Organization had increased significantly, partly because it had been unable to phase out a sufficient number of low-priority activities. Last year, the Assembly had acknowledged that in 2002-2003, some modest growth was needed to allow the Secretary-General to cope with new mandates. That trend was likely to continue and would need to be reflected in the programme budget for the next biennium. At the same time, the Assembly had emphasized the continuing importance of reform and enhanced efficiency, which should go hand in hand with agreement on new priorities for the United Nations. Strict budgetary discipline remained a key requirement to contain the rate of the budget growth.
It was only possible to ensure that all funds were well spent through full implementation of results-based budgeting and identification and discontinuation of obsolete programme activities. As for the recommendation concerning restoration of funding proposals rejected by the Assembly in December 2001, that would only be possible if there was evidence of justified need. All programmatic activities, including such high-priority ones as special political missions, would require scrutiny before funding could be agreed to in the context of the next budget.
Regarding the 2002-2003 budget, he said that most of the increases, such as the currency and inflation fluctuations, were largely outside the Secretariat’s control. Other budgetary add-ons, like extra costs for improved security, could not have been foreseen in last year’s budget proposals. In that regard, the 2002-2003 budget and the sharp increases in the budget level during the course of the biennial period were exceptional and must not be seen as a precedent. Against that background, the European Union stood ready to take note of the Secretary-General’s report and the preliminary estimate regarding the budget level for 2004-2005. The Member States and the Secretary-General had to find ways to better match resources and priorities.
Further Introduction of Texts
WARREN SACH, Director of the Office of Programme Planning and Budget Division, introduced the programme budget implication statements of draft resolutions A/C.3/57/L.27 on the United Nations Verification Mission in Guatemala, A/C.3/57/L.48 on the situation of human rights in Myanmar, A/57/L.20 on the situation in Central America, and A/C.3/57/L.70 on the Khmer Rouge trials.
Mr. MSELLE introduced the related reports of the ACABQ.
ANTONIO ALARCON (Costa Rica) returning to the issue of the International Research and Training Institute for the Advancement of Women (INSTRAW) on behalf of the Rio Group, said that in resolution 56/125 of 2001 the General Assembly had set up a working group to study INSTRAW. He listed the group’s conclusions, including the allocation of funds out of the regular United Nations budget to finance the basic activities of the Institute, and the maintenance of its headquarters in the Dominican Republic. There were three other research institutes functioning in the United Nations system out of the regular budget, which was being used to pay for administrative and Professional posts as well as other expenses. The INSTRAW should be accorded the same privilege, he said.
DULCE BUERGO (Cuba) said that her delegation attached particular importance to the issue of INSTRAW. Many resolutions reiterated the financial difficulties encountered by the Institute, which prevented it from performing the activities entrusted to it. A clear decision had been made on the establishment of the working group to study its situation, and this year those recommendations had been presented to Member States. Other institutes within the United Nations system were receiving funds from the regular budget of the Organization for the implementation of their basic activities. She supported the recommendations contained in the Secretary-General’s report as well as the ACABQ recommendation that additional resources be provided out of the contingency fund for the current biennium.
PEDRO PADILLA TONOS (Dominican Republic) said that the working group had assessed the situation of INSTRAW and presented its recommendations. The report of that body indicated that the Institute could make an important contribution to the work of the United Nations, provided it received proper financing. On the basis of that report, the Third Committee had adopted its draft resolution endorsing the recommendations of the working group on restucturing and revitalizing the Institute, including allocation of resources amounting to some $500,000 out of the contingency fund to provide for the basic needs of the Institute. An additional amount of some $1.31 million should be provided from voluntary contributions. Given the financial implications, that resolution was now being considered by the Fifth Committee. It was necessary to put INSTRAW on an equal footing with other institutions that received funding out of the regular budget. The INSTRAW provided unique services for the promotion of women, in particular those in the developing world, and the Fifth Committee must ensure that the recommendations of the working group were implemented, as endorsed by the Third Committee.
HAM SANG-WOOK (Republic of Korea) said that his delegation had voted against the resolution on the future operations of INSTRAW in the Third Committee. He attached great importance to the advancement of women and would continue to support such issues in the United Nations. However, regarding the future operations of INSTRAW, he had noted that INSTRAW had continuously faced financial and managerial problems. Providing the Institute with extra resources would not be a viable solution to its problems.
Mr. ALARCON (Costa Rica), speaking on behalf of the Rio Group on the Permanent Forum on Indigenous Issues, said that the Forum promoted the exchange of experiences between multi-ethnic societies and was a link between indigenous communities and the United Nations system. The Rio Group thought the most urgent task to be carried out was the establishment of a secretariat for that Forum. In the budgetary area, the Rio Group supported a gradual approach towards that goal, and felt that three posts should be established in the 2003 budget and the remaining proposed posts in the 2004-2005 regular budget.
Mr. KRAMER (Canada) associated himself with the comments by the representative of the Republic of Korea on INSTRAW and the statement by Costa Rica (on behalf of the Rio Group) regarding the Indigenous Forum.
ANNE MERCHANT (Norway) associated herself with the position of the Rio Group and supported the assignment of three staff to the secretariat for the Indigenous Forum.
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