Executive Summary
1. The Programme Implementation Report is a major accountability document covering the work of the Organization during the 2004-05 biennium. It provides information on resource use and organizational performance (Part I Organizational Performance; Annex 2 Geographical Representation of Professional Staff).It presents the outputs resulting from implementation of the programme of work (Part II Summary of Programme Implementation; Annexes 1: Completion of Outputs, 3: Unscheduled and Cancelled Sessions; 4: Use of Arrears, and 5: Summary Reporting on Programme Entities); and it gives some indications of outcomes, while a fuller appreciation of the latter can only be obtained in the companion Programme Evaluation Report, and other evaluation documents.
Organizational performance
2. Total expenditure incurred by the Organization in 2004-05 was US$ 1,543 million, nearly US$ 143 million (10.2%) higher than in 2002-03. Expenditure under the rubric General and Related Funds increased by US$ 128 million (16.5%), while overall Trust Funds and UNDP expenditures increased by US$ 14 million (2.4%), reversing the 2.4% decline experienced in the previous biennium. Expenditure on non-emergency Trust Funds increased by US$ 95.7 million (34%) while operations linked to emergencies declined by US$ 70.2 million (23%), mainly as the result of the termination of the Iraq Oil-for-Food Programme. Expenditure under UNDP funding continued to decline, i.e by US$ 10.7 million (41%) to reach US$ 15.3 million.
2. Total expenditure incurred by the Organization in 2004-05 was US$ 1,543 million, nearly US$ 143 million (10.2%) higher than in 2002-03. Expenditure under the rubric General and Related Funds increased by US$ 128 million (16.5%), while overall Trust Funds and UNDP expenditures increased by US$ 14 million (2.4%), reversing the 2.4% decline experienced in the previous biennium. Expenditure on non-emergency Trust Funds increased by US$ 95.7 million (34%) while operations linked to emergencies declined by US$ 70.2 million (23%), mainly as the result of the termination of the Iraq Oil-for-Food Programme. Expenditure under UNDP funding continued to decline, i.e by US$ 10.7 million (41%) to reach US$ 15.3 million.
3. Expenditures to implement the programme of work totalled US$ 829.8 million, against corresponding budgeted resources of US$ 830.6 million. Income earned was US$ 81.5 million, while the overall net expenditure against the Regular Programme appropriation of US$ 749.1 million approved by the 2003 Conference was US$ 748.2 million. Shifts of resources between major programmes were largely due to: the unfavourable staff cost variance of US$ 16 million, additional security requirements in the regional and sub-regional offices and at headquarters.
4. As authorized by the 2003 Conference, the Split Assessment arrangement for the Regular Programme was introduced from 1 January 2004 as a means of protecting the implementation of the programme of work from exchange rate fluctuations. The proportional expenditure by currency (US dollars and Euros) was very close to the approved split in assessments. Members seemed to adapt to the new arrangements relatively easily, but delays in the receipt of contributions have caused exchange losses during the biennium, which could be largely eliminated through the timely payment of assessments.
5. Total Field Programme delivery in 2004-05, including under the TCP and the Special Programme for Food Security (SPFS), increased by 3.1%. The cost of related support also increased sharply. Total Administrative and Operational Support (AOS) rose by US$ 34 million to US$ 105.5 million, or – as a percentage of total project delivery – from 10% to 14.1% in 2004-05, while reimbursements increased by US$ 31.1 million to US$ 78.4 million.
6. The vigorous pursuit of efficiencies has been under way in FAO for an extended period, and savings over the past five biennia are estimated to have led to a cumulative US$ 60 million per annum. During 2004-05, efficiency savings were achieved in several areas, including: improved cost recovery of technical support services; a reduced administrative unit in the Office of the Director-General; incentive-driven chargeback procedures for publications distribution; streamlining of governance; restructuring of registries; business process and work flow improvements; structural changes relating to information technology services; and through joint actions with other UN agencies in Rome.
7. The principles of geographic representation of Member Nations among the staff, as revised by the 32nd Session of the FAO Conference in 2003, took effect in January 2004. The application of the new formula resulted in a significant increase in the number of equitably-represented countries, from 59 to 123. At the end of 2005, there were 11 countries that exceeded the top of their range (thus considered over-represented), 17 under-represented countries and 31 non-represented countries. Details are provided in Annex 2. Efforts to increase the proportion of female staff in the professional category during the last five biennia have resulted in a move at headquarters from 21% at the beginning of 1996 to 32% at the end 2005, and an increase in all locations from 18% to 29%.
Summary of programme implementation
8. Key achievements in the biennium are highlighted in the Director-General’s foreword and in boxes throughout the document. Programme implementation is reported against the PWB programme structure with the aim of describing the main achievements at programme level including regional impacts, success stories and lessons learnt. Detailed reporting on programme entities is provided in Annex 5 posted on the FAO web site (http://www.fao.org/pir).
8. Key achievements in the biennium are highlighted in the Director-General’s foreword and in boxes throughout the document. Programme implementation is reported against the PWB programme structure with the aim of describing the main achievements at programme level including regional impacts, success stories and lessons learnt. Detailed reporting on programme entities is provided in Annex 5 posted on the FAO web site (http://www.fao.org/pir).
9. The Organization was particularly active in assisting Members in connection with a broad range of emergencies, including Avian Influenza, desert locust and natural disasters. The implementation of global instruments such as Codex, the IPPC, the International Treaty on Plant Genetic Resources, the Rotterdam Convention and others developed under the aegis of FAO, continued to figure prominently, including related assistance to countries, also facilitated by extra-budgetary funding. FAO’s information dissemination function was bolstered by the redevelopment of its major statistical system (FAOSTAT); saw further rapid growth in use of WAICENT information throughout the world; and continued to include its major periodic assessments and outlook studies.
10. Technical and economic programmes (Chapter 2 and Major Programme 3.1) delivered 1,041 (94%) of 1,110 planned outputs, as well as 132 unplanned outputs (Annex 1), and the non-technical and technical cooperation programmes delivered their established range of services. At total of 251 sessions of FAO Governing Bodies and expert consultations were held, of which 26 were unscheduled; six planned sessions were cancelled (Annex 3).
11. Adjustments in resources and outputs were necessary because the implementation of the programme of work inevitably diverged from that planned as the result of factors often beyond the control of programme managers, a natural phenomenon which is exacerbated by the two year planning cycle in use in FAO. These factors include unforeseen costs developments, as well as shifts in priorities reflecting the changing external environment and the Organization’s efforts to respond to Members' most pressing needs. Therefore, in the standard table preceding each programme in the Summary of Programme Implementation, information is provided on expenditure against the effective programme of work after budgetary transfers. A percentage of PWB resources subject to transfers is also given as a measure of the extent to which the actual programmes implemented departed, in financial terms, from those originally planned.
12. For example, the Organization had to take decisive action during the biennium to ensure a safe and secure working environment for staff at all locations. Security expenditures totalled about US$ 19 million under Chapters 1, 3 and 6, more than double that of the previous biennium, which contributed to resource shifts among chapters. These expenditures covered FAO’s share of the UN Department of Safety and Security, measures for increased safety and security at Headquarters, and provision of Minimum Operating Security Standards (MOSS) equipment and facilities for FAO field duty stations and personnel.
13. Extra-budgetary resources continued to play a critical role in facilitating the continuum between normative and operational work. For example, direct extra-budgetary support to Regular Programme activities was provided in relation to the Interim Secretariat of the International Treaty on Plant Genetic Resources, and the Strengthening of Capacities for Implementing Codex Standards. Field programme expenditures were at a level which was twice that of the programme of work for technical and economic programmes in Chapter 2, in particular for Major Programme 2.1: Agricultural Production and Support Systems. Areas benefiting from extra-budgetary support are described for each programme.
14. In late 2002, the Organization received from the major contributor a payment in the amount of US$ 100 million against arrears due. The use of these funds was stipulated in Conference Resolution 6/2001 for defined purposes, also involving expenditure of a one-time nature. The resources eventually available for this type of expenditure were US$ 44.9 million, of which US$ 31.3 million was spent in 2004-05. Eight substantive areas benefited from the arrears funding, as reported in Annex 4 posted on the FAO web site. Areas of particular note include: work on phytosanitary standards, animal genetic resources, national forest resource assessments, the redevelopment of FAOSTAT, the upgrading of WAICENT, and more effective implementation of the Plans of Action on sea birds, sharks, fishing capacity and illegal, unregulated and unreported fishing.