For information only - not an official document.
      22 November 2000
 Oversight Office Reports Taken Up by Fifth Committee

NEW YORK, 22 November (UN Headquarters) -- The increase in the activities over the past year of the Office of Internal Oversight Services (OIOS) was testimony to the fact that the groundwork of almost six years had borne fruit, the Fifth Committee (Administrative and Budgetary) was told as it took up its agenda item on the activities of that Office. 

Speaking on behalf of the European Union and associated States, the representative of France added that the increase in the United Nations activities required a parallel extension in the work of the Oversight Office.  The strategic considerations outlined in its report should lead to even more effective planning of its activities, closer coordination with the Organization’s other monitoring bodies, reformulation of its priority areas and improvement in its working methods.

[Established in 1994, the Office provides a comprehensive range of internal oversight services, in particular with regard to strengthening internal controls and improving management performance.]

The representative of the Russian Federation said that oversight activities could bear significant results only with scrupulous implementation of recommendations.  He supported the changes in the resource allocation and the structure of the Office aimed at ensuring adequate control over procurement and human resources management in the field.  However, he was concerned over numerous violations of financial regulations and procurement rules which were revealed during the audits of missions and peacekeeping operations.  Financial machinations resulting in losses to the Organization should be properly analysed, and those guilty should be punished. 

Reports concerning the work of the Oversight Office and the misdirection of contributions intended for the United Nations Environment Programme (UNEP) to an individual account at Chase were introduced by Under-Secretary-General for Internal Oversight Services Dileep Nair.

 Also this afternoon, as the Committee took up the financing of United Nations Interim Administration in Kosovo (UNMIK), the representative of Cuba said the purposes of the mission should be taken into account when considering a proposed budget.  The tendency to establish high-level posts could bureaucratize the mission and set a bad example for the territory. 

 Endorsing the recommendations of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), the representative of France (on behalf of the European Union and associated States) said that the activities of UNMIK had provided a new start for the province.  The mission had succeeded in building administrative machinery from scratch based on the rule of law. 

Relevant reports on the proposed budget for UNMIK were introduced by United Nations Controller Jean-Pierre Halbwachs and the Chairman of the ACABQ, Conrad S.M. Mselle.

 As the conclusion of the meeting, the Committee was informed that in order to complete consideration of the remaining issues, its Chairman would address a letter to the President of the General Assembly requesting an extension of the work of the Fifth Committee until 20 December.  That would allow the Assembly to consider the reports of the Committee no later than 22 December.

 Also speaking this afternoon were the representatives of Mexico, Egypt, Philippines, Nigeria, India, Libya, Canada, China, United States, Côte d’Ivoire, Japan and New Zealand.

 The Committee will conclude its general discussion on the activities and reports of the Oversight Office at 10 a.m. tomorrow.

Committee Work Programme

 The Fifth Committee (Administrative and Budgetary) met this afternoon to begin its consideration of agenda items on the activities of the Office of Internal Oversight Services (OIOS); review of efficiency (education grant entitlement); and financing of United Nations Interim Administration in Kosovo (UNMIK).

OIOS Activities

 In his note transmitting the sixth annual report of the Office of Internal Oversight Services covering activities for the period from 1 July 1999 to 30 June 2000 (document A/55/436), the Secretary-General notes with appreciation the continuing efforts of the Oversight Office to improve its relationships with management and with all Member States, and to coordinate its programme with other oversight bodies, including the Board of External Auditors and the Joint Inspection Unit (JIU). 

According to the report of the Office of Internal Oversight Services, contained in the document, the Office is now recognized as an objective source of reliable information and as an agent of change in the Organization.  Established in 1994, the Office provides a comprehensive range of internal oversight services, in particular for strengthening internal controls and improving management performance. 

During the review period, the Office made 968 recommendations to its clients (a 15 per cent increase over the previous year); and its investigators logged 287 new cases this year (an increase of 16 per cent).  The Oversight Office has addressed some of the major reform issues facing the Organization, and the report presents findings of the reviews conducted by the Office of United Nations recruitment and procurement procedures.  It made in-depth evaluations of programmes on the advancement of women and global development issues, and conducted inspections of the Office for the Coordination of Humanitarian Affairs, the United Nations Environment Programme (UNEP) and the United Nations Centre for Human Settlements (Habitat). 

 Further according to the report, as the pace of United Nations activities has intensified, so has the need to improve the oversight services provided by the Office.  However, it is unlikely that the Office, with the current level of resources, will be able to provide a full range of services to newly established extrabudgetary activities, as well as existing United Nations funds and programmes. 

 The Oversight Office must also continue to be a model and catalyst for all entities within the United Nations system to strengthen their oversight capabilities.  Towards that end, the Office is planning to propose the establishment of oversight committees within funds and programmes, similar to those at the United Nations Development Programme (UNDP) and the Office of the United Nations High Commissioner for Refugees (UNHCR). 

 With increases in humanitarian, development and peacekeeping activities, the United Nations is becoming more field-based, the report says.  The Office has extended its oversight of field activities, including for the Office of the Iraq Programme and operations of the Office of the United Nations High Commissioner for Human Rights.  Greater authority has been delegated to United Nations staff away from Headquarters in procurement and human resources management, so proper controls and procedures should be in place in the field.  Currently, about 30 per cent of the Oversight Office staff are deployed away from Headquarters.  To ensure adequate oversight of field-based activities, it is necessary to re-examine the Office’s allocation of resources, structure, and working arrangements and processes.

 Also according to the report, resident auditors are currently deployed in all major peacekeeping missions.  In addition to expanding the audit coverage of the Department of Peacekeeping Operations, audits were conducted at 11 missions in the field.  With additional challenges before peacekeeping operations, it is essential to ensure that no one exploits the lack of a proper civil administration for personal gain.  The oversight responsibilities of the Office will have to take on a new dimension, which needs to be fully addressed.  To further its partnership with Member States and managers at all levels of the Organization, the Oversight Office convened a workshop for its senior staff late in September to address strategic oversight issues. 

 Regarding technical advancement, the report states that it is important to provide the necessary resources to upgrade the skills of the staff; procure appropriate information technology tools; and secure services of outside consultants and innovative methods of service delivery.  A computerized monitoring system tracks the recommendations issued by the Office.  The Oversight Office continues to focus on full implementation of its recommendations, engaging in a continuous dialogue with its clients.  As a measure to improve the monitoring and reporting of its recommendations, the Oversight Office has recently developed specific criteria for identifying those measures, which have significant impact on client operations.

 Annexed to the report is a list of significant recommendations of the Office, on which corrective action has not been completed.  In particular, the Office called for 12 separate actions to strengthen management and accountability of the remaining Integrated Management Information System (IMIS) implementation tasks.  Implementation has been completed for three of the recommended actions, but further steps need to be taken by the Department of Management to fully implement the other nine.

 Also according to the report, an audit of the United Nations Transition Mission in Haiti disclosed a breakdown of internal controls and serious weaknesses in the management of the Trust Fund for Electoral Assistance, including a discrepancy of almost $625,000 between the amounts advanced and accounted for.  A follow-up audit revealed that the discrepancy had not yet been resolved.  The Department of Peacekeeping Operations has since been advised that the accounts of the Trust Fund have been reconciled, and the residual balance transferred to the UNDP.  The Oversight Office would follow up that matter.  Also, no significant action had been taken at the end of the reporting period on the implementation of recommendations concerning special emergency rules and procedures within the Department of Humanitarian Affairs.

 Also before the Committee was a report of the Secretary-General on the rules and procedures to be applied for the investigation functions performed by the Office of Internal Oversight Services (document A/55/469).  He explains that the Investigations Section, like all United Nations offices conducting investigations, operates in conformity with established United Nations regulations, rules and administrative instructions.  However, the Investigation Section is also subject to the provisions of two General Assembly resolutions and a Secretary-General's bulletin dated 7 September 1994.  Together, the resolutions and the bulletin form the Section’s mandate. 

 As part of the Secretary-General’s reform programme, the Investigations Section must undertake activities -- with due regard for fairness and objectivity -- to prevent and detect waste, misconduct, abuse and mismanagement in the operations of the Organization, the report says.  To achieve the objectives of its mandate, the Section examines allegations of misconduct or other prohibited activity, and ascertains the facts to either substantiate or disprove such allegations.  In that regard, the Section is committed to accountability.  If evidence shows that someone has violated laws or standards of ethical conduct, or has been responsible for misconduct, waste, abuse or mismanagement, the Section will make recommendations to the concerned programme manager.  Recommendations may include consideration of referral to a national jurisdiction for criminal prosecution and/or to the Office of Human Resources Management for consideration of disciplinary action.

 Likewise, the Investigations Section also works to clear the name of staff members who are wrongly or incorrectly accused, the report says.  In such cases, the evidence either demonstrates that the accused person has not engaged in an alleged activity or that there is insufficient evidence to support the allegation.  In the latter case, the accused person must be given the benefit of the doubt.  In both cases, the accused person is cleared.  In accordance with General Assembly resolutions, the Staff Rules and Staff Regulations and the mandate of the Office, investigative activities are conducted in such a way as to ensure the confidentiality of those making reports, the rights of the staff members involved, the protection from reprisals of those who contact the Section, and in the interests of the Organization. 

 The Committee also had before it a note of the Secretary-General on enhancing the internal oversight mechanisms in operational funds and programmes (document A/C.5/55/23).  In 1999, the Assembly requested that the Secretary-General update information contained in an earlier report on recommendations for the implementation and enhancement of internal oversight functions of United Nations operational funds and programmes.  The issuance of the updated report had been postponed until March 2001 because of the time needed to conduct consultations with the funds and programmes on the recommendations contained in the previous report.  Preliminary information shows that since 1997 improvements have been made to internal oversight functions, including greater cooperation with the OIOS and the adoption of new procedures for auditing, evaluation, monitoring and inspection.  The Oversight Office continues to provide assistance in the area of discrete investigations, which is a function not carried out by most of the funds and programmes.

 The Secretary-General notes that the UNDP established a Management Review and Oversight Committee, which holds periodic meetings to review UNDP’s accountability framework and reports to its Executive Board.  That Oversight Committee has invited the Under-Secretary-General for Internal Oversight to participate as a permanent member.  In the forthcoming report, the Secretary-General is expected to recommend that all funds and programmes establish similar oversight committees.  He will also propose a mechanism to reimburse the Oversight Office for services rendered, such as investigations.  It has carried out 287 investigations for funds and programmes since its establishment.  At present, the resources needed to conduct such investigations are provided from the regular budget.

Review of Efficiency

 The Committee had before it a note by the Secretary-General on the investigation into the misdirection of contributions from Member States to a United Nations Environment Programme (UNEP) Trust Fund account (document A/55/353). 

 According to that document, between 12 February 1998 and 25 October 1999, 13 wire transfers of funds intended as contributions to a UNEP Trust Fund Account at the Chase Manhattan Bank, totalling $701,998.94, were made by nine Member States (Belgium, Dominica, Finland, France, Italy, Namibia, Saint Kitts and Nevis, Turkey and Uruguay).  In error, the funds were deposited into another account at Chase, belonging to Susan Rouse-Madakor.  The two account numbers were the same, but for one digit. 

 When requested by Chase to return the funds, Ms. Rouse-Madakor refused and has since been charged with fraud by United States authorities.  After discussions with the Office of Internal Oversight Services, the United Nations Treasurer and the Office of Legal Affairs, as an accommodation to the United Nations, Chase has restored the full amount to UNEP.  The matter was investigated by the Office of Internal Oversight Services. 

 According to the report, the contributions were misplaced, because most of the funds transfer instructions did not include the fourth digit “1” in the UNEP Trust Fund account number, although the United Nations Office at Nairobi had provided the correct account number to Member States.  Also, Chase performs wire transfer deposits by account number only, without reference to the name of the intended beneficiary.  Since the incorrect account number was an active account at Chase, the transfers were automatically credited to the Rouse-Madakor account, instead of that of UNEP.  During the same time period, however, 88 contributions totalling over $22.55 million were correctly deposited to the UNEP Trust Fund account by the above-mentioned nine States, even though some of the transfer instructions were to the incorrect account number.

 The Investigations Section noted that United Nations Office at Nairobi did not act in a prompt and efficient manner in addressing the misdirected contributions, thereby allowing additional deposits to be credited to the Rouse-Madakor account.  For example, the Government of Italy notified the Nairobi Office that its contribution had not been credited.  It took that Office several months to provide all of the required tracking information to Chase.  In addition, Chase was not responsive to repeated requests from the United Nations Office at Nairobi, and it took Chase an additional six months from the initial notification by the Office to identify the incorrect deposits.

 The Investigations Section found no evidence of wrongdoing on the part of United Nations staff members, however.  While mistakes were made, the only wrongdoing was on the part of Ms. Rouse-Madakor, the report concludes.  The incident also demonstrates the difficulties inherent in the “account number only” system used by Chase.  Several recommendations have been made to improve the payment process and United Nations Office at Nairobi communications with Member States and Chase.  Both the Nairobi Office and the Department of Management have accepted the report’s findings and recommendations. 

Financing of UNMIK

 The Committee had before it a report of the Secretary-General on the financing of the United Nations Interim Administration in Kosovo (UNMIK) (document A/55/477), containing the proposed budget for that mission for 1 July 2000 to 31 June 2001.  The Secretary-General seeks $474.40 million gross ($446.24 million net).  The estimated requirements represent an 11 per cent increase ($47.34 million) in total resources compared to the apportionment for 10 June 1999 to 31 June 2000.  The proposed increase reflects a 199.7 per cent increase in military personnel costs, a 55.6 per cent increase in civilian personnel costs, a 65.9 per cent increase in staff assessment, a 47.3 per cent decrease in operational costs and a 23.1 per cent decrease in other programmes. 

 The Secretary-General recommends that the Assembly appropriate $474.40 million gross for the maintenance of the Mission for 1 July 2000 to 30 June 2001, inclusive of the amount of $220 million gross ($207.40 million net) already assessed on Member States.  The proposed budget provides for a total strength of 10,314 personnel, including 42 military liaison officers, 4,718 civilian police, 1,357 international staff, 11 national officers, 3,983 local staff and 203 United Nations Volunteers.  The report notes a net increase of 909 posts in the staffing table, including 51 posts for the Office of the Special Representative of the Secretary-General, 409 posts for Civil Administration and 489 posts for the Division of Administration.  There was a decrease, however, of 40 posts for the Office of the Deputy Special Representative of the Secretary-General.

 According to a related Advisory Committee on Administrative and Budgetary Question (ACABQ) report (document A/55/624), the initial estimates for the period from 1 July 2000 to 30 June 2001 amounted to $461.380 million gross.  The proposed budget thus represents an increase of $13.02 million over initial estimates, or 2.8 per cent.

 Among the recent developments, which affected the estimates, are the establishment of the Kosovo Transitional Council and of the Joint Interim Administrative Structure last year.  In May 2000, the Special Representative also decided to launch a Special Programme for International Judicial Support in Kosovo.  Resources are requested for that Programme, as well as for strengthening the Office of the Special Representative, regional and municipal operations, security and administrative and information technology services.

 The report states that proposed military personnel costs reflect an increase of $5.38 million for a total of $8.08 million.  The increase relates primarily to additional requirements for contingent-owned equipment and self-sustainment for 10 formed special police units.  Additional requirements of $113,000 are also proposed for the deployment of four additional military liaison officers and the rotation of military liaison officers.  The ACABQ recommends that, in the first instance, the functions of those officers be met through redeployment.

 From its visit to the Mission and the discussions it has had there, the Advisory Committee concludes that, in the allocation of resources, priority should be given to the resources requested for temporary judicial support, the police and other issues connected with security, as well as for managing the temporary administrative structure, including the Joint Interim Administrative Structure and regional and municipal support.

 Concerning the Office of the Special Representative of the Secretary-General, the ACABQ observes that there is room for considerable streamlining and that a number of its operational functions could be carried out by other components of the Mission.  The ACABQ recommends a net increase in the staffing of the Office of the Special Representative by 30 posts.  In his report, the Secretary-General also proposes the reclassification of five posts in the Office of the Special Representative.  The posts of Director and Deputy Director of the Office of Political Affairs are proposed for reclassification from D-1 and P-5 to D-2 and D-1 respectively.  Although the ACABQ recommended against the higher levels in its report on the previous budget submission, taking into account the experience of its visit to the region, it now recommends acceptance of the request.

 The ACABQ also maintains its previous position that the level of the posts within the Office of the Spokesperson for the Mission should be set at the D-1 and P-5 levels, respectively.  However, taking into account the evolving situation, it recommends that a review be undertaken of the level of and planning for public information activities.  It also agrees with the request for reclassification of the post of Legal Adviser to the D-2 level.  In Civil Administration, the ACABQ recommends that the post of Head of the Office remain at the P-5 level and recommends against the granting of the new post.

 The report goes on to say that 49 international language staff are proposed to provide specialized interpretation and translation services to the Special Programme of International Judicial Support.  The ACABQ recommends that a review be undertaken to determine the number of other support staff required in the light of the emerging caseload.  Should it be determined that not all of the posts requested would be required, some of them could then be redeployed to other areas of the mission.

 Also according to the report, during the meetings with the representatives of the Secretary-General, the principal Deputy Special Representative acknowledged that proper procedure should have been followed before the mission began funding the cost of the initial international judges and prosecutors under the assessed budget.  For the proposed international support to be effective, the caseload must be limited to those cases with maximum impact.  Furthermore, that international judicial intervention must not be regarded as a substitute for training of the local judicial personnel.  The ACABQ requests that information on cooperation between UNMIK and the International Tribunal for the Former Yugoslavia be provided to the Fifth Committee.

 The ACABQ further recommends acceptance of the seven proposed new posts for a new Department of Non-Resident Affairs.  Taking into account the executive mandate of the civilian police operation in Kosovo, the ACABQ recommends the establishment of a new D-1 post for the Deputy Police Commissioner.  Also taking into account its visit to the region, the Advisory Committee now recommends that the posts of regional administrator for Mitrovica and Pristina be reclassified from the D-1 to the D-2 level.  The ACABQ also recommends acceptance of 376 new posts requested for civil administration. 

 The ACABQ notes that a total in excess of $24 million has been approved and proposed for electronic data-processing equipment.  However, there has been no obvious effect or increased productivity in a number of sectors of the mission, such as the Financial, Personnel, General Services, Transport or Engineering Sections.  While the ACABQ is not calling into question the need to apply the most up-to-date technology in United Nations missions, acquisition of new technology and communications capacity, as well as the number of technical staff to support that capacity, should be appropriate to the particular needs of the mission.  Moreover, care should be taken to ensure that new technical capacity can be removed on departure or, if it is to be left, that the local administration has the necessary technical knowledge to use and maintain it. 

 The Advisory Committee further states that as of 31 October, of the $220 million assessed by the General Assembly for the period ending on 31 December 2000, expenditures have amounted to only $95.32 million net.  That leaves an unencumbered balance of $112.09 million, which allows for some reduction.  While it is not unusual for delays to be experienced in procurement, leading to eventual expenditure during the financial period, the ACABQ believes that the pattern of expenditure will result in savings.

 A review of the mission is planned after the holding of the municipal and central elections, the report states.  There does not seem to be any justification for expanding areas that will certainly begin to be taken over by the local administration and funded from the Kosovo consolidated budget and other sources.  In a related matter, the ACABQ encourages the use of United Nations Volunteers wherever possible. 

 The ACABQ recommends that the General Assembly appropriate for the maintenance of UNMIK an amount of $450 million, reflecting a reduction of approximately 5 per cent from the amount proposed by the Secretary-General.  That would be inclusive of the amount of $220 million already authorized by the Assembly in its resolution 54/245 B.

Introduction of Reports and Statements

 Introducing the annual report of the OIOS, DILEEP NAIR, Under-Secretary-General for Internal Oversight Services, said that in his first six months in office, he had made a number of overall observations about the work of the Office.  The Office’s independence had been essential to its success.  It had been free to examine any of the Organization’s activities, and the Secretary-General had assured him of his continued support in that regard.  He was committed to further improving the overall efficiency and effectiveness of the Oversight Office wherever possible.  The Office had demonstrated that it was an objective source of reliable information.  It was also an agent of change in strengthening internal controls and improving management performance in the Organization.  Nevertheless, he planned to review the existing organizational structure and resource allocations to ensure optimal efficiency.  He also intended to make concerted efforts to improve relationships with management and all Member States.  By maintaining an open, continuous dialogue, he hoped to build a trusting relationship and dispel any notions that there was a “hidden agenda”.

 He said that the Oversight Office had made 968 recommendations during the period, a 15 per cent increase over last year.  Those recommendations proposed measures which, if implemented by management, would achieve cost savings and recoveries totaling some $17 million.  Also during the period, the Oversight Office issued 82 audit reports and 35 investigation reports to management.  It transmitted 20 reports to the General Assembly and the Committee for Programme Coordination.  In addition, 453 audit observations were issued to clients at the operating level.  While its investigation activities increased significantly during the year, staffing remained the same as in previous periods.  As a result, the backlog of investigation cases had been growing. 

 Since July 1996, approximately 73 per cent of all Oversight Office audit recommendations had been implemented, he added.  Oversight priorities had evolved over time in response to General Assembly mandates and the changing nature of the Organization.  The priority oversight areas included peacekeeping operations, humanitarian activities, human resource management and procurement.  The assignments undertaken during the period had been challenging and diverse.  He would strive to maintain the highest levels of efficiency, effectiveness and professionalism, worthy of a world-class Organization.  This was, of course, on the understanding that the Oversight Office received the necessary resources to maintain and upgrade the skills and competencies of its staff, and to equip them with the appropriate information technology tools to perform their tasks.

 Turning to the report of the Secretary-General on the rules and procedures to be applied to the investigation functions performed by the Office, he said that the Investigations Section had to follow established United Nations Regulations, Rules and Administrative Instructions.  A manual, setting out the procedures followed by the Section, could be found on the Oversight Office Web site.  An investigation was a legal and analytical process.  It was an inquiry undertaken by specialized professionals to determine whether a wrongful or unlawful act had occurred and, if so, who were the person or persons responsible for the act.  Because the findings of such an inquiry must be based on evidence, it could also lead to clearing those who had been maliciously or wrongly accused. 

The Section, which was not a law enforcement office, conducted investigations within the terms of its mandate, he said.  In the disciplinary processes of the Organization, those constituted preliminary investigation activities.  Investigative activities were conducted with due respect for the confidentiality of those making reports.  The Section would work to clear the name of staff members who were wrongly or maliciously accused.  This report had been reviewed by both the Office of Legal Affairs and the Department of Management, and their views were incorporated in it, he explained.

 Mr. NAIR then introduced the Secretary-General’s note on enhancing the internal oversight mechanisms in operational funds and programmes.

 GUILLAUME GAUBERT (France), speaking on behalf of the European Union and associated States, said that the report on the activities of the Oversight Office proved that body’s true value.  The period covered by the report was a year of transition in two respects:  Dileep Nair had been called on to take over from the first Under-Secretary-General for Internal Oversight Services, Karl Paschke; and the Assembly had reaffirmed the mandate of the Oversight Office in its resolution 54/244.  The increase in the activities of the Office during the period under review testified to the fact that the groundwork of almost six years had borne fruit.  The more specific follow-up of the recommendations on the Office and an increased internal credibility also augured well for the future.  The progress since 1994 was laudable.

 The increase in the United Nations activities required a parallel extension in the activities of the Oversight Office, he continued.  The strategic considerations outlined in the report were welcome.  They should lead to even more effective planning of activities, closer coordination with the Organization’s other monitoring bodies, reformulation of its priority areas and improvement in its working methods. 

He inquired about the results of the in-service training organized at the end of September on strategic issues, and said that the intensification of United Nations missions justified maintaining a sensible balance of resources between Headquarters and the field in support of new priorities.  The Union was confident that the development and extension of Oversight Office activities was a key element for the development of a management culture within the Organization. 

 NIKOILAI V. LOZINSKI (Russian Federation) said that he had consistently advocated strengthening oversight structures within the United Nations and had noted the increase in the Oversight Office’s activities.  He supported the priority activities identified in the report before the Committee, in particular in the field of peacekeeping operations and procurement.  No oversight activities, however, would bear significant results without scrupulous implementation of recommendations.  On the whole, the Russian Federation was satisfied at the performance of the Oversight Office. 

He supported the decision to review its procedures and its structure in order to ensure adequate control over procurement and human resources management in the field.  He also took a positive view of the audits of missions and peacekeeping operations, although he was concerned over numerous cases of violations of financial regulations and procurement rules by the mission staff.  The financial machinations resulting in losses to the Organization caused even more concern.  He hoped all such cases revealed by the Oversight Office would be properly analysed, and that those guilty would be punished.  He also welcomed cooperation between various oversight bodies, saying that he was glad that the process was of a complementary nature, avoiding duplication.

Mr. NAIR then introduced the report of the Office on the Investigation into the Misdirection of Contributions made by Member States to the UNEP Trust Fund Account.  Between February 1998 and October 1999, nine Member States made 13 wire transfers of funds intended as contributions to the UNEP Trust Fund Account at the Chase Manhattan Bank.  The funds were deposited, however, in error, into an account of another account holder at Chase.  The Oversight Office conducted an investigation upon receipt of a report by the United Nations Treasurer in November 1999.  In the course of the investigation, it examined documents provided by the six Member States concerned, by Chase Manhattan Bank and by the United Nations Office at Nairobi, which administered the UNEP Trust Fund account.  Individuals at the Nairobi Office and UNEP were also interviewed.  No evidence of wrongdoing on the part of United Nations staff had been found.  A jury in the United States Southern District Court found the account holder, Ms. Susan Rouse-Madakor, guilty on both of the charges raised against her, namely bank fraud and bank larceny.  Sentencing was scheduled for February 2001.

The Committee then turned its attention to its agenda item on financing of UNMIK.

 Assistant Secretary-General for Programme Planning, Budget and Accounts and United Nations Controller, JEAN-PIERRE HALBWACHS, introduced the Secretary-General’s revised budget proposal for UNMIK.  Table 1 of the report provided a summary of the proposed changes.  The report indicated an increase in both military and civilian personnel costs.  A detailed breakdown of expenditures was provided in the annexes to the report.  In terms of structure, since the Secretary-General’s last report, there had been a number of developments, which were detailed in the report. 

CONRAD S.M. MSELLE, Chairman of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), introduced the related report of that body.  In examining the estimates proposed by the Secretary-General, the Advisory Committee had benefited from a five-day visit to the mission in June.  The report contained detailed comments and recommendations that were a direct result of the ACABQ’s visit to Kosovo.  Since the visit other developments had occurred.  The potential effects of those changes had been taken into account in a number of the ACABQ’s comments. 

 EVA SILOT BRAVO (Cuba) said that it was necessary to take into account the purposes of the mission when considering the proposed budget.  She noted the considerable amount of appropriations proposed and the advice of the ACABQ to reduce that amount.  As for the judicial system, she had doubts about the use of international judges instead of promoting an internal system with national judges.  That raised the question about the inter-relations between the two tribunals.  She was concerned about the tendency to establish high-level posts, which could bureaucratize the mission and set a bad example for the territory.  She also requested additional information about the Kosovo and consolidation budgets.  In conclusion, she welcomed the proposal to improve the structure of the mission.

 ALEXIS LAMEK (France), speaking on behalf of the European Union and associated States, said that the report by the Secretariat showed the scope of the work conducted in Kosovo.  The activities of UNMIK had made possible a new start for the province, to which the Union had made a considerable contribution.  It was necessary to continue efforts directed at institution-building.  The mission had succeeded in building administrative machinery from scratch, based on the rule of law.  That effort must be maintained.  He endorsed the analysis of the ACABQ. 

The European Union welcomed the recommendation of the ACABQ to authorize an additional 377 posts for civil administration, he said.  The ACABQ had also noted that a slight reduction in the budget due to economy could be made in the operation.  Such a reduction was compatible with the statement that it was essential to provide all the necessary means to the mission without compromising its functioning.

 Mr. HALBWACHS said that he would provide answers to questions raised by Member States in informal consultations next week.

 RAMESH CHANDRA (India) said that he agreed with the recommendations contained in the report of the ACABQ.  However, he asked for clarification regarding one of the concluding comments by Mr. Mselle, when he said that the Secretary-General should exercise his normal flexibility, particularly in terms of posts.

Responding to Member States queries, Mr. MSELLE said that the ACABQ had not summarized the number of posts to be deleted in its report.  The ACABQ had made reommendations regarding the overall amount for the mission.  Where the ACABQ had made comments regarding the need for a particular series of posts, the Secretary-General would take that recommendation into account.  It was for the Secretary-General, however, to indicate which posts could be dispensed with or left vacant in accordance with the requirement to implement the mandate of the mission.  This was not a new procedure.  The ACABQ had followed it from time to time. 

 The Committee then concluded its general discussion on that item.

Other Matters

 The Chairman, Mr. ROSENTHAL (Guatemala) drew the Committee’s attention to a list of pending issues.  Although the Committee had worked very hard and with great professionalism, much remained to be done.  The Committee would have to make some difficult decisions.  The first was to choose the items that demanded priority attention.  The second was to start holding night meetings.  The Committee would also have to extend beyond the date set by the General Assembly President.  On behalf of the Bureau, he had asked the Secretariat to circulate a list of the 16 items which were time sensitive and would require action.  If the Committee agreed, he would send a letter to the General Assembly President requesting an extension so that the Committee could conclude its work by Wednesday 20 December.  He asked that the Committee concentrate on the 16 topics contained in the list.  He also suggested that the Committee begin to hold night meetings.  The idea was to increase the number of meetings, both formal and informal, so that the Committee could complete its agenda.

 Ms. SILOT BRAVO (Cuba) asked why human resources had not been included in the list of priority issues.  After all, it was a personnel year.  That issue should be taken as a whole and not partially.  Regarding programme planning and the proposed medium-term plan, which were on the list, she wanted to ensure that the Committee would take up everything related to that topic.  She wondered about the inclusion of the item on peacekeeping operations.  She wondered if it was really a priority.  Regarding item 117, phase one of the Brahimi report, the Committee should not look at the financial aspects of that topic until the political organs studying the report completed their work.

 MARTA PEÑA (Mexico) endorsed the Chairman’s proposal.  She expressed concern, however, about the failure to include some topics on the list which required study at the current session, including human resources and reform.  She also questioned the inclusion of some topics on the list.  While she hoped that the General Assembly would take a decision on a number of proposals in the Brahimi report, she did not think that the Committee would be able to begin a discussion on financial aspects of that report. 

 AYMAN M. ELGAMMAL (Egypt) also expressed concern, and suggested that the title of the list -- “time sensitive” -- be changed.

 MARY JO B. ARAGON (Philippines) expressed support for the suggestion that the item on human resources be included on the list.

 Mr. LAMEK (France) said that working long hours was the tradition in the Fifth Committee.  The priorities had been well established.  It was clear to him, contrary to what others had said, that item 169, the scale of assessment for the peacekeeping operations, should be a priority.  Many delegations had asked that it be considered by the General Assembly this year.  It was a time-sensitive item.  Item 117, implementation of the Brahimi report, was also a priority because of the commitment made by heads of State at the Millennium Summit.  While issues such as procurement should also be considered as soon as possible, he was not convinced that they constituted a priority. 

 HASSAN MOHAMMED HASSAN (Nigeria) said that the “Group of 77” developing States and China had conveyed its position through a member of the Bureau on what should be included in the list.  Some items, however, were not reflected in the list.  He asked that the listed priority items be reconsidered.

 Mr. CHANDRA (India) said that programme planning and the regular scale were items which all had agreed were time bound.  Regarding item 117, the Special Committee was still considering the concepts included in the Brahimi report.  It would be difficult for the Fifth Committee to take any further action on the agenda item, either in terms of financial resources or posts, until the Special Committee had cleared the concepts contained in the report.

 KHALIFA O. ALATRASH (Libya), while endorsing the proposal to extend the Committee’s work, inquired about the provision of interpretation services for night meetings.  He also felt that the inclusion of item 117 was premature.

 M. MAE JOHNSON (Canada) said that there was a need to reconcile a heavy work schedule and a tight time period.  She supported the inclusion of item 117 on the list.  It was an issue that should be looked at with some speed.  Other bodies had taken up their consideration of that issue.  The Fifth Committee should do so as well.  The placement of agenda item 169 on the list of priorities was correct.  Over 70 delegations wrote in support of that item, and its placement on the list reflected the views of those delegates.

 Ms. SILOT BRAVO (Cuba) asked about the basis on which results-based budgeting had been included on the list.

 TANG GUANGTING (China) said that the Committee was limited in time and should handle only the most important issues.  Regarding the list, China agreed with some of the concerns already expressed.  Human resources should be resolved, as it was a personnel year.  He doubted, however, whether the issues over which there was a great difference of opinion could be resolved during the current session.  Results-based budgeting was a controversial issue and could probably not be resolved in the current session.  Discussion on that item could be continued in the Committee’s resumed session or at the fifty-sixth session.

 RACHEL J. GEMAN (United States) said that she agreed with the list presented to the Committee, in particular the reference to the peacekeeping scale of assessments.  There was real momentum in the consideration of the item, and there should be no delay in the work.  In order to put peacekeeping on a secure financial footing, it was important to continue work.  She was in support of doing everything possible to conclude consideration on the items on the list during this session. 

 MANLAN AHOUNOU (Cote d’Ivoire) agreed that in view of the lack of time, it was necessary to hold evening meetings, as in the past.  He regretted that some items had not yet been taken up by the Committee.  Items 117 and 116 were not real priorities for the Committee at this time.  Human resources management was a very important issue, which needed to be further discussed at a resumed session.  What was important for one delegation, could have less relevance for another.  It was important to bear in mind what was important for the Organization as a whole.

 GERT ROSENTHAL (Guatemala), Chairman of the Committee, took note of the statement by the representative of Egypt that the term “time-sensitive” was perhaps not the most fortunate one, but everyone understood what was meant.  It was necessary to organize the agenda, and he had identified the items that required priority during the next four weeks.  He had also intended to inject a sense of urgency into the Committee’s work, for the agenda was heavy, and most items required lengthy discussions.  Some items should be postponed.  The intention was to finish work on 20 December, to give the Assembly time to consider the report of the Fifth Committee. 

 ARATA FUJII (Japan) said that the two scales of assessment were a cause of particular concern.  Of course, this year was a human resources one, but the scales were very important too.  Basically, the schedule was full, and he trusted the Bureau to resolve the issue.

 Mr. AHOUNOU (Cote d’Ivoire) said that consideration of human resources management should be postponed, as decided in the informal consultations.  This was the year when human resources issues should be discussed, but no resolutions had been adopted on that issue during the first part of the session in previous years.  The Committee could not be expected to reach a consensus during the main part of the session this year.  He was not sure if the dateline of 22 December would be respected.  In previous years, some delegations had been forced to change their travel plans. 

 The CHAIRMAN said that it was up to the delegates to decide on the dates.  The proposal was to extend the activities of the Committee through 20 December, so the Committee’s reports could be considered by the Assembly on 22 December. 

 WEN CHIN POWLES  (New Zealand) supported continuing work through 20 December.  Results-based budgeting was a high priority for her delegation, as well as for up to 40 other countries.  It should be considered during this session, as decision on that matter needed to be achieved before the next budget cycle.  Results-based budgeting was no longer a controversial matter, and it should be considered as a priority. 

 The CHAIRMAN said that there seemed to be a consensus that a request for an extension of the Committee’s work up to 20 December should be sent to the President of the General Assembly.  Also, a list of priority issues should be agreed upon.  The list was not a rigorous commitment to adopt final decisions on all the items.  It was just an attempt to rationalize the Committee’s work.  There was also no objection to holding night meetings, and support services would be provided to that effect.

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