| GB.267/8/1
267th Session Geneva, November 1996 |
EIGHTH ITEM ON THE AGENDA
Reports of the Programme, Financial and
Administrative Committee
First report: Financial and general questions
Contents
Programme and Budget for 1996-97
Financial questions relating to the International Institute for Labour Studies
Report of the Building Subcommittee
Loan for the ILO headquarters building
Amendments to the Financial Rules
International Training Centre of the ILO, Turin
Assessment of the reforms in the functioning of the International
Labour Conference
Other financial and general questions
Appendix I. Amendments to the Financial Rules
Appendix II. Amendments to the Staff Regulations and to
the Financial Rules
1. The Programme, Financial and Administrative Committee of the Governing Body met on 13 and 14 November 1996 under the joint chairmanship of Mr. J.-J. Oechslin and Mr. W. Brett. Mr. C. Gray (Workers' spokesman) was the Reporter.
Regular budget account and Working Capital Fund
2. The Committee had before it a paper(2) containing detailed information on the 1996-97 regular budget account and the position of the Working Capital Fund as at 31 October 1996.
3. The representative of the Director-General (the Treasurer and Financial Comptroller) reported that since the preparation of the Office paper contributions of 20,393 Swiss francs had been received from Niger, of which 19,016 Swiss francs related to arrears, and 38,410 Swiss francs from Suriname, which included arrears of 33,822 Swiss francs.
4. The representative of the Government of the United States informed the meeting that the final Appropriations Bill for the fiscal year from which the ILO 1996 assessment was paid had been passed by Congress. The total amount to be allocated was approximately $85 million less than the amount requested for all agencies and this shortfall would be borne mainly by the three largest specialized agencies -- the WHO, the ILO and the FAO. The exact amount payable to the ILO was still to be determined, but was likely to be no more than $55 million, that is about 20 per cent less than the amount assessed.
5. Mr. Marshall, for the Employer members, pointed out that the issues facing the Committee were extremely important and he urged the Office to ensure that documents were distributed early enough for the groups to give them proper consideration. It was gratifying to see that the position now was better than last year in respect of both current contributions and arrears, but it would be useful to have a more detailed comparison between actual and budgeted positions, including the cash flow implications, and a projected position at year end. This was sound financial management practice from the point of view of member States and would also be valuable information for the Committee to have during its discussion of other business.
6. Mr. Gray, for the Worker members, remarked that the paper seemed to contain a mixture of good and bad news. On the one hand there was an excess of income over expenditure of about $47.8 million; on the other hand there were 31 member States, six more than last year, that had lost the right to vote, and about 80 member States had made no payment towards their 1996 contributions. The document did, however, bear testimony to sound and prudent financial management on the part of the Office.
7. The representative of the Government of the United Kingdom agreed with the Employers that it would be useful to have more information on forecasts based on the information in the Office paper. Admittedly, it was difficult to predict the payment behaviour of member States, but it would be useful to have estimates of the financial position at 31 December 1996 and some indication of the extent to which internal borrowing would be necessary.
8. The Treasurer and Financial Comptroller confirmed that at 31 October there was an excess of income over expenditure of almost $47.9 million. While it was possible for the Office to forecast expenditure on the basis of the approved programme and budget, it was difficult to do the same for income flows because the Office had no control over the collection of contributions. Furthermore, this Committee, particularly some members of the Government group, insisted that the Office adjust expenditure in line with income actually received, so even expenditure forecasts based on the approved programme and budget would be subject to adjustments if subsequently it was expected that there would be a shortfall in contributions.
9. The Committee took note of the Office paper.
Financial questions relating to the
International Institute for Labour Studies
(Second item on the agenda)
Authorization to accept contributions and gifts
10. The Committee had before it a paper(3) giving details of contributions and gifts received by the Institute, and a paper(4) containing a recommendation from the Board concerning these contributions and gifts.
11. The Committee recommends that the Governing Body accept the contributions and gifts as described in the document attached to the Office paper.(5)
Report of the Building Subcommittee
(Third item on the agenda)
12. The Committee had before it a report of its Building Subcommittee(6) describing progress in the extension of the ILO Regional Office in Abidjan, the construction of the ILO premises in Islamabad and the proposed purchase of the ILO Brussels Office.
13. Mr. Chotard, in his capacity as Chairman of the Building Subcommittee, introducing this paper, stated that the first of the three items contained in the report outlined the progress made on the extension of the ILO Regional Office in Abidjan. Work on the extension had to be interrupted following a landslide that had occurred at the site which had cost the life of a construction worker. Work had resumed following a special study which had been carried out at the site. The report introduced a proposal to construct four additional floors, rather than the two floors which were originally envisaged, in order to allow for future requirements. The decision to construct four floors had to be taken at that point of the construction as it would not be possible to add further floors at a later date. The construction of four floors would have the effect of reducing the unit cost of each floor and the total outlay would be financed from the Building and Accommodation Fund.
14. With regard to the Islamabad premises, construction work was advancing satisfactorily despite a number of delays at certain stages of construction. Decisions relating to the air-conditioning system had had to be taken by the Office and further decisions for additional financing would be necessary at the forthcoming Governing Body session. The Office had benefited from the devaluation of the Pakistan rupee and negotiations continued to be made with local authorities for the reimbursement of local taxes.
15. The third item concerned the proposed purchase of the ILO Liaison Office in Brussels. There were two alternatives open to the Office, namely moving to alternative premises or purchasing the existing premises. The second option was the preferred one as it avoided additional moving expenses and the attractive price requested by the owner meant that the purchase price could be amortized fairly rapidly. As in the case of the Abidjan extension, the purchase of the Brussels Office would be financed from the Building and Accommodation Fund.
16. Mr. Anand, speaking on behalf of the Employers' group, stated that he supported the proposals contained in the report. The construction of four floors in Abidjan would respond to the Office's future needs and the additional costs involved were reasonable. He was glad to note the progress that had been reported on the Islamabad premises and felt that the purchase of the Brussels Office represented a prudent approach.
17. Mr. Khurshid Ahmed, speaking on behalf of the Workers' group, stated that he appreciated the work of the Office and particularly the Treasurer in respect of the matters set out in the Building Subcommittee's report and that he fully supported the proposals it contained.
18. Mr. Blondel, a Worker member, thanked Mr. Chotard for his introduction to the Building Subcommittee's report. He however wished to be reassured that sufficient action had been taken to ensure that the Abidjan construction would not contain asbestos.
19. Mr. Chotard, in reply to Mr. Blondel, stated that although he could not give Mr. Blondel specific assurances, the engineering consultant from Geneva would have informed the Office if asbestos had been used.
20. The representative of the Director-General (the Treasurer and Financial Comptroller) confirmed Mr. Chotard's assessment of the question raised by Mr. Blondel and wished to assure him that the original building in Abidjan had been totally stripped down to the basic concrete and steel structure and that it did not contain any asbestos. He further reassured the Committee that all efforts would be made during the construction of the annex to avoid the use of asbestos.
21. Mr. Khurshid Ahmed stated that in view of the recent fatal accident at the Abidjan building site, it was hoped that the contractor would also observe fully the ILO's standards on safety and health.
22. The Committee recommends that the Governing Body:
- accept the proposal concerning the Abidjan Office involving the construction of four floors of offices, at an additional cost of US$165,000; and agree that the additional cost of US$165,000 be charged to the Building and Accommodation Fund; and
- accept the proposal to purchase the building in Brussels currently occupied by the ILO Liaison Office with the European Communities and the Benelux and agree that the cost of purchase, amounting to 15 million Belgian francs (US$480,000) be financed from the Building and Accommodation Fund.
Loan for the ILO headquarters building
(Fourth item on the agenda)
23. The Committee had before it a document(7) explaining that the Swiss authorities had decided to waive interest on the ILO loan and that the period of loans to international organizations was to be standardized to 50 years. The Director-General had already expressed appreciation to the Government of Switzerland for its decision.
24. The Committee recommends that the Governing Body request the Director-General also to express its gratitude to the Government of Switzerland for its generous action.
Amendments to the Financial Rules
(Fifth item on the agenda)
25. The Committee had before it a document(8) setting out proposed amendments to the ILO Financial Rules.
26. The Treasurer explained that there were three basic reasons for the amendments proposed in the Office paper. First, under the Active Partnership Policy greater authority had to be given to the directors of external offices to control and carry out technical cooperation projects. They already had full authority to manage their own budgets but any other expenditures had to be cleared through headquarters. This process was being decentralized so that directors of external offices had greater control over their technical cooperation activities and could be held accountable for them. They would also be authorized to prepare and revise technical cooperation budgets. To be consistent, and to improve efficiency and effectiveness, it would be useful to give department directors at headquarters the same authority to manage their own budgets. At present the Office had a highly centralized procedure where every financial commitment was approved by the Budget and Finance Branch, but with modern computer technology this was a task which could be decentralized to programme managers. Computer systems would ensure that all basic checks were performed by the programme managers before a commitment could be authorized.
27. The responses to these checks would leave an audit trail so that commitment approvals could be verified at a later stage by the Budget and Finance Branch. Exceptional authorizations were automatically reported to headquarters for follow-up action. Procedures for these systems would be set out in instruction manuals and special training would be organized for staff in the field, which in turn would be reinforced by audit visits from the regional offices and from headquarters.
28. The second change responded to the observations of the External Auditor, who had pointed out that even if financial functions were decentralized to the field, the Treasurer remained responsible to the Director-General for the proper financial management of the Office and should therefore have some authority over transactions approved at field offices. The additional sentence proposed for rule 1.40 provided that persons to whom authority was delegated for this purpose were accountable to the Treasurer.
29. The third change responded to the External Auditor's recommendation that all cases of fraud or presumptive fraud should be automatically reported to the External Auditor. This was already current practice and would be formally recognized by the proposed amendment.
30. Mr. Gray expressed the Workers' concern about whether programme managers in the field would be capable of handling these extra financial responsibilities and whether the time spent on this work would not detract from their more important work on programme activities. The Office would also have to ensure that when responsible officials were absent, the staff to whom this work was delegated were properly trained to carry it out. The Workers also asked for information on the frequency of expenditure reporting in field offices.
31. Mr. Marshall expressed the Employers' appreciation for the Office paper and for the remarks of the Treasurer. The delegation of authority was a logical part of the process of decentralization but it should be coupled with accountability for audit purposes. They were pleased to see that proper training would be provided for field staff and that it would be reinforced by visits from internal audit staff. The Employers agreed with the Workers that it would be useful to have more information about the frequency of expenditure reporting in the field. On balance, the additional financial responsibilities imposed on programme managers in the field should not be too onerous, and if managed properly could give them greater flexibility in the way they carried out their work.
32. The Treasurer, in reply to questions raised by the Employers and Workers, said that most Area Office directors would prefer greater financial autonomy in being able to execute their programmes. Under the new system they would avoid having to spend time communicating with headquarters, but it was true that in the end they would be required to spend more time on administrative matters. However, there was no alternative if they wanted additional authority in the management of their programmes. The answer was to have good support staff, and training programmes would be aimed at local administrative staff to improve their effectiveness. When office directors were absent they would have to delegate their responsibilities but, in accordance with usual practice, they would be held accountable if things went wrong. Each external office would submit accounts for its own operations and for its technical cooperation activities each month to its regional office for verification, so expenditure would be audited in the month after it was incurred. Computer-generated exception reports would be instantly routed to headquarters for attention.
33. The Committee recommends that the Governing Body approve the amendments to the Financial Rules as set out in Appendix I to this report.
International Training Centre of the ILO, Turin
(Sixth item on the agenda)
34. The Committee had before it the documents submitted to the 58th Session of the Board of the Centre, together with the report of the session.
35. Mrs. Sasso-Mazzufferi, speaking on behalf of the Employer members, said that the Turin Centre report was clear, precise and well drafted. The year 1995 had been a very positive one for the Centre. The number of participants in the Centre's activities had increased and were expected to increase further in 1996 and 1997. Tripartite participation had improved and Employers' programmes had given good results.
36. Relations with ACT/EMP and employers' organizations had been strengthened and increased participation of employers in bipartite and tripartite activities was planned for the future. The Centre had a good image and reputation was competitive, and had consequently managed to balance its budget, with the bulk of its income coming from training course revenues. The establishment in the Turin Centre of the UN Staff College, which was self-financing and which would be involved in the training of United Nations staff, was also welcomed.
37. The Employers' group was however disturbed to note the reduction in funds made available to the Centre by the UNDP and the reduction in programmes for certain regions which included Latin America, the Caribbean and Asia. These regions had enormous needs with regard to training and the Employers' group hoped that steps would be taken to have this situation corrected. The Employers also stressed the efforts made to improve the management information system and to standardize accounting, as well as the need to encourage the decentralization of training programmes.
38. Thanks were again due to the Government of Italy, the City of Turin, the Piedmont region and the Governments of France and Switzerland for their continued support.
39. On the question of the limited time available to the Employers' group for examining and discussing the Centre's report, it was felt that the one-hour session was not sufficient, and a request had been made for the Employers' group meeting to be held on the day before the Turin Board's session in future.
40. The Employers' group endorsed the point for decision contained in paragraph 4 of document GB.267/PFA/6/2.
41. Mr. Agyei, speaking on behalf of the Worker members, commended the clarity of the Centre's report and recommended that donor support for the Centre's activities should be intensified so as to make up for the reduction in UNDP funding. The Centre should facilitate workers' participation in the UN- system programmes and a separate account should be maintained for such programmes. The Centre's programmes should also include bipartite programmes, particularly on management development, which should be made available to workers.
42. Documents relating to the Centre should be made available earlier in order to allow more time for review and discussion.
43. The Workers' group endorsed the point for decision contained in paragraph 4 of document GB.267/PFA/6/2.
44. The representative of the Government of France stated that he supported the point for decision contained in paragraph 4 of document GB.267/PFA/6/2. He was pleased to note that the uncertainties which had surrounded the Centre in the past had been replaced by complete confidence and that, thanks to the efforts of the Centre's Director, the Centre's involvement in the training of UN staff would only help to promote the ILO's image within the United Nations.
45. The representative of the Government of the United States stated that she agreed with the remarks made by the representative of the Government of France and welcomed the Centre's report. She also supported the point for decision contained in paragraph 4 of document GB.267/PFA/6/2. She was glad to note the UN Staff College project and looked forward to seeing good results throughout the UN system from this initiative. She congratulated the Centre on its ability to remain competitive.
46. The representative of the Government of Italy was pleased to note that the Centre had achieved a high profile within the UN system with regard to training activities.
47. The representative of the Government of Egypt expressed support for the Centre and for the efforts made to promote its self-sufficiency and international competitiveness. For those programmes which were funded through income generated by the Centre itself, it was hoped that the Centre would maintain a competitive edge on the international scene. The Centre's efforts to diversify its sources of income were welcomed, as was the UN Staff College project. The continued financial support of the Government of Italy was also greatly appreciated and the three-year financial plan adopted by the Centre should help to reinforce its training programmes.
48. The running of training activities in the field represented a new venture for the Centre, and it was hoped that the participation of African and Arab countries in those activities would be increased. The increased participation of women in the Centre's activities was also welcomed.
49. The representative of the Government of Chile wished to echo the comments made and gratitude expressed by previous speakers, particularly those representing the Governments of France and the United States. The work carried out by the Centre was greatly appreciated.
50. The representative of the Government of China congratulated the Director and staff of the Centre for the positive results it had achieved. He also wished to thank the Centre's donors, especially the Italian Government, and recommended that the Office should allocate more funds to the Centre whose activities were extremely useful to developing countries and to tripartism in general.
51. The representative of the Government of India congratulated the Centre's secretariat for the very comprehensive and detailed report, and the Centre's Director and staff for the successful activities carried out by the Centre in 1995 and 1996. He also wished to thank the Government of Italy for its continued support to the Centre.
52. The Centre had contributed considerably towards improving the quality of vocational training in several countries and should continue to concentrate on vocational training in the future. The Centre should not attempt to apply its limited resources to other activities.
53. The Asia Pacific region was the largest region in terms of population and was facing serious problems related to poverty, unemployment and underdevelopment. Special attention should therefore be given to that region and efforts should be made to increase the Centre's level of activities for the region, and to develop programmes which respond to specific needs of certain countries which had undertaken economic reforms, trade liberalization and structural adjustment.
54. The Committee recommends that the Governing Body endorse the amendments to the Centre's Financial Regulations, as proposed in document CC/58/6/6 (Appendix II to document GB.267/PFA/6/2), subject to any observations that the Governing Body may make.
Assessment of the reforms in the functioning of
the International Labour Conference
(Seventh item on the agenda)
55. The Committee had before it a paper(9) containing information on the reforms in the functioning of the 1996 Session of the International Labour Conference.
56. Mr. Gray said that the Workers were concerned about the effect that shortening the Conference by one day had had on the work of the Committee on the Application of Standards. It would be useful to have a paper at the next session of the Governing Body showing how the work of this Committee was being restructured before making a final decision to shorten the Conference permanently by one day. The Workers felt very strongly that the Provisional Record should be reinstated, and they asked for some explanation of why savings were now shown as $481,000 compared with the original estimate of $87,000. The main reason for reinstating this record was that many smaller delegations were unable to follow plenary discussions when their members were involved in committee work. The five-minute time-limit for speeches seemed quite adequate and should be continued. The annual Conference was not an activity that could be squeezed continually in the search for savings, and even though the reforms had saved $887,000 this year, it should not be regarded as a continuous source of savings. The Workers would return with other comments later in the discussion.
57. Mr. Marshall, on behalf of the Employer members, pointed out that the Conference was the supreme authority for the ILO and the quality of its work should not be jeopardized in the search for savings. He agreed with the previous speaker that it would be useful to have a paper on how the work of the Committee on the Application of Conventions and Recommendations was being rationalized before deciding finally on the length of the Conference.
58. The Employers supported the continuation of the five-minute limit to speeches because it yielded worthwhile savings, and because it was a sound discipline which could improve the quality of debate. The Employers also supported the retention of one week for plenary discussions and believed strongly that there should be full discussion before any limitations were placed on the reports of the Officers of the Committee. In respect of the non-production of the Provisional Record, there was no reason why the results of a record vote could not be produced immediately, as had happened at the Maritime Conference. The same applied to the reply of the Director-General. These savings were substantial and should be retained, although in view of the relatively modest cost involved there was no objection to making copies of the original individual speeches available to delegates on request.
59. Communication between delegates was an important aspect of Conference activities and the Office should look at innovative and cost-effective ways in which translation difficulties could be overcome. Reducing the free distribution of Conference reports yielded only modest savings, but it should nevertheless continue. The Employers acknowledged the severe pressures placed on the Office during the Conference, but despite these constraints there should be sufficient planning and discussion time allowed for the proper consideration of Committee reports. The Employers supported the proposal to delegate the approval of uncontroversial changes in the composition of Committees to the Selection Committee.
60. The representative of the Government of Spain expressed appreciation for the Office paper, which dealt with an extremely important topic relating to the supreme authority of the ILO. Shortening the Conference by one day had yielded worthwhile savings and should be continued, but it would be unwise to assume that the experience of the Maritime Conference could be repeated at the International Labour Conference, for at the former there was no Report of the Director-General to consider.
61. The introduction of a five-minute time-limit for speeches had been quite successful and this reform should be continued. Discussion of the Reports of the Director-General and the Chairperson of the Governing Body were matters of prime importance at the Conference and included extremely important information. The plenary discussion thereon should therefore be duly circulated.
62. He was unable to support the abolition of the Conference Provisional Record since few delegations, particularly the smaller ones, could allow themselves the luxury of having a delegate permanently in the plenary. The proposal to make photocopies of speeches available was not a satisfactory alternative. A reasonable compromise might perhaps be to reduce print runs by distributing individual copies of the record to delegates' boxes instead of making the documents available at the counter or to produce summary versions thereof. The final records should be produced without delay. The Office should be encouraged to continue its search for savings, but it should ensure that reforms did not undermine the running of the Conference.
63. The representative of the Government of the Republic of Korea also expressed appreciation for the Office paper and stressed that it would be useful to continue the practice of producing a summary record of main statements following the Conference. From comments at the 83rd Session of the International Labour Conference in June 1996 many delegates had reservations about the timing of the plenary discussion, and it was not clear whether the savings justified the considerable inconvenience to delegates. This matter should be given further consideration before a final decision was made.
64. The representative of the Government of Austria considered that a number of the reform measures had proved their worth and had made it possible to achieve considerable savings. However, shortening the time-limit for speeches during the discussion of the Director-General's Report had not been useful as the speeches were either delivered quickly or contained little substance. It was very difficult to address important issues in such a short time. Plenary sessions gave delegates an opportunity to air issues that were particularly important to national representatives. The non-production of the Provisional Record meant that delegates following other activities and unable to attend plenary sessions were not always able to follow some of the important statements. Even if only a few delegates attended plenary it did provide a central meeting place. However, it was also true that savings made by reducing the number of plenary sessions probably could not be made in any other way. He agreed to the proposal that the Selection Committee be responsible for the composition of committees.
65. The representative of the Government of Germany supported the proposals made in the report, and suggested that speakers should be careful about criticizing them. Reducing the time-limit for speeches was fundamentally a good thing but it should not be carried out mechanically. The Maritime Conference had shown that, generally, the new measures worked, and that they allowed delegates to focus better on their work. However, as suggested by the Employer members adequate time should be granted for discussion of the committee reports. The question of whether or not to continue the Provisional Record was quite delicate. Measures already taken should not be reversed, but further changes should be introduced with caution.
66. The representative of the Government of the United Kingdom believed that although the measures introduced for the 1996 International Labour Conference were prompted by financial difficulties, they were worthwhile in themselves, particularly in relation to the time-limit imposed in plenary sessions. The measures proposed in paragraph 12 addressed effectively the main concerns expressed by delegates during the 1996 Conference, and she fully supported the Office proposals that these reforms be maintained. The Office should be encouraged to consider longer term improvements to the format, organization and promotion of the Conference, the most publicly visible aspect of the ILO's work and a significant event on the international calendar. There was considerable scope to enhance its promotional value for the ILO and to ensure that it generated maximum positive publicity. It should be placed at the centre of the publicity strategy that the Office was developing. The paper to be presented at the next session of the Governing Body should include ideas for enhancing the promotional value of the Conference. She expressed full support for the points for decision.
67. The representative of the Government of Finland thought that although there had been some problems with the changes that had been implemented, they could be resolved quite easily. For instance, the time constraints had meant that there was less time for committee work which had led to the use of more working groups which in turn might undermine the transparency of the preparatory work. One could ask whether limiting the distribution of publications, which yielded only minor savings, was practical when compared to the need for more publicity. Now that the Provisional Record was being published at a later date, timely information on what was happening during the plenary was threatened. However, on the understanding that speeches could be made available as suggested in paragraph 12, he expressed support for the proposals in paragraph 16.
68. The representative of the Government of Canada welcomed the proposals in the paper and agreed with the remarks made by the representative of the Government of the United Kingdom. Her Government supported the recommendations made in paragraph 16. She agreed with the view earlier expressed by the Employer members that time-limits on speeches was a good discipline. It would be useful to extend time-limits to statements on the presentation and discussion of committee reports, because it was appropriate that committee members were bound by the same restrictions as ministers. The procedures outlined in paragraph 6 were cumbersome and could easily take as much time to implement as the time saved by limiting the speeches. It might be better to take a general decision at the beginning of the Conference by placing a time-limit on all interventions. She requested the Office to consider and respond to the suggestion. She supported the emphasis on changes designed to improve efficiency and make savings, but it was time to look at the broader issues of Conference reform. In addition to the suggestions made by the Employer and Worker members on the analysis of committee reports and those presented by the representative of the Government of the United Kingdom, other questions to be addressed concerned the link between discussions in the Conference and the work of the Governing Body, how to make the Conference more interesting to ministers and to the general public, and how the work of the Conference could be organized to manage better the work of the Organization.
69. The representative of the Government of France expressed support for the proposals in the paper, with the exception of that concerning the Provisional Record. A secretariat service which provided copies of speeches did not solve the problem, as first one would want to know whether a speech was interesting. Delays were another problem, and in the interests of the ILO itself the Provisional Record should be re-established. Those responsible for reporting to government administrations or even to the media would find that after one or two months there was no interest in what had happened at the Conference. Moreover, the figure of $481,000 given for savings seemed high. Transcriptions, translations and printing were still being made, so the saving of $481,000 could only come from the rapidity with which the work was done. Nevertheless, even if this figure was correct, the Provisional Record should be reinstated and savings sought elsewhere.
70. The representative of the Government of Panama recalled that the proposals outlined in the paper had been developed as a result of the ILO's financial crisis. The financial situation was still difficult and therefore the adjustments should remain until the situation changed. He agreed to the points listed in paragraph 1, except for the reduction in the number of copies of the Provisional Record which were distributed. A maximum of three copies should be available per delegation so that Government, Workers' and Employers' delegates would have the necessary information. This should not be too expensive.
71. Mr. Blondel (Worker member) asked whether it was the Office's intention to ask for payment for the copies of the speeches they provided. If this was the case, it would be simpler to authorize delegates to distribute their speeches themselves. The Office should not charge money for making speeches available. Referring to paragraph 13, he asked for clarification on how, if the report was going to be published anyhow, savings could be made by dropping transcription services. Furthermore, the report, which was distributed widely, had educational value. It was a pity to limit its distribution, as had happened at the 1996 Conference. The Office had already achieved considerable savings and it was time to move on. The Working Party on Conference Reform had decided unanimously that some of the savings should be used to improve the representation of certain delegations at the Conference by paying travel and accommodation costs of certain delegates. The savings having been made, a decision on this should now be taken.
72. The representative of the Government of Pakistan expressed her Government's appreciation for the efforts by the Office to cut costs. Although the five minute time-limit might be too short for some ministers to make their statements, it was sufficient time for anyone to say something concrete. Regarding the issue of the Provisional Record, she submitted that the problem raised by the representative of the Government of Spain whereby delegations could not cover all meetings and would need to have access to a Provisional Record, might be solved through the use of more innovative methods. The Office could, for example, examine the possibility of uploading statements onto the Internet and making computers available to delegates who could then download them. Another way, especially useful to delegates unable to attend meetings and for Missions in Geneva would be to provide an on-line service through which interested persons could listen to the speeches. As far as the translation of the Provisional Record was concerned it should be remembered that this was a cost-cutting exercise and was not intended to exclude delegates who found it difficult to read a particular language, so again statements could be uploaded onto the Internet in the original language. Alternatively, a brief provisional summary could be included with copies of individual speeches as suggested in paragraph 12. It would be useful to have more information from the Office on exactly what the consequences would be if the point for decision was adopted.
73. Mr. Anand (Employer member), referring to paragraph 5 where it was stated that the average length of speeches turned out to be 65 per cent of the length of speeches delivered in 1995, suggested that this figure should be calculated by group so that the Vice-Chairmen could ensure that discipline was maintained in their respective groups. Experience showed that if time-limits were ignored, then the length of speeches gradually crept back to original levels.
74. The representative of the Government of Italy expressed satisfaction with the paper and was, in general, prepared to accept its contents. The main difficulties raised by members concerned the suggestions made in paragraph 12 of the Provisional Record. It was clear that the proposal to set up a secretariat service where delegates could obtain copies of individual speeches was not popular. Perhaps it was possible to find a less expensive way, other than printing, to distribute the text of the documents. Ideally, the final record should be issued immediately.
75. The representative of the Government of the United States complimented the Office on the quality of the paper and favoured maintaining the shortening of the Conference by one day and the time-limit on speeches. She agreed also with the comments made by the representative of the Government of the United Kingdom on including the Conference in the ILO's promotional strategies.
76. There may be technological solutions to some of the problems raised, and the suggestions made by the representative of the Government of Pakistan should be examined carefully. Computerization could certainly be used to provide access to delegates' statements and the idea of an on-line service to Missions was excellent. Translation was costly because it had to be done at short notice and frequently required overtime, so perhaps an answer would be for documents to be electronically transmitted to regions with a time-lag so that documents could be translated overnight. She supported the point for decision.
77. The representative of the Government of the Russian Federation supported the efforts to make savings in the functioning of the International Labour Conference. The reduction of the Conference by one day, the time-limit on speeches, the limitation to one week of the discussions of the Reports of the Director-General and the Chairman of the Governing Body, the delayed publication of the Provisional Record and the selective free distribution of Conference reports were positive ideas and had helped to make considerable savings. He had no objections to the adoption of the recommendations in paragraph 16 and he supported the suggestion in paragraph 6 that time-limits on speeches should be extended to the discussion of committee reports, beginning at the 1997 Session of the Conference.
78. Mr. Gray, on behalf of the Worker members, emphasized Mr. Blondel's statement that savings should be used to assist some delegates to participate at the Conference. He asked what had happened to the idea of charging a participation fee to NGOs. The Worker members would not agree to applying the same time-limit to discussions on committee reports, because an adequate mechanism already existed which permitted a time-limit to be imposed if necessary. He asked for an explanation on the practical implications of dispensing with the transcription services for the Committee on the Application of Standards. The Worker members had no objection to the Selection Committee handling the composition of committees.
79. The representative of the Government of Sweden regretted the disappearance of the Provisional Record, and thought that it should be reinstated. The reduction in the time-limit on speeches in general was acceptable, but the same limits should not be imposed on the discussions on the work of the committees. If too short a time was made available for the work of the committees, the quality of the work would suffer; there would not be enough time for serious discussion, or for hearing arguments and explanations. The work of the technical committees should not be rushed in such a way that solutions were only found by voting. Furthermore, if less time was allowed in technical committees, which involved the framing of new instruments as well as general discussions, working parties might be set up which would involve very few people in the work of the Committee.
80. Mr. Marshall, for the Employer members, emphasized that the considerable savings achieved through the non-production of the Provisional Record should not be undermined. The major part of the savings came from the costs of setting up for printing and staff time -- the length of the print run was a relatively small element of the cost and should not be a significant consideration. The Employer members proposed that paragraph 12 should be accepted in respect of the 1997 Conference to see how the proposal would work while bearing in mind the need to look at innovative approaches for future years. There should not be any time restriction placed on Committee reports to the Conference. Adequate procedures already existed if time constraints were required. The technical committee reports were important and the whole Conference needed to hear them before delegates could make informed voting decisions.
81. Mr. Gray, speaking for the Worker members, reiterated his request for clarification on how the Office arrived at the figure of $481,000 for estimated savings compared with an earlier estimate of $89,000.
82. The representative of the Government of Argentina believed that the alternative solutions to the Provisional Record as proposed in paragraph 12 were valid, but could be improved by studying various suggestions made. In the light of the experience at the 1996 International Labour Conference and the volume of the savings made, she expressed support for the point for decision.
83. The Director of the Relations and Meetings Department, replying to questions concerning the extent of the savings made with regard to the Provisional Record, explained that $481,000 was the amount of savings actually made in 1996 in comparison to expenditure in 1995. A detailed breakdown of this figure was available and could be given if required. The large difference between the actual savings and the estimates made in 1995, which had been made under great pressure, was mainly due to the cost of external staff normally recruited for the Provisional Record. Thanks to a reorganization of work it became possible to do away completely with the recruitment of external staff for work on the production of the Provisional Record. For example, transcription was done entirely in-house and that measure alone had eliminated the recruitment of 30 people. External recruitment had also been suspended for translation, revision, proofreading and distribution. At the time the estimates were made such radical measures had not been envisaged because they were considered potentially quite risky. Given the continuing financial problems facing the Office, the risk was taken and it worked, thus resulting in the significant savings reported.
84. Answering Mr. Blondel's question on the saving of $85,000 on the transcription of the report of the Committee on the Application of Standards, he stated that the savings would not diminish the service or the quality of the final product. The work had been reorganized in such a way that the report would be done by the committee secretaries without recourse to transcriptions. Transcriptions had been used to facilitate the work of the committee secretaries who worked under pressure to reflect what was said by delegates. Henceforth, only very experienced committee secretaries would be selected who would be able to produce the same quality without the transcriptions.
85. He also reassured Mr. Blondel that there was no intention to charge for photocopying the speeches of Conference delegates. The Office had also examined the possibility of making speeches available through the Internet, but unfortunately they were not at present delivered to the Office in electronic form. The Office had tested scanners, but they did not work very fast and, while they were able to read typed copies of speeches they were not usable with handwritten or marked copies. However, it was an option that the Office would continue to examine. If delegates could provide the Office with electronic or clean copies and translations of their speeches then an Internet service could perhaps be provided quite easily. Electronic translation had also been tested, but it was not yet usable. Other technological options would also be pursued.
86. Regarding the request that voting results and the Director-General's statement be produced in-session, he was pleased to announce that results at the Maritime Conference had been quite conclusive. At that Conference, seven votes had been carried out within barely one hour and the results of all of them had been available before the end of the sitting; the Director-General's statement had been available by the following morning. Referring to the question of a fee for NGOs to attend the Conference, he explained that this had in fact been effectively replaced by the decision to charge NGOs for Conference reports.
87. The Chairman, summarizing the discussion, recalled to the Committee that the 1996 Conference had been an experiment. The proposals made in the Office paper were probably not satisfactory to everybody, but the statement by the Director of the Relations and Meetings Department indicated clearly that the search for innovative methods for resolving these problems would continue. Therefore the proposals in the Office paper could be implemented in 1997 again on a trial basis on the understanding that the Office would take into account the comments and suggestions made by members of the Committee.
88. Mr. Gray confirmed that, if a paper concerning the Committee on the Application of Conventions and Recommendations was to be prepared for March 1997, the Worker members would agree to the Chairman's suggestion that these proposals be implemented experimentally.
89. The Chairman, in reply to a query from Mr. Blondel as to whether some of the savings could be used to help finance the attendance of delegations at the Conference, advised him that it would not be possible to pursue the question at this stage, but that it could be discussed at a future session.
90. The Committee recommends to the Governing Body that --
- all the measures it adopted at its 264th Session (November 1995) be continued at the 85th Session (June 1997) of the Conference, on the understanding that the facilities described in paragraph 12 of the Office paper,(10) as well as any others that may be identified by the Office, will be introduced at that session;
- the responsibility for the approval of non-controversial changes in the composition of committees be delegated to the Selection Committee.
Other financial and general questions
(Ninth item on the agenda)
91. The Committee had before it a paper(11) on the internal oversight function of the ILO which proposed certain amendments to the Financial Rules and the Staff Regulations.
92. Mr. Marshall, speaking on behalf of the Employers' group, stated that the internal oversight function had been discussed by the Governing Body on previous occasions. While the proposals contained in the paper were approved, it would perhaps be more appropriate in structural terms for the Chief Internal Auditor to be directly responsible to the Director-General, as was normal in large modern organzations.
93. Mr. Gray, speaking on behalf of the Worker members, explained that the proposed changes to the internal oversight function, which were fully supported, should not be seen to imply any mistrust or dissatisfaction with past performance, but were made to follow procedures being set up by the United Nations system as a whole.
94. The representative of the Government of Germany also supported the proposals before the Committee, but added that the Chief Internal Auditor, apart from his Annual Report, should only approach the Governing Body under exceptional circumstances.
95. The representative of the Government of Japan requested clarification as to the specific duties of the Chief Internal Auditor in relation to existing audit and evaluation functions within the Organization. He also requested clarification as to the relationship between the Chief Internal Auditor and the External Auditor since they both reported to the Governing Body. Care should be taken to avoid the unnecessary duplication of duties.
96. The representative of the Government of Turkey supported the proposals for strengthening the internal control function. The changes proposed should ensure a better realization of the objectives of that function.
97. The representative of the Government of Canada welcomed the document and the opportunity to discuss the question of internal oversight in the Governing Body, as her Government attached great importance to having strong oversight systems in the ILO. Responsibilities between internal oversight and external audit must be made clear. Internal oversight was part of a system which also included good financial control, external audit and effective strategic budgeting which together protected the organization against fraud, mismanagement and wasted resources. The introduction of any new proposals should not cause duplication between internal oversight and external audit. The primary reporting responsibilities, which, in the case of the internal audit, was to the head of the organization and, in the case of the external audit, was to the legislative body, should be respected. The best way to ensure value for money and reduce waste and mismanagement was through programme planning systems that were based on clear objectives, management accountability for results, transparency in presentation of information, strong evaluation mechanisms and good staff recruitment and training policies. Although the Canadian Government strongly endorsed the new direction towards strategic budgeting as presented in the document earlier in the Committee, other instruments such as internal oversight and external audit should also be used effectively.
98. The amendment to the Financial Regulations in which the Internal Auditor reported all cases of fraud to the external audit was welcomed, but to build on this initiative it was proposed that the External Auditor be asked to make proposals at the March session of the Governing Body on two themes. The first was how the issue of fraud awareness and organization vulnerability to fraud could be addressed in the ILO. Indeed, the External Auditor had indicated at the Conference Finance Committee in June that this area might be explored for his thematic audit for the new biennium. The second topic the External Auditor might be asked to comment on was whether the existing oversight systems might be examined in conjunction with external audit provisions to see if there was any room for improvement. This would give a better understanding of the problem before solutions were proposed. The Canadian Government supported the amendments to the Staff Regulations and the Financial Rules as proposed in paragraph 8 of the document, with the exception of the final sentence in the proposed amendment of paragraph 13.10(b) of the Financial Rules, which should be deleted. It was not necessary to have more than one annual report from the Internal Auditor to the Governing Body, in particular since he was obligated under the Financial Rules to report instances of fraud.
99. The representative of the Government of the United States enthusiastically supported the paper and the points for decision. The Office's initiative in pursuing the matter and the seriousness with which the Office had taken the issue was appreciated. Regarding the frequency of reporting, an annual report was the minimum acceptable. The Internal Auditor would have enough discretion to decide when another report would be necessary and this discretion should not be further restricted. Together, the Internal Auditor, working on behalf of the Director-General, and informing the Governing Body of his major activities and the External Auditor, working for the Members, would be able to satisfactorily coordinate their activities. The enhanced powers of the Internal Auditor should not weaken such coordination. The Government of the United States supported the proposals in the document and felt that paragraph 13.10(b) of the Financial Rules should be left as proposed.
100. The representative of the Government of Mexico expressed strong support for the document and the proposals it contained, which would bring about stricter financial management of the Office's activities and a better understanding of the issues for the Governing Body. He supported the proposals made by the Canadian delegation.
101. The representative of the Government of the United Kingdom also supported the document and the proposals therein. He agreed with the German Government that the Internal Auditor's right of access to the Governing Body should be used in moderation. The proposals enhanced existing oversight mechanisms, which already functioned well. He supported the proposal by the Canadian Government to ask the External Auditor to provide an assessment of the present relationship between internal and external audit functions in his next report to the Governing Body and the Conference.
102. The representative of the Government of Panama supported the proposals made in the document and was satisfied that these proposals would provide the Governing Body with the necessary information to make better decisions regarding financial aspects of the Office.
103. Mr. Marshall, speaking on behalf of the Employers, supported the proposals. In respect of the amendment on 13.10(b), he considered that, although an annual reporting system was normally sufficient, it would be valuable to leave the paragraph intact as the Internal Auditor would be expected to apply discretion in respect of additional reports submitted.
104. A representative of the Joint Inspection Unit informed the Committee that, following the suggestion made by the secretariats of the United Nations, ICAO and the World Meteorological Organization (WMO), the Joint Inspection Unit had included in its programme of work for 1996-97 a study of the coordination and harmonization of the work of oversight bodies. The study would address specific suggestions made by the secretariats of the three organizations concerned and other issues concerning accountability, management, improvement and oversight in the United Nations system. He hoped that this study, when available next year, would be of use to the Committee for its discussion on internal and external oversight mechanisms in the United Nations system.
105. The Treasurer reiterated that the proposals in the document were not put forward to address any perceived weaknesses in the ILO's financial control mechanisms, but were part of a general initiative in all bodies of the UN system. These proposals were not intended to reinforce internal audit but to give it greater autonomy and to provide direct access to the Governing Body. In the ILO the work of the Internal Auditor had never been subject to censorship or restrictions, and in practice the proposals would change very little.
106. The proposals constituted a new reporting arrangement rather than a new auditing system, and gave greater autonomy in the appointment and dismissal of the Internal Auditor, but this would not alter the relationship between the Internal Auditor and the External Auditor. The privileges which would be given to the Internal Auditor were, in fact, already enjoyed by the External Auditor who was appointed by, and reported to, the Governing Body. The question of overlapping of responsibilities of the Internal and External Auditors depended very much on mutual confidence and the working relationship between the two. An External Auditor, before beginning an audit, always made an assessment of the system of internal financial controls and checks in an organization before he determined how much checking to do himself. The weaker the internal controls, the more comprehensive the audit performed by the External Auditor. In the ILO, the Internal Auditor and the External Auditor had always had a relationship of total mutual trust and frequent dialogue. The External Auditor would be unlikely to examine the same areas as the Internal Auditor unless problems had been discovered, in which case, the External Auditor would examine them and report to the Governing Body. In fact, all reports of the Internal Auditor were, without exception, sent to the External Auditor for evaluation. It was important to note that, besides the Internal and External Auditors, the Treasurer himself, under article 13 of the Financial Rules, had full audit responsibilities, and the regional offices had senior administrative officers who conducted regular visits to external offices to perform audits.
107. The question of coordination with outside bodies had already been explained, in part, by the representative of the Joint Inspection Unit. In addition, the Internal Auditors of all the United Nations organizations met regularly to discuss common problems and to exchange experiences, and the Treasurer was required to give presentations from time to time to ACABQ on the ILO's activities.
108. Regarding the proposal by the representative of the Government of Canada to delete the last sentence of the amendment proposed in the Financial Rules, this was very much a matter for the judgement of the Committee. This provision would not require the Internal Auditor to make additional reports to the Governing Body but left the possibility open for him to do so under very extreme and exceptional circumstances. In the absence of such exceptional conditions, it was highly unlikely that the Chief Internal Auditor would make such additional reports.
109. In reply to a question put by the Chairman, the representative of Canada agreed to withdraw her proposal in the light of the explanations that had been given.
110. The Programme, Financial and Administrative Committee recommends that the Governing Body approve the amendments to articles 4.2 and 11.1 of the Staff Regulations and Financial Rule 13.10 as set out in Appendix II to this report.
Statement by Mr. E. Hoff, Director of the
Confederation of Norwegian Business and Industry
111. Mr. Hoff (Employer member) said that as an Employer member of the ILO Governing Body and also as a member of the group in the Foreign Ministry in Oslo which dealt with proposals for aid projects, he was concerned at recent budgetary developments in the ILO and its capacity to deliver high-quality services. It was clear that, in the current climate of budgetary restraint, it was extremely important that the ILO make greater efforts to attract extra-budgetary funds.
112. The Governing Body Committee on Technical Cooperation had met earlier in the week and among other things it had discussed ways in which technical cooperation activities could be better carried out. It was disappointing that the Employers' Activities Branch, which had expanded very little in the last ten years or so, had been unable to accept all the projects it was offered. He asked the Government and Worker members of the Committee to join the Employer members in supporting the work of the Employers' Activities Branch and enhancing its capacity to participate and play its proper role in the work of the ILO.
Geneva, 19 November 1996.
(Signed)
C. Gray,
Reporter.
Points for decision:
Paragraph 11;
Paragraph 22;
Paragraph 24;
Paragraph 33;
Paragraph 54;
Paragraph 90;
Paragraph 110.
Amendments to the Financial Rules
(Additions are shown in bold type; deletions are indicated by square brackets)
I. AUTHORITY AND APPLICABILITY
1.20 Definitions
...
Financial Services:
[The Budget and Finance Branch and the Treasury and Investments Branch.] The Financial Services Department at headquarters.
Certifying Officer:
An official authorised by the [Chief of the Budget and Finance Branch] Treasurer to certify the budgetary or financial propriety of proposed obligations or disbursements.
...
1.40 Responsibility for Implementation
The Treasurer is responsible to the Director-General for the application and implementation of these Rules. The Treasurer may delegate any specific authority vested in him pursuant to these Rules [to the Chief of the Budget and Finance Branch, to the Chief of the Treasury and Investments Branch, to Directors of external offices, to Chief Technical Advisers, or to officials replacing them in their absence]. Officials to whom such specific delegations of authority have been made shall be accountable to the Treasurer for the responsibilities delegated to them.
1.50 Additional Instructions to be Issued by the Treasurer
...
(b) The Treasurer may determine the extent to which these Rules shall apply to external offices, to the offices of Chief Technical Advisers and to officials on individual assignments away from headquarters. He may establish separate financial rules, instructions and procedures for such offices and officials taking into consideration their special conditions and requirements. The separate rules, instructions and procedures thus established shall normally be incorporated in comprehensive manuals of financial and administrative practices and procedures drawn up for the use of offices away from headquarters. No changes in such rules, instructions or procedures shall be made without the approval of the Treasurer. The authorities given to officials away from headquarters [Directors of external offices and Chief Technical Advisers and officials on individual assignments away from headquarters] under the present Financial Rules shall be exercised in conformity with all relevant rules, instructions and procedures approved by the Treasurer. In matters for which no separate rules or instructions have been thus established the present Financial Rules shall apply.
1.60 Responsibilities of the Financial Services
The Financial Services are responsible to the Treasurer for the performance and/or supervision of all budgetary, financial and accounting operations. They are responsible for establishing and monitoring the application of policies and procedures relating to all financial operations [carried out in the field].
* * *
II. PREPARATION OF BUDGET ESTIMATES
2.30 Furnishing of Cost Estimates
The Budget and Finance Branch shall be responsible for the preparation of all cost estimates that may be required in connection with the activities of the Organisation including estimates of the cost of all projects, meetings, staff salaries and missions. No official shall issue cost estimates for use outside the Office without prior written authorization [clearance of the estimates by] from the Treasurer [the Chief of the Budget and Finance Branch].
* * *
IV. APPROPRIATIONS AND ALLOCATIONS
4.40 Periodic Review of Expenditure Position
The Director of the Financial Services Department shall ensure that programme managers have ready access to information on [Programme managers shall be informed regularly by the Budget and Finance Branch of] the expenditures and unliquidated obligations recorded against their allocations. The [Chief of the Budget and Finance Branch] Director of the Financial Services Department shall monitor the extent to which allocations are used and prepare reports for the Director-General on amounts currently allocated, obligated and expended, and expected future expenditure, under the allocations.
* * *
V. CONTROL OF OBLIGATIONS
5.30 Control of Obligations [at Headquarters]
(a) All contracts, appointments, mission orders, purchase orders, or other documents by which a financial obligation is to be incurred on behalf of the Organisation must be submitted in advance [to the Budget and Finance Branch for financial clearance] to an official authorised by the Treasurer to provide financial clearance under Article 30 of the Financial Regulations, except as provided in subparagraph (d) below.
(b) An [authorised] official [of the Budget and Finance Branch] who has been authorised to provide financial clearance shall [review the obligating documents submitted in the light of] exercise this authority only after ensuring that the proposed expenditure is in conformity with the applicable financial regulations and rules, and the approved budget, and is within the available balances in the respective allocations. He shall also [assure himself] ensure that the principles of sound economy are maintained. [If the obligating document conforms with above requirements, it] A record of obligations incurred or foreseen shall be [certified by an authorised official of the Budget and Finance Branch that funds are available and have been reserved to meet the resulting expenditure. Approved obligations shall be recorded] kept in a [register] form approved by the Budget and Finance Branch which will serve, for the purpose of Article 14 of the Financial Regulations, as a record of obligations incurred.
(c) No obligating document shall be released outside the Organisation without the certification by an authorised official [of the Budget and Finance Branch] that funds are available.
(d) An authorised official [of the Budget and Finance Branch] may issue lump-sum certificates to cover minor routine purchases which involve individual expenditures each of which does not exceed the equivalent of US$1,000. [The certificates shall normally cover an amount sufficient to provide for one month's operation. At the end of the period for which the certificate is issued, it shall be returned together with a record of the obligations incurred against it, and shall be supported by copies of the corresponding obligating documents.] A lump-sum certificate shall be recorded in the accounts as a valid obligation [, which shall be adjusted to actual obligations when the certificate is returned].
(e) Major obligations to be incurred shall be coordinated in advance with the competent administrative and financial services at headquarters.
[5.40 Control of Obligations Away from Headquarters
(a) An official away from headquarters who has been authorised to incur financial obligations in relation to funds allocated to him shall exercise this authority only after ensuring that the proposed expenditure is in conformity with the applicable financial regulations and rules, the approved budget and the available balance in the allocation. He shall also assure himself that the principles of sound economy are maintained. A record of obligations incurred or foreseen shall be kept in a form approved by the Budget and Finance Branch.
(b) Major obligations to be incurred by officials away from headquarters shall be coordinated in advance with the competent administrative and financial services at headquarters.]
[5.50] 5.40 Obligations to be Incurred in Conformity with the Budget
Obligations shall be incurred only in strict conformity with the relevant budget. All obligating documents submitted for financial clearance shall be accompanied by an indication of the appropriate accounting classification. In case of doubt, the correct classification against which any charge is to be made shall be determined by the [Chief of the Budget and Finance Branch] Director of the Financial Services Department.
[5.60] 5.50 Objection to Proposed Obligations
If [the Chief of the Budget and Finance Branch] an authorised official cannot approve an obligating document submitted for certification he shall state his objections in writing. If the requesting official does not agree with the objection, the matter shall be referred to the Treasurer for decision.
[5.70 Information on Available Balances (See Rule 4.40.)]
[5.80] 5.60 Downward Adjustments of Obligations
If part or all of an amount recorded as an obligation is no longer required for the purpose originally foreseen, the responsible programme manager shall [inform the Budget and Finance Branch immediately, in writing] take the necessary action to adjust the amount.
* * *
VI. PRESENTATION AND AUDIT OF CLAIMS
6.60 Claims to Be Accompanied by Receiving Reports
...
(c) For goods delivered to a place outside [Geneva] the country where the ordering unit is located, payment may be authorised upon receipt of documents provided that the goods were dispatched appropriately insured to their destination. A duly executed receiving report must be forwarded to the [Budget and Finance Branch] Certifying Officer not later than one month after receipt of goods.
...
6.80 Objection to a claim
(a) When the [Chief of the Budget and Finance Branch] Director of the Financial Services Department, or an official authorised to make payments, objects to the payment of a claim in full or in part, he shall communicate his objection to the official presenting the claim. If the official does not agree with the objection, he may appeal through proper channels to the Director-General.
(b) If the Director-General decides that a claim is to be paid notwithstanding an objection by the [Chief of the Budget and Finance Branch] Director of the Financial Services Department, his decision shall be reported to the External Auditor.
* * *
VII. PAYMENTS
7.80 Responsibility for Payments
(a) An instruction from a superior official shall not relieve an official authorised to make payments from responsibility for an irregular payment, unless, before payment was made, written notification had been received from the Director of the Financial Services Department that the official's doubts concerning the regularity of that payment were unfounded.
(b) An instruction from a superior official shall not relieve the Financial Services from responsibility for an irregular payment, unless the irregularity was pointed out by the [Financial Services] Director of the Financial Services Department to the Director-General in writing before the payment was made, and [their] his objection overruled. Any such overruling shall be given in writing and shall be reported to the External Auditor.
* * *
VIII. MANAGEMENT OF FUNDS
8.40 Loss of Cash or Negotiable Instruments, Cases of Fraud
Any loss of cash or negotiable instruments and any case of fraud, presumption of fraud or attempted fraud must be reported at once to the Treasurer who will ensure that appropriate follow-up action is taken and that full details are submitted to the External Auditor with the related accounts, in conformity with Rule 11.40.
* * *
XI. PROPERTY
11.40 Treatment of Cases of Loss of Assets, Fraud or Unrecovered Debt
...
(e) Any case of fraud, presumption of fraud or attempted fraud must be reported to the Director-General through the Treasurer. Full details of such cases shall be submitted to the External Auditor with the related accounts.
...
Amendments to the Staff Regulations and
to the Financial Rules
(Additions are underlined. There are no deletions.)
I. Amendments to the Staff Regulations
Article 4.2
Filling of Vacancies
(d) Vacancies in the Director and Principal Officer category shall be filled by the Director-General by transfer in the same grade, promotion or appointment. Such promotions or appointments, other than to vacancies in technical cooperation projects, shall be reported to the Governing Body with a short statement of the qualifications of the persons so promoted or appointed. The position of Chief Internal Auditor shall be filled by the Director-General after consulting the Officers of the Governing Body.
Article 11.1
Provisions Governing Termination
The following sentence would be added at the end of the article:
The Director-General shall consult the Officers of the Governing Body before terminating the appointment of the Chief Internal Auditor.
II. Amendments to the Financial Rules
XIII. INTERNAL AUDIT
Rule 13.10 Responsibilities of the Chief Internal Auditor
The current rule 13.10 will be renumbered 13.10(a) and would read as follows:
(a) Without derogating from the control and audit responsibilities of the Treasurer and the Financial Services, the Chief Internal Auditor shall carry out such independent examinations and make such reports to the Director-General as he may consider necessary, or as the Director-General or the persons designated by him may specifically require, in order to ensure an effective internal audit in accordance with paragraph (d) of article 30 of the Financial Regulations.
A new paragraph 13.10(b) would read as follows:
(b) The Chief Internal Auditor shall prepare a report for the Governing Body on significant findings resulting from internal audit and investigation assignments undertaken in each year. The Director-General shall submit this report, together with any comments thereon he deems appropriate, to the first session of the Governing Body in the following year. Additional reports on significant internal audit and investigation findings may be similarly prepared by the Chief Internal Auditor and submitted to the Governing Body in the same manner, should he deem this to be necessary.