VZCZCXYZ0013
PP RUEHWEB

DE RUCNDT #1135/01 3411608
ZNR UUUUU ZZH
P 071608Z DEC 07
FM USMISSION USUN NEW YORK
TO SECSTATE WASHDC PRIORITY 3282

UNCLAS USUN NEW YORK 001135 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: AORC UNGA
SUBJECT: CONCEPTS FOR BUDGET NEGOTIATIONS ON THE 2008/2009 
BUDGET 
 
¶1.  The draft resolution on the 2008/2009 biennium budget 
constituting a compendium of proposals from the G-77, EU, 
CANZ and others, is expected to be distributed at the end of 
this week.  In anticipation of the intense negotiations that 
will begin next week, Ambassador Wallace and the USUN/MR team 
prepared a memorandum outlining for Ambassador Khalilzad the 
concepts for the negotiations on the 2008/2009 budget.  The 
memo introduced five (not mutually exclusive) across the 
board approaches that could result in significant savings. 
All five concepts in paras 2-6 have the benefit of pushing 
the SYG and the UN to be more efficient in the use of its 
resources - to do more with less, something the USG and other 
governments are routinely asked to do.  There are, of course, 
obstacles that each option will encounter.  The memo 
recommends that all five approaches be advocated with a goal 
of advocating a principled approach to budgeting and 
returning to the zero growth concept, adopting some 
reasonable across the board cuts; paras 2-6 briefly describes 
the five approaches and provides analysis on the potential 
outcomes. 
 
¶2.  Concept 1 - Seek to agree in principle to the proposed 
$4.19 billion dollar budget and potential $.8 billion or so 
in "add ons" but require the Secretariat to absorb the "add 
ons" within existing resources.  This approach is the 
simplest to apply in principle but it will be criticized for 
granting the SYG such a a wide ranging opportunity to manage 
the UN. 
 
¶3.  Concept 2 - Establish a UN "real overhead" figure 
baseline for the 2006/2007 budget, and hold the UN to a "real 
overhead" baseline in future budgets.  This approach has the 
prospect of significant savings without the need to delegate 
to the SYG sweeping authority to use positions and resources 
as he sees fit.  However, because of its uniform application 
across the board to each and every office and program, it 
lacks the flexibility to differentiate the well managed 
entities from poorly managed entities.  Of course, seeking to 
allow for distinctions is a formula for endless debate, 
especially within the Fifth Committee.  On the other hand, 
the SYG could be granted limited discretion under exceptional 
circumstances, to be defined, to depart from the overall 
vacancy rate or reduction in non-post costs. 
 
¶4.  Concept 3 - Seek an across the board budget reduction on 
a percentage basis.  For example, freeze vacancy rate and 
hiring at a particular level and establish a fixed 
(percentage) reduction in non-post costs for the UN overall, 
but grant the SYG wide discretion to determine how to achieve 
the overall vacancy rate and fixed reduction in non-post 
costs.  This approach may avoid the criticism that the 
concept of "real overhead" will draw, but does have the 
potential to significantly reduce both post and non-post 
costs while at the same time minimizing the risk of criticism 
that the approach penalizes well managed entities within the 
Organization, as it would place the burden on the SYG. 
However, there is a risk that the SYG would exercise this 
authority to favor programs that he supports at the expense 
of programs that we support. 
 
¶5.  Concept 4 - Specifically request the SYG to propose 
itemized action on mandate review to offset the exact 
percentage increase ultimately adopted in the budget and tie 
the budget increase to the organization wide adoption of all 
UNTAI reforms.  Our greatest leverage at the UN is that we 
pay the lion share of the UN budget - 22%.  If we are asked 
to fund such an extraordinary increase in the budget member 
states should agree to real and legitimate standards of 
transparency and accountability across the UN system.  Member 
states will likely object to tying any reforms, including 
mandate review and UNTAI, to the adoption of the budget. 
However, by permitting the SYG to propose the most sensible 
elimination of duplicative and no longer applicable mandates 
we may obtain a viable path forward on mandate review and 
identify savings to offset the enormous increase in the 
budget. 
 
¶6.  Concept 5 - Seek action on the UN budget similar to a 
continuing resolution that would permit the UN to continue 
operating in the new year and permit the member states to 
view the entire budget precisely and holistically and permit 
the SYG to report back on other areas described above. 
Unlike the previous budget "cap" agreed to by the General 
Assembly, this approach would not tie further action on the 
budget to any specific reform  Although an unusual practice, 
the Fifth Committee Chairman from Malaysia, Hamidon Ali, has 
proposed this exact approach to continue the Procurement Task 
Force (PTF).  Such an approach addresses the inappropriate 
piece-meal and ad hoc approach as currently proposed by the 
SYG. 
 
¶7.  As a first step after discussing all five options with 
Ambassador Khalilzad, USUN has begun to explore the 
 
 
possibility of a continuing resolution with Secretariat 
officials and other member states. 
 
¶8.  None of these options will be easy to advocate nor 
certainly delivered. 
Khalilzad