1 PROPOSED PROGRAM-BUDGET FOR 2012 Overview and Guide August 26, 2011 Presentation for CAAP

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PROPOSED PROGRAM-BUDGET FOR 2012 Overview and Guide

August 26, 2011

Presentation for CAAP

Table of contents

Overview• Role of CAAP and Basic Documents 3-4• Roles in decision-making: Aug. – Oct. 2011 6• San Salvador General Assembly Resolution 5

Proposed Program-Budget for 2012• Program-Budget of the Organization – Budget levels for 2011 and 2012 7• Key Criteria Considered in Formulating the 2012 Budget Proposal 8

Secretary General’s Proposal• Assumptions 9• Personnel (Object 1) 10-

12• Non-Personnel (Objects 2-9) 13-15

Analysis• 2011-2012 Distribution & Variations by Programmatic Areas – All Funds 16-

18• 2011-2012 Distribution & Variations by Programmatic Areas – Regular Fund 19-

21• Changes in Programmatic Structure in 2012 (vs. 2011) 22

In conclusion 23

Page

3

Role of CAAP

• Examines, evaluates and makes recommendations to the Permanent Council (PC) in relation to the programs, budget, administration, and financial aspects of the operations of the GS/OAS referred to it by the PC.

• Reviews periodic GS/OAS resource management reports (budgetary, financial and administrative).

• Monitors implementation of mandates and other measures of performance, as required by the PC or the General Assembly (GA).

• Prepares the draft annual Program-Budget Resolution for consideration by the Preparatory Committee of the GA.

Source: Rules of Procedure of the Permanent Council: http://scm.oas.org/doc_public/ENGLISH/HIST_03/CP11732E07.DOC

http://scm.oas.org/doc_public/ENGLISH/HIST_03/CP11732E07.DOC

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CAAP Basic Documents

Legal Framework, Mandates: Charter of the OAS. General Standards to Govern the Operations of the GS/OAS. Budget resolutions:

• AG/RES. 1 (XL-E/10) “Program-Budget of the Regular Fund of the Organization for 2011, quota assessments and contributions to FEMCIDI for 2011;”

• AG/RES. 2696 (XLI – O/11) “Financing of the 2012 Program-Budget of the Organization.”

Additional Key Documents: Proposed Program-Budget of the Organization for 2012 [CP/doc. 4657/11]. Quarterly Resource Management Reports, Financial Statements, and other CAAP

documents issued in 2010/11. “Report to the Permanent Council – Annual Audit of Accounts and Financial

Statements for the years ended December 31, 2010 and 2009” [CP/doc.4555/11].

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CAAP• Analysis of the Secretary General’s Proposal.• Reach consensus on modifications, if any.• Agree on the wording of the Budget Resolution.• Examine other topics:

– Provisions of an administrative and budgetary nature (Section III of the budget resolution).

– Proposed changes to the General Standards in support of efforts to reengineer and streamline human resources management.

Secretariat for Administration and Finance (SAF)• Provide technical support to the CAAP.• Incorporate CAAP agreements into the budget document.

Committee Secretary• Arrange scheduling of formal and informal meetings, preparation of minutes, and

participation of other GS/OAS areas in the deliberations of the CAAP.

Roles in decision-making: Aug. – Oct. 2011

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General Assembly Budget ResolutionAG/RES. 2696 (XLI – O/11)

Resolves,

“To set the overall budget level of the Regular Fund program-budget for 2012 at $85,350,800, and to finance it as follows” (figures in millions of USD):

FinancingContributions of member states in the form of Regular Fund Quota Assessments 80.7$

Admin. & tech. support from FEMCIDI 0.3

Transfer from Spercific Fund indirect cost 2.5recovery (ICR)

Other income * 1.8

Total Approved Funding 85.3$

* Includes interest, rentals and repayments

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Projected Budget Level for 2012

Program-Budget of the Organization for 2012(Figures in thousands of USD)

Approved Budget Level for 2011

2011

2011 Proposed %

Personnel 54,943.8$ 64.37% -$ 20,012.3$ 74,956.1$ 44.1%

Non-Personnel 30,406.0 35.63% 4,712.4 59,871.0 94,989.5 55.9%

Total 85,349.8$ 100.00% 4,712.4$ 79,883.4$ 169,945.6$ 100.0%

2011 Global Level

Regular FundFEMCIDI

(Voluntary Fund) Specific Funds %

2012 Proposed %

Personnel 54,892.2$ 64.35% -$ 24,495.3$ 79,387.5$ 50.2%

Non-Personnel 30,406.0 35.65% 2,275.6 46,165.5 78,847.1 49.8%

Total 85,298.2$ 100.00% 2,275.6$ 70,660.8$ 158,234.5$ 100.0%

%

Regular Fund

Voluntary Fund Specific Funds 2012 Global Level

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Key Criteria Considered by the General Secretariat in Formulating the 2012 Budget Proposal

• Decision of the GA to maintain the Regular Fund (RF) budget ceiling at $85.3M.

• Impact of budgetary reductions of $4.8 million in 2011 on the activities of the Organization

• Prioritization exercise by the Member States.

• Progress reports of the Working Group on streamlining of OAS activities

• Costing of resolutions approved at the XLI Regular Session of the General Assembly in San Salvador

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Secretary General’s 2012 RF Budget ProposalAssumptions

• 2011-2012 average inflation estimated at 2.0%.

• Budget for Personnel cost increases for 2012 estimated at $1.9 M:

Impact of 2011 increases on the 2011 budget: $0.7 M2012 statutory remuneration adjustments: 0.7 MMandatory step increases: 0.4 MHealth insurance premiums: 0.1 M

$1.9 M• The Organization’s cost of staff and retirees’ health insurance premiums is

budgeted to increase by 2.0% in 2012.

• Operational costs (electricity, heating, supplies, maintenance and custodial services) are budgeted at the 2011 levels in the proposed non-personnel budget, even though they are expected to experience some inflationary increases.

• RF personnel costs remain below the 64.38% threshold established by resolution AG/RES 1 (XL – E/10).

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Position reductions of $1.9 Million

Number of positions financed by the Regular Fund is reduced in 2012 by a net of eighteen to absorb $1.9 million in anticipated statutory increases

• To achieve these reductions, the following situations were considered:

– Positions vacated when incumbent reaches retirement age– Positions vacated through voluntary separation, expiration of contract,

resignation, or internal transfer– Elimination of frozen positions without funding– Terminations due to area re-structuring – Transfers to Specific Funds

Secretary General’s Proposed 2012 RF BudgetPersonnel (Object 1)

Secretary General’s Proposed 2012 RF BudgetPersonnel (Object 1) cont.

• RF Position reductions, 1999-2011 and proposal for 2012

16.7% reduction in RF staff positions, 1999 – 2011 8.4% reduction in RF staff positions, 2010 – 2011 3.7% reduction in RF staff positions 2011 – 2012

11

582 582 582

552

528

506

522

539547

534

489

471450

500

550

600

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Secretary General’s Proposed 2012 RF BudgetPersonnel (Object 1) cont.

• Positions in 2012 vs. 2011 by Programmatic Area

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Programmatic Areas2012 2011 Δ

Democracy and Governance 47 51 -4Human Rights 31 33 -2Integral Development 73 76 -3Multidimensional Security 24 25 -1Support for the Member States 148 148 0Policy Direction 50 48 2Administration 98 108 -10

Total 471 489 -18

Regular Fund Positions

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Secretary General’s Proposed 2012 RF BudgetNon-Personnel Costs (Objects 2-9)

• Upward adjustment of $400,000 to 2012 appropriations of some subprograms are required to:

a) Accurately reflect the actual level of execution and,b) To sufficiently fund the minimum level of operations of technical areas

• Reduction of $400,000 for scholarships, as a result of increased efficiency in the management of the program, without reducing the number of awards or the academic quality of the program.

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Secretary General’s Proposed 2012 RF BudgetNon-Personnel Costs (Objects 2-9) (cont.)

102K-Retirees’ health insurance (to cover increases to premiums) 100,000$ 12A-Office of the Secretary General (avg. prior years’ execution) 80,000 22C-Conferences and Meetings (additional meetings) 65,000 82F-Press Dept - (avg. prior years’ execution) 55,000 92C-DFAMS (Tax consultancy contract) 50,000 22B-Permanent Council (transcripts – annual average of transfers) 25,000 22F-Columbus Library (Outsourcing of services) 15,000 92E-Purchasing (to cover operating costs) 10,000

Total adjustments to be included in 2012 Budget 400,000$

Appropriation adjustments in 2012 budget proposal:

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• Current budget is equal to 2011 level of appropriations, and $4.8 million less than in 2009.

• Reduction, in real terms, of the purchasing power of the program-budget

• No Across-the-board monetary reductions to the areas. Any increases are accompanied by offsetting decreases.

• “Real” reductions managed by scaling back activities and operations.

• Impact of budget cuts presented in a separate detailed document for consideration of the Subcommittee on Administrative and Budgetary Affairs.

• Resources for major urgent repairs and building improvements are not contemplated.

Secretary General’s Proposed 2012 RF BudgetNon-Personnel Costs (Objects 2-9) (cont.)

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2010 and 2011 Distribution by Programmatic Areas(Figures in thousands of USD)

2011

2012

2011 Regular Fund %2011 Specific and Voluntary Funds % Total 2011 %

Democracy and Governance 7,421.4$ 8.7 33,848.9$ 40.0 41,270.3$ 24.3 Human Rights 6,584.8 7.7 4,278.5 5.1 10,863.3 6.4 Integral Development 17,436.4 20.4 20,897.7 24.7 38,334.1 22.6 Multidimensional Security 4,986.9 5.8 18,980.0 22.4 23,966.9 14.1 Support for the Member States 16,769.2 19.6 1,157.0 1.4 17,926.2 10.5

Sub total 53,198.7 62.3 79,162.2 93.6 132,360.9 77.9 - Policy Direction 7,113.4 8.3 938.6 1.1 8,052.0 4.7 Administration 12,858.6 15.1 3,238.5 3.8 16,097.1 9.5 Infrastructure & Common Costs 12,179.1 14.3 1,256.5 1.5 13,435.6 7.9

Sub total 32,151.1 37.7 5,433.5 6.4 37,584.6 22.1

Total 85,349.8$ 100.0 84,595.8$ 100.0 169,945.5$ 100.0

2012 Regular Fund %2012 Specific and Voluntary Funds % Total 2012 %

Democracy and Governance 7,134.5$ 8.4 18,017.5$ 24.7 25,152.0$ 15.9 Human Rights 6,605.5 7.7 3,600.4 4.9 10,205.9 6.4 Integral Development 16,821.4 19.7 20,782.7 28.5 37,604.1 23.8 Multidimensional Security 5,120.4 6.0 20,656.0 28.3 25,776.3 16.3 Support for the Member States 17,500.8 20.5 1,893.3 2.6 19,394.0 12.3

Subtotal 53,182.5 62.3 64,949.9 89.1 118,132.4 74.7

Policy Direction 7,538.0 8.8 1,852.5 2.5 9,390.6 5.9 Administration 12,418.5 14.6 4,745.2 6.5 17,163.7 10.8 Infrastructure and Common Costs 12,159.1 14.3 1,388.7 1.9 13,547.9 8.6

Subtotal 32,115.6 37.7 7,986.5 10.9 40,102.1 25.3

Total 85,298.2$ 100.0 72,936.4$ 100.0 158,234.5$ 100.0

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2011 - 2012 Distribution by Programmatic Areas – All Funds(Figures in millions of USD)

Program - Budget of the OAS 2011 -2012By Programmatic Area, All Funds

$16.1

$25.2

$10.2

$41.3

$11.0

$38.4

$24.2

$17.7

$8.0

$13.3

$37.6

$25.8

$19.4

$9.4

$17.2

$13.5

$-

$5.0

$10.0

$15.0

$20.0

$25.0

$30.0

$35.0

$40.0

$45.0

Democracy andGovernance

Human Rights IntegralDevelopment

MultidimensionalSecurity

Support for theMember States

Policy Direction Administration Infrastructure andCommon Costs

2011: $169.9 M2012: $158.2 M

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2011 - 2012 Variations by Programmatic Areas – All Funds(Figures in thousands of USD)

Program - Budget of the OAS 2011 -2012By Programmatic Area, All Funds

1,066.61,618.71,653.7 1,354.0

228.9(747.1) (777.4)

(16,108.5)

-1.9%

-39.0%

16.8%9.3% 6.7%

6.6%

1.7%

-7.1%

(18,000.0)

(16,000.0)

(14,000.0)

(12,000.0)

(10,000.0)

(8,000.0)

(6,000.0)

(4,000.0)

(2,000.0)

-

2,000.0

4,000.0




IntegralDevelopment

Human Rights Democracy andGovernance

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2011 and 2012 Distribution by Programmatic AreasRegular Fund

(Figures in thousands of USD)

2012 Total 2011 Total Variance

Democracy and Governance 7,134.5$ 7,411.6$ (277.1)$ Human Rights 6,605.5 6,704.8 (99.3) Integral Development 16,821.4 17,453.5 (632.1) Multidimensional Security 5,120.4 5,177.6 (57.2) Support for the Member States 17,500.8 16,583.3 917.5

Subtotal 53,182.5 53,330.8 (148.2)

Policy Direction 7,538.0 7,098.0 440.0 Administration 12,418.5 12,858.6 (440.1) Infrastructure and Common Costs 12,159.1 12,062.4 96.7

Subtotal 32,115.6 32,019.0 96.6

Total 85,298.2$ 85,349.8$ (51.6)$

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2011 - 2012 Distribution by Programmatic Areas–Regular Fund(Figures in millions of USD)

Program - Budget of the OAS 2011 -2012By Programmatic Area, Regular Fund

$7.4

$6.7

$5.2

$16.8

$7.5

$12.1$12.9

$7.1

$16.6

$17.5

$12.2$12.4

$17.5

$5.1

$6.6$7.1

$-

$2.0

$4.0

$6.0

$8.0

$10.0

$12.0

$14.0

$16.0

$18.0

$20.0

Democracy andGovernance

Human Rights IntegralDevelopment




2011: $85.3M2012: $85.3M

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2011 - 2012 Variations by Programmatic Areas – Regular Fund(Figures in thousands of USD)

Program - Budget of the OAS 2011 -2012By Programmatic Area, Regular Fund

(57.2)

440.0

917.5

96.7

(99.3)

(277.1)

(440.1)

(632.1)-3.7%

-3.6%

0.8%

5.5%

6.2%

-1.1%-1.5%

-3.4%

(800.0)

(600.0)

(400.0)

(200.0)

-

200.0

400.0

600.0

800.0

1,000.0


Policy Direction Infrastructure andCommon Costs


Human Rights Democracy andGovernance

Administration Integral Development

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Changes in Programmatic Structurefor 2012 (vs. 2011)

Transferred From To

Chapter 4 - Department of Legal Services (42F) Chapter 4 - Secretariat for Legal Affairs Chapter 1 - Office of the Secretary General

Renamed

Department of State Modernization and Good Governance (62D) Department of State Modernization and Good Governance (62D) Department of Effective Public Management (62D)

Department of Cultural Affairs (82D) Department of Cultural Affairs (82D) Art Museum of the Americas (82D)

New Subprograms

Department of Defense and Hemispheric Security (52F) Chapter 5 - Secretariat for Multidimensional Security

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Per the Secretary General’s directive, every effort has been made to maintain sufficient funding and personnel support for the key activities and programs of the OAS. Nevertheless, there are limits to what can be achieved with reduced resources. A number of anticipated results may take longer to achieve and some services and activities will have to be scaled back or reduced.

The availability of Specific Funds will continue to be a central element of the GS/OAS capacity to respond to key objectives of the Organization.

Additional financing avenues will need to be explored to resolve the growing gap between infrastructure needs and the availability of resources.

CAAP members will have additional opportunities to consider the impact of the proposed budget levels on specific areas and programs of the General Secretariat in their chapter-by-chapter analysis of the SG’s 2012 Budget Proposal, including feedback from area Secretaries and Directors.

The 2012 RF budget ceiling is set at $85.3 M. Hence, all proposals for upward budgetary adjustment must be accompanied by a proposal for an equivalent reduction elsewhere in the proposed budget.

In Conclusion