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The United Nations continued to experience financial difficulties in 1996. In his final report for 1996 concerning the UN's financial situation (A/51/515/Add.1, dated December 16, 1996), the UN Secretary General noted that nearly $2.3 billion in outstanding assessments was owed by the UN member states. This comprised $546 million for the UN regular budget, $1.7 billion for UN peacekeeping operations and $8.3 million for the International War Crimes Tribunals. It was noted further that approximately 65 percent of the total owed was attributable to the United States.
There was a year-end deficit of $195 million in the UN General Fund. This meant that virtually no improvement had been achieved since 1995 when the deficit level stood at $198 million. In comparison, the deficit levels in 1994 and in 1993 stood at only $26 million and $1 million, respectively.
For UN peacekeeping operations, the combined cash level at end of 1996 was estimated to be $910 million. However, against this amount, $990 million was still owed to member states as reimbursements for troop and equipment costs. The $990 million reflected the balance still owed to the member states after the United Nations had made reimbursements in the course of 1996, which totaled $550 million. Also, the available cash balance in UN peacekeeping operations would be used, at least temporarily, to help finance the $195 million deficit in the UN General Fund. Such borrowings would be repaid to the peacekeeping accounts whenever the General Fund was sufficiently replenished by income from member contributions to the UN regular budget.
In combining the cash positions of both the General Fund and peacekeeping operations--a deficit of $195 million and a positive balance of $910 million--the total cash position of the United Nations at the end of 1996 was $715 million. As noted, the cash balance would not take account of the $990 million still owed to member states for troop and equipment costs relating to peacekeeping operations.
In noting the UN practice of having to resort to internal borrowing from the various peacekeeping accounts in order to maintain UN basic operations, the Secretary General stated ". . . not only is this inherently poor financial practice but the level of peacekeeping balances is quite likely to decline in the immediate future, depending on the level of new assessments to be approved by the General Assembly." He also stated that ". . . at a time when all efforts should be focused on reform and renewal of the organization, the continuing financial crisis undermines these efforts and distracts from the implementation of the program priorities of member states."
The UN General Assembly approved resolution 51/222 by consensus on December 18. This resolution established a revised appropriation for the 1996-1997 UN program budget. The revised appropriation amounted to $2,603,280,900, which was $4,993,100 less than the initial appropriation, $2,608,274,000, as approved one year earlier in December 1995.
The lower appropriation level was made possible primarily by favorable exchange rates involving the U.S. dollar, as compared to the Swiss franc and other major currencies under which UN expenditures are made. Because of exchange rate gains and other savings, the United Nations was able to offset the costs of a number of activities that were approved after the start of the 1996-1997 biennium and, therefore, were not included in the initial appropriation level. The additional costs included added meetings, special missions in Haiti and Central America, decisions of the Economic and Social Council and increased expenses for the International Seabed Authority.
The United States supported the revised, lower budget level for 1996-1997. The United States had indicated all along that it considered the initial appropriation level of $2,608,274,000 to be an absolute ceiling for the full 1996-1997 biennium. Also, U.S. legislation governing the Fiscal Year 1997 appropriation for the Contributions to International Organizations (CIO) account required the United States to withhold $100 million from its contribution to the UN regular budget pending certification by the Secretary of State that the revised 1996-1997 UN budget had not exceeded $2,608,000,000.
On December 18 the UN General Assembly also approved by consensus the UN budget outline for the next biennium, 1998-1999. Under resolution 51/220, the General Assembly approved a budget outline level amounting to $2,480,000,000, as recosted, and a Contingency Fund level amounting to $19 million. The resolution did not include certain provisions that had been requested by the Secretary General when he submitted his outline proposal. Among these was the proposal to include in the outline level approximately $70,000,000 for the continuation of existing special missions or the establishment of new missions. Many delegations believed this proposal to be a departure from the criteria set out in the annex to resolution 41/213 (1986) concerning the UN budget outline. In rejecting this proposal, the General Assembly requested the Secretary General to prepare a comprehensive policy paper on the issue.
The Secretary General also had requested that certain reimbursable costs in the UN budget, such as the cost for the Joint Inspection Unit, be "netted out" in the calculations for expenditures in 1998-1999. Additionally, he had requested that the Contingency Fund be established at $6 million or at a level approximating 0.25 percent of his proposed budget outline level of $2,602,000,000. Both measures were rejected in the resolution approved by the General Assembly.
The approved resolution called on the Secretary General to prepare his detailed budget proposal for 1998-1999 using the current UN budget methodology, including provision for recosting the budget based on updated rates for inflation and currency exchange. Under current UN methodology, the budget estimates would be recosted in the spring of 1997, at the time the Secretary General presents his detailed budget estimates, and in late autumn of 1997, at the time the General Assembly approves the 1998-1999 UN budget. Further recosting would occur in the autumn of 1998, at the mid-point of the budget period, and in the autumn of 1999, at the end of the budget period. If the recosting exercises result in higher budget estimates, it may be difficult to maintain a firm budget ceiling throughout the 1998-1999 biennium, while still remaining consistent with the current UN budget methodology.
During early November, the Fifth Committee considered the following 14 financial reports and audited financial statements for the period ended December 31, 1995: United Nations; UN peacekeeping operations; International Trade Center; UN University; UN Development Program (UNDP); UN Children's Fund (UNICEF); UN Relief and Works Agency for Palestine Refugees in the Near East (UNRWA); UN Institute for Training and Research (UNITAR); UN High Commissioner for Refugees (UNHCR); UN Environment Program (UNEP); UN Population Fund (UNFPA); Habitat; UN Drug Control Program (UNDCP); and UN Office of Project Services (UNOPS). The Committee also considered the reports and audit opinions of the Board of Auditors, its principal findings and recommendations and the report of the Advisory Committee on Administrative and Budgetary Questions (ACABQ).
The Auditor General of Ghana, O.T. Prempeh, who served as Chairman of the Board of Auditors in 1996, introduced the Board's report, highlighting significant findings and observations. Though organizations generally complied with common accounting standards in presenting their financial statements, the Board noted that further attention needed to be devoted to the valuation of property, plant and equipment and adequate disclosure of liabilities related to termination benefits. Among major shortcomings, the Board cited its qualified opinions on the financial statements of UNDP, UNFPA, UNDCP, UNEP, Habitat and UN peacekeeping operations. With regard to the reasons for the qualification, in the case of UNDP, UNFPA, UNDCP and UNEP, the Board obtained inadequate information to confirm that governments used technical cooperation funds for the purposes intended. With regard to UN peacekeeping, the Board questioned the UN valuation of outstanding accounts receivable and in the case of Habitat, income was overstated and financial statements improperly prepared. C.S.M. Mselle (Tanzania), Chairman of the ACABQ, also provided introductory remarks in light of the UN financial regulations, which require the Board to submit its reports to the UN General Assembly through the ACABQ. Among other things, Mselle urged the United Nations and its subsidiary organs and programs to come up with satisfactory procedures to address personal accountability of staff members.
The United States, Japan, Ukraine, Russia, Pakistan, Norway, Ghana, China and Ireland, speaking on behalf of the European Union, delivered statements which focused on the financial reports. The U.S. and other delegations stressed that the Board's qualified opinions on financial statements was a serious matter that should not be taken lightly, yet was a recurring problem. The importance of personal responsibility and accountability of staff members was also stressed.
Another common theme cited was the need for continued cooperation among oversight mechanisms of the Board, the Office of Internal Oversight Services (OIOS) and the Joint Inspection Unit (JIU). The European Union was adamant that the Board not insist that old assessed contributions for peacekeeping operations be written off. Prempeh clarified that the Board's remarks were not meant to suggest that this practice, which is a generally accepted accounting principle, be adopted in the case of assessed contributions. There was considerable criticism related to the conclusion of executing and implementing agreements where the implementing party lacks adequate capacity to deliver what is set forth in agreements. Habitat's utter disregard of UN procedures in diverting funds from the Foundation's assets to meet financing requirements of Habitat II was also raised.
The Fifth Committee was unable to complete work on the financial statements due to the press of negotiations on a range of difficult budgetary and administrative issues and deferred action on an audit resolution until its resumed session in the spring of 1997. The extension of the term of office for the Board of Auditors is also expected to be considered at the resumed session.
The majority of the resolutions provided funding for the operations approved in previous years. These were for the UN Disengagement Observer Force (UNDOF) on the Golan Heights (Resolution 50/20 B); UN Interim Force in Lebanon (UNIFIL) (Resolution 50/89 B); UN Angola Verification Mission (UNAVEM) (Resolutions 50/209 B and 51/213); UN Observer Mission in Georgia (UNOMIG) (Resolution 50/237); UN Mission in Haiti (UNMIH) (Resolutions 50/90 B and 51/14); UN Observer Mission in Liberia (UNOMIL) (Resolution 51/3); UN Assistance Mission for Rwanda (UNAMIR) (Resolution 50/211 B); UN Mission of Observers in Tajikistan (UNMOT) (Resolution 50/238); UN Iraq/Kuwait Observer Mission (UNIKOM) (Resolution 50/234); UN Peacekeeping Force in Cyprus (UNFICYP) (Resolution 50/236); the UN Preventive Deployment Force (UNPREDEP) (Resolutions 50/243 and 51/154); UN Peace Forces (UNPF) (Resolutions 50/235 and 51/12); and the UN Mission for the Referendum in the Western Sahara (MINURSO) (Resolution 51/2). New operations approved for funding in 1996 include the UN Transitional Administration for Eastern Slavonia, Baranja and Western Sirmium (UNTAES) (Resolutions 50/242 and 51/153); UN Mission to Bosnia and Herzegovina (UNMIBH) (Resolutions 50/241 and 51/152), which funds the UN Mission of Observers in Prevlaka (UNMOP) and the International Police Task Force (IPTF); and the UN Support Mission in Haiti (UNSMIH) (Resolution 51/15), which succeeded UNMIH in June 1996. Funding for the War Crimes Tribunals was approved as follows: for Rwanda, resolutions 50/213 and 51/215; for the former Yugoslavia, resolutions 50/212 and 51/214. In the case of the Iraq/Kuwait border and Cyprus operations, the relevant resolutions continued the provisions established in 1993 for significant voluntary funding by the locally interested parties, i.e., Kuwait for UNIKOM and Greece and Cyprus for UNFICYP.
As provided in the draft decision of the Fifth Committee, the General Assembly decided to continue its consideration of the agenda item entitled, "Scale of assessments for the apportionment of the expenses of the United Nations," as a matter of priority at the first part of its resumed 51st session in March 1997. The draft decision was adopted without a vote on December 18. (Decision 51/454.)
The draft decision was outlined in the report of the Fifth Committee, dated December 17, 1996, in document number A/51/747. The report called on the General Assembly, at its resumed 51st session, to approve no later than March 31, 1997, the methodology that will instruct the Committee on Contributions to recommend to the General Assembly at its 52nd session a scale of assessments for the period 1998-2000. At the time the report was prepared, Mexico had submitted a proposed resolution regarding the 1998-2000 scale of assessments which, together with other proposals that could be forthcoming later, would be acted on by the General Assembly at its resumed 51st session.
The Fifth Committee report also endorsed the conclusion of the Committee on Contributions that the failure of Comoros to pay the minimum amount necessary to avoid the application of Article 19 of the UN Charter (loss of vote in the General Assembly) was attributable to conditions beyond its control. As a result of this, Comoros would be permitted to vote through the 51st session of the General Assembly, including the resumed sessions. (Resolution 51/212.)
The Committee for Program and Coordination (CPC), composed of 34 member states, functions as the main subsidiary organ of the Economic and Social Council and the General Assembly for planning, programming and coordination. Its responsibilities include: reviewing and recommending priorities among UN programs as defined in the medium-term plan, giving guidance on translating legislation into programs, developing evaluation procedures, assessing the results of current activities and the continuing validity of legislation, and reviewing and making recommendations on the Secretary General's program budget outline. It also considers programs and activities of the UN system, on a sector-by-sector basis, to enable ECOSOC to ensure that they are compatible and complementary. The CPC met in New York in two sessions June 3-28 and August 26- September 6.
During the first session the Committee reviewed and reported on nine evaluations and reports, including the program performance report for the 1994-1995 biennium, a JIU report on "Accountability, Management Improvement and Oversight in the UN System" and OIOS reports on the termination phase of peacekeeping, the Department of Public Information, and UNHCR. It did not complete formal review of the 25 programs in the proposed medium-term plan for 1998-2001. There was significant disagreement with the introduction to the plan, which gave the Secretary General's views on world trends and their impact on the plan. The Committee requested that the Secretary General provide a revised introduction outlining broad priority areas.
In the second session the Committee did not reach agreement on the Secretary General's proposed budget outline for 1998-1999, and so took note of it, passing it on to the Fifth Committee. The Committee approved, with changes, most of the 25 programs in the medium-term plan, but could not agree on those for Political Affairs, Human Rights, Administrative Services and Oversight Services. Members of the Committee also were unable to agree on the revised introduction. In particular, the United States and like-minded delegations objected because it was based on language from the Agenda for Development that was still under negotiation. Therefore, the Committee took the position that approval of each of the programs was subject to a final decision by the General Assembly about the structure of the entire plan.
At the final session, the United States stated that, in view of the CPC's failure to fulfill its role, it would continue to pursue the objective of dissolving the CPC or transferring its functions to other fora, as previously argued during debate on General Assembly resolution 50/227 on ECOSOC reform.
The Joint Inspection Unit (JIU), an external oversight body accountable to member states, consists of 11 inspectors authorized to investigate matters pertaining to efficient and effective operations in the UN system. Inspectors serve in their personal capacity as experts on the UN system. John D. Fox of the United States began a 5-year term of office January 1, 1996.
The JIU issued 7 reports: The UN Conference on Trade and Development: Review of Institutional and Program Issues; Feasibility Study of the Relocation of UNITAR to the Turin Center; Coordination of Policy and Programming Frameworks for More Effective Development Cooperation; Review of Financial Resources Allocated by the UN System to NGOs; Common Services at UN Headquarters; Review of the Application of UN Recruitment, Placement and Promotion Policies: Part II--Placement and Promotion; Comparison of Methods of Calculating Equitable Geographic Distribution within the UN System.
The JIU's annual reports to the 49th and 50th sessions of the General Assembly were reviewed in the resumed session in the spring of 1996. In June the General Assembly adopted by consensus resolution 50/233, which included the following requests: to report to the 51st General Assembly on measures taken to develop a set of internal standards and guidelines for inspection, evaluation and investigation; to focus reports on concrete managerial, administrative and programming questions; and to provide practical, action-oriented recommendations. In November 1996 the JIU issued to the 51st General Assembly its annual report (A/51/34), which included the revised internal standards and procedures described above, but the report was not taken up for consideration.
The International Civil Service Commission (ICSC), a 15-member body of recognized experts, is responsible for making recommendations on salaries, allowances, benefits and other conditions of service for employees of the United Nations and its specialized agencies. Lucretia Myers, Assistant Director for the Office for Insurance Programs at the Office of Personnel Management, continued to be the U.S. member in 1996. The Commission met in Vienna and New York for its 43rd and 44th sessions, respectively. The Fifth Committee considered the ICSC's annual report in November and December.
At the ICSC sessions, the Commissioners discussed, debated, took decisions and developed recommendations regarding a wide variety of topics. Based on these recommendations, the General Assembly took the following key actions:
· Reaffirmed the existing methodology for determining the margin between UN professional salaries and those of the U.S. Civil Service, the comparator service;
· Introduced a common staff assessment for general service and professional staff;
· Granted a real net salary increase of 0.4 percent for the professional and higher categories of staff;
· Accepted ICSC recommendations to increase dependency allowances and the education grant and to delink hazard pay from the salary scale;
· Reiterated its request to the ICSC to complete its study on the methodology of establishing a single post adjustment for Geneva and requested the commission to complete its study on implementing it by January 1, 1998;
· Called on the Board of Auditors to conduct a management review of the ICSC Secretariat; and
· Requested the ICSC to look into new approaches such as flexible contractual arrangements, pay for superior performance and special occupational rates as ways to introduce flexibility within the Common System and address specific needs of organizations of the Common System.
The General Assembly adopted resolution 51/216 on the Report of the International Civil Service Commission without a vote.
Under this heading, the Fifth Committee considered a wide variety of issues in resumed sessions of the 50th General Assembly and at the regular session of the 51st General Assembly.
At resumed sessions of the 50th General Assembly, the Fifth Committee adopted resolutions on high-level appointments and referring the issue of the reform of the internal justice decision to the Sixth Committee, and deferred consideration of a number of issues.
At the 51st General Assembly, the Fifth Committee decided to set a salary ceiling of $22,000 ($40,000 for language services staff) per annum for the employment of retired UN staff who receive UN pensions and to limit retiree hiring to a maximum of 6 months in a calendar year. No retired staff member can be reemployed at a level higher than that from which he or she separated from the organization nor can he or she be paid at a level higher than that of regular staff performing the same function at the same duty station. (Decision 51/408.)
The 51st General Assembly deferred to a resumed session consideration of the human resources management item. (Decision 51/456.)
The Department of State attempts to assist qualified U.S. citizens in competing for professional positions in the United Nations and other international organizations. The Department's UN Employment Information and Assistance Unit, along with numerous other Executive Branch agencies, assists these organizations by disseminating vacancy information to Americans across the country. In a typical year, the Department provides direct assistance to hundreds of Americans and general information about employment opportunities in international organizations to thousands of others. U.S. Missions to the United Nations and other international organizations in New York, Geneva, Montreal, Nairobi, Rome and Vienna, as well as some embassies, also provide direct support for this function through regular contacts with agency officials.
The following chart shows the total number of Americans in professional and senior positions in UN agencies[1] as of December 31, 1996.
| Professional and Senior Staff | |||
| Total | U.S. Number | U.S. Percent | |
| UN Secretariat | 4,988 | 663 | 13.3 |
| UN Subsidiary Bodies | 6,268 | 545 | 8.7 |
| UN Specialized Agencies and IAEA | 6,975 | 650 | 9.3 |
The UN Secretariat and some of the specialized agencies have established a system of "desirable ranges" to estimate member states' geographic representation. The following chart lists those UN agencies that have such ranges, the number of Americans on board and their status as of December 1996. (These figures represent that portion of the agencies' total professional posts "subject to geographic distribution" and funded by assessed budgets.)
| UN Agency | Total Posts | U.S. Desirable Range or Quota | Americans on Board | Current Status | |
| Range | Number | Percent | |||
| UN[2] | 2,492 | 326-441 | 372 | 14.9 | In range |
| FAO | 904 | 170-206 | 107 | 11.8 | Below Range |
| ICAO | 201 | 27 | 14 | 7.0 | Below Range |
| ILO | 595 | 91-121 | 66 | 11.1 | Below Range |
| UNIDO | 286 | 48-66 | 18 | 6.3 | Below Range |
| WHO | 1,064 | 174-237 | 139 | 13.1 | Below Range |
We recognize that during 1996 the failure of the United States and other member states to meet their financial obligations to the United Nations Secretariat, its subsidiary agencies and the specialized agencies has noticeably affected the staffing decisions of these organizations. The UN Secretariat imposed a hiring freeze throughout much of the year, and many of the other agencies cut back significantly on their external hires or initiated staff cuts.
In 1996 Americans held the top position in the following UN agencies: UNICEF (Carol Bellamy, Executive Director); UNDP (Gus Speth, Administrator); UPU (Tom Leavey, Director General); WFP (Catherine Bertini, Executive Director); WIPO (Arpad Bogsch, Director General); and IOM (James Purcell, Director General).
Throughout the year, the United States continued to give special attention to recruiting qualified women for UN positions and encouraged UN agencies to hire and promote more women. At present, 41 percent of Americans in professional and senior positions in all UN agencies, excluding peacekeeping missions, are women.
In addition to helping recruit for permanent, career positions throughout the UN system, the Department of State provided candidates for UN peacekeeping and other special operations.
The United States has a long-standing policy of lending professional staff to international organizations either by detail (in which the employee remains on the U.S. payroll but serves at the international organization) or by direct transfer (in which the employee is paid by the organization but retains reemployment rights with the U.S. agency). These arrangements usually last less than 5 years but may last as long as 8 years if it is considered to be in the national interest. The United States also supports a limited number of Junior Professional Officer positions at FAO and at UNHCR.