Distr.

GENERAL

FCCC/SBI/1999/10

28 September 1999

Original: ENGLISH

SUBSIDIARY BODY FOR IMPLEMENTATION

Eleventh session

Bonn, 25 October - 5 November 1999

Items 12 (b) and (c) of the provisional agenda

Paragraphs Page

I. INTRODUCTION 1 - 5 3

A. Mandate 1 - 2 3

B. Scope of the note 3 - 4 3

C. Possible action by the SBI and the COP 5 4

II. INCOME AND EXPENDITURE REPORT FOR 1998-1999 6 - 31 4

A. Trust Fund for the Core Budget of UNFCCC 6 - 22 4

B. Trust Fund for Participation in the UNFCCC Process 23 - 25 10

C. Trust Fund for Supplementary Activities 26 - 28 11

D. Trust Fund for the Special Annual Contribution from the

Government of Germany (Bonn Fund) 29 - 31 13

GE.99-

Paragraphs Page

III. PERSONNEL 32 - 38 14

A. Staff 32 - 36 14

B. Consultants 37 - 38 16

IV. IMPLEMENTATION STATUS OF AUDIT OBSERVATIONS 39 - 41 17

V. ADMINISTRATIVE ARRANGEMENTS 42 - 44 18

VI. SCALE OF CONTRIBUTIONS 45 - 48 18

I. Draft decision on administrative and financial matters 20

II. Indicative scale of contributions to the Core Budget of the UNFCCC: 2000 21

1. Rule 10 (e) of the draft rules of procedure being applied (FCCC/CP/1996/2) stipulates that the provisional agenda for each ordinary session of the Conference of the Parties (COP) shall include, as appropriate, the proposed budget as well as all questions pertaining to the accounts and financial arrangements.

2. The Subsidiary Body for Implementation (SBI), at its tenth session, after taking note of the report of the Executive Secretary on administrative and financial matters, requested the Executive Secretary to incorporate relevant points into a draft omnibus decision on administrative and financial matters to be considered by the SBI at its eleventh session and to be recommended for adoption by the COP at its fifth session (COP 5) (FCCC/SBI/1999/8).

3. This document responds to the requests noted above, as follows:

(a) Section II contains information on financial performance during the biennium 1998-1999 as at 30 June 1999 for all four of the trust funds administered by the secretariat, namely the Trust Fund for the Core Budget of UNFCCC, the Trust Fund for Participation in the UNFCCC Process, the Trust Fund for Supplementary Activities and the Trust Fund for the Special Annual Contribution from the Government of Germany (Bonn Fund);

(b) Section III provides information on personnel matters, including on filling the approved posts and on the hiring of consultants;

(c) Section IV deals with the status of implementation of audit observations and recommendations;

(d) A brief update on the progress made regarding the administrative arrangements of the Convention is provided in section V;

(e) The last section raises an issue that concerns the determination of the indicative scale of contributions to the core budget.

4. This document should be read in conjunction with other documents relating to administrative and financial matters prepared by the secretariat for this session:

(a) The draft decision on the programme budget for the biennium 2000-2001 recommended by the SBI for adoption by COP 5 is contained in the report of the SBI on its tenth session (FCCC/SBI/1999/8, annex I);

(b) An addendum to this document has been issued to provide detailed information

on financial performance and programme delivery in the secretariat (FCCC/SBI/1999/10/Add.1);

(c) A report on the status of receipt of contributions to UNFCCC trust funds is contained in document FCCC/SBI/1999/INF.9; and

(d) The interim financial statements for the first year of the biennium 1998-1999 are provided as an information document (FCCC/SBI/1999/INF.11).

5. The SBI may wish to consider the above information, and recommend a draft omnibus decision to COP 5 for adoption. An initial draft for such a decision is contained in annex I to this document. The draft omnibus decision addresses a number of non-programme budget related matters, including the adoption of the indicative scale of contributions for 2000 and 2001.

6. The Conference of the Parties at its third session approved a total budget of $21,346,000 for the biennium 1998-1999 (decision 15/CP.3).⁽¹⁾ This budget is summarized in table 1 below, as slightly amended by the SBI at its eighth session to take into account the incorporation of the post-Kyoto contingency into the overall core budget.

	1998	1999	TOTAL
Programmatic expenditures	8 453 000	10 208 800	18 661 800
Overhead charge paid to United Nations	1 098 900	1 327 100	2 426 000
Increase in working capital reserve	93 400	164 800	258 200
TOTAL APPROVED BUDGET	9 645 300	11 700 700	21 346 000
Less contribution from the host Government	(887 600)**	(887 600)**	(1 775 200)
NET TOTAL BUDGET (to which the indicative scale of contributions is applied)	8 757 700	10 813 100	19 570 800

* Figures rounded off to the nearest $100.

** US$ 887,600 was calculated at the rate of US$ 1 = DM 1.69, prevailing at the time of the budget preparation, but actual receipts were only $837,989 in 1998 and $874,503 in 1999 as indicated in para. 8 below.

7. Table 2 represents contributions paid in full or in part for 1998 by 98 Parties, or 57 per cent of the total number of Parties to the Convention. 54 Parties have paid their 1999 contribution. Ten out of the twenty top contributors had not yet paid their 1999 contributions by 30 June 1999. (An update on the status of contributions as at 30 September 1999 can be found in FCCC/SBI/1999/INF.9.)

8. In addition to the above, voluntary contributions of $837,989 in 1998 and $874,503 in 1999 have been received from the host Government. Table 3 (a) takes these contributions into consideration.

	Indicative contributions	Contributions received (as at 30 June 1999)	Percent of total received
1998	8 757 700	7 778 758	88.8
1999	10 813 100	5 951 472	55.0
TOTAL	19 570 800	13 730 230	70.2

9. 1998-1999 expenditures as at 30 June 1999 are shown in tables 3 (a), (b) and (c). Table 3 (a) reflects a comparison between the approved budget, the paid contributions and the actual expenditures. Tables 3 (b) and (c) show expenditures by programme and by object of expenditure respectively. The budget shown in the tables is for the entire biennium, while the expenditures are as at 30 June 1999. Hence, full expenditures as at 30 June 1999 should be in

the range of 75 per cent of the approved budget.

10. Total expenditures through 30 June 1999 amounted to $11,885,482. This represents 56.4 per cent of the total approved budget, or 77 per cent of paid contributions. The lower level of expenditures of 56 per cent (as opposed to 75 per cent) as at 30 June 1999 can be attributed, at least in part, to financial prudence in response to cash flow. (It should be noted that authorization to use available cash resources, including carry-overs, was not given until the June 1999 sessions). To a certain extent, it could also be attributed to delays in filling posts and in effecting payments for which expenditures have been committed (e.g. contribution to IPCC). The expenditures for the second half of 1999 are expected to be relatively higher than the first half, as indicated in paragraph 11 below.

	Approved budget	Contributions received	Actual expenditures	Expenditure as a percentage of:
						Budget	Contributions received
1998	9 551 900	8 616 747	8 211 416	86.0	95.3
1999	11 535 900	6 825 975	3 674 066	31.9	53.8
TOTAL	21 087 800	15 442 722	11 885 482	56.4	77.0

* Budget and expenditures include 13 per cent administrative support costs, but not the working capital reserve.

(a) Expenditures by programme

11. As can be noted from table 3 (b), expenditures have been contained within original appropriations for all programmes. It is evident, however, that so far some programmes have spent less than their budgeted resource levels, owing largely to the fact that a number of posts were vacant for extended periods. However, expenditures during the second half of 1999 are expected to be proportionally higher than during the first half due to additional expenditures in relation to COP 5, payment of the annual contribution to IPCC, the filling of more vacant posts, and the holding of at least two workshops (on emission factors and implementation of Article 4.8 and 4.9) funded fully from the core budget.

Programme	1998-1999 Approved budget	Estimated expenditures (as at 30.6.99)	Per cent of expenditures**
Executive Direction and Management	1 264 100	818 656	64.8
Science and Technology	5 520 700	2 434 001	44.1
Implementation	5 067 600	3 188 533	63.0
Conference and Information Support	3 400 700	1 921 485	56.5
Resources, Planning and Coordination	3 408 700	2 155 451	63.3
TOTAL	18 661 800	10 518 126	56.4

* Budget and expenditures do not include 13 per cent administrative support costs.

** It should be noted that full expenditures as at 30 June 1999 should not exceed 75 per cent of the approved budget.

(b) Expenditures by object of expenditure

12. While the overall expenditures are well below the approved budget, expenditures on consultants and staff travel have gone over 75 per cent for the following reasons:

(a) Consultants: In addition to hiring expertise not available in the secretariat, this budget line has been used to hire personnel to carry out certain functions pending the filling of vacant posts;

(b) Travel: As noted in document FCCC/SBI/1999/3, the high level of expenditures on staff travel (over 75 per cent) can be explained by two factors. First, the amount includes expenditures for preparatory missions for COP 4 that will be reimbursed by the Government of Argentina. Secondly, the interest in the UNFCCC process generated by COP 3 led to a demand for secretariat participation in meetings that was greater than that provided for in the approved budget. Steps are being taken to ensure that expenditures on travel for the biennium do not exceed budgeted levels.

Object of expenditure	Budgeted amount	Estimated expenditures	Per cent
Staff costs	13 316 100	7 000 834	52.6
Consultants	905 000	821 494	90.8
Travel of participants	576 000	277 756	48.2
Travel of staff	944 500	749 896	79.4
General operating expenses	2 170 200	1 288 146	59.4
Grants and contributions	750 000	380 000	50.7
TOTAL	18 661 800	10 518 126	56.4

13. This section provides brief highlights on the main outputs achieved by each programme during the reporting period. Detailed information on programme performance at the subprogramme level is provided in addendum 1 to this document.

(a) Executive Direction and Management programme

14. The outputs of the Executive Direction and Management programme (EDM) have been consistent with those described in the programme budget of the Convention for the biennium 1998-1999 (see FCCC/CP/1997/INF.1). The Executive Secretary has provided ongoing management and coordination of the activities of the secretariat, as well as advice to the Convention bodies and their officers. In his external relations, he has attached a higher priority to promoting coordination among United Nations bodies, in addition to continuing to represent the interests of the UNFCCC at various intergovernmental meetings.

15. Time was invested, in cooperation with other programmes, in developing and revising a personnel policy, developing procedures for the use of supplementary funds, and recruiting senior staff. EDM has also started work with the Conference and Information Support programme on improving the system for recording, tracking and following up correspondence.

(b) Science and Technology programme

16. This programme supported the work of COP 4 and the eighth, ninth and tenth sessions of the Subsidiary Body for Scientific and Technological Advice by providing reports, studies and draft guidelines. Some of its main achievements are related to guidelines for reporting greenhouse gas (GHG) inventories by Annex I Parties; preparation of reports and organization of workshops on land-use, land-use change and forestry; methodological issues related to GHG inventories; preparation of reports and technical workshops on the Kyoto Protocol mechanisms; and reports related to technology, including supporting the launch of the technology transfer consultative process.

(c) Implementation programme

17. The programme supported the work of COP 4 and the eighth, ninth and tenth sessions of the SBI. Its main concentration over the reporting period was in supporting the development of guidelines for the preparation of national communications of Annex I Parties, maintaining the database on GHG emissions, facilitating consultations on procedures and mechanisms related to compliance under the Kyoto Protocol, coordinating in-depth reviews of second national communications from Annex I Parties, and launching initial actions on the programme of work to implement Articles 4.8 and 4.9 of the Convention and Articles 2.3 and 3.14 of the Kyoto Protocol.

18. It also facilitated financial and technical support to non-Annex I Parties for the preparation of their national communications, in cooperation with the GEF and its implementing agencies, and organized workshops and side events on capacity-building needs of non-Annex I Parties, on emission factors and activity data as well as on issues related to the implementation of the Convention by non-Annex I Parties.

(d) Conference and Information Support programme

19. The main achievements of this programme are related to making arrangements for, and servicing, COP 4 in Buenos Aires, held in conjunction with the ninth sessions of the subsidiary bodies, attended by more than 5,600 participants representing Parties, intergovernmental organizations, and non-governmental organizations. It also made arrangements for and serviced the eighth and tenth sessions of the subsidiary bodies in Bonn as well as several workshops.

20. In addition to providing information technology services, the programme facilitated internet broadcasts of COP proceedings, provided databases for GHG emissions, maintained the database of new ratifications of the Convention and the Kyoto Protocol, provided a database for participant registration, and maintained and further developed the UNFCCC web site, including special COP and subsidiary body modules.

21. In support of the initiative of the Executive Secretary, the programme has undertaken a number of activities in relation to collaboration among United Nations bodies, while also reaching out to key observer constituencies. These activities will eventually form the core of the outreach subprogramme to be implemented in the next biennium.

(e) Resources, Planning and Coordination programme

22. During the reporting period, this programme organized and supported four Bureau meetings and associated informal consultations by the President, as well as the plenary of COP 4, including preparing the associated documents for the session. It coordinated internal planning to facilitate integrated inputs of all programmes to COP 4 and the eighth, ninth and tenth sessions of the subsidiary bodies. Under RPC, the secretariat has provided all legal, financial and administrative services to the Convention. Notable achievements include the classification of all new secretariat posts, support to an extensive recruitment drive, and the drafting of a revised secretariat personnel policy, the processing of amendments to the lists contained in Annex I to the Convention and support to the opening for signature of the Kyoto Protocol.

23. Table 4 provides detailed information on income and expenditures under the Trust Fund for Participation in the UNFCCC Process. Further information on contributions as at 30 September 1999 will be contained in document FCCC/SBI/1999/INF.9.

24. As at 30 June 1999, contributions received for the biennium amounted to $1,823,043, while the expenditures thus far totalled $2,115,564, resulting in a shortfall of $292,521 in contributions over expenditures. However, owing to the substantial amount carried forward from the 1996-1997 biennium and adjustments on prior years' obligations, there is still sufficient balance to cover participation costs of all Parties eligible for financial support to participate in COP 5. At least one delegate from each eligible Party will be provided with financial support to attend COP 5. In addition, a second participant will be financed from each of the least developed countries and small island developing States.

25. Those Parties which are not least developed countries or small island developing States and which would normally be eligible for financial support to participate in the meetings of the Conference of the Parties and its subsidiary bodies, but which have not yet paid their contributions for 1996 through 1998, will not be considered for funding from the Trust Fund for Participation. As requested by the SBI at its tenth session, the Executive Secretary will prepare a note on how to respond to the situation of late payment of contributions for consideration at the SBI at its twelfth session (see FCCC/SBI/1999/8, para. 69 (d)).

26. Receipts for this trust fund by 30 June 1999 amounted to $2,802,791 ($1,670,918 in 1998 and $1,131,873 in 1999). Together with the balance brought forward from the previous biennium and accrued interest, the total amount available for supplementary activities during the biennium totalled $3,963,191, although a substantial portion of these contributions were earmarked and their use is restricted to finance specific activities. Information on contributions to the Trust Fund for Supplementary Activities as at 30 September 1999 is contained in document FCCC/SBI/1999/INF.9.

27. The actual expenditures in 1998 amounted to $1,255,130, with further commitments of $1,321,777 in 1999, to cover the following supplementary activities, for which approved funds are not available under the core budget:

Project	1998 expenditure (United States dollars)	1999 commitments (United States dollars)
Maintenance of information and outreach support capacity in the Convention secretariat. 3 professional and 1 GS posts have been created under this project to provide Parties and the secretariat with up-to-date information - including in electronic form.	473 731	283 800
Seconded staff bilaterally funded by Governments, notably by the USA and Japan under the Science and Technology subprogramme. The incumbents left the secretariat or were appointed to a core budget post. (Such staffing arrangements have now been terminated.)	272 584	7 130
African regional workshops on capacity-building and CDM (Dakar, May, October 1998 and May 1999). These workshops were organized at the initiative of the SBI Chairman and financed from contributions specifically made for this purpose.	175 304	61 000
Workshop on project-based mechanisms and activities implemented jointly (Abidjan, September 1998). The workshop brought together over 50 participants who helped to develop practical options on methodological, technical and institutional issues.	105 716	(24 059)
Workshops on land-use, land-use change and forestry (Article 3.4 of the Kyoto Protocol) (Rome, September 1998; Indianapolis, April 1998). 97 participants were brought together in Rome and 125 in Indianapolis, 35 of whom were provided with financial support.	35 747	118 847
Informal consultations on mechanisms provided for in Articles 6, 12 and 17 of the Kyoto Protocol (Buenos Aires, October 1998).	30 375	-
Technical workshop on mechanisms (Bonn, April 1999). The workshop was attended by 97 participants with the objective of producing operational guidelines on mechanisms under the Kyoto Protocol. 51 participants were provided with financial support.	-	259 300
Strengthening the activities of the non-Annex I subprogramme in the area of financial and technical cooperation. Through this project two posts, one P2 and one GS, have been created temporarily to support the subprogramme.	20 317	211 683
Regional workshops on transfer of technology. The first workshop will be held in August 1999 in Arusha, Tanzania, while the Asian and Latin American workshops are scheduled for early 2000.	-	150 000
Fellowship programme: as at 30 June 1999, five fellows from China, Colombia, Nigeria, the Philippines and the Russian Federation have been awarded three month fellowships for conducting research on climate change-related topics.	-	69 800
Improved management of supplementary funds. The main objective of this project is to provide support to the Executive Secretary in following up fund-raising issues and prioritizing the use of resources for supplementary activities. One post at P-2 level is financed under this project.	-	32 160
Total direct expenditures	1 113 774	1 169 661
Programme support costs	141 356	152 055
Total expenditures	1 255 130	1 321 717

28. The secretariat continues to undertake additional fund-raising activities in order to attract contributions for general supplementary activities as well as for specific purposes based on approved projects.

29. As part of its offer to host the secretariat in Bonn, the Government of Germany pledged a special annual contribution of DM 3.5 million to the UNFCCC to offset primarily the costs of organizing meetings and events in Germany. By 30 June 1999, 75 per cent of the total contribution for the current biennium (DM 5.25 million) was received. It has also been confirmed that the remaining amount of DM 1.75 million has already been remitted by the Government. The timely payment of these funds, in accordance with bilateral arrangements between the Government of Germany and the Convention secretariat, has helped to ensure the smooth organization of intergovernmental meetings in Bonn.

30. In 1998, over 67 per cent of the actual expenditures covered costs related to conference servicing and information activities. About 20 per cent was used to provide financial support to participants from developing countries and countries in economic transition to attend informal meetings and workshops in Bonn or in developing countries. The remaining 13 per cent is charged by the United Nations for administrative support.

31. The expenditure pattern in 1999 will be different, since the requirements for conference facilities will be higher as both of the annual sessional periods of Convention bodies will be convened in Bonn for the first time. A detailed income and expenditure report is provided in table 5.

	1998	1999
INCOME
Contributions*	1 949 997	1 944 594
Interest/miscellaneous income	27 126	33 927
TOTAL INCOME	1 977 123	1 978 521
EXPENDITURES
I. Conference support
Facilities	702 140	1 465 904
Staff	320 610	205 000
Travel	12 906	-
Subtotal I: Conference support	1 035 656	1 670 904
II. Information support
Staff	132 428	80 000
COP 4 Information	116 816	-
Publications and supplies	17 103	-
Subtotal II: Information support	266 347	80 000
III. Workshops	401 006	-
TOTAL (I, II and III)	1 703 009	1 750 904
Overhead charge	221 391	227 617
TOTAL EXPENDITURES	1 924 400	1 978 521

* Equivalent to DM 3.5 million each year.

32. For the tenth session of the SBI, the secretariat had reported developments in classifying, advertising and filling the approved posts under all sources of funding. Although some posts have since been filled, others were vacated. Therefore no significant progress has been achieved since the last report. The comparison between approved and filled posts as at 30 June 1999 is reflected in table 6.

	Core		Supplementary		Bonn Fund		Overhead		Total
Level	Approved	Filled	Approved	Filled	Approved	Filled	Approved	Filled	Approved	Filled
ASG	1	1							1	1
D-2	2	2							2	2
D-1	5	4							5	4
P-5	6	6	1	1			1	1	8	8
P-4	9	6			1	1	1	1	11	8
P-3	12	9	1	0	2	0			15	9
P-2	6	3	3	1	1	0			10	4
Subtotal	41	31	5	2	4	1	2	2	52	36
GS	22	20	2	2	5	4	5	5	34	31
TOTAL	63	51	7	4	9	5	7	7	86	67

33. "Filled" posts in the table refer to posts occupied by staff who have been given a fixed-term contract of one year or more, and are appointed against established posts after going through the complete recruitment process including review by the UNFCCC Appointment and Promotion Board. In addition to these, 8 professionals and 15 in the general service (GS) category have been hired under temporary assistance or short-term contracts as at 30 June 1999, bringing the total number of staff in the secretariat, excluding consultants, to 90.

34. Out of 41 professional posts funded from the core budget, 31 have been filled as at 30 June 1999. Meanwhile, the recruitment process of three candidates have been finalized. One started on 1 July 1999 and two started in August 1999, bringing the total of filled posts to 34. Of the remaining 7 posts, 3 are under recruitment and 4 have been frozen and the funds allocated to other staffing arrangements (e.g., temporary staff, consultants). Both of the vacant core posts in the GS category have been advertised and they will soon be filled. Meanwhile, the same services are being provided by temporary staff under short-term contracts.

35. Most of the vacant posts financed from the supplementary fund and the Bonn fund are also being used to finance the hiring of consultants or staff under "general temporary assistance". One post financed from the supplementary fund will be filled in August 1999. Two out of the four professional posts and one GS post under the Bonn Fund are occupied by staff under short-term contracts.

36. Information on the geographical distribution of the appointed staff on board is provided in tables 7 (a) and (b). While priority is given to professional competence and relevant experience, every attempt is made to ensure geographical diversity of staff in the professional category and above.

	Grade	Africa	Asia	L. America and Caribbean	E. Europe	W. Europe and others	Total
	ASG					1	1
	D-2	1				1	2
	D-1		1		1	2	4
	P-5	2	1	1	1	3	8
	P-4	2		2	1	3	8
	P-3	1	2	1		4	8
	P-2	1	2	1		1	5
TOTAL		7	6	5	3	15	36
Percent of total		19.4	16.7	13.9	8.3	41.7	100

	Grade	Annex I	Non-Annex I
	ASG		1
	D-2	1	1
	D-1	3	1
	P-5	4	4
	P-4	4	4
	P-3	4	4
	P-2	1	4
TOTAL		17	19
Percent of total		47.2	52.8

37. Between 1 January 1998 and 30 June 1999, 79 individual consultants have been hired, and provided a combined total of 155 months of work. One half of this total represented assistance in editing, conference management, information technology and administration, partly supplementing staff resources and partly filling gaps left by vacancies. The nature of these tasks and, in some cases, the linguistic requirements, direct the search for such services to the region in which the secretariat is located, thus skewing the geographical distribution of consultants towards those resident in Annex I Parties. The other half of the work months represented the provision of expertise not available within the secretariat. While such expertise is more easily found in Annex I Parties, an effort is being made to diversify sources so as to increase the input of experts from developing countries. An additional, and sometimes alternative, source of expertise is the roster of experts (see FCCC/SBSTA/1999/9).

38. Table 8 provides information on how such services were distributed among the various programmes.

Programme	Person-months	Cost
Executive Direction and Management	-	-
Science and Technology	51	328 404
Implementation	36	325 942
Conference and Information Support	56	107 150
Resources, Planning and Coordination	12	59 998
TOTAL	155	821 494

39. The secretariat was audited by the Office of the Internal Oversight Services (OIOS) of the United Nations in late 1997 and early 1998. The audit observations along with the efforts made to implement the recommendations were reported at COP 4.⁽²⁾ The COP, after taking note of the report, requested the Executive Secretary to complete the implementation of the recommendations and report the progress through the SBI. The update on the implementation is regularly reported to the OIOS and such reports will be made available to the SBI if so required.

40. In addition, the United Nations External Auditors conducted regular audits over the biennium. Their first report, together with the comments of the secretariat, was made available to the COP at its fourth session in document FCCC/CP/1998/9 and FCCC/CP/1998/10.

41. At the beginning of this year, the external auditors conducted another audit and submitted their report on 12 April 1999, covering issues regarding transfer of financial and administrative authority to the UNFCCC, establishment of automated financial management systems, as well as a recommendation on how to improve financial controls. Action to implement their recommendations is under way.

42. The progress made in implementing the transfer of the administrative responsibilities from the United Nations Office at Geneva to UNFCCC Bonn was reported to the SBI at its tenth session (see FCCC/SBI/1999/3, paras. 46-50).

43. Meanwhile, the secretariat continued to make progress in strengthening its human resource capabilities in preparation for the increased responsibilities.

44. It is expected that the secretariat will assume full responsibility for human resources administration in late 1999, with the transfer of financial functions following in 2000. After considering various options for information management systems, it has been decided that linking the secretariat into the Integrated Management Information System (IMIS) of the United Nations would be the most efficient and cost-effective option. The Financial Management and Administration subprogramme, together with the Information Support subprogramme, have started to make the necessary arrangements with UNOG to implement the linkage to IMIS before the end of 1999.

45. The COP, at its fifth session, must adopt a new indicative scale of contributions for 2000 and 2001. In the context of developing a proposed scale for consideration by the SBI, an issue has arisen covering the shares of those Parties which have hitherto been fixed, namely the United States of America and those with a minimum contribution of 0.001 per cent.

46. The financial procedures of the Convention stipulate that contributions "made each year by Parties on the basis of the indicative scale adopted by consensus by the Conference of the Parties, ... [are] based on such a scale of assessments of the United Nations as may be adopted from time to time by the General Assembly" (decision 17/CP.4, paras. 15-16).⁽³⁾ In past financial periods, the resulting scale of contributions of each Party had to be adjusted upwards in order to meet the difference between the United Nations membership and that of the UNFCCC. By virtue of the provisions of the financial procedures in effect at that time, namely that "no one contribution exceeds 25 per cent of the total", this upwards adjustment was not applied to the contribution of the United States of America, as its share was already at 25 per cent by virtue of the United Nations scale of assessments. This particular provision of the financial procedures, along with the provision for a minimum contribution of 0.001 per cent, were deleted through the process of amendment undertaken at COP 4, although, in adopting the new indicative scale, the COP did refer to the 25 per cent ceiling and the 0.001 minimum in its decision (17/CP.4).

47. For the coming financial period, the indicative contributions of most Parties can be adjusted downward, becoming slightly less than the percentages prescribed in the United Nations scale of assessments, due to nearly universal membership in the Convention and to the fact that a few Parties that do not contribute to the regular budget of the United Nations (and are not included in the United Nations scale of assessments) have become Parties to the UNFCCC.⁽⁴⁾ For the Parties whose contribution is 0.001 per cent, the adjustment downward is so small as to not affect the percentage share at three decimal places. For the United States, the question remains how to apply this adjustment in the context of the adoption by the COP of the new indicative scale "based on" the United Nations scale of assessments. The United States' share stands at 25 per cent in the United Nations scale of assessments.⁽⁵⁾

48. In agreeing on the 2000-2001 indicative scale of contributions, the SBI will need to consider the matter at this session and make a recommendation to COP 5. Two options can be identified:

(a) The percentage share of the United States could, in accordance with the general downward adjustment of contributions, be revised to 24.220 per cent; or

(b) The percentage share of the United States could be held at 25 per cent as a consequence of the calculation of the United Nations scale of assessments.

Other percentages shares would be adjusted accordingly. The two options are provided in annex II to the present document.

The Conference of the Parties,

Having considered the report of the Subsidiary Body for Implementation on its work on administrative and financial matters at its tenth and eleventh sessions, and having taken note of the reports by the Executive Secretary on the related subjects;

1. Adopts the indicative scale of contributions for 2000 and 2001 contained in the annex to this decision [to be completed];

2. Expresses its appreciation to the Parties that made their indicative contributions to the core budget in a timely manner, as well as those that made additional voluntary contributions to the Trust Fund for Participation in the UNFCCC Process and the Trust Fund for Supplementary Activities of the UNFCCC;

3. Also expresses its appreciation to the Government of Germany for its special contribution to cover costs of events held in Bonn or in developing countries (the Bonn Fund);

4. Expresses concern at the continuing trend toward late payment of contributions, some still outstanding from 1996 and 1997, and encourages all Parties that have not yet paid their contributions to do so without further delay;

5. Requests the Executive Secretary to present to the COP, through the SBI at its twelfth session, possible options to respond to the situation of late payment of contributions for consideration at its sixth session;

6. Authorizes the Executive Secretary to enter into commitments up to the level of the approved budget, drawing on available resources, including unspent balances or contributions from the previous financial period, pending an overall review at its sixth session, of the issue of the carry-over balance from the 1996-1997 biennium, to be undertaken on the basis of the recommendation from the Subsidiary Body for Implementation;

7. Takes note of the developments reported by the Executive Secretary in his discussions with the United Nations regarding administrative arrangements for the Convention;

8. Requests the Executive Secretary to continue with these discussions to achieve a more rational and efficient approach to the administrative arrangements between the secretariat and the United Nations, and to report to the SBI at its twelfth session on progress made in implementing the new administrative arrangements;

9. Takes note of the continuing action taken by the Executive Secretary to implement the recommendations made by both the internal and external auditors of the United Nations and invites the Executive Secretary to complete implementation as appropriate.

Party	Indicative scale			Party	Indicative scale
	I*	II**			I*	II**
Albania	0.003	0.003		Dominican Republic	0.015	0.014
Algeria	0.083	0.082		Ecuador	0.019	0.019
Antigua and Barbuda	0.002	0.002		Egypt	0.063	0.062
Argentina	1.069	1.057		El Salvador	0.012	0.012
Armenia	0.006	0.006		Eritrea	0.001	0.001
Australia	1.437	1.421		Estonia	0.012	0.012
Austria	0.913	0.903		Ethiopia	0.006	0.006
Azerbaijan	0.011	0.011		European Community	2.500	2.500
Bahamas	0.015	0.014		Fiji	0.004	0.004
Bahrain	0.016	0.016		Finland	0.526	0.520
Bangladesh	0.010	0.010		France	6.341	6.273
Barbados	0.008	0.008		Gabon	0.015	0.014
Belgium	1.070	1.058		Gambia	0.001	0.001
Belize	0.001	0.001		Georgia	0.007	0.007
Benin	0.002	0.002		Germany	9.550	9.448
Bhutan	0.001	0.001		Ghana	0.007	0.007
Bolivia	0.007	0.007		Greece	0.340	0.336
Botswana	0.010	0.010		Grenada	0.001	0.001
Brazil	1.425	1.410		Guatemala	0.017	0.017
Bulgaria	0.011	0.011		Guinea	0.003	0.003
Burkina Faso	0.002	0.002		Guinea-Bissau	0.001	0.001
Burundi	0.001	0.001		Guyana	0.001	0.001
Cambodia	0.001	0.001		Haiti	0.002	0.002
Cameroon	0.013	0.012		Honduras	0.003	0.003
Canada	2.647	2.619		Hungary	0.116	0.115
Cape Verde	0.002	0.002		Iceland	0.031	0.031
Central African Republic	0.001	0.001		India	0.290	0.287
Chad	0.001	0.001		Indonesia	0.182	0.180
Chile	0.132	0.130		Iran (Islamic Republic of)	0.156	0.154
China	0.964	0.954		Ireland	0.217	0.215
Colombia	0.106	0.104		Israel	0.339	0.335
Comoros	0.001	0.001		Italy	5.267	5.211
Congo	0.003	0.003		Jamaica	0.006	0.006
Cook Islands	0.001	0.001		Japan	19.931	19.719
Costa Rica	0.016	0.015		Jordan	0.006	0.006
Côte d'Ivoire	0.009	0.009		Kazakhstan	0.047	0.046
Croatia	0.029	0.029		Kenya	0.007	0.007
Cuba	0.023	0.023		Kiribati	0.001	0.001
Cyprus	0.033	0.033		Kuwait	0.124	0.123
Czech Republic	0.104	0.103		Lao People's Democratic Republic	0.001	0.001
Democratic People's Republic of Korea	0.015	0.014		Latvia	0.016	0.016
Democratic Republic of the Congo	0.007	0.007		Lebanon	0.016	0.015
Denmark	0.670	0.663		Lesotho	0.002	0.002
Djibouti	0.001	0.001		Libyan Arab Jamahiriya	0.120	0.119
Dominica	0.001	0.001		Liechtenstein	0.006	0.006
* Downward adjustment applied to all Parties (see para. 48 above).
** 25 per cent share retained for U.S.A. (see para. 48 above).
Party	Indicative scale			Party	Indicative scale
	I*	II**			I*	II**
Lithuania	0.015	0.014		Saint Vincent and the Grenadines	0.001	0.001
Luxembourg	0.066	0.065		Samoa	0.001	0.001
Madagascar	0.003	0.003		San Marino	0.002	0.002
Malawi	0.002	0.002		Saudi Arabia	0.544	0.539
Malaysia	0.177	0.175		Senegal	0.006	0.006
Maldives	0.001	0.001		Seychelles	0.002	0.002
Mali	0.002	0.002		Sierra Leone	0.001	0.001
Malta	0.014	0.013		Singapore	0.173	0.172
Marshall Islands	0.001	0.001		Slovakia	0.034	0.034
Mauritania	0.001	0.001		Slovenia	0.059	0.058
Mauritius	0.009	0.009		Solomon Islands	0.001	0.001
Mexico	0.964	0.954		South Africa	0.355	0.351
Micronesia (Federated States of)	0.001	0.001		Spain	2.510	2.483
Monaco	0.004	0.004		Sri Lanka	0.012	0.012
Mongolia	0.002	0.002		Sudan	0.007	0.007
Morocco	0.040	0.039		Suriname	0.004	0.004
Mozambique	0.001	0.001		Swaziland	0.002	0.002
Myanmar	0.008	0.008		Sweden	1.045	1.034
Namibia	0.007	0.007		Switzerland	1.177	1.165
Nauru	0.001	0.001		Syrian Arab Republic	0.062	0.061
Nepal	0.004	0.004		Tajikistan	0.004	0.004
Netherlands	1.581	1.564		Thailand	0.165	0.163
New Zealand	0.214	0.212		The Former Yugoslav Republic of Macedonia	0.004	0.004
Nicaragua	0.001	0.001		Togo	0.001	0.001
Niger	0.002	0.002		Tonga	0.001	0.001
Nigeria	0.031	0.031		Trinidad and Tobago	0.016	0.015
Niue	0.001	0.001		Tunisia	0.027	0.027
Norway	0.591	0.585		Turkmenistan	0.006	0.006
Oman	0.049	0.049		Tuvalu	0.001	0.001
Pakistan	0.057	0.057		Uganda	0.004	0.004
Panama	0.013	0.012		Ukraine	0.184	0.182
Papua New Guinea	0.007	0.007		United Arab Emirates	0.172	0.171
Paraguay	0.014	0.013		United Kingdom	4.933	4.881
Peru	0.096	0.095		United Republic of Tanzania	0.003	0.003
Philippines	0.078	0.078		United States of America	24.220	25.000
Poland	0.190	0.188		Uruguay	0.047	0.046
Portugal	0.418	0.413		Uzbekistan	0.024	0.024
Qatar	0.032	0.032		Vanuatu	0.001	0.001
Republic of Korea	0.975	0.964		Venezuela	0.155	0.153
Republic of Moldova	0.010	0.010		Viet Nam	0.007	0.007
Romania	0.054	0.054		Yemen	0.010	0.010
Russian Federation	1.043	1.032		Yugoslavia	0.025	0.025
Rwanda	0.001	0.001		Zambia	0.002	0.002
Saint Kitts and Nevis	0.001	0.001		Zimbabwe	0.009	0.009
Saint Lucia	0.001	0.001		TOTAL	100	100
* Downward adjustment applied to all Parties (see para. 48 above).
** 25 per cent share retained for U.S.A. (see para. 48 above).

1. See document FCCC/CP/1997/7, Add.1.

2. See document FCCC/CP/1998/INF.1.

3. According to decision 17/CP.4, paras. 15 and 16: "[15.] [The Conference of the Parties] Adopts the new indicative scale for the biennium 1998-1999 adjusted so as to ensure that no Party contributes less than 0.001 per cent of the total; that no one contribution exceeds 25 per cent of the total; and that no contribution from a least developed country Party exceeds 0.01 per cent"; and [16.] [The Conference of the Parties] "Amends paragraph 7 (a) of the financial procedures (as contained in decision 15/CP.1, annex I) to read as follows: "Contributions made each year by Parties on the basis of the indicative scale adopted by consensus by the Conference of the Parties, and based on such a scale of assessments of the United Nations as may be adopted from time to time by the General Assembly". See document FCCC/CP/1998/16/Add.1.

4. Notably the European Community (2.5 per cent).

5. In the absence of a ceiling, the United States' share of the United Nations scale of assessments would, according to the applicable methodology, stand at approximately 29 per cent.