RICUPERO SEEKS FLEXIBILITY IN UNCTAD PRIORITIES

6:10 AM Feb 29, 1996

RICUPERO SEEKS FLEXIBILITY IN UNCTAD PRIORITIES
Geneva 28 Feb (Chakravarthi Raghavan) -- The financial constraints by the United Nation's budgetary crisis is obliging UNCTAD to reduce its overall capacity to respond to needs and "we should all refrain from suggesting further mandates, and be prepared to terminate some existing programmes," the Secretary-General of UNCTAD, Rubens Ricupero told an informal plenary of the Trade and Development Board, currently preparing for the Ninth Session of the Conference.

Ricupero was detailing the budgetary and financial constraints because of the UN financial crunch.

On Monday, introducing his Report to the Conference at the Executive Session of the Board, Ricupero had outlined broadly the constraints facing UNCTAD, and UN bodies, and, while seeking membership's views on the priorities, said he would come back at a later stage to outline what he thought could be done.

While some of these issues, in terms of the intergovernmental bodies of UNCTAD, would continue to be discussed and negotiated over the next few weeks in preparing the final documents for UNCTAD-IX, the two days of discussions at the Board, according to one participant, did not bring out at this stage a consensus or even a convergence towards it on the programmatic priorities that the membership wants.

In his presentation to the informal session of the Board, Tuesday, Ricupero (according to the text of his speech that was put out by the press office) referred to the "unavoidable implications" for UNCTAD's daily work and programme of the UN financial crisis and the correlated issue of UN reforms. Outlining in some detail the budget cuts, which would necessitate staff cuts and some programme cuts too, Ricupero sparked off a lively two-day debate and views from the members.

Explaining that the secretariat was facing a "moving target", with every day bringing more bad news, Ricupero that UNCTAD was aiming to achieve a 12% vacancy rate (against the present 6%) among professional staff, and a seven percent rate (against about one percent now) among the General Service staff.

UNCTAD currently has a staff of 437, of which 252 are in the professional category and 185 in the General Services.

UNCTAD has been compelled to freeze 735 work months out of approximately 6000 among the professional staff, which translated into the equivalent of 30 staff positions. The main options available, he said, seemed to non-renewal of short-term contracts and non-replacement of permanent staff reaching retirement age.

The attrition option was however hardly the best way of improving efficiency, he noted. The 'freeze' on new hirings had also precluded him from responding to the other UN mandate of hiring women at top positions, he would like to fill two vacant pots with women.

"Achieving and then preserving managerial flexibility to be able to bring in new blood and respond quickly to changing needs of member States is vital to me, as the Secretary-General of an organization which must adapt significantly in the way that it is conducting its activities," Ricupero told the delegates.

"Without being able to bring in new talent and skills, especially at the senior levels of the organization, I am convinced that UNCTAD is simply condemning itself to a slow death," he warned.

Striking an optimistic note, he said that despite the gloomy financial outlook, he was not discouraged and viewed opportunity in the crisis.

"I personally don not believe that financial constraints or administrative questions, should be a prevailing factor in determining our approach to the issues we are going to deal with," Ricupero said.

"There is ofcourse a need for efficiency in costs and savings. But my ultimate goal in UNCTAD is to reach efficiency in a broader sense: better services to meet the expectations of the international community in the best possible way and with costs as low as possible."

While there was a need for efficiency in costs and savings, Ricupero said he did not personally believe that "financial constraints or administrative questions should be a prevailing factor" in determining the approach to the future issues UNCTAD was going to deal with.

"My own overall goal in UNCTAD is to reach efficiency in a broader sense: better services to meet the expectations of the international community in the best possible way and with costs as low as possible," he said.

The UN General Assembly has mandated the UN Secretary-general to effect an overall budget savings of $154 million for the biennium of 1996-1997 and this, as Boutros Boutros-Ghali has told the Assembly would require a combination of staff cuts and non-staff cuts.

Regrettably, Ricupero said, they were not dealing with a stable financial situation whose full extent was know and could be dealt with in a predictable fashion. "Rather, it is a moving target, and one almost every day seems to bring more bad news," he said.

During the discussions, several members sought to make a distinction between the overall budget constraints needing a more focused priority on programmes and projects and the immediate cash crunch over the next biennium, caused essentially by the arrears from the membership.

A number of delegates raised questions about the 12% professional staff reductions envisaged and whether it related to the $154 million savings cut the Assembly had approved last December (and thus binding) or the further cuts the UN Secretary-General was envisaging to meet the cash crunch.

With an already professional vacancy rate of 6%, UNCTAD might be able to weather the 6.1% vacancy rate that the $154 million budget cut warranted, whereas the 12% cut would mean that some of the staff (including those on short-term contracts, but performing some essential tasks and bringing some high professional abilities to the secretariat) would have to be let go.

The Indian Ambassador, Ms. Arundati Ghose referred to this aspect and suggested that the membership could make 'voluntary contributions' to the UNCTAD Secretary-General and in a Trust Fund in order to give him some flexibility in the immediate days ahead.

While there were no detailed comments on this, several Third World delegations said later that this would let off developed countries from fulfilling their obligations and UNCTAD would be made a responsibility of developing countries.

But Ms. Ghose later explained that what she had in mind was the need for immediate action to ensure that the UNCTAD head got some flexibility and was not hobbled. The voluntary contributions she had in mind was not what is normally termed in UN language as 'contributions from donors', but from the membership. The amount involved, she said, was probably in the range of 3-4 million dollars and India would be willing to contribute to such a fund. It would not be a contribution to the UN's regular budget, but to a special Trust Fund to be created to enable Ricupero to have managerial flexibility in looking ahead to UNCTAD-IX and beyond.

Egypt stressed the need for members to discharge their legal obligations to the UN and paying up their arrears without any prior condition. The most important thing was to avoid focusing on the financial difficulties, but rather focus on preparations for UNCTAD-IX. The additional $100 million budget cut sought within the UN, and that on UNCTAD within it, should be discussed after UNCTAD-IX and the priorities set there.

The United States, the world's richest country is also the world's leading deadbeat -- with a whopping $1.6 billion in arrears on the regular budget and the peacekeeping budgets -- but in a Keynesian twist about debtors and creditors, is using its debt to force UN system to fall in line with its own shifting ideological positions.

The US delegate, Ms. Melinda Kimble, in her intervention made no reference to this, but said US priorities in programmes would be guided by the criteria of human rights, sustainable development and free trade. International organizations she said had not transferred themselves as radically as they should have and, after UNCTAD-VIII, there was a hybrid organization with old programmes continuing with new ones. From the US view, UNCTAD's programmes should be oriented to achieve full integration of developing countries and particularly the least developed into the world economy. This should be done by pursuing programmes where UNCTAD has comparative advantage: the programmes on 'Trade Efficiency', the development of Small- and Medium-Enterprises, the Transnational Corporations and Investments, and Science and Technology.

Brazil, which chairs the Preparatory Committee of the Group of 77, while supporting the need for improving the efficiency of international organisations, stressed that the essential character of UNCTAD should be preserved. Given the 'moving target' facing the UNCTAD head in effecting budget savings, Brazil felt that he should have necessary flexibility. The views of the regional groups of the Group of 77 had all agreed on need for reform and streamlining for a better focus, and not merely for saving money.

Canada said that the need to cut the budget was real, and there was also a need to improve the effectiveness of UNCTAD programmes. while Australia wanted elimination of programmes that were not useful.

Bolivia drew a distinction between financial questions and political questions and insisted that the intergovernmental preparatory process was a political one and should not be seen as a technical question on budget and finance.

Bangladesh said the financial crisis should not be made an excuse for sacrificing programmes. The division on least developed countries should be continued and preserved as a unit.

Pakistan drew a distinction between the staff cuts needed to give effect to the $154 million budget cuts the Assembly had approved, and the $100 million further cuts sought to be made by the UN Secretary-General, which was an administrative decision, and should not be allowed to come in the way of agreed work programmes at UNCTAD.

Switzerland pointed out that the staff cuts (12% in professional staff) seemed to be less than what the Paschke report (for 20% staff cuts) had suggested. While it was the prerogative of the UNCTAD secretary-general to restructure the secretariat, it should correspond to the intergovernmental machinery and in step with the priorities to be set at UNCTAD-IX.

Japan said that there was a general shortage of funds and UN and UNCTAD have to deal with the problem. The work programme would have to be adjusted to deal with the changing nature of the world situation. While acclaiming the usefulness of UNCTAD and its programmes, Japan favoured a more efficient organization.

In responding to the wide-ranging views, Ricupero explained that he had brought up the budgetary issues with a view to ensuring transparency and sharing the information available with the secretariat, and the implications for UNCTAD in terms of future activities.

While he remained optimistic, he did not see streamlining and reduction of staff through attrition as the most efficient way. It was not something that the private sector would do.