Fifth Committee Report: Week of December 18-22, 2006

From December 16 to 22, the Fifth Committee concluded negotiations on resolutions on, among other, Human Resources Management, Procurement Reform, Governance and Oversight, and the Scale of Assessments.

PROCUREMENT REFORM

Agreement on the draft resolution on Procurement Reform was reached. The resolution consists of 7 parts.

Staff
This part of the resolution deals with the filing of annual financial disclosure statements for all staff involved in procurement; the development and implementation of an ethics and integrity programme for procurement staff; the issuance of ethics guidelines by June 2007; and the implementation and evaluation of training programs. Member States regret that the Secretary General had not submitted the requested proposals on conflict of interest.

Internal Controls
With regards to the establishment of an Independent Bid Protest System, the General Assembly would like to learn more about its specific modalities and related procedures, including possible legal and financial implications. Information on the Bid Protest System should be posted on the website. This part also requests that the vendor registration process be further simplified and streamlined.

Governance
The General Assembly remains concerned about the split of procurement responsibilities between the Department of Management and the Department of Peacekeeping Operations and requests a comprehensive report for the second part of the resumed session in this regard.

Increasing procurement opportunities for vendors from developing countries and countries with economies in transition
Apart from the business seminars, additional ways to increase such procurement should be explored in a report for the second part of the resumed session. The Inter-Agency Procurement Working Group is invited to recommend concrete proposals in this regard as well.

Procurement Management
With regards to procurement management, the lead agency concept, a.o., should be detailed further in a report to be submitted for the GA’s 62nd session. The creation of a UN global procurement website should be fully accessible no later than 1 June 2007. The Secretary General should also provide a comprehensive report at its 62nd session on the best-value-for-money principle.

For background information on these issues read:

5th Committee Considers Progress on Procurement Reform by Lydia Swart, November 15, 2006,

Resources
The conversion of GTA (general temporary assistance) to established posts was approved, including the six additional posts. Of these posts, 1P4, 1 P3 and 1GS will be designated to the Vendor Registration and Management Team which should “promote the diversification of origin of vendors among all Member States, including developing countries and countries with economies in transition, simplify vendor registration, manage the vendor database and liaise with vendors.”

Other Issues
Further issues include: reducing the timeline for payment of invoices; the posting of monthly updates on contract award statistics; and improving the website of the Procurement Division and make it more ‘user-friendly.’

Relevant Document:

Draft Resolution on Procurement Reform December 20, 2006

HUMAN RESOURCES MANAGEMENT REFORM

Fifth Committee members reached agreement on a draft resolution on Human Resources Management.

For an analysis of Human Resources Management reform and an overview of the resolution mentioned above read:

Much Needed Change in UN Human Resources Policies Gets a Timid Start by Irene Martinetti, December 21, 2006

Relevant Document:

Draft Resolution on Human Resources Management December 20, 2006

Report on Adoption of Resolutions on Human Resources Management and Procurement Reforms:

Budget Committee approves Drafts on Human Resources Management, Capital Master Plan, Programme Planning and Procurement Reform DPI Report, December 21, 2006

OVERSIGHT AND GOVERNANCE REFORM

On December 20, 2006, during General Discussions, the Fifth Committee agreed on the financial implications of a comprehensive review of the governance and oversight systems of the UN. It is estimated that improving the system-wide oversight and governance mechanisms would require an additional amount of $1.32 million. Efforts will be made to accomodate the amount within the existing resources approved in the budget for 2006-2007.

The preparation of the reports on the IAAC revised terms of reference and strengthening of the Office of Internal Oversight Services (OIOS) would not entail additional resources. However, the organization will need in-house and external expertise in order to formulate policies to build adequate frameworks for enterprise risk management, stronger internal controls, results-based management and better overall accountability. Hence, it is likely that additional appropriation of resources will be necessary.

Relevant Document:

Draft Resolution submitted by the Chairman following informal consultations on the Comprehensive Review of Governance and Oversight

For further information read:

Fifth Committee agrees on budget implications of comprehensive governance, oversight review DPI Report, December 20, 2006

SCALE OF ASSESSMENTS

Background:
Member States’ dues/assessments are apportioned according to their capacity to pay. Simply put, the dues are based on a State’s Gross National Income for a certain period (varying between 1 and 10 years in the past) with adjustments depending on its debt burden and low per capita income. Currently there is a maximum assessment rate of 22% for the biggest contributor, a maximum of 0.010% for least developed countries and the minimum rate is 0.001%.

In informal meetings, Member States continued to discuss proposals to amend the assessments scale methodology. The base period last used was constituted by the average of 6 Years (1999-2004) and 3 years (2002-2004). Some Member States have favored a shorter period while others prefer a longer base period. A longer period would benefit the EU (which currently pays 37% of the assessments and which would see an increase to 39-40% if the current scale would be applied) but would not be advantageous to the developing countries. The EU feels that a longer period would improve stability.

Other amendments included a proposal to create multiple gradients for low per capita income adjustments: 85% for the least developed countries, 70% for large countries above 1% of world share and 80% for others. Currently there is a flat adjustment of 80%. The G77 and the Russian Federation do not favor multiple gradients.

The G77 favors an increase of the 22% maximum assessment rate to 25% arguing that the US – the only State that pays the maximum rate – had received a reduction to 22% earlier after having promised they would pay their dues in a more timely manner, which has not been the case. The US made it clear that it would not be part of a 25% consensus.

In a resolution agreed to by the Fifth Committee late on 22 December, it was decided that the current methodology will be continued.

OTHER GENERAL DISCUSSIONS