Delegates Endorse $40 Million Proposal, as Budget Committee Examines Capital Upgrade Plans of Regional Commission Offices in Bangkok, Addis Ababa

Delegates of the Fifth Committee (Administrative and Budgetary) today backed the Secretary-General's $40.02 million project plan to retrofit the premises of the Economic and Social Commission for Asia and the Pacific (ESCAP), as part of their discussion on upgrades of Commission buildings in Bangkok and Addis Ababa.

Thailand's representative, speaking on behalf of the "Group of 77" developing countries and China, said that the specific project plan considered by the Secretary-General was the most cost-effective, low-risk and viable option, also providing long-term energy and space efficiencies.

Stephen Cutts, Assistant Secretary-General of the Department of Management's Office of Central Support Services, highlighted those same benefits as he introduced the related progress report for capital projects at ESCAP. Bangkok was surrounded by seismically active zones, compounded by the specific soil characteristics of the area. He said the project aimed to address that risk through seismic mitigation retrofit to ensure safety of staff, delegates and visitors. In addition, it would offer an opportunity to address life-cycle replacements of building systems that were close to reaching the end of their useful lives.

The representatives of Chad, on behalf of the African Group, and China, also endorsed the project proposal, with the latter noting ESCAP's important role in the region's development and the need to make its facilities more earthquake resistant and well-functioning.

Turning to project developments at the Economic and Social Commission for Africa (ECA), Mr. Cutts also presented the Secretary-General's progress report on the construction of office facilities and the renovation of Africa Hall in Addis Ababa.

Ethiopia's representative said that the Africa Hall project would render high returns in the long run and that the building embodied the vision of modern Africa. However, delays in recruitment were unjustified and he also warned against prolonged procurement processes.

The representative of Chad, speaking for the African Group, was also concerned about the slippage of the project implementation due to contract negotiations, and stressed the need to ensure that the time lost was recovered without undermining the quality and scope of the project.

Also speaking today was Carlos Ruiz Massieu, Chair of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), who introduced that body's related reports on ESCAP and ECA.

In other matters, the Committee Chair Ingha Rhonda King (Saint Vincent and the Grenadines) drew attention to a letter dated 26 October 2016 from the President of the General Assembly (document A/C.5/71/11). The document contained the observations and comments by the judges of the United Nations Dispute Tribunal on recommendations in the Secretary-General's report on the findings and recommendations of the Interim Independent Assessment Panel on the system of administration of justice at the United Nations.

The Fifth Committee will meet again at 10 a.m., on Friday, 4 November, to discuss appointments to fill vacancies in subsidiary organs and other appointments.

Programme budget for 2016-2017: Construction and Property Management

STEPHEN CUTTS, Assistant Secretary-General, Office of Central Support Services, Department of Management, presented the Secretary-General's reports on the proposal for the seismic mitigation retrofit and life-cycle replacements project at the Economic and Social Commission for Asia and the Pacific (ESCAP) premises in Bangkok (document A/71/333 and A/71/333/Corr.1) and on the progress in the construction of new office facilities at the Economic Commission for Africa (ECA) in Addis Ababa and update on the renovation of conference facilities including Africa Hall (document A/71/370).

With respect to developments in Bangkok, the report provided details of the revised proposal for the project, he said. Bangkok was surrounded by seismically active zones, compounded by the specific soil characteristics of the area. The main objective of the project was to address that risk through seismic mitigation retrofit to ensure safety of staff, delegates and visitors. The project also offered an opportunity to enhance energy conservation; increase accessibility for persons with disabilities; and address life-cycle replacement of building systems that had nearly reached the end of their useful lives. As risk management was fundamental for the success of the project, the Secretary-General had proposed to hire a third party risk management firm.

The project team had developed four options for the proposed project, which had all undergone cost-benefit analysis, he said. Based on those analyses, the Secretary-General had considered option C at $40.02 million to be the most cost-effective, low-risk, and beneficial solution. He stressed that all options included the provision of adequate contingency funding. The General Assembly was asked to approve option C, as well as the related resource requirements for the 2016-2017 biennium, the establishment of a project management team and six temporary positions to create a multi-year construction-in-progress account for the project.

Turning to developments in Addis Ababa, the new office facility had been fully functional for more than two years and final works were scheduled to be completed by early 2017, he said. Regarding the Africa Hall renovation, several tasks had been performed during the reporting period; the governance structure had been refined, the recruitment of the project team was close to completion; and a mitigation strategy had been developed. The Secretary-General had proposed to hire a third party risk management firm to report directly to the Office of Central Support Services. The estimated overall project cost for the renovation was $56.9 million and would be implemented beginning in 2016 and expected to be completed by 2021. On those projects the General Assembly was requested to take note of the progress; to approve the revised cost plan for the renovation of Africa Hall, which remained within the approved budget; and to approve the proposed business case for the Visitors Centre at the Hall.

CARLOS RUIZ MASSIEU, Chair of the Advisory Committee on Administrative and Budgetary Questions (ACABQ), presented that body's related reports on ESCAP (document A/71/570) and ECA (document A/71/571). With respect to the Organization's premises in Bangkok, the Advisory Committee recommended option C of the four options presented by the Secretariat as it addressed the necessary seismic mitigation and life-cycle replacements goals simultaneously. That recommendation was subject to the Advisory Committee's guidance on the related cost estimates. The Advisory Committee urged the General Assembly to ask the Secretary-General to provide an update of cost estimates for option C, incorporating the Advisory Committee's observations on the escalation and contingency provisions, swing space requirements and space and energy efficiencies.

With the exception of resources related to the proposed consultants for flexible workplace arrangements, the Advisory Committee recommended approval of the proposed resource requirements for 2017, totalling $705,800 under sections 19 and 33 of the 2016-2017 programme budget, Mr. Ruiz said. That would represent a charge against the contingency fund. The Advisory Committee also recommended approval of the creation of the project management team and project support staff and the establishment of a multi-year construction-in-progress account to monitor the project's spending from 2017 until its completion.

Turning to ECA and the renovation of Africa Hall, he noted that the project's preparation and design (stages 1 and stage 2 respectively), had been completed and the third stage of pre-construction had begun in May of this year. Extended contract negotiations with the lead consultant for design and supervision meant some pre-construction work would be postponed until the 2018-2021 period. Even with the delay, a contractor for the fourth stage of construction was scheduled to be hired by year-end and an independent risk management firm would be hired in early 2017. The Advisory Committee reiterated that keeping the project on schedule was critical to avoid any potential cost overruns and it recommended approval of the proposed temporary positions.

SIRITHON WAIRATPANIJ (Thailand), speaking for the "Group of 77" and China, said the 2016 seismic risk analysis of the ESCAP premises confirmed that peak ground acceleration was classified as having moderate to heavy potential to cause damage to structures. Coupled with the area's soil and bedrock characteristics, that could lead to several damage, or even complete collapse of the secretariat building, if an earthquake hit. The Group found the identified risk extremely alarming and believed the safety of staff and visitors should never be compromised and the Fifth Committee should act decisively. The Group agreed with the Advisory Committee that option C, combining seismic and life-cycle facets and carried out in multiple phases over a six-year timeline, was the most viable and cost-effective option. That option also had the lowest risk and provided long-term efficiencies in energy and space. The Group was prepared to discuss and approve a multi-year construction-in-progress account and the scope, resources, and timeline for the project to ensure its successful implementation.

The Group reiterated the importance of continued interaction between the Organization and the host country throughout the project's planning and implementation, she said. In addition, the Group believed governance and oversight were key drivers of the project's successful implementation. Close interaction and coordination, with clear reporting lines, between the Secretariat in New York, the Office of Central Support Services and the Commission in Bangkok, were essential.

Turning to the construction of office facilities at the ECA, the Group noted that an independent assessment had confirmed that neither the contractor nor consultant design firm had breached the contract, she said. The Group recommended the ECA complete the contract and stressed the need for greater efforts to ensure the remaining work was fully completed within the newly defined timelines to avoid any additional delay or cost overrun. Noting that the renovation of Africa Hall had been under discussion for nearly a decade, the Group was again disappointed at the delays arising from, among other reasons, contract negotiations. The Group emphasized the need for timely completion of the Africa Hall renovation and sought details of the revised time frame and steps to recover the lost time and expedite the project's implementation. The Group noted that the planned expenditure for the biennium was lower than originally planned due to delays in contract talks. It understood that the remaining financial planning elements would be carried out within the approved maximum resources of $56.9 million and any unspent balance would be retained in the multi-year construction-in-progress account, created under section IX of Assembly resolution 70/248. Regarding oversight and governance, the Group stressed the need for full and timely implementation of the issued recommendations of the Office of Internal Oversight Services (OIOS) and ensuring the Financial Rules and Regulations, as well as procurement policies and procedures, were strictly followed.

BACHAR BONG ABDALLAH (Chad), speaking for the African Group, aligned himself with the statement by Thailand's representative on behalf of the Group of 77. The Group took note of the progress made on ancillary work of the new office facilities at the ECA, and emphasized the need to finalize the remaining work in a timely manner and within approved resources. It also had taken note of the findings of the OIOS which had only awarded the project a partially satisfactory rating, and stressed the need for timely implementation of all the recommendations of the Office, including ensuring that risks were identified and managed to avoid the reoccurrence of identified weaknesses.

With regard to the renovation of Africa Hall, the Group was concerned about the slippage of the project implementation due to contract negotiations and emphasized the need to ensure that the time lost was recovered without undermining the quality and scope of the project. On developments in Bangkok, the Group supported the Secretary-General's proposal for option C.

FU DAOPENG (China), aligning himself with the statement presented by Thailand's representative on behalf of Group of 77, said that the ESCAP had long been engaged in efforts to promote regional interconnectivity, playing an important role for the inclusive development of the region. China welcomed the Secretary-General's proposal which aimed at making the Commission's buildings more earthquake resistant and well-functioning.

MAHLET HAILU GUADEY (Ethiopia), aligning herself with the Group of 77 and the African Group, noted with satisfaction the progress made in completing the new office facilities in Addis Ababa and said there had been significant cost savings for the Organization. Pointing to the Secretary-General's report indicating that an independent assessment of the project had confirmed that neither the contractor nor the consultant design firm had breached the contract, she said that it was time for the Secretary-General to ensure completion of all claims of correction and pay all contract funds held, to bring the project to closure. Regarding renovation of Africa Hall, she said that the delay in recruitment was hard to justify. The importance of the renovation project, including a Visitors Centre, could not be overemphasized, both in terms of its historical significance and in rendering the facility compatible with health and safety standards for delegates and staff. Ethiopia believed that the Africa Hall project would have very high return in the long run, she said, adding that "let us therefore not underestimate the powerful significance of this building, which will continue to fascinate because it embodies the vision of modern Africa".

Source: United Nations.

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