Eighty-first Session

Provisional agenda item 8.3

EXECUTIVE BOARD

ORGANISATION MONDIALE DE LA SANTE

WORLD HEALTH ORGANIZATION EB81/10

6 October 1987

INCENTIVE SCHEME TO PROMOTE TIMELY PAYMENT OF ASSESSED CONTRIBUTIONS BY MEMBERS

The Executive Board, following its review of the Director-General's report on the report of the Joint Inspection Unit on "Cash management in the United Nations and four specialized agencies (FAO, ILO, UNESCO, Ш 0 ) м at its seventy-ninth session held in January 1987, requested tue Director-General to prepare a proposa丄 or alternative proposals for an incentive scheme for the apportionment of casual income among Members, to be submitted to the eigiity-first session of the Board. The formula used for apportionment in the Director-General1 s proposal is identical to the ••S-curve" formula developed and adopted by ICAO. This formula has also been adopted by WMO. A similar incentive scheme is presently under consideration by other specialized agencies, including FAO, ILO, and UNESCO. The Director-General proposes that the formula should be applied to the amount of interest credited to the casual income account. If the Executive Board should agree to the Director-General1 s proposal, it may wish to recommend to the Forty-first World Health Assembly the adoption of a resolution along the lines of that proposed in paragrapn 14.

Introduction

1. In the "Report of the Joint Inspection Unit on cash management in ttie United Nations and four specialized agencies (FAO, ILO, UNESCO, WHO)M,^ submitted to the seventy-ninth session (January 1987) of the Executive Board under cover of a report by the Director-General,^ the first recommendation of the Inspector reads as follows:

The governments which have met all their financial obligations concerning the payment of contributions siiould benefit from any surpluses to be credited to them, proportionate to the scale of contributions and in accordance with the timing of their payment during the previous budgetary period.

2. The comments and observations of the Administrative Committee on Coordination^ with respect to this recommendation read, inter alia, as follows:

3.1 As noted by the Inspector, each organization has financial regulations specifying when assessed contributions are due and payable. The widespread disregard of these provisions by Member States has been a major factor contributing to the cash flow problems being experienced by most organizations.

Report by the Director-General

1 Document JIU/REP/86/b, Geneva,丄986. 2 Document EJJ79/丄987/REC/丄,Aimex 13, 3 Document EB79/1987/REC/丄，Annex 13,

pp. 150 to 丄 5 6 , p. 1 5 丄 .

3. The Director*—Genera丄,s comments^ on this matter included tne fo丄丄owing!

3.3 In recent years, WHO,丄ike other organisations in the United Nations system, has experienced considerable delays ia payment by Member States of assessed contributions to the regular budget. This has been a matter of great concern since it prejudices the ability of tne Organization to implement the programme budgets adopted by the World Health Assembly. Moreover, the practice of apportioning casual income among Member States in ttie same proportion as the scale of assessments, without making any distinction between those Members which pay early and those which pay late, favours the late-paying Member States. Not only do such Members have the use of the unpaid assessment, while those that pay on time lose interest they could have earned, but also the Organization1s interest earnings are reduced and, as a consequence, assessments on all Member States, early and late payers alike, are increased. The Healtti Assembly has each year urged ail Memùer States to pay their contributions as and when taey fall due, but this has generally had little effect on the timing of payment of contributions by Member States.

4. At the seventy-Liinth session of the Executive Board, in January 丄987， the Director-General had sought ttie guidance of the Executive Board (1) on the possible adoption by WHO of an incentive scheme similar to that which had been adopted by the International Civil Aviation Organization (ICAO) in 1986 to become effective as from 丄 January 1987 and whicli was under consideration by some other specialized agencies of ttie United Nations； and (2) on the wishes of the Board as to the procedural and logistical aspects of review and adoption of such a scheme, wtiich would determine the earliest date from which sucii a scheme might possibly become effective in WHO.

5. Ttie Executive Board decided^ to request the Director—Genera丄 to prepare a proposal or alternative proposals for an incentive scheme for the apportionment of casual income among Members, to be submitted to tlie eighty-first session of the Board.

Present system

6. A relatively substantial portion of the biennial regular budget of WHO nas normally been financed by appropriations of casual income earned by the Organization in the two calendar years immediate丄y preceding the year of adoption of the budget. The casual income appropriated by Health Assemblies for this purpose has been deducted, together with the expected reimbursement of support costs by the United Nations Development Programme, from the total budget level in order to arrive at the portion of the budget which was to be financed by assessed coatributions of Member States according to the WHO scale of assessments. In effect, therefore, all casual income appropriated to help finance the regular budget has in the past been apportioned among Member States in accordance with the scale of assessments applicable to the financial period covered by the programme budget.

Alternative incentive formulae

7. Ttie Director-General proposes the adoption of an incentive scheme under which available casual income would continue to be appropriated to help finance the regular budget and thus reduce net contributions of Member States but which would provide that the amount of interest credited to the casual income account would be apportioned among Members in accordance with a formula wnich takes account not only of the scale of assessments but also of the dates and amounts of the payments of assessed contributions made by Member States in respect of and during each year of a preceding two year period, the remaining portion of the casual income appropriation being deducted from the total budget, as in the past, in the manner indicated in paragraph 6 above. Such a scheme would not affecc the amount of casual income to be appropriated by the Healtn Assembly to help finance the regalar budget but would merely change the method by which part of it would be apportioned among Member States, with consequent minor changes to the Financial Regulations and the appropriation resolution for the financial period.

1 Document ЕВ79/丄987/REC/丄,Atmex 丄3, pp.丄51 and 152. 2 Document EB79/1987/REC/1, decision EB79(丄1), p. 26.

Prior to year for whicn contribution is due January February Mar en April May June July August September October November December After 31 December of the year

for which contribution is due

Each Member State would be awarded a certain number of incentive points determined by multiplying the amounts of its contribution payment or payments (to the nearest thousand dollars) by the incentive points assigned to the month of receipt of each payment. Each Member State would have credited against its assessment a percentage of the amount of interest earnings subjected by the Health Assembly to the incentive scheme which is equal to its percentage share of the tota丄 number of incentive points awarded to all Member States. Thus, the formula for calculation of the share of interest earnings to be apportioned to a Member State under the incentive scheme could be expressed as follows :

Amount of interest earnings apportioned to a Member = State in accordance with incentive formula

(b) Alternative 2 一 "S-curve"

Number of incentive points awarded to that Member State

Total number of incentive points awarded to all Member States

method

Amount of interest earnings subjected to the

X incentive scheme

Incentive points would be assigned to each day (as opposed to month in the "straignt line" method) of each "base year" of the two year "base period" for which assessed contributions are payable and during which interest is earned, according to the formula indicated in Annex 1, which is an extract of a document presented to the Executive Committee of ICAO in September/October 1986. The effect of this formula is essentially to break up the year into three segments； the first segment covering the five months from January to May, providing a gradual decline in the incentive points applied (from 10.0 on 1 January to 7.75 oil 31 May), the second segment covering tfte two months June and July, during which there would be a sharp decline in the number of points earned (from 7.72 on 1 June to 2.25 on 31 July), and a third segment covering the last five months from August to December, during which there would be a gradual decline in the number of points earned (from 2.22 on 1 August to 0.0 on 31 December). This formula has already been adopted by ICAO with effect from 1 January 1987 and by WHO with effect from I January 1988. A table indicating the incentive points applicable to the day number and actual dates of payment is provided in Annex 2.

8. The Director-General has considered two basic formulae for the apportionment of interest earnings which would reward Member States in accordance with the timing of payment of their contributions, as follows :

(a) Alternative 1 ~ "Straight line" method

Incentive points would be assigned to each month of each "base year" of the two-year "base period" for which assessed contributions are payable and daring which interest is earned, according to tne fol丄owing scale：

Month of receipt of contribution payments for the base year Incentive points

3 210987654321 о

1111

Relative merits of the two alternative incentive formulae

9. In considering the relative merits of the alternative incentive formulae it will be seen that the "straight line" method appropriately grants an additional incentive to Member States which pay their contributions before ttie due date of payment, i.e., prior to 1 January of the year for which contributions are due. The formula is less complex than that applied in the "S—curve" method. This method also gives greater recognition to the fact that some Member States have different fiscal periods than that of the Organization, thus rendering it more difficult for them to pay early in the calendar year, and that, because of the usual de丄ays experienced in obtaining payment clearances from the various Ministries concerned and in the transmission of payments through banks, Members frequently cannot determine the exact date on which payment will be received by the Organization. However, the "S-curve" formula provides a greater incentive to Member States to advance tne dates of payment of their contributions；

this formula also appeared to receive more support at the seventy-ninth session (January 1987； of the Executive Board. The Director-General therefore recommends the adoption of the "S-curve" formula for application in WHO.

Casual income to be subjected to the incentive scheme

10. The Director—Genera丄 considers that for an incentive scheme to be effective the maximum amount of financial benefit should be provided to Members which pay their contributions early. He had therefore originally proposed that the entire amount of casual income appropriated to help finance the regular budget be apportioned to Member States on the basis of an incentive formula, as recommended by the Joint Inspection Unit,l or that at least the components of casual income represented by interest earned and arrears of contributions collected should be subjected to the incentive formula. However, in view of the reservations expressed at the seventy-ninth session of the Executive Board in January 1987, the Director-General proposes that the apportionment on the basis of the MS-curve" formula be limited to tne "interest earned" component of casual income. The balance of casual income appropriated to help finance the budget would, as in the past, be apportioned, together with the expected reimbursement of support costs by the United Nations Development Programme, to Members in accordance with the WHO scale of assessments. A statement of casual income received and utilized during the period 1982 to 1986 is attached as Annex 3.

11. The various steps that would need to be taken to determine the insta丄merits of contributions payable by Member States in each year of a financial period are listed in Annex 4.

Effective date of implementation

12. If ttie Executive Board and the World Health Assembly should agree to the proposals of the Director-General in 1988, the incentive scheme could become fully effective, to the extent that casual income is appropriated to help finance the budget, as from the programme budget for the financial period 1992-丄993, to be adopted in 1991, based on the record of Members1 payments of assessed contributions for the years 1989 and 1990 and the interest income subjected to the incentive scheme that is earned in those two years. The normal text of the programme budget appropriation resolution would require minor modifications as indicated in Annex 5 in which the changes have been underlined for emphasis. The current status in the United Nations and specialized agencies of related measures already adopted or present丄y under consideration is shown in Annex 6.

Amendment to the Financial Regulations

丄3. Adoption of the Director-General1 s proposal would require amendment of Financial Regulation 5.3, which would read as follows (with the changes underlined for emphasis):

1 Document JIU/REP/86/6, p. 8.

5.3 The Health Assembly shall adopt a total budget level and scale of assessments for the following financial period• The assessed contributions of Members based on the scale of assessments shall be divided, after applying credits due to Members in accordance with any financial incentive scheme that may be adopted by the Health Assembly, into two equal annual instalments, the first of which shall relate to the first year and the second of which shall relate to the second year of the financia丄 period. In the first year of the financial period, the Health Assembly may decide to amend the scale of assessments to be applied to the second year of the financial period.

14. If the Board should agree with the Director-General’s proposal, it may wish to consider adoption of a resolution along the following 丄inesî

Proposed resolution

The Executive Board,

Having noted the report by the Director-General on an incentive scheme to promote timely payment of assessed contributions by Members,

RECOMMENDS the following resolution for adoption by the Forty-first World Health Assembly.

"The Forty-first World Health Assembly,

Noting that in accordance with Financial Regulation 5.6 annual instalments of contributions are considered as due and payable in full as of the first day of the year to which they relate,

Recalling the past efforts of the Healtn Assembly, the Executive Board and the Director-General to ensure timely payment of contributions,

Noting the serious deterioration in the rate of payment of contributions in recent years,

Having been informed of the Joint Inspection Unit's recommendation to the effect that the Governments which have met all their financial obligations concerning the payment of contributions should benefit from any surpluses to be credited to them, proportionate to the scale of contributions and in accordance with the timing of their payment during the previous budgetary period,

Agreeing that some incentive should be provided to Members to encourage them to advance the dates of payments of their contributions,

Considering that the proposals made by the Director-General and endorsed by the Executive Board for an incentive scheme to promote timely payment of assessed contributions by Members are appropriate in the context of WHO1s financial mechanisms；

1. DECIDES that an incentive scheme to promote the timely payment of assessed contributions by Members to the Organization 1s regular budget as proposed by the Director-General and the Executive Board shall be effective as from the programme budget for 1992-1993, to be approved in 1991, based upon the record of Members1 payments of assessed contributions in the years 1989 and 1990 and the record of the casual income earned in those two years and subjected to the scneme；

2. DECIDES further that, pursuant to this incentive scheme and to the extent Chat casual income is appropriated to help finance the budget, the component of such casual income consisting of interest earned will be apportioned among Members in the form of credits against their gross assessments in accordance with an S-curve formula which takes into account not only the scale of assessments but also the dates and amounts of the payments of assessed contributions made by Member States in respect of and during each year of the two-year period prior to the year in which a programme budget is adopted；

3. CONFIRMS that casual income exclusive of interest earned, which is appropriated to help finance the regular budget, will continue as in the past to be apportioned to Members in accordance with the WHO scale of assessments;

4. DECIDES to amend the text of Financial Regulation 5.3 to read as follows：

5.3 The Healtn Assembly shall adopt a tota丄 budget level and scale of assessments for the following financial period. The assessed contributions of Members based on the scale of assessments shall be divided, after applying credits due to Members in accordance with any financial incentive scheme that may be adopted by the Health Assembly, into two equal annual instalments, the first of which shall relate to the first year and the second of which shall relate to the second year of the financial period. In the first year of the financial period, the Health Assembly may decide to amend the scale of assessments to be applied to the second year of the financial period.".

it applicable to the tive scale and the 360 day

JAN FEB MAR APR MAY JUN JUL AUG SEP

Elapsed time in days (x scale)

Factors have been added to the basic parameters which have been selected, that time scale. The formula representing the

equation to make is, the ten point incen "S" curve shown is:

ANNEX 1

FORMULA FOR CALCULATION OF INCENTIVE POINTS BASED ON DATE OF PAYMENT

(as presented to the Executive Committee of IСAO)

1. The following graph represents the proposed method for determination of the number of incentive points to be awarded for each one thousand dollars of current year contribution received by the Organization on any particular day of the current year.

2. The vertical scale (y) represents the incentive points to be awarded, ranging from ten points for payments made on or before 1 January of the current year, to zero points for payments made on the last day of the year. The horizontal scale (x) represents the time scale of the current year as 360 days.

3. The formula represented in the graph is a variation of the equation x=-y^, which describes an "S" curve. Use of an "S" curve formula takes into account the number of days during the year for which funds paid are available to the Organization, but giving comparatively greater reward for payments made in the first half of the year and comparatively lesser reward for payments made in the second half of the year.

§§oi DEC NOV ОС

8 7

6 5

4 3 2

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Annex 1

Example A Contracting State being assessed at the rate of 丄％ (or 农 271 062) contribution for 丄 9 3 4 makes full payment on 17 March 1984 (day 11)• Assume the total incentive points earned by all Contracting States for 1984 was 128 3丄6 and the incentive amount was equivalent to the Organization*s interest earnings for 1984, $ 369 521,

Ttie incentive share would be determined in two steps.

Step 1. At time of receipt of contribution Awarding of incentive points

a) Calculation of incentive points for payment on day 77

5 + 125 - (day of payment x 250 36Ô

5 + 250

1 2 5 - (

7 7 x 错 ）

=9.15 incentive points (per ^ 丄 0 0 0 payment)

b) Calculation of incentive points for payment of $ 271 062

=9.15 x amount of payment (in thousands)

=9.15 x 271

2480 incentive points awarded

Step 2.

a)

b)

Had the same would have been:

At time of Assembly Sharing of incentive amount between eligible States

Calculation of incentive amount applicable to each incentive point earned by all Contracting States for the year.

= $ 369 521 г 128 316

= $ 2.88 per incentive point

Calculation of incentive amount applicable to the contribution of $ 271 062 made on 17 March 1984

= i 2.88 x 2480 (from Step 1)

= $ 7丄42 representing a rebate of 2.63% of the contribution,

contribution been paid on say 25 September (day 265), the incentive amount

= i 864 representing a rebate of 0.32% of the contribution.

CALCULATION OF INCENTIVE POINTS USING "S-CURVE" FORMULA

January February March April May June

Day No. Date Points

Day No. Date Points

Day No. Date Points

Day No. Date Points

Day No. Date Points

Day No. Date Points

10.00

1 5

1 6

1 7

1 8 I Q

1 5

1 6

1 7

1 8 1 Q Л.У

2 0

丄У 2 0

2 1 2 1

2 2 2 2

2 3 2 3

2 4 2 4

2 5 2 5

2 6 2 6

2 7 2 7

2 8 2 8

2 9 2 9

3 0 3 0 / 3 1

9 8

9 7

9 6

9 5

9 4

9 3

9 2

9 . 9 2

9 . 9 1

9 . 9 0

9 . 8 9

9 . 8 8

9 . 8 7

9 . 8 6

9 . 8 5

9 . 8 4

9 . 8 3

9 . 8 2

9 . 8 1

9 . 8 0

3 1

3 2

3 3

3 4

3 5

3 6

3 7

3 8

3 9

4 0

4 1

4 2

4 3

4 4

4 5

4 6

4 7

4 8

4 9

5 0

5 1

5 2

5 3

5 4

5 5

56 5 7

5 8

4

5

6 7

8 9

20 21 22 2 3

2 4

2 5

26 2 7

28

9 . 6 9

9 . 6 8

9 . 6 7

9 . 6 6

6 5

6 4

6 3

62

5 9 2 9

6 0 -

9 .

9 .

9 .

9 .

9.61 9.60 9.59 9.58 9.57 9.55 9.54 9.53 9.52 9.51 9.50 9.49 9.47 9.46 9.45 9.44 9.43 9.42 9.40 9.39 9.38 9.37

61 62 6 3

6 4

6 5

66 6 7

68 6 9

0 1 2 3 4

5 6 7

8 9

80 81 82 83 8 4

8 5

86 8 7

88 8 9

5

6 7 8 9

0 1 2 3 4

5

6 7 8 9

20 21 22 2 3

2 4

25

26 27 28 2 9

9 . 3 6

9 . 3 4

9 . 3 3

9 . 3 2

9 . 3 1

9 . 2 9

9 . 2 8

9 . 2 7

9 . 2 6

9 . 2 4

9 . 2 3

9 . 2 2

9 . 2 0

9 0 3 0 / 3 1

9 .

9 .

9 .

9 .

9 .

9 .

9 .

L0 9 . 0 8

9 . 0 7

9 . 0 5

9 . 0 4

9 . 0 3

9 . 0 1

9 . 0 0

8 . 9 8

8 . 9 7

9 1

9 2

9 3

9 4

9 5

9 6

9 7

9 8

9 9

100 101 102 1 0 3

1 0 4

1 0 5

106 1 0 7

108 1 0 9

1 0

1

1 2 3 4

5

6 7

8 9

120

5

6 7 8 9

0 1 2 3

4

5 6 7

8 9

20 21 22 23

2 4

25 26 27

28 2 9

30

8.95 8.94 8.92 8.91 8.89 8.88 8.86 8.85 8.83 8.82 8.80 8.78 8.77 8.75 8.73 8.72 8.70 8.68 8.67 8.65 8.63 8 . 6 1

8 . 6 0

8.58 8.56 8.54 8.52 8.50 8.49 8.47

121 122 1 2 3

1 2 4

1 2 5

126 1 2 7

128 1 2 9

1 3 0

1 3 1

1 3 2

1 3 3

1 3 4

1 3 5

1 3 6

1 3 7

1 3 8

1 3 9

1 4 0

1 4 1

1 4 2

1 4 3

1 4 4

145 1 4 6

1 4 7

1 4 8

1 4 9

1 5 0

1 2 3

4

5

6 7

8 9

0 1 2 3

4

5

6 7

8 9

20 21 22 2 3

2 4

2 5

26 2 7

28 2 9

3 0 / 3 1

8.45 8.43 8.41 8.39 8.37 8.35 8.33 8.31 8,28 8 . 2 6

8.24 8.22 8 . 2 0

8.17 8.15 8.13 8 . 1 0

8.08 8.05 8.03 8.00 7.98 7.95 7.92 7.90 7.87 7.84 7.81 7.78 7.75

1 5 1

1 5 2

1 5 3

1 5 4

1 5 5

1 5 6

1 5 7

1 5 8

1 5 9

160 161 162 1 6 3

1 6 4

1 6 5

166 1 6 7

168 1 6 9

0 1 2 3

4

5

6 7

8 9

180

5 6 7

8 9

20 21 22 23

2 4

2 5

26 27

28 2 9

3 0

7 . 7 2

7 . 6 9

7 . 6 6

7 . 6 2

7 . 5 9

7 . 5 5

7 . 5 2

7 . 4 8

7 . 4 4

7 . 4 0

7 . 3 6

7 . 3 2

7 . 2 8

7 . 2 3

7 . 1 8

7 . 1 3

7 . 0 8

7 . 0 3

6 . 9 7

6 . 9 1

6 . 8 4

6 . 7 7

6 . 6 9

6.61 6 . 5 1

6 . 4 1

6.28 6.12 5 . 8 9

5 . 0 0

S81/10

Taage 9

ANNWX 2

CALCULATION OF INCENTIVE POINTS USING "S-CURVE" FORMULA (continued)

July August September October November December

Day No. Date Points

Day No. Date Points

Day No. Date Points

Day No. Date Points

Day No. Date Points

Day No. Date Points

181 182 183 184 185 186 187 188 189 190 191 192 193 194 195 196 197 198 199 200 201 202 203 204 205 206 207 208 209 210

1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 L9 20 21 22 23 24 25 26 27 28 29

30/31

4.11 3.88 3.72 3.59 3.49 3.39 3.31 3.23 3.16 3.09 3.03 2.97 2.92 2.87 2.82 2.77 2.72 2.68 2.64 2.60 2.56 2.52 2.48 2.45 2.41 2.38 2.34 2.31 2.28 2.25

1 2 3 4 5 6 7 8 9

220 221 222 223 224 225 226 227 228 229 230 231 232 233 234 235 236 237 238 239 240

1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 L9 20 21 22 23 24 25 26 27 28 29

30/31

2.22 2.19 2.16 2.13 2.10 2.08 2.05 2.02 2.00

97 95 92 90 87 85 83 80 78

1.76 74 72 69 67 65 63 61 59 57 55 53

241 242 243 244 245 246 247 248 249 250 251 252 253 254 255 256 257 258 259 260 261 262 263 264 265 266 267 268 269 270

5 6 7 8 9

20 21 22 23 24 25 26 27 28 29 30

1.51 1.50 1.48 1.46 1.44 1.42 1.40 1.39 1.37 1.35 1.33 1.32 1.30 1.28 1.27 1.25 1.23 1.22 1.20 1. 1. 1. 1. 1. 1. 1.09 1.08 1.06 1.05 1.03

1 2 3 4 5 6 7 8 9

280 281 282 283 284 285 286 287 288 289 290 291 292 293 294 295 296 297 298 299 300

3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 L9 20 21 22 23 24 25 26 27 28 29

30/31

1.02 1.00 0.99 0.97 0.96

95 93 92 90 89 88 86

0.85 0.84 0.82 0.81 0.80 0.78 0. 0. 0. 0. 0.72 0.71 0.69 0.68 0.67 0.66 0.64 0.63

301 302 303 304 305 306 307 308 309 0 1 2 3 4 5 6 7

318 319 320 321 322 323 324 325 326 327 328 329 330

2 3

4 5

6 7 8 9 0 1 2 3 4 5 6 7

8 9

20 21 22 23 24 25 26 27

28 29

30

0.62 0.61 0.60 0.58 0.57 0 . 5 6

0.55 0.54 0.53 0.51 0.50 0.49 0.48 0.47 0.46 0.45 0.43 0.42 0.41 0.40 0.39 0.38 0.37 0 . 3 6

0.35 0.34 0.33 0.32 0.31 0 . 2 9

331 332 333 334 335 336 337 338 339 340 341 342 343 344 345 346 347 348 349 350 351 352 353 354 355 356 357 358 359

5

6 7

8 9

20 21 22 23 24 25 26 27

28 29

,0.28 0.27

360 30/31

26 25 24 23 22 21 20 9

6 5 4 3 2 1 0

09 08 08 07 06 05 04 03 02 01 00

EB81/10

pâge 10

Annex 2

CASUAL INCOME RECEIVED AND UTILIZED, 1982 TO 1986

(Expressed in US dollars)

Income received Utilization Balance Unobligated

Year brought balance at forward from Interest Other Total Financing Other Total year end previous year earned income of regular

budget

1982 17 440 884 18 226 157 24 073 079 42 299 236 - 3 453 990 3 453 990 56 286 130

1983 56 286 130 17 082 854 5 035 724 22 118 578 54 500 000 605 500 55 105 500 23 299 208

1984 23 299 208 19 552 795 14 791 723 34 344 518 - 852 020 852 020 56 791 706

1985 56 791 706 21 531 120 17 977 497 39 508 617 56 790 000 - 56 790 000 39 510 323

1986 39 510 323 15 074 353 25 829 600 40 903 953 - 31 245 145 31 245 145 49 169 131

> и 2： CD td Sí OQ 00

ANNEX 4

STEPS TO BE TAKEN TO DETERMINE THE PAYABLE BY MEMBER STATES IN EACH

INSTALMENTS OF CONTRIBUTIONS YEAR OF A FINANCIAL PERIOD

Step 1. Determine the total number of incentive points awarded to each Member State in each of the two base years£. by multiplying each payment (to the nearest thousand dollars) received from a Member State in respect of its regular budget contribution for each of the two base years by the incentive points assigned to the date of receipt of the payment (i.e., value date of credit to the Organization1s bank account or, if payment is made by cheque, the date of receipt of the cheque by WHO) and adding the resulting figures.

Step 2. Determine the total number of incentive points awarded to all Member States in each of the two base years by adding the figures obtained in step 1 for each Member State.

Step 3. Determine each Member State1s percentage share (calculated to six décima丄 places)il of the total number of incentive points awarded to all Member States in each of the two base years by expressing the figure obtained in step 1 as a percentage of the figure obtained in step 2.

Step 4. Calculate the amount of interest income to be apportioned to each Member State (to the nearest ten dollars) in accordance with the incentive formula in respect of each of the two base years by applying the percentages obtained in step 3 to half of the interest income subjected to the incentive scheme.

Step 5. Add the amounts of interest income apportioned to each Member State in accordance with the incentive formula in respect of each year of the two-year base period to arrive at the total amount of interest income to be credited against the gross assessment of each Member State for the financial period. Gross assessments in this context represent the total budget level for the financial period after deduction of UNDP support costs and that portion of casual income appropriated to help finance the budget which is not subjected to the incentive formula.

Step 6. Determine the net contributions payable by Member States during the financial period by crediting against their gross assessments (as adjusted by their share of the credit in the Tax Equalization Fund) the amounts of interest income apportionable in accordance with the incentive formula as obtained in step

Step 7. Half of the net contributions of each Member State for the financial period as obtained in step 6 shall be payable in the first year of the financial period and the remaining half in the second year of the financial period in accordance with Financial Regulation 5.3.

Notes

The base years for calculation of incentive points are the third and second calendar years immediately preceding the financial period of the budget for which casual income is being appropriated, e.g., for ttie financial period 丄992-1993 the base years for calculation of incentive points would be the years 1989 and 1990. The base years are thus the years in which the interest income to be appropriated and to be apportioned among Member States is actually received.

The share of interest income apportioned to each Member State in accordance with the incentive formula will be indicated on a year-by-year basis in statements showing, together with the scale of assessments, tne gross assessment, the credit from the Tax Equalization Fund, the interest earned apportionable in accordance with the incentive formula, and the net contribution of each Member State,

Timely annual payments of consolidated prior years1 arrears of contributions made in accordance with a deferred payment plan approved by the Health Assembly do riot earn incentive points.

ANNEX 5

WHA44.

Appropriation resolution for the financial period 1992-丄993

The Forty-fourth World Health Assembly

RESOLVES to appropriate for the financial period 丄 9 9 2 — 1 9 9 3 an amount of US¿ follows :

A. Appropriation section

1. 2. 3.

Purpose of appropriation

Direction, coordination and management Health system infrastructure Health science and technology:

health promotion and care Health science and technology：

disease prevention and control Programme support

Amount US ¿

6. 7.

Effective working budget

Transfer to Tax Equalization Fund Undistributed reserve

Total

B, Amounts not exceeding the appropriations voted under paragrapn A shall be available for the payment of obligations incurred during the financial period 1 January 1992 一 31 December 1993 in accordance with the provisions of the Financial Regulations. Notwithstanding the provisions of the present paragraph, the Director-General shall limit the obligations to be incurred during the financial period 1992-1993 to sections 1-6.

C. Notwithstanding the provisions of Financial Regulation 4.5, the Director-General is authorized to make transfers between those appropriation sections that constitute the effective working budget up to an amount not exceeding 10% of the amount appropriated for the section from which the transfer is made, this percentage being established in respect of section 1 exclusive of the provision made for the Director-General1s and Regional Directors1 Development Programme (US$ ). The Director-General is also authorized to apply amounts not exceeding the provision for the Director-GeneralT s and Regional Directors1 Development Programme to those sections of the effective working budget under which the programme expenditure will be incurred. All such transfers sha丄丄 be reported in the financial report for the financial period 1992-1993. Any other transfers required shall be made and reported in accordance with the provisions of Financial Regulation 4.5.

D. The appropriations voted under paragraph A shall be financed by assessments on Members after deduction of the following:

US (i) reimbursement of programme support costs by the

United Nations Development Programme in trie estimated amount of

(ii) casual income (other than interest earned)

Annex 5

thus resulting in assessments on Members of US$ . In establishing the amounts of contributions to be paid by individual Members, their assessments shall be reduced further by (a) the amount of interest earned, US^ , credited to them in accordance with the incentive scheme adopted by the Health Assembly in resolution WHA41. , and (b) the amount standing to their credit in the Tax Equalization Fund, except that the credits of those Members that require staff members of WHO to pay taxes on their WHO emoluments shall be reduced by the estimated amounts of such tax reimbursements to be made by the Organization.

INCENTIVES OR PENALTIES BASED ON TIMING OF PAYMENT OF CONTRIBUTIONS

(Status and relevant developments in the United Nations system)

UN/Agency Applies at present incentives or penalties based on timing of payment of contributions

Governing bodies are currently considering (or have considered) proposals for introduction of such measures

Incentives for early payments and penalties for late payments have been considered at the Thirty-seventh session of the General Assembly in 1981, but after the debate on the subject in the Fifth Committee it may be concluded that there was little support at the time for the introduction of new procedures in this respect. Nevertheless, in view of the financial crisis faced by the United Nations in 1986 the General Assembly, by its resolution 41/204, requested the Secretary-General "to continue to study various options to alleviate the financial difficulties of the Organization, taking into account the views expressed by Member States, including, inter alia, a review of the practices of other organizations of the United Nations system for achieving prompt and full payment of assessed contributions and to report to the General Assembly at its forty-second session".

WHO

FAO

UNESCO

The Health Assembly rejected a few years ago an interest charge proposal. Report of the Joint Inspection Unit on cash management in the United Nations Organization and four specialized agencies reviewed by WHO Executive Board in January 1987. Executive Board generally in agreement with idea of incentive scheme for distribution of interest earnings. Director-General requested to provide study for review by Executive Board at January 1988 session.

The Council of FAO at its June 1987 session requested the FAO Secretariat to prepare a resolution for consideration of the autumn session of the Council and the November session of the FAO Conference, recommending a positive incentive scheme by distribution of interest earned among Member States which have paid their assessed contributions in full by the end of the biennium, on a weighted basis, in accordance with the amount and timing of payment of their contributions.

Twenty-third session of General Conference requested Director-General to study feasibility and desirability of introducing positive incentive measures and report to Executive Board for submission to the General Conference at its twenty-fourth session.

S81/10

page 15

iw^ 6

UN/Agency Applies at present Governing bodies are currently considering (or have considered) incentives or penalties proposals for introduction of such measures based on timing of payment of contributions

ILO

IAEA

UNIDO

ITU

I CAO

WIPO

WMO

IMO

No

No

Yes (1)

At its June 1987 session the Governing Body of ILO considered a proposal from the Employers1 Group to improve the rate of collection of contributions, by granting rebates on assessed contributions to those Member States that pay their contribution in a timely manner. The Governing Body took no decision on this proposal but will pursue the question of an incentive scheme. It is to receive a new paper on the subject at a future session (probably November 1987).

No current consideration.

No further current consideration.

Yes effective 1 January 1987 Incentive scheme approved by Assembly held September/October 1986.

No No current consideration; Governing Body discussed matter in 1983 and 1985, but decided in 1985 not to approve a proposal that a study be made concerning the possibility of charging interest on unpaid contributions.

No Congress decided in May 1987 to introduce an incentive scheme effective 1 January 1988 by distribution of General Fund interest in accordance with timing and amount of contributions paid, using the ICAO1 s "S curve" formula.

No No current consideration; Council in 1981 considered interest credit scheme, but did not adopt it.

UPU Yes (2) No further current consideration.

(1) A contribution (in Swiss francs) not received by 1 January is subject to 3% interest charge during first six months and 6% per annum thereafter.

(2) Interest charges similar to ITU.