2009 Proposed Program-Budget 1 SECRETARIAT FOR ADMINISTRATION AND FINANCE March 2008 (Portions updated July 22, 2008)

2 What is covered in this presentation? I.Context II.2009 Proposed Program-Budget III.Summary of Decisions To-date and Next Steps IV.Subsequent Challenge: Finding Long-Term Solutions 2009 Proposed Program-Budget March 26, 2008

3 I Context 2009 Proposed Program-Budget March 26, 2008

Context Annual OAS Management Cycle: Annual Audit, RF Program-Budget and Quarterly Reports aligned to CAAP’s Agenda Jun 30 Mar 31 1 st Quarterly Report 2 nd Quarterly Report Sep 30 3 rd Quarterly Report Dec 31 Jan 1 Publication of Annual Audit of Accounts Phase 2 SAF inputs budget Information Phase 1 Program-Budget formulation and planning Phase 6 Publication and distribution of the Budget by no later than 60 days after approval Phase 5 (Jun 1 st – Jun 6 th ) Approval of Program-Budget by the GA Phase 4 Discussion and review by CAAP and recommendation to the Preparatory Committee 15 days prior to GA Phase 3 Budget analysis, preparation and presentation 90 days prior to GA Publication of RF Program- Budget Year-round financial planning and performance assessment Preliminary Audit of Accounts (SEP to OCT) Audit of Accounts (JAN to APR) Report from the Board of External Auditors (end of APR) Legend Annual Audit RF Program-Budget Quarterly Reports

5 Context 2007 Modified Appropriation and Execution: ■ The General Secretariat was authorized, pursuant to Res. AG/RES. 2257, to execute $81.5 million in ■ This level was subsequently raised through a special appropriation of $2.9 million for a budgetary authorization (“ceiling”) of $84.4 million (column A). ■ Column B shows transfers during execution. ■ Of the total in Column D, $5.2 million corresponds to a special authorization to defer the execution of Fellowships, and $0.5 million in unobligated appropriations, which are no longer available for execution (became part of the Reserve Subfund as of 12/31/07). (in millions of USD) (A) Budgetary Authorization (B) Modified Appropriation (C) Execution (D)=(B)–(C) Variance Personnel Non-personnel Total Proposed Program-Budget March 26, 2008

6 Context 2008 Approved Budget and Execution: ■ The General Secretariat was authorized, pursuant to Res. AG/RES. 2353, to execute $87.5 million in ■ Column (C) provides an up-date on execution at mid-point in the 2008 fiscal year. The GS/OAS estimates 100% execution at 12/31/ Proposed Program-Budget March 26, 2008 (in millions of USD) (A) Budgetary Authorization (B) Modified Appropriation (C) Execution As of 06/30/08 (D)=(B)–(C) Variance Personnel (0.6) Non-personnel Total page modified 7/22/08

7 II 2009 Proposed Program-Budget March 26, 2008

Proposed Program-Budget 2009 Indicative Figures 2009 Proposed Program-Budget March 26, 2008

Proposed Program-Budget Assumptions ■Adherence to the SG’s commitment, stated on June 5, 2006 in Santo Domingo, to present throughout his administration a proposal that maintains the real value of the budget. ■The 2009 Budget ceiling is being proposed at $90.1 million, only 3% over the 2008 Approved Budget ceiling. ■Object 1 (personnel) has been set to $58.0 million, equivalent to 64.38%, pursuant to AG/RES (XXXVII – O/07) ■Compared to the 2008 Approved Budget, this represents an increase of $2.2 million resulting from statutory increases (post adjustment, health insurance). ■Objects 2-9 (non-personnel) have been adjusted to $32.1 million. ■Compared to the 2008 Approved Budget, this represents an increase of $436.0 thousand to accommodate inflationary increases (electricity, fuel, travel) Proposed Program-Budget March 26, 2008

Proposed Program-Budget Assumptions (cont.) ■Statutory increases to personnel costs are based on the following: ■A 4% increase for professional staff and 3% for General Services staff in These estimates are based on the trend of the increases granted by the UN in recent years. ■Increases to objects 2-9 costs have been capped in the 2009 proposed program-budget at 1.3% Proposed Program-Budget March 26, 2008

Proposed Program-Budget Expenditure budget 2009 Proposed Program-Budget March 26, 2008 Comparative summary of appropriations (by Fund) (in millions) 2009 Distribution of funds administered by the OAS (by Fund) (in millions)

Proposed Program-Budget Expenditure budget (cont.) 2009 Proposed Program-Budget March 26, 2008 Comparative summary of appropriations (by Chapter) – Regular Fund (in thousands)

Proposed Program-Budget Expenditure budget (cont.) 2009 Proposed Program-Budget March 26, Proposed Program-Budget (by Chapter) – Regular Fund (in millions)

Proposed Program-Budget Expenditure budget (cont.) 2009 Proposed Program-Budget March 26, Proposed Program-Budget – Expenditure budget of the Regular Fund by object of expenditure and Chapter (in thousands)

Proposed Program-Budget Expenditure budget (cont.) 2009 Proposed Program-Budget March 26, 2008 Budgetary Evolution of Approved Posts from 1999 to 2009 (in millions and number of positions, respectively)

Proposed Program-Budget 2009 Proposed Program-Budget Areas 2009 – Composition March 26, 2008

Proposed Program-Budget 2009 Proposed Program-Budget Areas 2009 – Composition (cont.) March 26, 2008

Proposed Program-Budget 2009 Proposed Program-Budget Areas 2009 – Composition (cont.) March 26, 2008

Proposed Program-Budget 2009 Proposed Program-Budget Areas 2009 – Composition (cont.) March 26, 2008 Comparative summary of appropriations (by Fund and Area)

Proposed Program-Budget Areas 2008 versus 2009 – All Funds 2009 Proposed Program-Budget March 26, 2008

Proposed Program-Budget Financing 2009 Proposed Program-Budget March 26, 2008

Proposed Program-Budget Reserve Subfund 2009 Proposed Program-Budget March 26, 2008 updated 7/22/08

23 III Summary of Decisions To-date and Next Steps 2009 Proposed Program-Budget March 26, 2008

24 Summary of Decisions To-date and Next Steps ACTIONS TAKEN MARCH – JUNE 2008: ■CAAP reviewed the 2009 Program-Budget Proposal and drafted the 2009 Budget Resolution. No changes were made to the proposed itemized budget figures. ■Medellín GA approved the “Guidelines for the 2009 Program-Budget” AG/RES (XXXVIII-O/08). JULY- SEPTEMBER 2008 ■CAAP recommends budget expenditure ceiling and financing sources. ■CAAP presents report to the Permanent Council/ PrepCom by Sep. 12. ■PrepCom convenes the XXXVI Special Session of the General Assembly by 9/30/08. ■By September 30, Special GA approves 2009 budget and its financing 2009 Proposed Program-Budget July 22, 2008

25 IV. Subsequent Challenge: Finding Long-Term Solutions ■Pursuant to resolution AG/RES (XXXVIII-O/08), the Permanent Council is required to convene, in a special session by December 15, “to consider the recommendations of the Board of External Auditors … in regards to the need for a periodic adjustment of quota income to the Organization’s expenditure level”, as well as to “convoke prior to 31 January 2009, a Special Session of the General Assembly to adopt, as appropriate, those decisions that may be required.” In this context: ■The SG is committed to maintain budget growth target of 3% annually. ■Inflationary pressures and a weak US $ are likely to test the limits of targeted growth rate: ■US inflation at 5% for the 12-month period ending June ■US dollar posting losses against major currencies. ■Improved quota collections have eliminated the receivables of prior periods which have contributed to finance the budgets up to The gap starting in 2010 needs to be closed by a one-time quota increase, a one time program reduction or a combination of both Proposed Program-Budget July 22, 2008