Document: ECLVIDoc'18'45

1
Review ofthe WMO Programme Support
CostArrangement

• Document EC-LVI/Doc.18.4(5)
• Executive Council
• Fifty-Sixth Session
• Geneva 2004

2
Review of the WMO Programme Support Cost
Arrangements

• Fourteenth Congress requested
• the Secretary-General to report to EC-LVI on the
  outcome of the review of the current WMO
  programme support cost arrangement
• EC to approve a revised approach with a view to
  charging appropriate rates of programme support
  costs to donors.

3
Background

• United Nations system-wide need for a
  coordination of programme support cost policies
• Joint Inspection Unit (JIU) report on programme
  support costs in 2002
• WMO standard cost recovery rate of 14 not
  systematically applied
• Reduction in XB funding
• Reduction in average recovery rate

4
Current support cost arrangements

• Programme support for WMO-administered trust
  funds
• Technical co-operation programmes financed from
  voluntary contributions totalling CHF 35.2
  million for 2002-2003.
• charged support costs at 14 of direct
  expenditures in theory
• due to waivers actual recoveries are less than 9
  in practice
• Normative programmes funded from voluntary
  contributions totalling 4.4 million per
  2002-2003.
• support costs charged at 0 to 13 with the
  average about 6.9
• B. Programme support for Joint Activities (GCOS,
  IPCC, JCRF)
• Project volume of CHF 22.1 million in 2002-2003.
• Not charged for support costs
• WMO support costs estimated at CHF 0.8 million in
  2002-2003

5
Cost Study Methodology

• Methodology used for cost measurement studies
  carried out in United Nations system
  organizations since 1990
• Questionnaire completed by general service staff
  from G4 to G7 and professional staff from P3 to
  D2
• Other work load statistics
• Fixed and variable costs

6
New arrangement Fixed costs

• Definition Costs incurred by the Organization
  under the regular budget, regardless of the
  implementation of additional XB activities.
• The new programme support cost arrangement
  provides for funding of fixed costs entirely
  under the regular budget.

7
New arrangement Variable Costs

• Definition Costs that are incremental to fixed
  costs and are required as a result of
  implementation of XB activities.
• The new programme support cost arrangement is
  geared towards the recovery of variable costs
  only.

8
Result of the cost measurement

•     

9
Proposed recovery rates

• Technical cooperation FIT projects
• Standard rate of 13
• Reduction by up to 2 if donors assumes
  responsibilities
• Reduction by 1 for simplified reporting
• Separate rate of 9 for procurement only TC FIT
• Normative FIT projects
• 7 rate for normative FIT which supplement
  regular programme

10
Current and proposed recovery rates compared
11
Proposed actions

• Charging WMO costs directly to project budgets
  whenever practicable
• Measures to be taken for compensation for the
  support costs incurred for GCOS, IPCC and JCRF
• Arrangement to protect WMO from the currency risk
• Report to EC-LVIII in 2006 on the progress made
• EC is invited to adopt the draft resolution which
  summarises the recovery rates.