Committee on Technical Cooperation
THIRD ITEM ON THE AGENDA
Further developments concerning operational activities in the United Nations system
1. This paper is intended to provide the Committee with a summary of major developments concerning the operational activities of the UN system and to assess, where appropriate, the implications for the ILO's programmes.
2. As mentioned in the previous report on this subject,(1) it has become repetitive to note that the whole UN system has entered a period of change and reform. However, in the intervening period, the focus on reform in the UN and of the UN system has intensified, dominating discussions in all the major intergovernmental and inter-agency bodies, and covering the global mandates and substantive tasks and functions of the UN system to discussions on governance and financing, the relationships and division of work between UN system organizations, and managerial and administrative reform at all levels.
3. As the Secretary-General of the United Nations, Mr. Kofi Annan, noted in introducing his package of reform proposals earlier in the year, "reform is a process, not an event". Many of the issues under discussion, notably those concerning governance and financing, involve reviewing the UN Charter and will require extensive and long-term political negotiations that may continue into the next century. However, the complex of interrelated reform processes has accelerated recently as a result of a combination of factors:
4. As the General Assembly is beginning its examination of the many aspects of reform this autumn, there is a feeling of a certain momentum towards constructive negotiations on UN reform between member States of the UN and the agencies of the United Nations system.(3)
5. So far the most visible changes are taking place in the area of operational activities for development, both as a result of processes already under way in intergovernmental and inter-agency fora and in terms of specific new initiatives and proposals included in the UN reform packages presented by the Secretary-General in two stages in March and July of this year. It is also in this area that the many UN funds, programmes and specialized agencies are most closely associated in practical collaboration. Last year's report contained an outline of an emerging new paradigm for the UN system's development activities as regards substantive orientations and organizational arrangements at the country level. The major elements of this paradigm are being reinforced by a major thrust in the reforms already under way that is aimed at creating the conditions for greater unity of action at the global or headquarters level: this involves framing the substantive orientation of the UN system's activities in development and making the organizational arrangements for improved and coordinated action. The principal managerial and organizational changes in this regard are outlined below.
6. There is considerable interest in, and indeed political pressure on, the UN system's activities for follow-up on the series of global UN-sponsored conferences of the 1990s. The programmes of action adopted at these conferences, with their complementary, overlapping and interlocking goals and targets, are generally seen as providing a broad common policy platform for international development cooperation. More specifically, they are seen as an opportunity for the variety of UN system agencies to operate and coordinate their action within a framework of common objectives. This framework will provide each agency with a clear focus and priorities for its action in accordance with its specific mandate and area of competence, while also indicating areas for collaboration and joint action, thereby also providing a management matrix that should enable the complex UN system to define and assign roles and responsibilities between the agencies at the global, regional and country levels.
7. The opportunity created by the global conferences and the expectations raised as regards the UN system's performance are intricately linked to the debate over the UN system's particular role in development vis-à-vis other actors, such as development banks, bilateral donors, NGOs and the private sector. It is increasingly recognized that what sets the UN system apart -- its comparative advantage -- is that its action is based on international agreements and compacts, and that the promotion of normative goals should hence be integrated into and promoted through its operational activities. At a time of shrinking resources for international development cooperation, it is furthermore recognized that the agencies of the UN system, both collectively and individually, should focus on and reinforce the interaction between its technical cooperation and normative functions. These links are of course not new to the ILO. The fact that it is increasingly recognized in the wider UN system may also generate greater openness and receptivity to ILO standards in the programmes of other agencies.
8. In this context the Consultative Committee on Programme and Operational Questions (CCPOQ)(4) at its meeting in March 1997 reviewed the status of implementation of global programmes of action and the future arrangements for integrated and coordinated action by the UN system. Its recommendation, subsequently endorsed by the Administrative Committee on Coordination (ACC),(5) was that these complex issues, with their substantive and organizational dimensions, should be examined in depth in a workshop setting. This workshop, aimed at producing practically useful elements and operational guidelines for UN-system field representatives, will be held in December at the UN Staff College at the International Training Centre of the ILO, Turin. It will examine existing follow-up mechanisms at both the intergovernmental and inter-agency levels, and review the experience and outputs of the three inter-agency task forces set up by the ACC (the ILO chaired the ACC Task Force on Full Employment and Sustainable Livelihoods), as an issue common to the Social Summit and the other global conferences. The results of these inter-agency discussions, which will also incorporate the conclusions of discussions held in the agencies' executive bodies, will also produce proposals and recommendations on the most effective kinds of assistance the UN system can produce to help countries reach the various global targets and commitments, and on practical arrangements for coordination and concerted action within the UN system in this regard.
9. Ultimately, deliberations on these issues within the inter-agency bodies point to new, more flexible arrangements for coordination and collaboration within the UN system at all levels where issues are entrusted either on an ad hoc or on a more long-term basis to an issues manager or task manager, who ensures coordination between the organizations directly concerned or interested in the issue. Within such arrangements the ILO could be called upon to assume leadership and a coordinating role on specific priority issues in a given context, such as child labour, the protection of workers' rights, employment policy and other areas of priority for the ILO.
10. As mentioned in earlier reports, it is in the areas of governance and financing that the process of reform naturally moves most slowly. As regards governance, changes in this area -- however desirable they may be thought -- will inevitably result in realignments in the way political power is exercised at the different levels of the UN system and between the executive bodies and constituencies of the different organizations. In spite of the complexity and the slow speed at which the reform of UN-system governance is moving, a few significant developments affecting operational activities have occurred and deserve comment.
11. First, there is in the reform proposals presented by groups of countries, and in the Secretary-General's proposals, a clear recognition of ECOSOC as the weak link between the overall policy-setting role of the General Assembly and the individual executive bodies of individual UN funds, programmes and specialized agencies. It has long been recognized that ECOSOC, with its present format and working methods, is unable to exercise effectively its mandate for policy coordination of the wide range of sectoral issues addressed in various ways by the panoply of UN-system entities.
12. The Secretary-General's proposals stop short of more radical proposals put forward by others wishing ECOSOC to become a real governance superstructure for development activities and regular programmes in the social and economic fields and to exercise some degree of supervision, for example, over the programmes and budgets of individual agencies. The Secretary-General's proposals for more gradual reforms and qualitative improvements may stand a better chance of being accepted in the shorter term. His proposal is to enhance ECOSOC through a more clearly, thematically focused structuring of its agenda, to rationalize its subsidiary committees, and to enhance the quality of discussions by improved preparations in the UN secretariat and at the inter-agency level, and to ensure a higher level of participation of government representatives.
13. Previous reforms of the governance arrangements for the UN funds and programmes (UNDP, UNFPA, UNICEF and WFP) have, as reported earlier, resulted in the transformation of their governing bodies into smaller executive boards which operate in a more business-like fashion, interacting more frequently in the overall management of the respective organizations. The closer integration of these funds and programmes at the managerial and operational level, as described below, will inevitably lead to some consolidation of the different executive boards and the introduction of joint meetings covering shared issues.
14. As regards the financing of development activities in the UN system, the decline in Official Development Assistance (ODA) witnessed in recent years was arrested somewhat in 1996, but there is no cause for complacency or for any belief that the trend will be significantly reversed. Discussions in ECOSOC, which devoted the high-level operational activities segment of its 1997 substantive session to the issue of financing, have instead focused on ways to ensure the funding of UN-system development activities on a more predictable basis so as to avoid the ravaging effects on planning of the extreme fluctuations in resources allocated, which have become the norm in recent years.
15. These discussions still depart from ideas originally presented by the Nordic countries for a three-tier funding system consisting of:
(a) assessed contributions in line with regular budget contributions to cover fixed costs, i.e. the core administrative costs;
(b) negotiated pledges along the lines of the replenishment exercises for the "soft windows" of the international and regional development banks;
(c) voluntary contributions as at present.
This proposal would have the added benefits of greater equity and burden sharing between countries, based on the ability to pay, and would also result in additional resources for development activities, as a greater part of the administrative structures would come under the regular budgets. However, there is no consensus on these proposals, and the interim agreement is instead a joint commitment, on the one hand for member States to provide resources on a more predictable and multi-year basis, on the other hand for the UN system to base resource planning on realistic assessments of the resources to be made available, rather than setting over- ambitious targets as a means of pressurizing donors to provide more.
16. In this rather stagnant situation, interest is turning from traditional state-funded ODA, channelled through the central funding mechanisms, towards new and innovative sources of financing and towards proactive resource mobilization at all levels. This concept is now becoming an integral part of resource mobilization strategies in practically all organizations. In his Track II proposals the Secretary-General is proposing to create a special office for development financing. Supplementing the resource mobilization functions of individual UN agencies, this office will explore and promote various forms of private-sector financing, including the much debated ideas being floated for various forms of taxation of international and supernational transactions. In the short term the establishment of a foundation to permit the UN to receive tax-free donations for UN-system development and humanitarian operations from private corporations and individuals is expected to produce significant results.
17. The situation prevailing as regards the funding of UN-system development cooperation has become increasingly complex, and in some respects contradictory, as illustrated by the evolution of the relationship between UNDP and the specialized agencies: after successive years of declining or stagnating contributions to its core resources, UNDP has been forced to seek new substantive roles for itself to develop marketable products and services and increasingly to draw on its limited core resources as seed money to attract additional core resources. As a result UNDP has each year been able to increase the volume of resources under its management, while the involvement of its traditional UN-system partners in the programming and implementation of these resources, the specialized agencies, have declined. By contrast, after successive years of declining resources from the central funding window of UNDP, the specialized agencies have been obliged to develop proactive resource mobilization of their own and have, in that sense, become funding agencies in their own right.
18. The scope and range of reform proposals presented by the Secretary-General(6) are too extensive, even just in the area of operational activities for development, to be adequately summarized here. Therefore only those measures are highlighted below that are of particular significance and have implications for the ILO's collaboration with the larger UN system.
19. The Secretary-General indicated shortly after taking office his intention to move forward in a two-staged approach, as mentioned above. While the first set contained a fast track of measures that could be implemented immediately under his authority, the second set of more extensive measures would require discussions with, and ultimately endorsement by, the member States. He also referred to a set of wider issues, which will require changes in the constitutional basis of the UN, reviewing the UN Charter and reassessing the relationships and functioning of the entire UN system. To initiate deliberations on the latter extremely complex set of issues he is proposing the establishment of a special ministerial-level committee.
20. In line with this approach, the ILO and other specialized agencies have been briefed, but not directly consulted, on the initial stages of the process. As changes in the institutional arrangements and modalities of programming the UN's development activities will inevitably have implications for the entire UN system, the ILO has followed the process with close interest. As regards operational activities the most important change is the creation of the UN Development Group (UNDG) whose core members are UNDP, UNFPA and UNICEF, but with other UN entities participating on a more ad hoc basis according to their interests and mandate. The UNDG is managed by an Executive Committee, comprised of the executive heads of the UN funds and programmes, and is chaired by the administrator of UNDP.
21. The creation of the Development Group and its Executive Committee, the result of considerable efforts in different directions by forces both within and outside the UN, falls short of what some had expected and wanted, while others fear it will result in the creation of a more monolithic, centrally managed UN development agency. Under the proposed arrangements the individual funds and programmes will retain their own line management, corporate identity, constituency base, and resource mobilization functions. Seen from the perspective of the specialized agencies, including that of the ILO, the creation of the Development Group will establish a new partner in development, more powerful than the sum of its parts, with more authority and a greater resource base, which will clearly, over time, bring about important changes in the relationship and modalities for collaboration with the UN and its funds and programmes.
22. As the intended objectives -- greater coherence, effectiveness and impact -- of this consolidation of the UN's development agencies take root, the ILO for its part has noted that the Development Group is intended to provide unity of action and synergies between the different areas of the entire UN system, that there are also proposals to strengthen the substantive technical support to development programmes and to link normative action closer to development, and that the consolidation of the Development Group at a higher level than its constituent parts will enable specialized agencies, such as the ILO, to interact with a body that is one step removed from the institutional interests of its constituent components.
23. As a highly visible manifestation of the objective of greater operational unity behind the creation of the Development Group, the Secretary-General has introduced a new programming and resource planning instrument, the United Nations Development Assistance Framework (UNDAF) and requested the Development Group to ensure its pilot implementation in at least ten countries before the end of 1997. Following the development of guidelines and formats for the UNDAF by the Executive Committee, this process is now well under way. The UNDAF, where it exists, is described as derived from the Country Strategy Note (CSN),(7) or other general policy instruments outlining a given country's development priorities and strategy. It should function as a more solid common management framework for the planning, programming and implementation of, in the first place, the activities of the Development Group organizations in line with national objectives.
24. It is evident that the UNDAF will introduce significant changes in the way the UN system approaches the programming of development cooperation, away from the separate, sometimes overlapping, programming exercises of each individual organization. As such, the UNDAF will provide the missing link between the CSNs and the individual activities of UN organizations, in translating the broad objectives into a management framework with assigned tasks and resource allocations.
25. The ILO has noted the somewhat ambiguous nature of the UNDAF. On the one hand it is described as applying to the UN funds and programmes and only they are committed to its application. At the same time other partners in the UN system are invited to join in their preparation. It is also difficult to see how the UNDAF, framed on one side by the CSN, and on the other by programme implementation -- both of which implicate the entire UN system -- can become meaningful if only applying to the Development Group. Reports are being received from ILO area offices that the ILO is being invited to participate in the UNDAF process and that this is taking place. The issue raised by the UNDAF for the ILO is mainly whether this new programming tool will enable the ILO to contribute from its substantive experience to and derive benefits from the UNDAF in ways that will reinforce its own programmes as defined with its constituents in the country objectives exercises. This includes the important question of how the UNDAF will be used for resource mobilization, both from the funding agencies and from other donors.
26. The Secretary-General's proposals for reforms at the country level also include a series of measures to further strengthen the Resident Coordinator system. These measures follow the thrust of recent General Assembly resolutions and ACC agreement on this subject, while going some steps further in clearly designating the Resident Coordinator as the senior ranking UN-system official and the Secretary-General's representative directing the activities of the UN funds and programmes in the Development Group, and as team leader of the UN country team and the Resident Coordinator system. The function of Resident Coordinator is intricately linked to the function of UNDP Resident Representative, while the incumbent is required to make a clear distinction between the two. In return, prospection for candidates for these assignments is now widened to the major UN funds and programmes and specialized agencies.
27. Another significant element in the arrangements for country-level coordination of particular relevance to the ILO is the notion of thematic groups, directed or coordinated by a lead agency operating under the Resident Coordinator system. Such arrangements, reflecting at the country level the global-level task manager system (see paragraph 9), offer opportunities for the ILO to lead or support broader UN-system activities in areas of particular concern to the ILO or where it has a clear comparative advantage.
28. Considerable importance is attached to the issues of common premises and common services, for reasons of cost-effectiveness and economies of scale, and for the more intrinsic and symbolic value of demonstrating and fostering unity and team work by housing the UN family in a UN House in each country. In principle, specialized agencies are invited to share in such common premises, and there is a certain onus on them to do so. The ILO remains positive to these concepts, and does in fact share premises with other UN organizations in several duty stations, with the proviso that particular circumstances, including constituents' need for unrestricted access to ILO offices, as well as cost considerations, should be taken into account in evaluating each case.
29. UNDP remains the largest single donor for ILO technical cooperation activities, and in many countries is the only really viable source of extra-budgetary financing. Participation in the development and implementation of UNDP programmes links the ILO directly to the wider UN-system programmes. Changes in UNDP, reported earlier, therefore directly influence the volume, substantive direction and types of ILO technical cooperation.
30. The Annual Meeting of UNDP's Executive Board, held in May 1997, reached the final stage of its work on internal organizational and managerial reforms in UNDP, referred to as the Change Management Process. At the meeting the administrator stressed that these changes should in no way be seen as detracting from the earlier decisions of the Executive Board to reorient UNDP's substantive focus towards the Sustainable Human Development paradigm and redefine its functional relationships with other partners, but rather, should be seen as measures to enable UNDP to manage this new mandate more effectively. While these measures mainly concern internal changes in UNDP, in view of the role played by UNDP at the centre of UN-system development cooperation they will have an impact on arrangements and modalities for collaboration with its UN-system partners, such as the ILO.
31. There are three main elements in the change process: (a) decentralization; (b) restructuring at headquarters; and (c) a new resource mobilization strategy. As regards the first two, it is interesting to note that the major feature is a redistribution of roles and responsibilities between UNDP headquarters and its network of field offices, which bears some resemblance to the process carried out in the ILO with the implementation of the Active Partnership Policy. In the new structure, UNDP headquarters will shift from an ex-ante to an ex-post role in programme and project development and approval, with responsibility for programme and project formulation delegated entirely to the field level, whereas headquarters will exercise ex-post quality control, monitoring and evaluation.
32. UNDP headquarters will also progressively move away from its traditional technical backstopping and service-centre role, which is being decentralized. Again, the most interesting feature of the changes being introduced is the establishment of a network of 15 so-called subregional resource facilities (SURFs) which will handle support tasks very similar to those of the ILO's multidisciplinary teams. Considering UNDP's limited resources in relation to its extensive field structure, the SURFs will be set up progressively over the next three years; they will be relatively light, with only two or three international staff, the intention being -- and this is a significant difference from the blueprint for the ILO's MDTs -- that they will not themselves be physically the source or provider of technical services. Instead, they will act as focal points or catalysts for relevant technical support available in the subregion to programmes and projects, thus orchestrating a network of local institutions, consultants, NGOs and UN-agency specialists. With similar subregional coverage to the ILO's MDTs, they will not be independent entities, but will be housed in a UNDP country office and report to the UNDP Resident Representative.
33. The SURFs should not, as stressed by UNDP's Executive Board and affirmed by UNDP's management, in any way duplicate or compete with the existing decentralized technical expertise of the UN system, such as the ILO's MDTs or that of other major technical agencies, or of the World Bank, which is also decentralizing technical support and reinforcing its field structure. If this is the case, the new SURFs -- often located in the same duty station as the MDTs -- may provide a new point of entry for collaboration, closer to the countries being served, and will make possible a more technically focused dialogue between the ILO's technical specialists and the UNDP's structure for mobilizing substantive support.
34. As regards resource mobilization, the main elements in UNDP's strategy have been discussed above in the section entitled "Governance and financing". The main elements -- diversified funding, expanding cooperation with donors, combining multilateral, bilateral and private-sector sources and mobilizing all levels of the organization, particularly country offices, in the funding strategy -- resemble certain elements of the proposed ILO strategy for resource mobilization.(8) In view of UNDP's role in aid coordination, the central ground it occupies as the counterpart to central government ministries, its close ties to other donors and its greater resource base, the ILO -- and others -- can expect intense competition from UNDP, and pressure to channel resources mobilized from multibilateral donors at the country level through UNDP arrangements. Conversely, the emphasis on resource mobilization at the national level, underpinned by the pressure on UNDP offices to reach quantitative resource mobilization targets, may also make UNDP more interested in supporting ILO project ideas and thus open opportunities for joint resource mobilization vis-à-vis other donors.
Geneva, 23 September 1997.