Press Releases

    GA/AB/3688
    18 October 2005

    UN Financial Situation Shows "Encouraging Signs of Improvement", but Continued Fragility, Controller Tells Budget Committee

    Debate on Accountability, Oversight also Continues

    (Issued on 14 October 2005.)

    NEW YORK, 13 October (UN Headquarters) -- "There are some encouraging signs of improvement, but there is still cause for concern," the United Nations Controller, Warren Sach told the Fifth Committee (Administrative and Budgetary), as he delivered the Secretariat's biannual statement on the financial situation of the United Nations today.

    He said the cash position as of 7 October 2005, was stronger than at the end of 2004 and projections to the end of the year for the regular budget and the international Tribunals were also more positive.  At the same time, unpaid dues from Member States outstanding were "highly concentrated", with more than 90 per cent owed by three Member States and over 80 per cent by the United States alone.

    The positive projections depended crucially on a relatively few Member States making payments in line with their past pattern of payments, he stressed.  That underlined the continuing fragility of the Organization's financial situation and it might still be necessary to cross-borrow from the accounts of closed peacekeeping missions.  The only way to secure financial health for the United Nations was for Member States to meet their financial obligations to the Organization in a full and timely fashion.

    Also today, the Committee continued its discussion on accountability and oversight within the United Nations.  Many speakers insisted on the need to ensure independence of oversight bodies and cautioned that the creation of additional bodies or "layers", as the representative of Jordan put it, was not necessarily beneficial for the Organization.  Jordan's representative said that it was necessary to be very careful in considering some of the proposals to enhance oversight, as Member States could find themselves with an overly bureaucratic structure that would not deliver quality services.

    It was also pointed out in the debate that responsibility and accountability went hand in hand and as a prerequisite for success.  The reform efforts needed to be comprehensive, non-selective and sustainable and the credibility of the process through which organizational change was introduced was of utmost importance.

    Among other issues, speeches highlighted:  the inadequacy of funding available for mandated oversight coverage of extrabudgetary activities by the Office of Internal Oversight Services (OIOS); and OIOS findings following audits of peacekeeping operations, including sexual exploitation and abuse, charges of corruption concerning Pristina airport in the United Nations Interim Administration Mission in Kosovo (UNMIK), and over-reporting of troop strength in United Nations Organization Mission in the Democratic Republic of the Congo (MONUC).

    Speaking on behalf of the Group of 77 developing countries and China, the representative of Jamaica said that any accountability framework or oversight system must be founded on the principle that the General Assembly was the primary oversight body and the Secretariat was accountable to it.  The Summit outcome was not the only reference document on oversight and accountability -- the Assembly had made numerous requests in that regard.  She called on the Secretary-General to submit the comprehensive review of the governance structures, principals and accountability throughout the United Nations system, as requested by the General Assembly, as soon as possible and not in the sixty-first session.

    Several speakers also expressed misgivings regarding the establishment of the Oversight Committee as an independent advisory panel to the Secretary-General, aimed at facilitating the implementation of oversight bodies' recommendations.  In that connection, delegates shared the concern of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), which questioned the appropriateness of the Oversight Committee's mandate to provide advice on the priorities, long-term strategy and annual audit work oversight bodies, since that could affect their independence. 

    India's representative recalled that, in its resolution 59/272, the Assembly had called for a high-level follow-up mechanism on the implementation of OIOS recommendations.  Creation of an Oversight Committee might not serve that purpose, due to potential conflicts of interest.  Responding to those concerns, the Principal Officer in the Office of the Under-Secretary-General for Management, Nancy Hurtz-Soyka, said the Committee would not call into question the independence of oversight bodies and the quality of audit reports.  The Committee would not be involved with setting work programmes or determining priorities of the oversight bodies.

    Statements were also made by representatives of the United Kingdom (on behalf of the European Union), Argentina (on behalf of the Rio Group), South Africa, Saudi Arabia, China, Switzerland, United States, Nigeria, Cuba, Trinidad and Tobago, Brazil (on behalf of the Rio Group), Syria, Pakistan, Singapore, Egypt, Russian Federation, Burkina Faso and United Republic of Tanzania.

    The Committee will hold its next formal meeting at 10 a.m. Monday, 17 October.

    Background

    The Fifth Committee (Administrative and Budgetary) met this morning to hear a presentation on the financial situation of the United Nations by the United Nations Controller, Warren Sach, and continue its consideration of the operations of the Office of Internal Oversight Services (OIOS) and reports related to the review of efficiency within the Organization.

    Briefing by Controller

    "In order to be able to carry out the important and challenging tasks that Member States have entrusted to the United Nations, it is essential that the Organization has a strong and dependable financial base", United Nations Controller, WARREN SACH, said. 

    Focusing on four main indicators of the Organization's financial health as of 7 October 2005 -- assessments issued, unpaid contributions, available cash, and debt to Member States -- he said that regular budget assessments and payments were both higher on that date than on 30 September 2004, by $345 million and $247 million, respectively.  Unpaid assessed contributions were also higher -- by $14 million.  On a positive note, 126 Member States had paid their regular budget assessments in full, two more than at the end of 2004.

    The countries that had paid all their assessments, including those for the regular budget, peacekeeping and the Tribunals -- International Criminal Tribunals for the Former Yugoslavia (ICTY) and for Rwanda (ICTR) -- in full, as of 7 October, were: Australia, Azerbaijan, Canada, Croatia, Denmark, Finland, Germany, Ireland, Liechtenstein, New Zealand, Sierra Leone, Singapore, Sweden and Thailand.  Payments received this week would add South Africa and the United Kingdom to that list.  He encouraged all other Member States to join them.

    The $739 million that remained outstanding was "highly concentrated", with over 90 per cent owed by three Member States -- United States, Brazil, Argentina -- and over 80 per cent by the United States alone.  Clearly, the final outcome in 2005 would depend heavily on the action taken by those countries.

    Based on current projections, the cash deficit for the regular budget was expected to be significantly lower than at the end of last year and combined net cash in the General Fund, to which assessments are paid, to be over $100 million higher.  While the projections for October-December were "getting healthier", the outcome was based on the pattern of payments received in 2004 being replicated in the final quarter of 2005.  On that basis, the Organization expected to receive over $400 million during the final quarter.  Should there be any serious delay in those payments, especially those from the major contributor, the United Nations could still end the year in the red.

    Turning to peacekeeping, he said that the circumstances surrounding peacekeeping operations were often very unpredictable.  The peacekeeping financial period runs from 1 July to 30 June, rather than from 1 January to 31 December; assessments are issued separately for each operation; and, since assessments for each mission can only be issued through the period approved by the Security Council, they are issued periodically throughout the year.

    The amount outstanding for peacekeeping operations exceeded $2.5 billion at the end of 2004 -- after assessments of over $5 billion had been issued that year, he said.  So far, in 2005, payments had somewhat exceeded new assessments, including those issued on 27 September 2005.  As a result, the total amount outstanding at 7 October was lower by over $400 million.  With peacekeeping assessments issued throughout the year, it was more difficult for Member States to keep fully current.  Therefore, he wanted to pay special thanks to countries that had paid all their peacekeeping dues by 7 October:  Australia, Azerbaijan, Canada, Croatia, Denmark, Egypt, Finland, Germany, Ireland, Liechtenstein, Micronesia, New Zealand, Russian Federation, Sierra Leone, Singapore, Sweden and Thailand.  Payments received this week would add South Africa and the United Kingdom to the list.

    Although cash available for peacekeeping was over $2.2 billion, that amount was divided between the accounts maintained for each peacekeeping mission, he continued.  In line with a decision of the Assembly, the Secretariat was precluded from borrowing from the accounts of active missions.  In addition, the resources of the Peacekeeping Reserve Fund could only be used for new operations and expansions of existing missions.  Of the amount of cash available in the accounts of closed peacekeeping operations, $262 million related to amounts to be paid for troops and equipment, as well as credits to be returned to States.  That left only $83 million that could potentially be cross-borrowed for other accounts, including the regular budget, the Tribunals and active peacekeeping.  This year, a significant part of that amount had been cross-borrowed for active missions and the Tribunals, with a peak of $79 million in March.

    Given that very limited amount and uncertainties surrounding the position of several accounts, the Secretary-General would be proposing that the cash held in the accounts of closed peacekeeping operations should be retained for the time being.

    It was projected that amounts owed to Member States for troops and contingent-owned equipment at the end of 2005 would come to $779 million, he continued.  That was due to a delay in the deployment of troops in Sudan, delays in the signing of memoranda of understanding with troop providers, the deployment of additional troops and police to Haiti, the Democratic Republic of the Congo and Côte d'Ivoire and a shortage of cash in some missions.  Indeed, the current cash position of the Mission in the Democratic Republic of the Congo made December payments to troop contributors to the Mission unlikely.

    Regarding the international tribunals, he said that by the end of last week, 79 Member States had paid their assessments to both Tribunals in full.  The total amount received so far this year was slightly more than a year ago, and the amount outstanding, at $73 million, was significantly less than the $111 million last year.  While there were some signs of progress, no fewer than 112 Member States still had amounts outstanding for one or both tribunals and 10 countries had made no contributions to the Tribunals since their inception. 

    As for the Tribunals' cash flow, he said that while the estimates showed a net positive balance at year-end, that reflected a cash deficit of $9 million for the Rwanda tribunal and a positive balance of $25 million for the tribunal for the former Yugoslavia.  Even that mixed result, however, was based on the expectation of further payments during the final quarter of 2005.  The completion of the Tribunals' important work depended on Member States meeting their financial obligations in a fuller and more timely fashion, and he urged Member States to do so.

    On the Capital Master Plan, he recalled that the Assembly had authorized assessments for 2002-2003 and 2005, totalling $43.3 million, for preparatory activities for the plan.  By 7 October 2005, payments of over $31 million had been received.  Future implementation of the Capital Master Plan, including modalities for financing, was currently under review.

    Statements

    ELIZABETH GALVEZ (United Kingdom), speaking on behalf of the European Union and associated States, said she welcomed the attention the OIOS has made in areas of high risk, such as procurement, and appreciated the attention to abuse in the peacekeeping operations.

    Some of the issues of particular concern to the Union were the level and rate of implementation of OIOS recommendations and the problems between OIOS and the funds and programmes with regard to the availability of funds, she continued.  Another area of concern was the scope and quantity of problems that had arisen in peacekeeping missions.  The case of alleged corruption concerning the Pristina airport and other issues at United Nations Interim Administration Mission in Kosovo (UNMIK) were of particular concern and should be drawn to the attention of the Security Council.  The Union also believed that close coordination between the OIOS and the Joint Inspection Unit (JIU) was important to avoid potential duplication of activity and ensure mutual reinforcement.  And finally, the Union welcomed the OIOS efforts to strengthen the results-based management culture within the United Nations, as a means to make the work and resources more effective.

    The Union favoured the creation of an external oversight committee to advise the General Assembly and as way to ensure budgetary independence of the OIOS, she said.  The Union believed that the strengthening of capacity, expertise and resources for OIOS called for by the World Summit should be addressed during the session and not await the outcome of the evaluation.

    NORMA ELAINE TAYLOR ROBERTS (Jamaica), speaking on behalf of the "Group of 77" developing countries and China, insisted on full and effective implementation of the oversight recommendations.  While pleased to note the savings arising from them, she was concerned that a number of the recommendations had not been implemented.  As for the investigations on sexual exploitation and abuse, the Group reiterated that the recommendations of the Office on that issue should be based on Assembly resolution 59/300.  The Group would like to reaffirm the role of the General Assembly as the principal oversight organ of the Organization, in accordance with resolution 54/244.

    In resolution 59/272, the Assembly had reviewed the activities and reaffirmed the mandate of the OIOS, she continued.  She was, therefore, concerned at the preoccupation with audit and investigation at the seeming expense of the critical area of evaluation.  In paragraph 13 of resolution 59/272, the Assembly had stressed "the vital importance of the evaluation function of the OIOS".  Evaluation was an integral part of the oversight function, and the Group would appreciate receiving the views of the Office on that emphasis.

    The Group noted the statement by the Under-Secretary-General on the establishment of a high-level coordination mechanism, she said.  Consistent with the provisions of resolution 59/272, continued effective coordination and collaboration among the internal and external oversight bodies was needed in order to maximize the use of resources and share experiences, knowledge, best practices and lessons learned.

    EDWINA STEVENS (Australia) also speaking on behalf of Canada, New Zealand and Australia, said the countries she spoke for placed a high premium on strong and effective oversight and believed it was crucial for the United Nations to make this oversight system as independent as possible. She welcomed the Summit outcome document requesting an independent, external evaluation of the United Nation's auditing and oversight system, including specialised agencies.

    She was pleased that OIOS was conducting a review of its internal requirements and highlighted two areas of concern that were raised in the OIOS annual report. The first area was the inadequacy of funding available for mandated oversight coverage of extrabudgetary activities. The second area of concern relates to sexual exploitation and abuse in the context of management of peacekeeping operations. She sought assurance about oversight activities in peacekeeping operations, with particular regard to conduct, and would like to learn more about the investigations, their findings and how those finding are being acted upon.  She also asked if OIOS activities had effectively discouraged sexual exploitation and abuse in peacekeeping operations.

    ALEJANDRO TORRES LEPORI (Argentina) speaking on behalf of the Rio Group, associated itself with the comments of Jamaica and the Group of 77 and China.  He was concerned with the degree of implementation of the OIOS recommendations and urged all departments to implement the recommendations as soon as possible.  With regard to helping it make the best decisions on the various issues before the Committee, he wanted to obtain all the available technical information from the JIU, the Board of Auditors and the OIOS.

    He stressed the importance of improving the system of acquisitions, so the process could be more transparent.  The policies regarding acquisitions should ensure that suppliers from all regions, particularly developing regions, were considered.  And regarding the subject of the eradication of poverty, he believed the United Nations needed a systemic transfer of knowledge and experience to strengthen its work in the fight against world hunger.

    KAREN LOCK (South Africa) said that her delegation attached great importance to the internal oversight functions and was encouraged by the comments of the Under-Secretary-General that any review of the Office had to be objective, independent and comprehensive.  She commended the Office for its contribution to enhancing the effectiveness of programme implementation through constant improvement of internal control mechanisms.  That would contribute to the efforts to improve accountability and governance in the Organization.  South Africa was appreciative of the ongoing efforts of the Office to refine the format of its report and improve the quality of information contained in it.

    The large number of OIOS reports submitted to the General Assembly during the period under review, the wide range of issues covered and the actual savings of $18 million, as a result of the implementation of OIOS recommendations, testified to the importance of having effective oversight mechanisms, she said.  Therefore, she encouraged the management to take every effort to ensure full implementation of the OIOS recommendations, in particular those that were critical in nature.

    On the issue of subregional offices of the Economic Commission for Africa (ECA), she said that the challenges faced by the continent could not be addressed through the efforts of African countries alone.  The ECA and its subregional offices played an important role in the efforts to advance the development agenda in Africa.  The OIOS had recently conducted an audit of the management of the ECA itself and, since 2002, the Commission had made considerable progress in aligning its activities and programmes with the priorities of the New Partnership for Africa's Development (NEPAD) and the internationally agreed development goals.  Thus, it seemed logical for the OIOS to shift its focus to the subregional "outposts" of the Commission.

    She was encouraged that the inspection of the OIOS had reaffirmed the importance of the subregional offices of the ECA, she said.  The report had also highlighted a number of areas that required urgent action.  She was concerned to have learned that the mandated core functions of the five suberegional offices were not supported by adequate resources, their outreach in the subregions was limited, the coordination and support from the ECA headquarters were weak and that the offices continued to face high vacancy rates.  It was imperative to ensure that the "development of Africa", as one of the main priorities of the Organization, received not only political support, but also more concrete and visible action.

    AHMED EL-RASHID (Saudi Arabia) supported the OIOS as one of the most important internal oversight bodies of the United Nations.  He welcomed the fact that some $35 million had been identified by the Office in recommended savings and that some $18 million had actually been recovered.  Among the highlights of the Office's activities during the reporting period were evaluation of the tsunami response, investigation of procurement and a training programme to enhance performance, monitoring and reporting.  Management and senior management must accord utmost importance to the implementation of the major recommendations of the Office, particularly those that had not yet been implemented.

    Establishment of resident investigators in 6 peacekeeping operations would improve monitoring and limit corruption, he continued.  Introduction of ethics units in several missions was also important, and he hoped that practice would be extended to all peacekeeping operations.  He welcomed the efforts of the Office to develop strategies for auditing to mitigate the risks to the external, unauthorized access to sensitive materials.  Also commendable was the establishment of a working group to elaborate the policy for the protection of whistleblowers.

    SUN XUDONG (China) said that the implementation rate for critical recommendations remained low, at about 43 per cent.  That was certainly not encouraging news.  Although the implementation rate had been 95 per cent for 2001-2002, one recommendation issued during that period remained unimplemented after a lapse of 3 to 4 years.  He hoped the Secretariat would look into that matter seriously and provide the necessary clarifications.  He also hoped that the already established high-level oversight coordinating mechanism would play its role in improving the implementation of the Office's recommendations.  He was pleased that the OIOS had identified a total of $35.1 million in recommended savings, of which a total of $18 million had been actually recovered.

    Turning to oversight results, he said that the audit of peacekeeping operations had exposed many problems.  Many of those could actually be avoided with strengthened management and accountability.  Once management was in good order, the number of problems would certainly decline, and a reduced need for OIOS resources could then be translated into savings.  He hoped the Department of Peacekeeping Operations would further improve its management of the missions, cut out waste and avoid duplication, so that peacekeeping resources could be used most effectively.

    In connection with UNMIK, he recalled that, according to paragraph 19 of the report, investigators had spent some 18 months looking into the most significant charges of corruption concerning Pristina Airport.  As many as 30 additional OIOS report related to the subject.  The poor management of UNMIK was a source of serious concern, and he wanted to know about the root causes for numerous problems.

    The OIOS recommendation that the United Nations Organization Mission in the Democratic Republic of the Congo (MONUC) adjust over-reported troop strength in its records had resulted in estimated savings of some $1.9 million.  The same problem had also been reported last year.  MONUC must cease such fraudulent behaviour and establish a mechanism to ensure the accuracy of troop-strength reporting.  Since the problem had been also found in some other missions, DPKO needed to lay down clear rules and regulations in anticipation of the problem.  His delegation had already called attention to the need for MONUC to enhance budget management and recruit people with managerial expertise, and he wanted to know if the Mission had taken any measures in that regard.

    Last year's report had also mentioned the abuse of the telephone billing system of the United Nations Mission in Ethiopia and Eritrea (UNMEE) in the amount of $1.1 million, and he wanted to know how much of that had been recovered so far.  This year, the audit had found that the Mission was being billed by a private hospital for diagnostic tests and x-rays that were supposed to be provided by its own hospital.  He wanted to know the exact reasons behind the Mission's action.

    In conclusion, he said that the hard work of the Office had produced fruitful results and saved millions of dollars for Member States.  Its work needed to be further improved to ensure greater fairness and objectivity.  His delegation endorsed the idea of giving greater independence to the Office in budget and human resources management.

    ANJA ZOBRIST RENTENAAR (Switzerland) said the OIOS annual report as usual provided a comprehensive and clear picture of how the Office had helped identify savings and improved the efficiency of the Organization.  The delegation would continue to pursue many of the report's critical issues.  Among the issues of particular interest to Switzerland was the implementation rate of OIOS recommendations, which was still too low.  Especially during the first six months after the issuance of critical recommendations, quick action by the Secretariat was necessary.  She hoped the newly created Management Performance Board would improve the situation.

    She said it was imperative that negotiations with all funds and programmes for appropriate funding arrangements be concluded right away and she noted with concern that the discussions between the United Nations Compensation Commission and OIOS on the proper scope of the audit of the Commission was still ongoing.  She added that the management of peacekeeping operations was one of the most significant risks to the Organization and the recent abuses in the missions undermined the Organization's reputation.  She would like a more detailed account of the OIOS survey on the state of discipline in peacekeeping missions.  And to insure proper accountability for the $1 billion in funds accumulated for the tsunami relief operation, she said OIOS should take the lead in the joint audit of the relief efforts.

    ANNE WOODS PATTERSON (United States) said the OIOS played a key role in the ongoing viability and effectiveness of the United Nations, and global leaders at the recently concluded World Summit identified Secretariat and management reform as a central priority.  She said the $35.1 million in recommended savings identified in the recent OIOS annual report underscores why the work of the OIOS was crucial to the ongoing effective functioning of the United Nations.

    The United States would like to know the status of several action items that were reflected in the outcome document to "substantially improve the United Nations' oversight and management process".  Those items included requesting the Secretary-General to submit an independent external evaluation of the audit and oversight system in the United Nations and specialized agencies; authorizing OIOS to examine the feasibility of providing oversight to other United Nations agencies that requested it; and significantly strengthening the expertise, capacity and resources of OIOS in respect of audit and investigations.

    The United States welcomed the strategic initiatives already started by OIOS, such as the self-assessment of the Monitoring, Evaluation and Consulting Division conducted in 2004 and the increased focus on audits conducted in the Departments of Peacekeeping and Humanitarian Affairs.  The United States also welcomed any information in the Office's efforts to address the lack of skilled auditors in the area of information and communication technology.

    NONYE UDO (Nigeria) said that the report before the Committee, to its credit, highlighted a significant fact that the sum of $18 million had been saved and recovered as a result of the work of the OIOS.  That was highly commendable.  Also notable was the almost 50 per cent implementation of the Office's recommendations. Expressing hope that programme managers would implement the outstanding recommendations, she wanted to know if the OIOS had in the interim obtained a further update on the implementation of the remaining recommendations.  She also wanted to know if any consideration had been given to the possibility of putting a percentage of the savings realized from OIOS recommendations into undertaking other investigations that had been delayed due to lack of sufficient resources.

    She took due note of the fact that the expansion of peacekeeping activities had imposed additional demands on the OIOS and the Department of Peacekeeping Operations, she said.  Cognizant of the above, the Assembly had increased the number of resident audit staff around the world from 30 to 51.  The filling of additional posts should have alleviated the strain on the Office.  She was encouraged that the Peacekeeping Department and peacekeeping missions were cooperating with the OIOS and addressing issues raised in its audit reports.  In that regard, she took note of the establishment of Conduct and Discipline Units in several missions.  She also welcomed the recorded improvements on rations contracts in UNMEE and the United Nations Mission of Support in East Timor (UNMISET), and was pleased that MONUC now took advantage of early payment discounts for the supply of its food rations.  It had also developed a database to facilitate contractor assessments.  The United Nations Mission in Liberia (UNMIL) had also strengthened its evaluation of contractor performance and food quality controls and committed itself to carrying out more detailed inspections of contractor's warehouses and contingent's storerooms.

    Health, welfare and security of troops should remain a paramount concern to all, she continued.  She was, therefore, concerned that there may still be a need for rethinking security activities and operations, particularly since the report indicated some deficiencies in the Rwanda and former Yugoslavia Tribunals and ECA.  A security strategy for the ECA had not yet been developed.  Regarding audits of the administration of staff entitlements, she wanted to know if the findings from those audits could be used in ascertaining the real cause of high vacancy rates in some duty stations.

    Continuing, she welcomed the remittance of monies by the United Nations Office for Project Services (UNOPS) on behalf of the Office of the United Nations High Commissioner for Human Rights to contractors for completed projects, and took note of the positive report on United Nations Office on Drugs and Crime in Nigeria, Afghanistan and Bolivia.  On the tsunami relief, care should be taken to ensure that adequate precautions are taken to project a positive image of the United Nations.  She called for full implementation of all recommendations in that regard. There was also a need to maintain proper coordination with other bodies involved in oversight of the relief efforts.

    Closely related to that was the issue of procurement, she said.  On that issue alone, since 2000, the OIOS had issued some 154 reports and about 691 recommendations.  It was not clear how many of those recommendations had been implemented. She also wondered about the status of the common procurement management system.  Concerning the discussion between the OIOS and the United Nations Compensation Commission, she reiterated that the Assembly had, only a few months ago, pronounced itself on that issue, as reflected in paragraph 11 of resolution 59/271.

    PABLO BERTI OLIVA (Cuba) said that, at a time when internal oversight had become particularly important, he wanted to thank the OIOS for improving the quality of its annual report and the benefits it had brought to the Organization.  He noted that in the first paragraph of its report, the Office repeated the words regarding its mission that had been addressed in resolution 59/270.  In that text, the Assembly had noted the description of the mission of the OIOS, as outlined in its annual report, and stressed that the mission of the Office should be in full conformity with its mandate.  The message of the Assembly should be taken into account.  Paragraph 2 of the report contained a description with regard to stages of implementation of measures in 2004.  However, during the fifty-ninth session each of those measures had been analysed in detail and addressed in a relevant resolution.  In that connection, he said that the Assembly was still awaiting a report requested in that resolution on the operational independence of the Office.

    Turning to paragraph 4 of the report, he said that he was also struck by the fact that Office used a report of the Volcker Committee to justify the need for greater independence.  That report was not being considered by the General Assembly.  Were there any other recommendations by that body that had been applied by the Office?

    In general, his delegation would like to know more about cooperation between the OIOS and other oversight bodies, he said. How was that cooperation organized? He hoped that an external evaluation requested in the final document of the Summit -- which his delegation had expressed reservations on -- would be well-founded and would contain all the technical information and justifications that would enable the Assembly to take action upon it. He did not appreciate hasty decisions on such matters, without detailed proposals before the Assembly.

    RAJIV RAMLAL (Trinidad and Tobago) said he associated himself with the statement of Jamaica on behalf of the Group of 77 and China and supported efforts to strengthen the OIOS.  He said the annual report with its recommended savings underscored the importance of its work, but, as many other speakers indicated, much more work needed to be done.  He said Under-Secretary-General Ahlenius was leading the Organization at a critical juncture of the Organization and he had no doubt that OIOS could make a meaningful contribution to the process under way.

    He said there has been a disturbing tendency in the Organization to throw resources at problems as a way to rectify the situation.  He urged that there be careful assessment of any problem in order to decide the best recourse.  He said the magnitude and scope of the oversight exercise deserves that approach.  He said he agreed with OIOS, which questioned the naming of a new independent oversight body as the so-called Oversight Committee.  He questioned whether a different name, such as high-level follow-up or coordination mechanism, would not be more appropriate and better reflect its work in following up on oversight recommendations.

    FERNANDO DE OLIVEIRA SENA (Brazil) said he associated himself with the statement of the Jamaica on behalf of the Group of 77 and China and spoke for the Rio Group.  He said the Summit outcome discussed the need for coordination among all agencies of the United Nations in the fight against hunger and poverty.  He said the document pointed out the need for an enhanced approach to knowledge and greater collaboration between country teams and the agencies.  He said the eradication of hunger and poverty must be tackled through a coordinated approach and he would like more information from OIOS on how that could be done.

    MHD. NAJIB ELJI (Syria) said he supported the statement made by Jamaica on behalf of the Group of 77 and China, and said the Office's oversight function was very important to the Organization and it served a special role in its work with the Fifth Committee.

    He said the Office was critical for monitoring all departments' compliance with staff rules and regulations, as well as the Organization's financial rules and regulations.  The Office's job was to monitor the implementation of mandates and to monitor wasteful practices and corruption.  He supported the coordination between the several oversight bodies.  He stressed the importance of external oversight and viewed with satisfaction the important step of resolution 59/272, which laid the groundwork for the further work of the OIOS.

    With regard to the OIOS annual report, he said he appreciated the valuable information and the quality of the report, but felt it overstepped some of its mandates and believed it should avoid addressing issues solely handled by legislative organs.  Syria noted its concerns with issues in the report, including the lack of sufficient auditors in the information technology areas.  He was also concerned that the efforts of the Joint Pension Board were concentrated on the investment of funds and neglected the problems that the beneficiaries faced because of administrative shortcomings.

    AHMED FAROOQ (Pakistan) said that the value added by the OIOS in the oversight structure of the United Nations could not be overstated.  He was happy that the recommendations of the OIOS had resulted in actual savings worth $18 million.  However, it was a matter of concern that so far the programme managers had implemented only 50 per cent of over 2,000 recommendations and work was yet to start on some 25 per cent of the recommendations.  He stressed the need for an institutional structure to ensure full implementation of the oversight recommendations.  Coordination and collaboration between oversight bodies was essential.  However, he shared the observations of the Advisory Committee on Administrative and Budgetary Questions (ACABQ) regarding the oversight committee that the Secretary-General intended to set up in pursuance of resolution 59/272.  Its terms of reference would have to be reviewed to ensure that the establishment of the committee fully addressed the request of that resolution.

    He added that he fully supported the independence of the OIOS to enable the Office to carry out its mandated responsibilities of checking waste, fraud and abuse.  Strengthening of the OIOS and its accountability to the Assembly would contribute to greater transparency and would help address the concerns about the mismanagement at the United Nations.

    Responding to the comments from the floor, INGA-BRITT AHLENIUS, Under-Secretary-General for Internal Oversight Services, said she appreciated the support expressed by the delegations.  Together with her colleagues, she would prepare answers to all questions.

    The lack of independence of the OIOS, weak structures for the enforcement of recommendations and signs of weakness in reporting structures were among the issues raised, she continued.  Financing was a major concern, as far as independence of the Office was concerned.  With the regular budget process, the situation at present was that one of the Office's major auditors was a major player in the decision on financing.  As far as extrabudgetary funds were concerned, the Office's managers had to devote time to fund-raising, having to convince funds and programmes that they needed audits and that they had to pay for them.  The overall level of funding was inadequate.

    Weak structures for the enforcement of recommendations were also a source of concern.  Peacekeeping missions were a major risk for the United Nations, yet there were no formal channels for the Security Council to take note of OIOS findings, for example regarding the Pristina airport.  The shortcomings existing today should be addressed and assessed during the proposed review of the Office.

    Review of Efficiency

    Mrs. TAYLOR ROBERTS (Jamaica), on behalf of the Group of 77 and China, stressed that any accountability framework or oversight system must be founded on the principle that the General Assembly was the primary oversight body and the Secretariat was accountable to it.  She said the creation of additional structures and new resources was not the only way to address the Organization's problems.

    She said the Summit outcome is not the only reference document on oversight and accountability and noted that the General Assembly had made numerous requests in this regard.  She called on the Secretary-General to submit the comprehensive review of the governance structures, principals and accountability throughout the United Nations system, as requested by the General Assembly, as soon as possible and not in the sixty-first session.

    In connection with the OIOS report on the inspection of programme and administrative management of the subregional offices of the Economic Commission for Africa, she said it was important that those subregional offices had clearly stated mandates and understood their responsibilities.  She said they should also have staffs with requisite skills and tools for the job.  She looked forward to receiving details in the next OIOS report on how the ECA was cooperating fully with the Office.

    She remarked on several issues regarding the report of the Secretary-General on measures to strengthen accountability (A/60/312).  She said there appeared to be some duplication in the functions of the Management Performance Board and the Oversight Committee and would like a clarification on the issue.  She said measures to evaluate programme delivery should include a transparent process to assess and validate managers' achievement of delivering programmes.

    Regarding the strengthening of oversight mechanisms, she shared the concerns of the ACABQ that it may not be appropriate for the Oversight Committee, on behalf of the Secretary-General, to provide advice on the priorities, long-term strategy and annual audit work plans of the oversight bodies.  She said the independence of the oversight bodies was very important.  Regarding ethical conduct, she looked forward to receiving, through the established channels, the proposals for the creation of the United Nations Office of Ethics.  She stressed that the General Assembly had not approved the creation of a conduct and discipline unit at Headquarters or in the field.

    And on the issue of enhancing transparency, she welcomed efforts to make procurement practices more transparent and encouraged measures to ensure the procurement policies and practices within the United Nations system incorporated suppliers from all regions, especially from developing countries.

    While welcoming the Secretary-Generals' recent initiatives on accountability, SARTAJ SINGH CHHATWAL (India) recognized that much work ended to be completed and the creation of committees and working groups in themselves could not ensure the system of accountability was in place.  From the measures described in the Secretary-General's report, it was obvious that the work on creating a credible accountability structure had just begun.

    Unfortunately, the measures and initiatives outlined in the report almost entirely pertained to accountability of programme managers to their superiors, he said.  As for the tools available to the Assembly, the programme performance report had proven to be inadequate.  In its resolution 58/269, the Assembly had asked the Secretary-General to improve the format and timing of programme performance and evaluation reports.  He looked forward to the consideration of the joint OIOS-JIU report on strengthening and monitoring of programme performance and evaluation.

    Transparency could not be defined purely in terms of availability of information through the use of Internet technology, he continued.  It had to exist at every level of decision-making and in the implementation of mandates.  He welcomed "the beginning" that had been made in achieving greater transparency in the selection and appointment of senior officials.  Like the European Union, he would like to know whether the new procedures would also apply to the selection of all Under-Secretary-Generals, Assistant Secretary-Generals and Special Representatives of the Secretary-General.

    He said that his delegation viewed the need for strengthening of expertise and capacity of the OIOS from the perspective of effective oversight as a prerequisite of accountability.  It was important for the Office to have a say in the areas in which it needed to be strengthened.  He, therefore, called on the OIOS to complete its self-evaluation, so that Member States had the benefit of its views before taking decisions on the issue of its strengthening. Finally, follow-up and implementation of audit recommendations left much to be desired. It was disconcerting that as many as 45 of the 69 recommendations of the Board of Auditors remained outstanding.

    Resolution 59/272 had called for a high-level follow-up mechanism on the implementation of recommendations, he said.  Recent creation of an oversight Committee might not serve that purpose, due to potential conflict of interest.  That aspect would be considered in the context of the comprehensive review of governance arrangements.

    As for the report on the contribution of the Department of Management, he agreed with the Advisory Committee, that in the absence of any quantification of the impact of the measures enumerated, it was difficult to comment on the concrete contribution those had made.  For example, in the area of procurement, it had been stated that the use of inter-agency system contracts had resulted in the ability to negotiate better prices in the procurement of information technology equipment.  However, the United Nations continued to purchase computers at prices higher that what was available in the market.  It would be useful to know how and where the mentioned economies had been arrived at.

    VANU GOPALA MENON (Singapore) said that to be endorsed by the general membership, the management and Secretariat reforms must be perceived to be genuine -- not implemented simply in response to a crisis of heavy criticism or because of pressure from certain quarters.  Reform should also be a constant, ongoing exercise.  It should be carried out at a pace that was comfortable to all of the United Nations membership and in a way that would not unduly affect delivery of programmes and initiatives or erode the legislative powers of Member States vis-à-vis the Secretariat.  Due regard should be paid to existing rules and regulations.

    If one of the objectives of management reform was to rehabilitate the United Nations' image, it would also be necessary to address the sources of bad news that the Organization had to deal with, he continued.  For example, the Secretariat did face various systemic inadequacies vis-à-vis transparency and accountability by senior management.  Beyond that, it was also necessary to recognize that the Organization did take a lot of criticism that it did not deserve.  Since its early days, the Organization had been a convenient scapegoat for certain quarters, but, since those days, the multiplier effect of the media had begun to amplify bad news manifold, instantly projecting it into every living room.  Despite all the good work of the Department of Public Information (DPI) in promoting the image of the United Nations and despite all the management reforms, it was unlikely that the Organization would see a let-up in the barrage of attacks against it.

    Turning to accountability, he said that, as international civil servants, United Nations staff were accountable only to the Organization and the Secretary-General and not to any individual government, including their own governments.  While supporting giving the Secretary-General greater flexibility, he believed that Member States would be more amenable to that idea only when the general membership was satisfied with the Secretariat's professional neutrality or independence and its improved accountability to the collective membership.

    Financial accountability of United Nations staff was only one facet of accountability, he said.  Another crucial aspect that deserved careful attention was accountability in the area of effective mandate and programme delivery.  Accountability needed to be applied at all levels and across the board.  Unfortunately, that was not always the case.  For example, no serious attempt appeared to have been made to understand the failures of the Security Council, more particularly the permanent members, in preventing sanctions-busting within the framework of the oil-for-food programme.  He also wanted to know what had been done to bring to account those responsible for inaction in connection with acts of sexual exploitation and abuse in peacekeeping missions.  Better coordination among departments was needed, if the United Nations as a whole was to be accountable to its members for such problems as late issuance of documents.

    As far as accountability was concerned, it was essential to have clearly defined responsibilities and performance expectations and put in place mechanisms to enable both routine and formal assessment of performance.  Actions to enhance accountability of senior management were very much in line with the efforts to establish the rule of law in the Secretariat with transparent rules and decision-making procedures.  He hoped that would lead to a better working environment for international civil servants.  However, he had doubts as to whether a Management Performance Board would be in position to assess the performance of individual senior managers in an impartial manner.  Perhaps the way forward should be to reduce the number of senior Secretariat staff and increase the number of external experts on the Board.

    Also essential were efforts to strengthen the oversight mechanisms within the United Nations and ensure effective follow-up on the basis of their findings.  Noting the Secretary-General's intention to establish an Oversight Committee, he shared the concerns of the ACABQ in that regard.  His delegation looked forward to the discussion on the terms of reference, composition and working methods of that body.  While the current efforts to ensure accountability were laudable, lacking in the Secretary-General's report was the need for sanctions, without which the measures proposed in the report would have no real impact and would be difficult to enforce.  Provisions should also be put in place to reward staff whose performance exceeded expectations.

    Ms. LOCK (South Africa) said that the Secretary-General's report on measures to strengthen accountability at the United Nations provided a good point of departure for reflection on some of the elements that should be considered in the comprehensive review of the governance principles, structures and accountability of the United Nations system.  It could also assist the Secretariat in its efforts to finalize the terms of that review.  The comprehensive review should ideally focus on the framework of accountability and management within which the Organization made decisions towards the attainment of its objectives.  That would only be possible if the Secretariat, management and governing bodies had a common and clear understanding of the objectives of the United Nations.

    As a first step, it was necessary to consider whether the Organization had the necessary mechanisms, systems and processes in place, in line with internationally accepted good practices, to support proper decision-making, accountability and attainment of goals.  The next step could be to consider whether those mechanisms were effective and robust in such areas as risk management, financial and performance management, information management and internal controls. The governance review could build on earlier reports by the Secretariat, the oversight bodies, expert groups and the governing bodies.  The oversight bodies were especially important in that respect.  In addition, she expected that the review would validate whether the internal decision-making processes were aligned with the objectives of the United Nations and actions of its staff to the benefit of the entire membership.  Managers and staff needed to have a clear understanding of the roles and responsibilities of each.

    The High-Level Committee on Management had mandated a working group to prepare the terms of reference for the comprehensive management review, she continued.  She trusted that those terms of reference would focus not only on regulatory and financial aspects of good governance, but also on the ability of the Organization to meet the broader principles of good governance and implement the non-financial aspects of its work.  It would be more realistic to undertake a review in a holistic, but phased manner.  It should be based on a well-structured and comprehensive project plan, setting clear the time frames for consideration of each individual report.  The external evaluation called for in the Summit outcome should be carried out in the context of that comprehensive review.

    YASSER ELNAGGAR (Egypt) said he supported the statement made by the representative of Jamaica, on behalf of the Group of 77 and China, on agenda items 132 and 122.  Egypt supported increased responsibility and accountability throughout the Organization.

    On the issue of oversight, he agreed with the statements of India, Singapore and South Africa.  He reaffirmed that the General Assembly was the supreme authority within the Organization, particularly in the areas of oversight and responsibility.  He said the examination of any proposals in the future must be done through the highlighting of that principle, rather than destroying this principle.

    He urged that the examination of any measures on oversight and responsibility in the Organization should be done in a global, comprehensive manner.  He said a piecemeal policy that did not represent a clear approach to the Organization should be avoided.  He added that the creation of administrative structures and financing them financing clear objectives would not lead to solutions to the problems.  Finally, he said that any party that made proposals in this area must take an in-depth look at the situation in order to make a correct decision.  The process should be completed with a clear and precise vision that considered the existing oversight and responsibility systems and shared respect for the independence of each body.  And everything should be completed within the framework of the General Assembly's resolutions and the Summit outcome.

    VLADIMIR A. IOSIFOV (Russian Federation) said he welcomed the report from the Secretary-General on the measures to strengthen accountability and noted that the Summit outcome emphasized the need for creating effective mechanisms for accountability and responsibility throughout the Secretariat.  It was clear that the existing system was not satisfactory and Member States needed a clear understanding of how the Secretariat plans to fulfil the document's mandates.  He noted that the Secretariat had finally started implementing provisions of earlier General Assembly resolutions and recommendations from the Board of Auditors, but he wanted specific tangible proposals that would make a root change in the accountability of the Secretariat.

    He said the creation of the Management Performance Board is a step in the right direction, but he would like confirmation of how this body would be more effective.  He said he would like to receive a review of the board's work over the past six months.  At the same time, he had enormous doubts about some functions allocated to the Oversight Committee, such as the setting of priorities, strategies and work plans for the system's oversight bodies.  He would like the opinion of the Board of Auditors on this subject.

    He noted that the report included an important change with the adoption of an electronic performance appraisal system, but that electronic system did not really change how the work of the staff was being assessed.  That electronic assessment was not a real tool for managing human resources and the issue remained unresolved.  He would like aggregate data on how the work of the staff was being assessed within the framework of this stronger appraisal system.  He added that more attention should be paid to the results-based management process, which was linked to a stronger accountability and responsibility in the Organization.

    SAÏDOU ZONGO (Burkina Faso) said he echoed the statement of the representative of Jamaica on behalf of the Group of 77 and China.  He said the Economic Commission for Africa was an extremely important institution that helped integrate the African continent as the nations moved toward their development goals.  And, as an important development instrument, the ECA fully deserved special attention and his delegation gave its operation a high priority.  He said the regional offices, which support the Commission, were also very important and provided "primordial links" to the analysis of general policies and the integration of economic policies throughout the African continent.

    Burkina Faso was concerned with the difficulties facing the subregional offices that were outlined in the OIOS report.  He said the subregional offices' work on the continent should be supported.  To carry out their mandate, the offices needed a better definition of their goals and adequate and efficient resources.  That would help boost the effectiveness of the subregional offices, as well as the Commission.

    MOHAMMAD TAL (Jordan) said that Member States' joint efforts, with full partnership from the Secretariat, could generate the necessary momentum to achieve the highest levels of accountability at all levels.  Responsibility and accountability went hand in hand and, as a prerequisite for success, the effort needed to be comprehensive, non-selective and sustainable.  The credibility of the process through which organizational change was introduced or even proposed was as important as the goals that the Organization aimed to achieve.  It was in that spirit that he took note of many proposals contained in the Secretary-General's report on measures to strengthen accountability.

    While reconstituting the Accountability Panel into a Management Performance Board and the establishment of the management and policy committees could be seen as a potentially beneficial exercise, he was curious as about they would interact with senior management to impartially and effectively measure their performance and give them feedback.  Definition of performance expectations and specifying time frames for programme delivery were important pillars in strengthening the results-based budgeting and management culture.  Measures to deal with failures to meet such expectations and adhere to specified time lines must be incorporated in that effort.

    In an intergovernmental organization like the United Nations, and in view of recent developments, more oversight was certainly always better, he continued, but that was not necessarily the case with new layers.  Simplicity was a virtue.  Mere establishment of new layers could prove counterproductive in the long term.  It was necessary to be very careful in considering some of the proposals to enhance oversight, as Member States could find themselves with an overly bureaucratic structure that would not deliver quality oversight.  Some of those concerns had been expressed by the ACABQ.

    Mr. OLIVA (Cuba) said that, as speakers preceding him had addressed most aspects of the matter, he only wanted to focus on the issue of accountability.  Accountability by the Secretariat to Member States and the Organization as a whole was an angle that was missing among the measures suggested.  Among clear examples of that, he mentioned recent delays in the issuance of documentation and statement of senior officials on the role of the General Assembly and procedures carried out by Member States.  Those events underscored what his delegation had been saying for a long time.  Accountability should apply in those areas, as well.

    Mr. FAROOQ (Pakistan) said that he attached high importance to enhancing the efficiency of the Secretariat.  A number of steps had been initiated in that regard.  Accountability of the Secretariat to the General Assembly and within was essential for increasing its efficiency.  Any reform of the management of the Secretariat would yield the desired result only if it was well structured and coherent and was undertaken in a way that ensured a clear action-oriented outcome, a time line for implementation and, most importantly, if there was accountability for meeting the targets. 

    Setting up a large number of bodies in the Secretariat with duplicating mandates and areas of action would only add to inefficiency and lead to the waste of resources.  The Management Performance Board and the proposed Oversight Committee, for example, had an overlapping mandate to ensure actions by the managers on the recommendations of oversight bodies.

    Ensuring transparency was the aim of the drive towards more effective accountability, he said.  Transparency was especially critical in the areas of staff selection and procurement.  However, it must also address the imbalances in the employment and procurement systems, so as to ensure that an equitable share of both was available to as wide a membership as possible.  For the strengthening of oversight, it was necessary to ensure independence of oversight structures and to introduce an effective mechanism to follow up on recommendations.  He shared the observations of the ACABQ in connection with the proposal to establish an internal oversight committee.  It was necessary to ascertain whether the establishment of that body would fully address the Assembly's request in resolution 59/272.  In the course of the session, clarifications should be provided as to its terms of reference.

    Turning to the report on the contribution by the Department of Management, he said that it contained no assessment of the impact of projects, focusing solely on the automation of certain processes.  Similarly, without providing a time line on the plan for the reduction of duplication and bureaucracy in the United Nations, the document merely stated the current status of some issues in the context of the efforts to reduce duplication and complexity.  He agreed with the Advisory Committee's observation that there was a need for further information on those measures, both in terms of measurable efficiency gains and the time-bound plan.

    THOMAS A. REPASCH (United States) said that accountability was the highest priority for the United States in the coming weeks and month.  It was essential for the Organization to have the appropriate management and accountability framework in place and effectively operating before Member States asked the Organization to take on more responsibilities.  To do anything else would set the United Nations up for additional failures, he said.

    He said reports by the Secretary-General and the Department of Management needed more specific time frames for implementation of measures and, since they were completed before the recent Summit, did not take the results on accountability of the outcome document into account.  He endorsed the ACABQ recommendation that the Member States should not wait until next year or later to receive a comprehensive report on accountability that had been requested by the General Assembly.  The issue needed immediate attention.

    On the issue of the procurement, he said with the recent developments at the United Nations and the high-profile procurement irregularities, he would like to know the status of efforts to come to grips with what seemed to be a much larger problem than originally thought.  He mentioned the turnaround of the United Nations Postal Administration as a contribution of the Department of Management towards improved management practices.  And regarding the OIOS report on ECA, he agreed with other representatives that it should be considered under a different agenda item.

    JOHN J. NG'ONGOLO (United Republic of Tanzania) associated himself with the statements of Jamaica on behalf of the Group of 77 and China.  Regarding the OIOS report on the ECA, he agreed with the statement of the representative of Burkina Faso and said the Commission, along with the subregional offices, helped the African continent achieve economic cooperation and integration and helped the African Union and NEPAD meet their goals.  He would like to see the subregional offices play an active role in implementing ECA's goals and the goals of other African organizations.  He commended the OIOS for an in-depth investigation that revealed the weaknesses of the subregional offices, and hoped that the ECA would take concrete measures to correct the weaknesses.

    He said the lack of adequate resources to finance ECA activities was the most serious issue.  He expressed hope that the Committee would consider the challenges faced by the ECA during its consideration of the programme budget for the biennium 2006-2007, and recall the determination that global leaders expressed in the Summit outcome to meet the special needs of Africa.

    Responding to comments from the floor, Principal Officer in the Office of the Under-Secretary-General for Management, NANCY HURTZ-SOYKA, said that she looked forward to providing further explanations and clarifications in informal sessions.  On the Oversight Committee, she wanted to make it clear that it would be an internal management tool seeking to facilitate the implementation of oversight bodies' recommendations.  It did not call into question the independence of oversight bodies and the quality of audit reports of the JIU, Board of Auditors and OIOS.  The Committee would not be involved with setting work programmes or determining the priorities of the oversight bodies.

    Regarding the contribution of the Department of Management, she said that the document before the Committee contained 23 management improvements, which had been selected from some four dozen measures.  It demonstrated substantial effort on behalf of the Department of Management.  As for the comments regarding the lack of quantification of the impact of measures, document A/60/342 should be read in conjunction with another report -- A/60/70 -- which provided such data.  Comments had also been made on the time-bound plan and the need for a broader plan for improvement.  Such a plan would be drawn on the basis of management reform proposals.  The Department of Management was analysing best practices in that regard.  She agreed that a piecemeal approach would not be beneficial, in this case.

    Mr. IOSIFOV (Russian Federation) said that he would like to comment on the inadequacy of interpretation from Russian into English in the course of today's meeting.  That was relevant to the issues of responsibility and accountability of the Secretariat.

    * *** *