Council 2006 – Final Meeting
Antalya, 4 November 2006
Document C06/93-E
22 September 2006
Original: English
DRAFT FINANCIAL PLAN 2008-2011
This document has been prepared on the basis of the results of the
work done by the Council Working Group for the elaboration of
the Draft Strategic plan & the Draft Financial Plan.
1
Introduction
1.1
Purpose and objective
The Financial Plan of the Union is quadrennial, covering two biennial budget periods. Main
purpose is to translate the objectives and their relative priorities set forth in the strategic plan in
monetary terms. It also consolidates the anticipated expenditure and the estimated income. The
primary objective of the Financial Plan is to allow Member States to know at the end of the
Plenipotentiary Conference the framework of their financial commitments to the Union for the
2008 to 2011 timeframe, based on the approved amount of the contributory unit.
1.2
Process
The process for setting the amount of the contributory unit involves the following steps (see
CS-Article 28):
a)
A provisional choice of the class of contribution by Member States is to be made one
week before the Conference and the definitive choice before the end of the Conference. Sector
Members have the possibility to make that choice within a period of three months after the
Conference.
b)
Member States need to know on which basis they may make that choice. For that
purpose, the Council has to prepare a draft financial plan to be submitted to the Member States.
c)
When establishing the draft financial plan, the Council can include in it only the level of
activities consistent with the level of activities for the previous period as well as new activities
already authorized in order not to prejudge decisions of the Conference on proposals that may be
submitted to it.
d)
Derived from the draft financial plan a provisional value of the contributory unit shall be
indicated in the report to Member States.
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e)
The Conference, taking account of the results of the review of the priorities of the Union
as they appear in the adopted strategic plan, will review the draft financial plan so that the
consequences of its decisions are included. This will result in a modified value of the
contributory unit that will be considered as an upper limit that will serve as basis, together with
other pertinent provisions of Decision 5, for establishing the budgets to be adopted by the
Council during the 2008-2011financial period.
f)
When adopting the definitive Financial Plan, the Plenipotentiary Conference needs to
give Council the possibility to authorize additional expenditure necessary because of future
changes in conditions of employment in the United Nations common system, in the exchange
rate between the Swiss franc and the United States dollar, and in the purchasing power of the
Swiss franc in respect of non-staff items of expenditure (See draft Decision 5 in Annex V).
2
Summary
2.1
Options
Two options for the quadrennial Financial Plan for 2008-2011 are proposed, with as only
difference between the two the ratio for determining the contributory unit payable by Sector
Members. Council at its 2006 session set the provisional amount of the contributory unit at CHF
318,000, or zero nominal growth compared with the 2006-2007 approved budget. Option 1
reflects the current ratio of 1/5 of the contributory unit payable by Members States, or CHF
63,600. Option 2 reflects a revision of the ratio to 1/4 of the contributory unit payable by
Members States, or CHF 79,500. Background information is provided in Document C06/94.
Table 1 below summarizes the two options. Option 1 indicates a shortage of income of CHF
33.3 million, corresponding to 5% of the expenditure estimates. Option 2 indicates a shortage of
income of CHF 12 million, corresponding to 1.8% of the expenditure estimates.
Table1
Amounts in thousands of Swiss francs
Option 1
Option 2
Income estimates
628,908
650,157
Expenditure estimates
Shortage of income
Share of the expenditure estimates
662,212
-33,304
-5.0%
662,212
-12,055
-1.8%
2.2
Income and expenditure estimates
This document reflects option 1 only with regard to the income estimates. The quadrennial
Financial Plan for 2008-2011 amounts provisionally to an income level of CHF 628.9 million,
whereas the expenditure level is CHF 662.2 million. On this basis, assuming zero nominal
growth in the amount of the contributory unit, either additional sources of income or further
reductions in the programme of activities, or a combination of both, would need to be identified
for a total value of CHF 33.3 million in order to arrive at a balanced financial plan.
Table 2 below shows the 2008-2011 estimates in relation to the 2004-2007 plan (Decision 6,
Marrakesh, 2002), and the total of the 2004-2005 actual and of the 2006-2007 budget.
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Table 2
Amounts in thousands of Swiss francs
Amount of the contributory unit
Financial Plan
Actuals
Budget
2004-2007
2004-2005
2006-2007
CHF 315.000 CHF 315.000 CHF 318.000
Total
2004-2007
Estimates
2008-2011
CHF 318.000
Variance
Variance
in %
Assessed contributions
Contributions from RRC
Cost Recovery income
Other income
Reserve Account
INCOME FORECAST
514,127
17,796
107,862
13,600
0
653,385
260,114
5,049
47,262
3,945
10
316,380
259,313
9,554
51,615
5,400
13,553
339,435
519,427
14,603
98,877
9,345
13,563
655,815
517,423
0
100,685
10,800
0
628,908
-2,004
-14,603
1,808
1,455
-13,563
-26,907
-0.4%
-100.0%
1.8%
15.6%
-100.0%
-4.1%
General Secretariat
Radiocommunication Sector
Telecommunication Standardization Sector
Telecommunication Development Sector
EXPENDITURE FORECAST
332,295
142,750
50,994
127,346
653,385
153,043
61,740
23,331
54,365
292,479
179,047
75,250
24,925
60,213
339,435
332,090
136,990
48,256
114,578
631,914
353,994
138,679
50,727
118,812
662,212
21,904
1,689
2,471
4,234
30,298
6.6%
1.2%
5.1%
3.7%
4.8%
0
23,901
0
23,901
-33,304
-57,205
INCOME LESS EXPENDITURE
Note: By excluding the costs of the RRC from the 2004-2007 figures, the R-Sector would show a variance of
CHF 7.5 million, of which CHF 5.2 million relate to the post RRC-06 work (see table 16).
3
Strategic dimension
In accordance with the Draft Strategic Plan 2008-2011 seven goals are identified for the Union,
and a number of objectives and outputs for each of the three Sectors and for the General
Secretariat. The ITU-R has five main objectives and twelve outputs. The ITU-T has seven main
objectives and twelve outputs. The ITU-D has seven main objectives and thirteen outputs. The
General Secretariat has five intersectoral objectives and six intersectoral outputs.
3.1
Goals and objectives
The strategic dimension of the Financial Plan is linked to the goals and objectives of the draft
Strategic Plan for 2008-2011. This relationship constitutes a key factor for implementing
successfully the Results Based Budgeting framework, and forms the essential part of an
integrated planning process that aims at bringing efficiency gains to all the activities of the
Union. This innovative dimension refers to Resolution 107 (Marrakesh,2002) on the
improvements to the management and functioning of ITU, and to Resolution 72
(Rev Marrakesh, 2002) on the linkage of strategic, financial and operational planning in ITU.
The linkage mechanism follows a systematic process by which Sector outputs are linked to
Sector objectives, Intersectoral outputs to General Secretariat objectives, and Sector and General
Secretariat objectives to the overall goals of the Union, as set out in the draft Strategic
Plan 2008-2011. The logical relationship between outputs, Sector and General Secretariat
objectives and the overall goals of the Union, provides a clear basis for understanding the level
of contribution of outputs to the ITU goals. Table 3 and figure 1 below show the proportion of
the draft financial plan in relation with the seven goals of the Union, and figure 2 indicates the
breakdown of the draft financial plan between the outputs of each of the three Sectors and of the
General Secretariat.
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Table 3
Amounts in thousands of Swiss francs
ITU Overall Objectives/Goals
Total
1
2
3
4
5
6
7
Inter-Sectoral
ITU-R
ITU-T
ITU-D
136,969
231,394
120,759
173,090
31,072
47,216
19,608
21,853
12,536
55,269
30,711
63,816
20,065
16,893
14,710
18,825
6,392
49,913
8,584
8,765
33,759
0
7,378
5,737
23,296
47,868
22,328
30,907
9,849
14,234
17,440
23,187
Total
662,212
119,750
162,333
70,493
73,654
46,874
124,399
64,710
Figure 1
Figure 2
3.2
Programme Outputs
The draft Strategic Plan and the draft Financial Plan are built upon a similar structure around a
set of mandatory outputs. Outputs are defined as the final products or services to be delivered. It
follows that the same structure will have to be applied in the two biennial budgets of the 20082011 plan period, along with the direct linkage between these budgets and the operational plans.
This logical framework contributes to increasing transparency and consistency between the
plans and the budgets.
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The plan takes due account of the relevant resolutions and recommendations by the Council, and
the results of Conferences and Assemblies of the respective Sectors. A list of the planned
conferences and meetings is given in Annex III. The expected level of financial resources may
however be insufficient to fully cover all the requirements. In case of a shortage of income, full
implementation of the planned outputs would not be possible. A priority setting exercise would
therefore be necessary, leading to a situation where some products and services could not be
executed unless funds were made available. For that purpose, high priority outputs have been
identified in the draft Strategic Plan for 2008-2011.
The estimated costs of outputs for each Sector and for the General Secretariat are indicated in
Annex I, together with their contribution to relevant objectives.
4
Main Financial Parameters and Targets
4.1
Financial Values
The expenditure estimates are based on 1 January 2006 real term values. The conditions of
service are those prevailing in the United Nations common system on 1 January 2006.
The cost increase between 1 January 2005 and 1 January 2006 is estimated at CHF 16 million
(see table of projected expenditure in Section 7).
Elements factored in for the re-costing process are: the United Nations operational exchange rate
of Swiss franc against the US dollar (1 US$ = CHF 1.31), the conditions of service in the UN
common system and the consumer price index reported by the Office cantonal de la statistique
of Geneva – all prevailing at 1 January 2006. The average re-costing factor amounts to 2.4 per
cent. On this basis, the estimates for 2008-2011 are in constant 1 January 2006 prices, excluding
any subsequent cost increases. They are thus comparable with the 2004-2007 figures in real
terms.
4.2
Basis for estimates
The sum of the actual expenditure incurred in 2004-2005 and of the approved budget for 20062007 is used as a basis for comparison. Any programme increase that may be required as a result
of the decisions of the 2006 Plenipotentiary Conference will have to be considered in the plan
estimates. The expected income in relation to activities subject to cost recovery is generally
highly unpredictable, and large variations may occur. The projected amounts reflect
conservative estimates which are generally based on the 2004-2007 levels.
4.3
Resource planning
Tables 4 and 5 show respectively the number of budgeted posts and budgeted work-months
since 2002-2003, including the planned levels for 2008-2011. These particularly highlight the
reductions in resources made from the 2004-2005 budget, leading to a situation where the
secretariat is currently operating at a reduced level of resources in spite of the increasing
workload.
Table 4 (Short Term staff excluded)
Posts
General Secretariat
BR (RRC incl.)
TSB
BDT
ITU
Financial Plan
Budget
2002-2003
497
183
71
148
Budget
2004-2005
450
186
65
138
Budget
2006-2007
442
182
66
134
2008
446
186
66
129
2009
446
186
66
128
2010
443
186
66
128
2011
442
186
66
128
899
839
824
827
826
823
822
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Table 5
Work-Months
General Secretariat
BR (RRC incl.)
TSB
BDT
ITU
Financial Plan
Budget
2002-2003
11'618
4'231
1'666
2'914
Budget
2004-2005
10'255
4'196
1'528
2'903
Budget
2006-2007
10'242
4'208
1'528
2'815
2008-2009
10'705
4'304
1'513
2'653
2010-2011
10'461
4'258
1'509
2'631
20'429
18'882
18'793
19'175
18'859
4.4
Prospective Cost Increase
Assuming a statutory cost increase of 1.5% per year on average from 2006 up to 2011 included,
the estimated costs would increase by approximately CHF 35 million. However, the draft
Financial Plan does not include any provision for the prospective cost increase with regard to the
period 1 January 2006 to 31 December 2011, due to the difficulty to project all the parameters of
cost increase over a six years time span, and because of their uncontrollable nature. This
planning method, which affects the purchasing power of the Union, implies that the price
variation is kept as a separate consideration, to be dealt with via a budgeting mechanism similar
to the one provided in Decision 5 of Minneapolis, 1998. See decides 4 and 5 of the draft
Decision 5 in Annex V.
4.5
Exchange Rate
The United Nations operational rate of exchange in force on 1 January 2006 of 1.31 Swiss franc
for 1 US dollar is applied. This rate is 4.8% over the budgeted rate of 1.25 for the 2006-2007
biennium. Approximately 15 per cent of the Union’s expenditure is based on US dollar, mainly
in respect of the contributions to the United Nations Joint Staff Pension Fund (UNJPF) for
professional and higher categories. In case of a strengthening of the US dollar against the Swiss
franc, the risk exposure of a 10% fluctuation is estimated at some CHF 4 million over the four
years plan period.
4.6
Cost of Languages
The cost of languages covering the translation and composition services is included as part of
the General Secretariat departments estimates. These costs are projected at some CHF 69.3
million. Moreover, interpretation costs, which are included under the various sections for
conferences and meetings, are estimated at CHF 6.7 million.
Table 6 below shows the workload estimates of the services of translation and typing in number
of pages and of interpretation in number of days over the 2008-2011 timeframe, broken down by
Sectors and Intersectoral outputs and for the Sectors Bureaux and the General Secretariat
Departments.
Table 6
Inter-Sectoral Outputs
ITU-R Outputs
ITU-T Outputs
ITU-D Outputs
Sectors Bureaux & GS Departments
Translation
Pages
19'018
62'004
84'280
48'914
17'629
Typing
Pages
19'536
74'528
103'018
49'437
15'806
Interpretation
Days
2'056
5'179
2'758
2'444
Total
Page
6
231'845
262'325
12'437
-7C06/93-E
Table 7 below indicates the estimated costs of the activities related with the production of
documents and of the interpretation services as planned for the period 2008-2011.
Table 7
000'CHF
Translation
Typing
Doc. Prod. & Reference
Strait/Terminology
Doc. Composition
EDMG
Sub-total
40,807
19,689
3,172
2,988
1,780
909
69,345
Interpretation
6,743
Total
76,088
4.7
Efficiency Measures
During the 2000-2003 and 2004-2007 financial plan periods, cost savings have already been
implemented for a total of more than CHF 75 million, including the staff-cost reduction in 20042005, as well as the efficiency measures planned for the 2006-2007 biennium. The Union will
endeavour to make any additional possible savings, in spite of the fact that what can be realized
for the optimization of resources is limited. Further measures to reduce costs that are for most of
them already incorporated in the draft expenditure estimates are listed in Annex II.
4.8
Reserve Account
The minimum level of the Reserve Account was set by Council in 1981 at 3% of the budget
appropriations. Following the withdrawal of CHF 14 million in relation to Resolution 1250, and
the positive balance of CHF 19 million generated from the execution of the 2004-2005
biennium, the Reserve Account stands at CHF 30.7 million, of which CHF 13 million is set
aside for activities subject to cost recovery. The latter being excluded, the Reserve Account is
standing above its minimum advisable level of 3% of the budget or around CHF 10 million. The
Reserve Account can also be used to replenish other funds and reserves.
In view of the uncertainty in terms of the income expected to be generated from the activities
subject to cost recovery, it may be appropriate to reassess the minimum level of the Reserve
Account and raise it to a higher share of the unpredictable/variable income. Currently the 3%
coverage of the total budget corresponds approximately to 10% of the income, the assessed
contributions from Member States being excluded. Table 8 below shows the variation of the
level of the Reserve Account between 2002 and 2006.
Table 8
Amounts in thousands of Swiss francs
Year
2002
2003
2004
2005
2006
Opening Balance
17,597
14,357
29,948
24,594
44,256
Payments
Withdrawals
0
-3,240
15,591
0
43
-5,397
19,662
0
597
-14,150
Closing Balance
14,357
Page 7
29,948
24,594
44,256
30,703
-8C06/93-E
4.9
Reserve for staff installation and repatriation
In its report to Council 06 on the 2004-2005 accounts (document C06/90), the External Auditor
is recommending to raise the budget provision of 3% of the staff expenditure to replenish the
reserve for staff installation and repatriation in view of the growing level of financial liabilities.
The impact of an increase of the rate from 3% to 4% is estimated at CHF 3.7 million over the
fours years plan period. This draft Financial Plan is based on the current rate of 3%.
4.10
Other considerations
The costs of outputs are established by application of Decision 535 on the new cost allocation
methodology, which has been elaborated with the aim of enhancing transparency of costs and
attributing costs directly to the relevant cost objects to the extent possible. In order to translate
the Strategic Plan in financial terms, the relationship between objectives and outputs is
expressed in monetary value by attributing on an equal basis the planned costs of outputs to the
objectives to which they relate.
Annex I gives a breakdown of the total costs for each intersectoral and Sector output, between
the direct costs, consisting in planned expenditure, documentation costs and other services costs,
and the indirect costs. In addition, the full costs of each sectoral output are assigned to the
respective sector’s objectives and each intersectoral output to the intersectoral objectives as
defined in the draft Strategic Plan 2008-2011.
5
Contributory Unit
5.1
Evolution
The amount of the contributory unit has decreased from CHF 334,000 in 1997 to CHF 318,000
in 2006-2007. Zero real growth in the amount of the contributory unit as per January 2006
would be CHF 325.000. Expressed in January 2006 real term values, the erosion over the ten
years period of 1997 to 2007 amounts to 14%. As a reference, the provisional amount of the
contributory unit of CHF 318,000 stays below the upper limit of CHF 330,000 set in decides 1.1
of Decision 5 (Rev. Marrakesh, 2002) for the current financial period. Figure 3 below shows the
evolution of the contributory unit and of the budgeted income since 1995. Figure 4 shows the
evolution of the contributory unit since 1995, expressed in January 2006 real term value.
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Figure 3
Figure 4
5.2
Decision 5 modalities
The draft Financial Plan assumes that Decision 5 should specify that Council, when drawing up
the budgets of the Union, may authorize an amount of the contributory unit in excess of the
upper limit in nominal terms, but not higher than the real growth value, so as to maintain the
purchasing power of the Union (See draft Decision 5 in Annex V). The real growth value will be
determined based on the cost increases in respect of the following elements:
a)
the exchange rate between the Swiss franc and the United States dollar;
b)
salary scales, pension contributions and allowances, including post adjustments,
established by the United Nations common system and applicable to the staff employed by the
Union;
c)
the inflation rate based on the consumer price index in Geneva in respect of non-staff
items of expenditure;
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5.3
Ratio between Member State and Sector Member’s Contributions
According to CV480, the amount of the contribution per unit payable towards the expenses of
each Sector concerned shall be set at 1/5 of the contributory unit of Member States. This ratio
was introduced in 1982. However, in view of the increasing role and participation of Sector
Members in the work of the Sectors, a different approach could be considered and a review of
the ratio might be appropriate. See Document C06/94 on this issue. Based on the number of
Sector Members and of Associates as of 1 May 2006, a change from 1/5 to ¼ would represent an
increase of income of CHF 21.2 million. According to CV483A, Associates shall share in
defraying the expenses of each Sector concerned as determined by the Council.
6
Projected Income
6.1
Income
Based on a contributory unit of CHF 318,000 reflecting zero nominal growth as compared with
the approved amount of the contributory unit for the 2006-2007 budget, on the number of
contributory units as of 15 September 2006 (406.78 full units Member States equivalents), and
on conservative estimates in respect of the revenue from cost recovery activities, total income is
expected to reach a level of CHF 628.9 million over the 2008-2011 plan period. Table 9
indicates the income by source and compares the 2004-2005 actual and the 2006-2007 budget
with the 2008-2011 estimates.
Table 9
Amounts in thousands of Swiss francs
Actuals
2004-2005
Budget
2006-2007
Total
2004-2007
Estimates
2008-2011
Variance
% Variance
Assessed Contributions
Contributions to the RRC
Cost Recovery Income
Other Income
Reserve Account
260,114
5,049
47,262
3,945
10
259,313
9,554
51,615
5,400
13,553
519,427
14,603
98,877
9,345
13,563
517,423
0
100,685
10,800
0
-2,004
-14,603
1,808
1,455
-13,563
-0.4%
-100.0%
1.8%
15.6%
-100.0%
Total
316,380
339,435
655,815
628,908
-26,907
-4.1%
The respective shares of the sources of income planned for 2008-2011 are illustrated in figure 5
and the breakdown of assessed contributions by source in figure 6.
Figure 5
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Figure 6
6.2
Assessed Contributions from Member States
Assessed Contributions from Member States account for 69% of the total income projected. The
estimated income is based on the number of units as notified to the Union as of 15 September
2006 (340 9/16 units), and on an amount of CHF 318,000 per unit. The Union counts
191 Member States, included Montenegro as from March 2006.
6.3
Assessed Contributions from Sector Members
Assessed Contributions from Sector Members account for 12% of the total income projected.
The estimated income is based on the number of units as notified to the Union as of
15 September 2006, and on an amount of CHF 63,600 per unit, representing 1/5 of the amount
applicable to Member States. Table 10 indicates the number of contributory unit from Sector
Members by Sector and the decrease compared with the Financial Plan 2004-2007. This
decrease represents a loss of income of 12%. Table 11 indicates the number of Sector Members
by Sector and for the whole ITU as of 15 September 2006.
Table 10
ITU-R
ITU-T
ITU-D
Financial Plan 04-07
Budget 2004-2005
Budget 2006-2007
127
121 1/2
122
191 1/2
175
160 1/2
32 5/8
28 9/16
28
Draft Plan 2008-2011
123
156 1/2
29 3/8
Page 11
ITU
20
1
0
351 1/8
325 1/16
310 1/2
308 7/8
- 12 C06/93-E
Table 11
Draft Plan 2008-2011
ITU-R
ITU-T
ITU-D
235
294
277
ITU
645
6.4
Assessed Contributions from Associates
Contributions from Associates account for 1% of the total income projected. The estimated
income is based on the number of Associates known as of 15 September 2006, and on an
amount of CHF 10,600 per unit for the R and T Sectors, and CHF 3,975 for the D Sector.
Table 12 gives the number of Associates by Sector and for the whole ITU.
Table 12
Financial Plan 04-07
Budget 2004-2005
Budget 2006-2007
Draft Plan 2008-2011
ITU-R
ITU-T
ITU-D
10
11
15
25
50
56
78
106
0
0
2
6
ITU
20
1
0
60
67
89
132
6.5
Contributions from Regional Conferences
No income is planned in 2008-2011.
6.6
Cost Recovery Income
Income under cost recovery accounts for 16% of the Union’s total income. Resolution 91 on the
cost recovery for some ITU products and services is expected to be reviewed in order to
determine whether any amendments or updates are required in light of its implementation since
its adoption by the 1998 Plenipotentiary Conference. The Report of the Council Group on the
Elaboration of the draft Strategic Plan and the draft Financial Plan contains a draft revision of
Resolution 91. See document C06/92. Income from activities subject to cost recovery is planned
as per Table 13 below.
Table 13
Amounts in thousands of Swiss francs
Actuals
2004-2005
Budget
2006-2007
Total
2004-2007
Estimates
2008-2011
Variance
% Variance
Projects support costs
Sales of Publications
Registrars
GMPCS
Satellite Network Filings
ITU TELECOM
Others
2,229
24,289
966
223
16,018
2,508
1,029
4,000
24,000
1,400
75
14,000
8,140
0
6,229
48,289
2,366
298
30,018
10,648
1,029
8,000
44,000
2,000
150
30,000
16,535
0
1,771
-4,289
-366
-148
-18
5,887
-1,029
28.4%
-8.9%
-15.5%
-49.7%
-0.1%
55.3%
-100.0%
Total
47,262
51,615
98,877
100,685
1,808
1.8%
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6.6.1 Project Support Costs Income
In line with the ITU Financial Regulations, the costs of any administrative and operational
services to be provided by the Union may be charged as expenditure to technical cooperation
projects. The exact amount is defined by the percentage charge as specified in the agreement
signed between the Union and the project donors/partners. Support-cost income derived from
the implementation of such projects is estimated at CHF 8 million for the period of the financial
plan. This is based on an estimated annual project delivery of USD 20.4 million in respect of
UNDP, trust fund and Telecom Surplus projects. The overall delivery of projects is expected to
attract an average rate of 7.5%. The exchange rate applied in the calculation is USD 1.0 =
CHF 1.31.
6.6.2 Sales of Publications
Publications income is estimated at CHF 44 million for 2008-2011, reflecting a decline from
CHF 48.3 million for the period 2004-2007 (actual 2004-2005 plus budget 2006-2007). The
projected income takes into account a potential loss of CHF 7 million resulting from the free online access to ITU-T Recommendations, and an increase of 10% on average in the price of
publications representing CHF 4 million in additional planned income.
6.6.3 ITU-T Registrars
The forecast for UIFNs is based on the actual figures of previous years, i.e.2 500 registrations
per year, generating an income of CHF 2 million for the plan period.
6.6.4 GMPCS
The cost recovery income reflects the full costs of the output, basically at the same level as the
2006-2007 approved budget.
6.6.5 Satellite Network Filings
The anticipated cost recovery income for satellite network filings for the 2008 to 2011 period is
expected to be steady as compared with the planned 2006-2007 income level. An increase is
foreseen for the 2010 to 2011 period on account of the introduction of cost recovery for the
notification stage of the processing.
6.6.6 Cost Recovery Income from ITU TELECOM
In accordance with the new budgeting framework and cost-allocation methodology, the draft
plan includes as cost-recovery income the full costs of services provided to ITU TELECOM. The
level of income is comparable with the amount of the approved 2006-2007 budget.
6.7
Income from Interests and Other Income
Interest income and other income account for 2% of the total income projected. Based on the
current level of cash balance, short term deposits are expected to generate an interest income in
the range of CHF 1.2 million per annum. Other income includes income from rental of
premises, sales of equipment, credit notes from vendors and other miscellaneous items. The
estimates are at the same level as the 2006-2007 approved budget.
6.8
Reserve Account
No withdrawal is included. In conformity with Article 27 of the Financial Regulations, Council
may decide to make withdrawals from the Reserve Account.
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7
Projected Expenditure
Planned expenditure expressed in January 2006 real term value is estimated at
CHF 662.2 million, the prospective cost increase during the years 2006 to 2011 being excluded.
The projected expenditure levels result from a fruitful cooperation between the General
Secretariat and the Bureaux. A contributory unit in the amount of CHF 338,500 would be
required to fully implement this programme.
Table 14 below indicates the expenditure by Sector and compares the 2004-2005 actual and the
2006-2007 budget with the 2008-2011 estimates in terms of cost increase and real growth
values. A lapse factor of nine months in recruitment delay has been applied to all G and P posts
due to become vacant in the 2008-2011 timeframe, as a general measure to alleviate the
expenditure levels.
Table 14
Amounts in thousands of Swiss francs
Actuals
2004-2005
Budget
2006-2007
Total
2004-2007
Cost
Increase
Real
Growth
Estimates
2008-2011
General Secretariat
ITU-R
ITU-T
ITU-D
153,043
61,740
23,331
54,365
179,047
75,250
24,925
60,213
332,090
136,990
48,256
114,578
6,723
4,280
1,699
3,332
15,181
-2,591
772
902
353,994
138,679
50,727
118,812
Total
292,479
339,435
631,914
16,034
14,264
662,212
Note: Real Growth is defined as the difference between the 2008-2011 estimates and the sum of the 2004-2005
actuals, the 2006-2007 budget and the cost increase.
7.1
General Secretariat
Table 15 below indicates the expenditure by section and compares the 2004-2005 actual and the
2006-2007 budget with the 2008-2011 estimates in terms of cost increase and real growth
values.
Table 15
Amounts in thousands of Swiss francs
Actuals
2004-2005
Budget
2006-2007
Total
2004-2007
Cost
Increase
Real
Growth
Estimates
2008-2011
Plenipotentiary Conference
WSIS
Council
Infrastructure Buildings
ICT Projects
Publications
New Initiatives
SG's Office & departments
Retired Staff
1
1,194
1,685
4,510
1,750
53
0
137,282
6,568
1,960
0
1,339
4,490
1,750
27
0
162,481
7,000
1,961
1,194
3,024
9,000
3,500
80
0
299,763
13,568
25
0
68
0
0
1
0
6,037
592
-149
-1,194
-939
-20
0
-26
202
17,307
0
1,837
0
2,153
8,980
3,500
55
202
323,107
14,160
Total
153,043
179,047
332,090
6,723
15,181
353,994
Page 14
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7.1.1 Plenipotentiary Conference
A Conference is planned in 2010 at an expenditure level similar to the approved budget of the
2006 Conference.
7.1.2 World Summit on the Information Society
The World Summit on the Information Society output documents call upon ITU to undertake a
wide range of new activities, as well as reinforcing the importance for the continuance of
existing work. ITU is mentioned specifically 28 times in the WSIS outputs. Principal new
activities for ITU include playing a lead facilitating role in implementing the Plan of Action and
in work among the 11 Action Line multi-stakeholder teams, serving as the main
moderator/facilitator for 2 Action Lines (infrastructure and security) and playing a co-facilitator
role in many other Action Lines. ITU is also expected to take a lead role in the newlyestablished UN Group on the Information Society and to contribute more actively to ECOSOC
with respect to WSIS matters. The Tunis outputs also reinforce existing ITU work in such areas
as spectrum management, global standards, Internet, affordable connectivity, combating spam,
data collection and analysis and developing an enabling environment. See the document on the
WSIS implementation plan within ITU at http://www.itu.int/osg/spu/stratplan/2006/revisedITU-WSIS-imlementation-plan-14-sept-06.pdf
These activities are consistent with the goals set forth in the draft Strategic Plan for 20082011. The new activities requested of ITU in the WSIS output are planned to be absorbed within
the existing resources throughout the Union.
7.1.3 Council
Annual sessions and working group meetings are planned at an expenditure level well below the
2004-2007 amount.
7.1.4 Infrastructure Buildings
The Buildings Maintenance Fund stands at the end of 2005 at CHF 6.5 million, with planned
funding of CHF 1.5 million from the 2006-2007 budget and CHF 3 million for the period 20082011. This funding is below the minimum resource requirements deemed necessary for the
normal maintenance of ITU buildings and related installations (1.5% of the value of the
premises per annum). Projects planned for the period include: extensive electrical safety and
modernisation works (surge compensation batteries, inverters, low voltage cabinets, Tower
lighting), renovation of « Salle des pas perdus » and renovation of the Tower cafeteria.
Furthermore, this intersectoral output includes a total of CHF 6 million in respect of the annual
instalments due to the Swiss Confederation for repayment of the loans, funded from the regular
budget.
7.1.5 ICT Projects
The Information and Communication Technologies Capital Fund stands at the end of 2005 at
CHF 4.2 million, with additional funding of CHF 1.75 million from the 2006-2007 budget, and
planned funding of CHF 3.5 million for the period 2008-2011. This is expected to cover high
priority investments only. Besides, an amount of CHF 4.8 million was transferred from the
Reserve Account by Council Resolution 1235.
7.1.6 General Secretariat Publications
The expenditure is set at the same level as the 2006-2007 budget for each biennium.
7.1.7 New Initiatives
The costs are moved from the SPU budget to the specific output and can therefore be identified
separately. They are provisioned for consultancy services with regard to the organization of
Page 15
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workshops, country case studies and other issues of current policy and regulatory interest. The
same level of expenditure was included in the 2006-2007 budget under the General Secretariat
Departments appropriations.
7.1.8 Secretary General Office and Departments
The approved level of resources of the 2006-2007 budget is in its majority reflected in the 20082011 estimates. Besides, the estimates include a provision for six new additional posts for
security, in order to comply with the minimum security standard requirements. Another two
posts are planned in relation to the information services function which under the previous plan
period are funded from extra-budgetary resources, in line with the need to maintain the function
at an effective level. The plan provides also for the reactivation of one post in respect of
financial services, reverting to the level of the 2002-2003 budget, and in line with the necessity
of reinforcing resources of the finance function.
The real growth amount corresponds to programme increases, mainly due to the introduction of
Resolution 115 on languages and the resulting additional financial requirements which came
into full effect as from the 2006-2007 biennium, and to the change to the full costs methodology
for the services rendered to ITU TELECOM. The costs of services provided by the General
Secretariat are, as from the 2006-2007 biennium, fully accounted for both as expenditure and as
income. Table 13 shows the effect of adopting the new cost accounting framework, whereby
cost recovery income from ITU TELECOM is in 2008-2011 planned CHF 6 million higher than
the 2004-2007 plan. Another factor of programme variation is the recentralization in the General
Secretariat, as from the 2006-2007 biennium, of the variable costs of documentation which
previously were included in the budgets of the conferences and Sectors. The creation of the new
Procurement Service in the General Secretariat contributes also to an increase of resources in the
General Secretariat. Five posts have been transferred from the Development Bureau and one
post from the ITU Telecom Secretariat, for a total of CHF 3.6 million over the period 20082011. Besides, the savings realized during the 2004-2005 biennium have only one time effect, as
they primarily relate to vacancies for which recruitment was delayed in spite of the heavy
workload and programme constraints.
With regard to the adoption of the International Public Sector Accounting Standards, a provision
of CHF 2.5 million is included in order to cover the resources required for its implementation.
Reference is made to documents on the IPSAS adoption draft UN General Assembly Report
http://www.itu.int/md/S03-RCLFI-ADM-0034 and on the Recommendation of the HLCM task
force on Accounting Standards http://www.itu.int/md/S03-RCLFI-ADM-0035
7.1.9 Retired Staff
The cost increase of CHF 0.6 million corresponds to the increase in the cost of living in line
with the 2006-2007 approved budget and the 2005 actual amount.
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7.2
Radiocommunication Sector
Table 16
Amounts in thousands of Swiss francs
Actuals
2004-2005
WRC
RA
RRC
RRB
RAG
Study Group Meetings
Activities & Programmes
Seminars
Bureau
0
0
2'926
898
134
1'564
2'151
291
53'776
Budget
2006-2007
Total
2004-2007
2'406
317
7'151
937
225
2'927
3'160
420
57'707
Total
61'740
75'250
* of which CHF 5.2 million relate to the post RRC-06 work
Cost
Increase
Real
Growth
Estimates
2008-2011
2'406
317
10'077
1'835
359
4'491
5'311
711
111'483
49
8
0
51
11
48
70
7
4'036
-351
-53
-10'077
494
-109
-164
-184
139
* 7'714
2'104
272
0
2'380
261
4'375
5'197
857
123'233
136'990
4'280
-2'591
138'679
All outputs undertaken and supported by the Radiocommunication Bureau are core and
mandatory outputs defined and set by the Constitution, the Convention, as well the Radio
Regulations. Therefore, despite best efforts to streamline the processes and improve the
working methods of the Bureau, it should be recognized that the Bureau is now working with
the minimum resource level necessary to implement the outputs and that any further reduction in
the already limited resources of the ITU-R would immediately result in the de-emphasis or
discontinuity of one or several outputs of the Sector.
As for the preparation of the 2006-2007 Budget, the anticipated human resource level for the
forthcoming period indicates a decrease of three positions as compared with the current level of
resources, not taking into consideration the proposed additional resources to cope with the post
RRC work. This has been obtained from substantive trade-offs between resources and outputs,
including prioritizing the activities and actions undertaken by the Bureau to support the outputs
of the Sector.
The challenges to be faced will be highly demanding of the Union and especially of the ITU-R
and the Radiocommunications Bureau. Now and in the future, Member States should provide
the Radiocommunication Sector with the means to play its role fully.
The key and most challenging issues for the concerned timeframe will be the following:
a)
To continue meeting the regulatory deadlines set up in the Radio Regulations for
processing satellite network filings (API, Coordination Requests, Notification, Appendices 30
and 30A Plans) and to ensure that processing backlog situation will not reoccur.
b)
To suppress the remaining backlog in processing Appendix 30B filings, which is
highly depending on the review of Appendix 30B by WRC-07.
c)
To take advantage of the high expertise of the BR staff to enhance the level of
assistance and support to administrations and BR customers.
d)
To implement the decisions of the WRC-07 in a timely manner, with special emphasis
to the changes in the regulatory procedures. The Bureau will also organize the preparatory
studies for WRC-2010, participate in the relevant preparatory activities, provide the logistic
support to WRC-2010 and proceed with the early implementation of its decisions.
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e)
To continue with the application of the procedures decided by RRC-06 regarding the
putting into operation of the Plans established by RRC-06, including the procedures for gradual
migration to digital broadcasting in the VHF and UHF bands in accordance with the
differentiated needs of the membership. Account will be taken of the relevant decisions of
WRC-07 regarding the sharing between terrestrial and satellite broadcasting in these bands.
f)
To continue to process notices to terrestrial services under various regulatory
procedures, as envisaged in the Radio Regulations and in the applicable Regional Agreements.
The processing software will be adapted to cover the changes in the technical and regulatory
procedures as may arise from the decisions of WRC-07 and WRC-2010, as well as from other
regional conferences that may be scheduled in this respect. The Bureau will continue with
timely preparation and dissemination of the relevant service publications and with maintenance
of their on-line equivalents.
g)
To provide for the continuing support for the ITU-R Study Groups to conduct their
studies according the their work programme, with special emphasis on the topics that may be
identified by WRC-07 and WRC-2010.
7.2.1 World Radiocommunication Conference / Radiocommunication Assembly
A World Radiocommunication Conference and a Radiocommunication Assembly are planned to
be held in 2010. The decreased level of planned expenditure as compared with the past events is
due to the proposed reduction of two working days of the 2010 conference as well as a proposed
reduction of one working day of the Radiocomunication Assembly.
7.2.2 Regional Radiocommunication Conference
No regional conference is planned for the 2008-2011 timeframe.
7.2.3 Radiocommunication Regulations Board
Eight meetings of the RRB are foreseen in 2008-2009 and seven meetings in 2010-2011, as
against six in 2006-2007, on account of the RRC06 and the WRC07, and seven in 2004-2005.
Consideration might be given to a reduction from four to three annual meetings
7.2.4 Radiocommunication Advisory Group
One annual meeting of the RAG will be held during the period. The duration of each meeting
has been reduced to three working days.
7.2.5 Study Group Meetings
The level of expenditure as compared to the previous budgetary periods remains steady despite
the fact that a major CPM is planned to be held in 2010. The duration of the CPM is reduced by
one working day.
7.2.6 Activities and Programmes
The planned expenditure for the production of the ITU-R publications have been reduced to
reflect the cost reductions achieved in this area while maintaining the same or equivalent
publications programme.
7.2.7 Seminars
During each biennium, two to three regional radiocommunication seminars will be organised as
well as one biennial world seminar.
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7.2.8 Radiocommunication Bureau
Notwithstanding the additional resources related to the implementation of the RRC-06
decisions, the planned staffing level for 2008-2011 for the Radiocommunication Bureau
indicates a decrease of three positions as compared with the 2006-2007 staffing level and a
decrease of seven positions as compared with the 2004-2005 staffing level. It is to be noted that
the draft Financial Plan does not include any provision for the Spanish editing to be carried out
by the Bureau.
7.3
Telecommunication Standardization Sector
Table 17
Amounts in thousands of Swiss francs
Actuals
2004-2005
Budget
2006-2007
Total
2004-2007
Cost
Increase
Real
Growth
Estimates
2008-2011
WTSA
WTSA Reg. Consult. Sess.
TSAG
Study Group Meetings
Activities & Programmes
Seminars
Bureau
491
121
194
1,770
483
94
20,178
0
0
198
2,121
390
100
22,116
491
121
392
3,891
873
194
42,294
7
3
13
50
11
5
1,610
29
219
-180
-425
49
-10
1,090
527
343
225
3,516
933
189
44,994
Total
23,331
24,925
48,256
1,699
772
50,727
Over the last years, ITU-T has improved its working methods and approval processes,
strengthened its cooperation with other standards developing organizations and forums,
increased its presence in the regions, particularly in the developing countries, and promoted its
work. All of this resulted in improving the image of ITU-T considerably. However, arguably no
industry goes through more rapid changes and shorter cycles of innovation than the industry of
Information and Communication Technologies, posing new challenges for ITU-T on a daily
basis. In order to stay a pre-eminent standards organization, the ITU-T draft Financial Plan takes
account of the competitive environment that ITU-T operates in, the increased workload assigned
by WTSA and WSIS, as well as the objectives, outputs and priorities defined by TSAG for the
Sector at its November 2005 session.
ITU-T needs to develop and publish the required global standards at the right time. One of the
challenges of ITU-T, and identified by TSAG as one of the main objectives, is to identify
relevant areas for future standardization projects to be initiated within ITU-T. ITU-T is at the
forefront of providing global standards for NGN (Next Generation Networks), now under the
brand name NGN-GSI (Global Standards Initiative). ITU-T is asked by both WTSA-04 and the
WSIS Tunis Agenda to take the lead role in building confidence and security in the use of ICTs.
New developments are taking place in fields such as Home Networking, Internet Protocol
Television (IPTV), Radio-Frequency Identification (RFID), Multilingualization, Grid and the
networked vehicle where ITU-T is going to play a role.
WTSA-04 also cemented the ITU-T workshop program as an integral part of the ITU-T
activities, and called for a technology watch function to monitor future-looking work.
Furthermore, ITU-T study groups rely heavily on electronic working methods which need to
evolve constantly.
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7.3.1 World Telecommunication Standardization Assembly
A World Telecommunication Standardization Assembly will be held in 2008, in accordance
with Article 18 of the Constitution of the Union.
7.3.2 WTSA Regional Consultation Sessions
One WTSA regional consultation session will be held per region in 2008 as requested by WTSA
Resolution 43 (Florianópolis, 2004). Expenditure has been set at the level of the 2004 initial
approved budget.
7.3.3 Telecommunication Standardization Advisory Group
One Telecommunication Standardization Advisory Group meeting has been planned on an
annual basis in 2008-2011, of a duration of three working days.
7.3.4 Study Group Meetings
Planned expenditure for the ITU-T Study Groups have been reduced by 17 % compared with
the level of the approved budget for 2006-2007, despite the fact that a multitude of new work
areas are going to open up for ITU-T in fields like NGN (Release 2 and higher), Home
Networking, IPTV, RFID, Multilingualization, Grid, and the fully networked vehicle.
7.3.5 Activities and Programmes
Planned expenditure for the production cost of ITU-T publications (printing of DVD-Rom,
postage and packing) as well as the operational expenses of the UIFN registrar unit are included
at a level similar to the 2004-2007 period.
7.3.6 Seminars
Planned expenditure covering primarily fellowships is in line with the 2004-2007 level.
7.3.7 Standardization Bureau
The staffing level of the Telecommunication Standardization Bureau has been kept unchanged
compared with the 2006-2007 budget. However, a reinforcement of the staffing level would be
necessary to compensate for the increased workload of the Bureau to face multiple new
challenges of the 2008-2011 period, in particular:
a)
In the field of Home Networking, IPTV, RFID, Multilingualization, Grid, Network
vehicle, and NGN.
b)
The increase work arising from WTSA-04 outcomes, i.e. security work, including
spam; internet interconnection work; bridge the standardization gap; E-business; workshops; the
work needed to take post-WSIS follow-up should also be considered.
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7.4
Telecommunication Development Sector
Table 18
Amounts in thousands of Swiss francs
Actuals
2004-2005
Budget
2006-2007
Total
2004-2007
Cost
Increase
Real
Growth
Estimates
2008-2011
WTDC
RTDC
TDAG
Study Group Meetings
Activities & Programmes
Bureau
6
742
232
987
11,132
41,266
1,213
0
203
590
11,528
46,679
1,219
742
435
1,577
22,660
87,945
20
14
15
17
262
3,004
-90
302
15
245
2,721
-2,291
1,149
1,058
465
1,839
25,643
88,658
Total
54,365
60,213
114,578
3,332
902
118,812
All current outputs and programmes of the BDT are based on and flow from decisions of PP-02
and WTDC-06. BDT has made strenuous efforts to maintain its work with a minimum of
resources and maintain its level of services to its members. However, the Bureau is now in a
situation where it can no longer absorb a further diminution of its resources without it having a
negative impact on its activities and outputs.
For the period covering the 2008-2011 Financial Plan, the BDT will be expected to reinforce its
programmes and activities as a direct result of the WSIS outcomes and also, decisions
emanating from the WTDC in Doha. Furthermore, the BDT continues to experience increasing
requests for assistance from developing countries, yet the resources available to meet these
requirements keep declining. Even with full support of the current resource requests, it should
not be assumed that BDT will be able to fully implement additional mandates related to the
WSIS and WTDC-06.
The challenges facing the BDT and the ITU as a whole are significant. With the high level of
importance that Member States have imparted on the outcomes of the WSIS and the
deliberations of the WTDC in Doha, the Bureau needs to be supported with the required
resources in order to fulfil its expanding mandate.
In broad terms, the following issues will present the key challenges to the BDT going forward:
a)
in light of the diminishing resources available, to continue to implement effectively and
on a timely basis the actions, activities, programmes and projects which the ITU membership
has already mandated the BDT to carry out;
b)
to maintain the capacity and expertise required to respond to the increasing number of
requests for assistance from developing countries,
c)
to implement in a timely manner decisions related to the Doha Action Plan (WTDC-06),
d)
to account for and integrate outcomes of the WSIS into the core BDT work-plan.
7.4.1 World Telecommunication Development Conference
The next World Telecommunication Development Conference will be held in 2010. The
conference will continue in its role as a vehicle for maintaining and extending cooperation
among all Member States and Sector members in decision-making on development issues,
including the establishment of work programmes and guidelines.
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7.4.2 Regional Telecommunication Development Conference
Meetings will be held in the individual regions in 2009 in preparation for the WTDC scheduled
in 2010. The plan for the 2009 cycle has been established based on the full estimated cost, while
actual expenditure for the 2005 cycle were below budget owing to the generosity of host
administrations in absorbing certain costs.
7.4.3 Telecommunication Development Advisory Group
One annual meeting over three working days will be held during the period concerned. The 2006
meeting was eliminated from the budget due to exceptional cycle of conferences in 2006, which
includes the Plenipotentiary Conference ending just prior to the usual dates of the TDAG.
7.4.4 Study Groups Meetings
The increase of expenditure for the Study Group meetings when compared to the prior periods
related to the re-establishment of the usual cycle and budget for the two study groups, this being
a request from Study Group members and the TDAG.
7.4.5 Activities and Programmes
The planned expenditure for the period concerned incorporates a new programme for Regional
Initiatives in the Doha Action Plan for an amount of CHF 4.5 million. Even at this level, it will
be extremely difficult for the BDT to accommodate the action plan emanating from decisions
taken at WTDC-06, and at the same time incorporating WSIS related actions into the delivery of
activities and programmes.
7.4.6 Development Bureau
Planned staffing levels for the financial plan period are identical to those presented in the 20062007 budget, except for one post being kept vacant as from 2009 until 2011. Five posts have
been transferred to the General Secretariat as a result of the creation of the new Procurement
Service, equivalent to CHF 3 million over the 2008-2011 period. There are no provision for the
increased staffing levels that will be required to incorporate WTDC-06/WSIS decisions into the
overall work-plan.
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Annex I
Assessment matrix between objectives and outputs
The Table below provides the total costs of each intersectoral and Sector output, broken down
between the direct costs, consisting of planned expenditure, documentation costs and other
services costs, and the indirect costs. In addition, the full costs of each sectoral output are
assigned to the respective sector’s objectives as per tables 4.1, 5.1 and 6.1 of the draft Strategic
Plan (document PP-06/28), and each intersectoral output to the intersectoral objectives as per
table 7.1 of the same document.
a)
Planned expenditure: Planned expenditure corresponds in financial accounting to the
nine categories of expenditure (staff costs; other staff costs; travel on duty; contractual services;
rental and maintenance; materials and supplies; acquisitions; public and internal services
utilities; audit and inter-agency fees, miscellaneous.).
b)
Documentation costs: Documentation services encompass 13 individual activities,
including mainly translation, typing and reprography. Documentation costs are allocated on the
basis of the number of pages processed.
c)
Costs of other services: Two types of invoicing are included in the costs of other
services: volume-based activities, other than documentation services, charged on the basis of
planned volumes, such as the number of employees; and time-based activities, charged on the
basis of the planned effort, expressed in time, necessary to provide the requested services.
d)
Indirect costs: Indirect costs are distributed to outputs using a key. They are the portion
of the total costs of activities that is not absorbed by direct invoicing. Under the principle of full
costing, all costs of the cost centres are allocated to outputs. The distribution is done on a prorata basis of the activity costs allocated directly to outputs. The remaining costs of departments
of the General Secretariat are distributed to all outputs, while the remaining costs of the Bureaux
are allocated only to their respective outputs and to the intersectoral outputs.
e)
Total costs: The total of the above reflect the full costs of outputs.
Page 23
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Draft Financial Plan 2008-2011
Direct costs
Activity Costs
Planned
expenditur Document
Other
e
ation costs services costs
ITU Total
82,220
56,007
431,217
Indirect
Costs
Full costs
Assessed
Total
92,768
Amounts in 000'CHF
662,212
Intersectoral Objectives
Intersectoral Outputs
30,887
1 Plenipotentiary Conference
1,837
2 Council & Working Groups
2,153
3 Budget, Corp. Governance & Communication
26,694
4 WSIS-General
5 ITU TELECOM
6 Intersectoral Coordination
202
4,761
1,466
2,911
210
173
-
72,395
7,088
20,517
29,462
2,317
11,959
1,052
28,926
2,015
6,433
12,868
1,236
6,086
286
136,969
12,407
32,015
69,234
3,553
18,219
1,541
1
31,390
3,102
10,672
17,309
0
0
308
2
32,278
3,102
10,672
17,309
888
0
308
3
38,351
3,102
10,672
17,309
888
6,073
308
231,394
11,095
63,288
43,749
42,703
47,868
4,349
5,793
2,761
3,426
1,858
4,505
1
23,075
11,095
0
0
0
0
0
0
5,793
2,761
3,426
0
0
2
107,037
0
0
63,288
43,749
0
0
0
0
0
0
0
0
3
42,703
0
0
0
0
42,703
0
0
0
0
0
0
0
120,759
3,213
1,065
3,810
69,446
4,381
28,410
2,587
2,882
1,672
1,530
1,764
1
19,552
803
0
762
11,574
730
5,682
0
0
0
0
0
0
2
14,783
803
266
762
11,574
730
0
647
0
0
0
0
0
3
7,805
803
0
762
0
0
5,682
0
0
557
0
0
0
173,090
8,408
16,786
11,338
14,681
4,568
14,080
13,683
13,283
10,542
17,337
3,758
7,242
37,385
1
39,264
4,204
2,798
1,620
2,936
2,284
2,816
2,281
1,898
1,506
5,779
1,253
2,414
7,477
2
10,637
0
2,798
1,620
0
0
2,816
0
1,898
1,506
0
0
0
0
3
22,947
0
0
1,620
2,936
0
2,816
2,281
1,898
1,506
0
0
2,414
7,477
4
10,371
3,102
0
0
888
6,073
308
5
24,578
0
0
17,309
888
6,073
308
ITU-R Objectives
1
2
3
4
5
6
7
8
9
10
11
12
ITU-R Outputs
15,446
World Radiocommunication Conference 2,104
Regional Radiocommunication Conference Processing of space Notices & Other
Processing of Terrestrial Notices & Other Study Groups, WPs, Task & Joint Groups 4,375
ITU-R Publications
5,198
Assistance to members, in part. DC and LDC's
Radio Regulations Board
2,380
Radiocommunication Assembly
272
Radiocommunication Advisory Group
261
Liaison / support for develpment activities Seminars
857
19,164
2,629
601
477
6,982
6,084
301
713
238
427
259
452
169,082
5,293
57,095
38,973
24,228
29,051
3,688
2,318
2,038
2,292
1,433
2,673
27,702
1,068
5,592
4,299
7,118
7,535
359
382
214
446
165
523
4
47,868
0
0
0
0
0
47,868
0
0
0
0
0
0
5
10,712
0
0
0
0
0
0
4,349
0
0
0
1,858
4,505
ITU-T Objectives
1
2
3
4
5
6
7
8
9
10
11
12
ITU-T Outputs
5,733
WTSA - World Telecom. Standard. Ass. 527
WTSA Regional consultation sessions
343
TSAG - Telecom. Standard. Advis. Group 225
Study Groups
3,516
Workshops
189
ITU-T Publications
811
Promotion
ITU Operational Bulletin
Database Publications
UIFN registrar
121
UIPRN/UISCN registrar
ITU-T Gen. Assistance & cooperation
-
20,831
802
92
348
19,016
574
-
76,248
1,396
547
2,653
36,078
3,632
22,972
2,286
2,547
1,467
1,112
1,559
17,947
487
84
584
10,837
560
4,054
301
335
204
296
205
4
20,102
0
266
762
11,574
730
5,682
647
0
0
0
0
441
5
24,310
0
266
0
11,574
730
5,682
647
2,882
557
1,530
0
441
6
14,065
0
0
762
11,574
730
0
0
0
557
0
0
441
7
20,144
803
266
0
11,574
730
5,682
647
0
0
0
0
441
6
34,566
4,204
2,798
1,620
2,936
0
2,816
2,281
1,898
1,506
5,779
1,253
0
7,477
7
10,101
0
2,798
1,620
0
0
0
2,281
1,898
1,506
0
0
0
0
ITU-D Objectives
ITU-D Outputs
1 WTDC and Regional TDC
2 Study Groups
3
4
5
6
7
8
9
10
11
12
13
30,154
2,208
1,839
Special Programme for LDC's
2,683
Global and regional initiatives
4,500
TDAG
465
Regulatory Reform
2,542
Info. & comm.. Infras & network devmnt 2,556
E-strategies, e-services,'e-applications
3,081
Economics and finance
2,042
Human capacity building
2,646
Statistics and ICT information
436
Partnership and promotion
721
Assistance to Members
4,437
11,251
1,788
2,465
762
608
721
725
874
580
750
123
207
1,648
113,492
3,485
10,108
7,018
9,202
2,995
9,534
9,290
8,300
7,064
12,486
2,854
5,627
25,529
18,193
927
2,374
876
979
501
1,283
1,112
1,027
856
1,456
346
687
5,771
Page 24
4
35,060
0
2,798
1,620
2,936
2,284
2,816
2,281
1,898
1,506
5,779
1,253
2,414
7,477
5
20,514
0
2,798
1,620
2,936
0
0
2,281
1,898
1,506
0
0
0
7,477
- 25 C06/93-E
Annex II
Options for reducing expenditure
1. Identification of possible duplications (functions, activities, workshops, seminars) and
centralization of finance and administrative tasks.
2. Coordination and harmonization of seminars and workshops in order to avoid
duplication of the subjects covered and to optimize the Secretariat attendance.
3. Coordination with the Regional Organizations in view to share the available resources of
the regional organizations and minimize the costs of participation (workshops, seminars,
preparatory meetings for world conferences).
4. Possible savings taking into account the natural attrition (opportunity for keeping vacant
positions unfilled and for the redeployment of staff).
5. New activities are to be implemented through staff redeployment.
6. Reduction in the cost of documentation of conferences and meetings by:
a. Requesting at the time of registration whether paper copies are required.
b. Setting a maximum number of copies by the Plenipotentiary Conference or by
Council.
c. Setting of a maximum of three sets per delegation.
d. Reducing the number of paper copies sent to administrations from currently five
a maximum of two or three.
7. Consideration of savings in languages (translation, interpretation) for study group
meetings and publications.
8. Implementation of activities of WSIS through staff redeployment within the existing
resources.
9. Review of the costs of Study Groups, Working Parties, Task Groups.
10. Limitation in the number of study groups meetings and in their duration.
11. Limitation of the number of days of meetings for the Advisory groups to three days per
year maximum. Additional meetings may be held on cost recovery basis, i.e. costs are
financed by the requesting Sectors.
12. Elimination as much as possible of physical meetings of the working groups of the
Council.
13. Reduction of 2 working days for the WRC, 1 for the RA and 1 for the CPM. The scope
and complexity of the agenda will have to be taken into consideration and adapted to the
new lengths of these events.
14. Identification of the level of achievement of the different programmes in view to
utilizing these resources for other new activities.
15. For new programmes or those having additional financial resources implications, a
“value-added impact statement” should justify how the proposed programs differ from
current and/or similar programs to avoid overlap and duplication.
16. Sound consideration of the resources allocated to regional initiatives, programmes and
assistance to members, to the regional presence both in the regions and at the
Headquarters, as well as those resulting from the outcome of the WTDC and Doha
Action Plan.
17. Reduce the cost of travel on duty, by limiting the time on mission as well as the
participation to meetings, and benefiting from reductions in air fares.
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Annex III
Programme of Conferences and meetings, 2008-2011
General Secretariat
2008
-
Council
Council Working Groups
2009
-
Council
Council Working Groups
2010
-
Council
Council Working Groups
Plenipotentiary Conference
2011
-
Council
Council Working Groups
Radiocommunication Sector
2008
-
4 Radio Regulations Board meetings
1 Radiocommunication Advisory Group meeting
Study Group meetings
Seminars
2009
-
4 Radio Regulations Board meetings
1 Radiocommunication Advisory Group meeting
Study Group meetings
Seminars
2010
-
World Radiocommunication Conference
Radiocommunication Assembly
3 Radio Regulations Board meetings
1 Radiocommunication Advisory Group meeting
Study Group meetings
Seminars
2011
-
4 Radio Regulations Board meetings
1 Radiocommunication Advisory Group meeting
Study Group meetings
Seminars
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Standardization Sector
2008
-
World Telecommunication Standardization Assembly
WTSA Regional Consultation Sessions
Telecommunication Standardization Advisory Group
Study Group meetings
Seminars
2009
-
Telecommunication Standardization Advisory Groups
Study Group meetings
Seminars
2010
-
Telecommunication Standardization Advisory Group
Study Group meetings
Seminars
2011
-
Telecommunication Standardization Advisory Groups
Study Group meetings
Seminars
Development Sector
2008
-
Telecommunication Development Advisory Group
Study Group meetings
2009
-
Regional Telecommunication Development conference
Telecommunication Development Advisory Group
Study Group meetings
2010
-
World Telecommunication Development Conference
Telecommunication Development Advisory Group
Study Group meetings
2011
-
Telecommunication Development Advisory Group
Study Group meetings
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Annex IV
Glossary of terms
Term
Definition
A
Accounts
The complete records of the financial operations of the
organization.
Activity
Activities are various actions/services of a department, or a
Sector Bureau (cost centre) for transforming resources (input)
into outputs. They are regular operational tasks performed by the
staff members in their daily operations. An activity can stand
alone or can be an element of a comprehensive business process.
The set of activities of a department should represent the services
the department offers inside or outside the organization to its
different clients. General activities apply to all ITU. Specific
activities apply only to the particular department or Sector Bureau
which offers the services in question.
Activity costs
Cost of activities directly assigned to outputs.
Actual
This corresponds to the expenditure or income incurred and
recorded in the accounts during a given financial period.
Actual costs
Actual costs are understood to be the costs actually incurred
during a certain period, as opposed to the
planned/expected/budgeted costs shown in a budget.
Consequently, such costs are only known at the end of the period.
These costs, either direct or indirect, are related to the activity
concerned through the application of a costing methodology over
a certain period.
Aggregated outputs
Aggregated outputs may be sub-divided into more detailed
outputs. Although the term "output" is commonly used for both,
the draft budget for 2006-2007 is presented at the level of
aggregated outputs. Detailed outputs are used at the level of
actuals, in particular for the time-tracking system.
Allocation
Allocation is a set of techniques for transferring budget amounts
(budgeting) or actual amounts (cost accounting) from one cost
centre to another or to cost objects, by either direct allocation
(direct costs) or indirect allocation (indirect costs). Typically in
ITU, the allocation of costs serves to identify the costs of outputs.
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Appropriation
The amount(s) adopted by the Council for specific purposes, for a
given financial period. Obligations and expenditures are incurred
against the appropriation for the purposes specified and up to the
amount(s) adopted. The appropriations do not confer the right to
commit.
Arrears
Amount due to ITU by Member States and Sector Members for
more than one financial year, in respect of assessed contributions.
Assessed costs
Costs allocated to ouputs by using keys, equivalent to the indirect
costs.
B
Biennial budget
The ITU budget covers a two-year period. The 2006-2007 budget
will begin on 1 January 2006 and end on 31 December 2007. The
budget is funded principally by membership contributions, but
also by cost recovery, sales of publications and other sources of
income. The Council establishes the biennial budget within the
framework of the four-year financial plan.
Budget
A plan in financial terms, for carrying out programmes of
activities during a specific period. Three different budgets are
prepared, all reconciled in terms of budget amounts: a financial
budget (budget for resources such as staff and external services),
a results-based budget (budget for activities and outputs), and a
strategic budget (budget for Sector and overall ITU objectives).
Both results-based budgeting and strategic budgeting essentially
generate "allocated budgets", i.e. derived from allocation of the
original budget numbers for staff and other expenses.
Budget estimates
Estimates of the cost of proposed activities and the revenues to
finance them for a given financial period prepared for submission
to the appropriate approving authority.
Budget, regular
The budget for which funds are appropriated by the Council and
which is financed by Member State and Sector Member assessed
contributions and by miscellaneous income (cost recovery,
interest), as distinct from the budget financed from
extrabudgetary resources, e.g. voluntary contributions.
Budgeting
Budgeting is the process of coordinating objectives and activities
of an organization through the definition and integration of
formalized finance-related plans (budgets). Budgeting requires
the integration of financial items into different budget-related cost
objects.
Buildings Maintenance
Fund
This is a special fund to cover the cost of major repair or
maintenance works on the buildings of the Union (Article 22 of
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the Financial Regulations).
C
Cancelled special arrears
account
A special arrears account is cancelled when the debtor fails to
comply with the repayment schedule, thus abolished. See also
Resolution 41 (Rev. Marrakesh, 2002) of the Plenipotentiary
Conference.
Capacity
Capacity represents the availability of staff or other resources of a
cost centre to provide services. Time-related capacity is measured
using units such as work-months, days or hours. In practice,
different capacity figures are used. The work-capacity of an
employee is the gross number of working days he/she offers
within a year, allowing for vacation and legal holidays.
Eliminating non-service times, such as education/sickness/special
leave, etc., the average net capacity can be derived. Time tracking
keeps track of the actual use of capacity for service and nonservice activities. Capacity can also be volume-based, and
measured, for instance, in number of pages (e.g. for a translator).
Commitment
An engagement involving a liability against resources of the
current and one or more future financial periods.
CO-SAP
The controlling or cost-management module of the SAP system.
CO is used to support the allocation process controlling and
reporting of costs.
Cost
A cost is a charge or a sum of charges attributed to a cost centre,
to the delivery of a product or service, and to an output. It is
defined according to the application domain of calculation
(activity, product, cost object etc.), the content (cost elements to
be taken into account, totally or partially), and the time period of
measurement.
Cost accounting
Cost accounting is posting, calculating and reporting all processes
relating to primary and secondary costs. The rules governing the
evaluation, calculation and allocation of costs within cost centres
and cost objects are set by the cost accounting methodology. To
integrate volume and time-related actuals, cost accounting is
interlinked with the time-tracking (TTS) and the Document
Production (DPS) systems. Cost accounting is supporting
tracking, recording, allocating and analysing of costs associated
with activities and outputs, and in relation to the cost plan
(variances).
Cost centre
The cost centre is the smallest organizational unit within a
controlling area where costs can be planned and controlled and
for which accountability is clearly established. Generally, a cost
centre represents a unit within a department.
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Cost driver
A cost driver is a factor that causes or drives costs of an activity.
The difference between drivers and keys relates to the degree to
which the factor reflects the actual volume of work consumed by
a specific cost object. Drivers may also be called "intelligent
keys". Drivers are used as basis for allocating costs to outputs (in
the cost-allocation methodology, the main driver is time: the costs
of a cost centre are allocated via activities to outputs based on the
time spent).
Cost element
A cost element classifies the organization's consumption of
production factors, expressed in terms of financial value. A
primary cost element corresponds to an expenditure item in the
chart of accounts (e.g. travel, salary etc.). Secondary cost
elements are used for allocating internal services or to reallocate
costs between cost centres and/or cost objects.
Cost increase
Cost increase includes cost variations due to:



inflation/price-index variations;
variations in the USD/CHF exchange rate;
variations in the conditions of employment in the UN
common system, as compared with the conditions that
prevailed for the preceding budget.
Cost object
Cost objects are cost collectors other than cost centres to identify
the costs of outputs. Cost objects may have primary costs and are
charged with secondary costs for received services and/or by reallocation of costs.
Cost planning
Cost planning is the process of allocating planned costs to the
different cost objects. Cost-centre planning (including the
planning of activity costs) and output cost planning are the most
important elements of cost planning. Cost planning estimates the
volume and costs of required resources according to the planned
work programme of the cost centre. Thus, capacity considerations
are far more important in cost planning than in financial
budgeting.
Cost recovery
In the context of the Union’s budget process, cost recovery refers
to recovery by the Union of specific costs incurred in the
implementation of a particular product or service. These products
or services are provided to a third party outside the ordinary
budget of the Union. Only the costs attributable to the product or
service in question can be recovered. This concept aims solely to
recover the costs incurred, and as such differs from the policy of
“profit-oriented pricing”.
ITU applies cost-recovery principles to a number of different
products and services. Cost recovery is pursuant to Resolution 91
(Minneapolis, 1998) of the Plenipotentiary Conference.
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Cost recovery, full
Direct and indirect costs attributable to a particular product or
service are recovered in full, i.e. at 100%.
Cost recovery, income
Income received or accrued during a financial period from
recovering the costs of a particular product or service and which
increases existing net assets.
D
Decentralization
General term for a transfer of authority and/or responsibility for
performing a function from high-level management to lower level
units or from centralized services to users.
Direct costs
These are costs readily associated with a particular cost centre or
an output (product or service) and directly attributed to the
activities undertaken to deliver these products or services. Costs
directly allocated using cost drivers (for a volume-based
allocation) and hours (capacity) (for a time-based allocation) are
also considered as direct costs.
In the approved methodology, direct costs also include primary
costs which are directly assigned to a cost centre or an output
(e.g. interpretation costs for the Council) and secondary costs
which are directly allocated to a cost centre or an output, via the
allocation of activities (e.g. number of printed pages, or number
of Finance Department staff hours dedicated to Council).
Documentation costs
Cost of translation, typing and reprography for the production of
documents.
E
Exhibition Working Capital
Fund
Upon closure of each world and regional TELECOM exhibition
organized by the Union, its financial result (surplus income or
excess expenditure) is transferred to this fund. Part of this fund
has been transferred to the Fund for the development of
information and communication technologies to pay for the costs
incurred by the Union in support of that programme (cost
recovery).
Expected results
Expected results should reflect the desired outcome of activities.
They should be linked, where applicable, to the underlying
objectives of the strategic plan. Expected results may be
expressed as a quantitative standard, value or rate leading to the
fulfilment of a certain objective. They can also be expressed in
terms of quality and timeliness. From the specification of
expected results, key performance indicators can be derived in
order to quantify and measure results.
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Expenditure
Expenditure for a financial period is the sum of the cash
disbursements and valid unliquidated obligations made against
the appropriations for the period. When the accounts are kept on
an accrual basis (which is the case of ITU), the term designates
amounts recorded in a given period, whether paid or unpaid.
Extrabudgetary resources
Financial resources made available to the organization for
financing an activity specifically agreed to by the parties
concerned, from sources other than the regular budget (e.g.
UNDP, UNFPA, etc.).
F
Financial period
A period of time that normally covers two consecutive calendar
years (starting with an even-numbered year) as specified in
Article 5 of the Financial Regulations
Financial plan
The financial plan covers a four-year period, coinciding with the
biennial budget. Decision 6 (Marrakesh, 2002) sets the financial
plan of the Union for the period 2004 to 2007.
Financial Regulations, ITU
The ITU Financial Regulations are a legal administrative
document governing management and control of the finances of
the Union.
Financial Rules, ITU
Document linked with the Financial Regulations, which addresses
essentially administrative and operational procedures.
Financial reporting
Financial reporting discloses information about the financial
aspects of business operations in terms of financial accounting,
and is closely related to the underlying organization-specific and
international accounting standards. In a narrow sense, it focuses
on balance-sheet and profit and loss statement issues and related
analyses (i.e. P&L statement, accounts payable / receivable and
other sub-items, assets and liabilities, cash flow statement, etc.).
Fixed costs
Fixed costs are costs that do not vary as the volume of the related
activity changes. Monitoring the level and structure of fixed costs
is crucial, especially for capacity and resource management, since
fixed costs cannot be easily adjusted with changes in the activity
volume. As fixed costs may also be interpreted as "contract-based
costs", a variation or reduction of fixed costs requires additional
analysis and management decisions in terms of rescinding or
modifying the underlying contract.
The notion of fixed cost relates to the portion of costs which is
not dependent of the level of activity but linked to the resource
structure of the Union.
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Forecast
Forecasting is a planning technique to calculate projections of the
presumed evolution of actual figures within and/or beyond the
respective budget planning period. The most important objective
of a forecast (e.g. budget forecast, income forecast) is to provide
a clear business outlook for management enabling timely and
appropriate actions.
FTE
Full-time equivalent, i.e. capacity of a staff member working full
time.
Full costing
Full costing is a cost-accounting system where the cost is not split
into fixed costs and variable costs but allocated as a whole. The
RBB budget for 2006-07 is based on the full costing principle.
Fund for the development
of information and
communication
technologies
Established in 1997, this special account is credited with funds
transferred from the Exhibition Working Capital Fund. It is used
to finance technical cooperation projects.
G
Goals
Goals refer to the Union’s high-level targets to which the
objectives of the Sectors and the ITU General Secretariat
contribute, directly or indirectly. These relate to the whole of
ITU.
Growth, real rate of
The rate of increase in the budget determined after excluding
increases due to inflation foreseen for the ensuing financial
period, increases or decreases due to depreciation or appreciation
in the value of the United States dollar, and variations due to
statutory staff cost increases. This notion contrasts with the idea
of nominal growth, which simply compares absolute budget
levels irrespective of the different price levels or rates of
exchange in each period.
Growth, zero nominal
Nominal growth analysis refers to the comparison of two figures,
calculating the nominal difference between the two. Zero
nominal growth means no change in the nominal figure between
the two. If the two figures are expressed in relation to two distinct
times, the real value can vary (lower or higher) even if the figures
are nominally the same (zero difference or zero nominal growth),
depending on the discount rate (inflation or deflation rate).
I
Indirect costs
Indirect costs are costs that cannot easily be identified as being
consumed by a particular cost object, and that are allocated
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- 35 C06/93-E
indirectly by using keys.
Information and
Communication
Technologies Capital Fund
The ICTC fund was established by Council Resolution 1173. Its
purpose is to meet the costs of procurement and development of
major IT systems (hardware, software, consulting), covering both
new systems and the replacement and upgrading of existing
systems (Article 23 of the Financial Regulations).
Internal order
Internal order is an SAP-related term. It represents a specific cost
collector and can be used as such for different objects such as
investment orders, maintenance orders, outputs (ITU’s approach)
or projects (e.g. IS implementation projects). Internal orders can
be grouped by hierarchies to represent the different aggregated
outputs.
ITU Centenary Prize Fund
This fund was created in 1978, by Council Resolution 816. It
aimed, inter alia, to reward persons who distinguished
themselves in the field of telecommunications. In 1992, by
Resolution 1027, the Council decided to make use of this fund for
modernizing the library.
K
Key
Keys are measures that allow an allocation of indirect costs from
one cost object to another. Keys are "proxy measures", as they do
not reflect the exact cost behaviour of the underlying object. Keys
are used to allocate remaining costs to outputs.
Key performance indicators
Key performance indicators (KPIs) are the criteria or features
used to measure the achievement of outputs, which in turn serve
to fulfil the various objectives defined in the strategic planning
process. These indicators can be qualitative, quantitative, or both.
They are designed to provide a scale against which to measure
and show progress towards producing outputs and achieving
objectives.
L
Limit on contributory unit
Ceiling which the value of the contributory unit must not exceed.
M
Mission
The mission of a Sector or of the ITU General Secretariat
describes its main overall function, as set out in the ITU
Constitution and Convention.
O
Objectives
Objectives refer to the specific purposes and aims of individual
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Sectors and of the ITU General Secretariat. They describe the
expected results to be achieved in a given period.
Operational plan
The operational plans of the three Sectors and the General
Secretariat play a critical role in linking the strategic and financial
plans of the Union. They are prepared annually, covering the
subsequent year and the following three-year period. The Council
approves the four-year rolling operational plans.
Other services costs
Cost of activities directly assigned to outputs, other than
documentation costs.
Outputs
Outputs refer to the final products or services delivered by the
ITU (e.g. deliverables of a programme). Outputs can be those of
individual Sectors or Union-wide intersectoral products and
services. Outputs are cost objects and are represented in the SAP
cost accounting system by internal orders.
P
Planned expenditure
Planned expenditure is expenditure that is directly assigned to
cost centres and outputs. It represents the resources that are
necessary for their basic functioning. In financial accounting,
planned expenditure corresponds to the nine categories of
expenditure identified in Rule 6.1 of the Financial Rules.
Planning
Planning is the process of developing objectives according to
decisions and resolutions and their financial implications. In
practice, strategic planning - with a clear emphasis on the overall
vision, mission and strategic objectives - and operational planning
are the most important cornerstones of planning. Under a topdown approach, the planning process becomes more and more
detailed. It is not unusual for operational planning - for each
sector of the organization - to be differentiated into income
planning, investment planning, expense / cost planning and headcount planning for the staff resources required.
Price increase
Any increase in the cost of resources or services arising from
changes in prices (inflation rates, salary increases, market price
increases) with no change in the actual volume of the resource.
Prospective cost increase
The cost increase which applies to the current and the
forthcoming budget periods.
R
Re-costing
A technique for achieving comparability between two budgets,
whereby the additional costs resulting from inflation or statutory
increases in staff costs during the current financial period are
added to the initial estimated cost of activities or services
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proposed for the immediately following period. A comparison
with the budget of the ensuing financial period then reflects the
rate of real growth.
Remaining costs
Remaining costs are the residual costs that cannot be allocated
directly. They relate to own consumptions and any costs of
internal services received from other departments and Bureaux.
Keys are used for allocating these costs indirectly to the outputs.
At ITU, such remaining costs are assessed to outputs at pro-rata
of the amounts that are charged directly (via activities)
Reserve Account
A Reserve Account is maintained in accordance with Article 33
(No. 485) of the Convention and with Article 27 of The Financial
Regulations.
Reserve for debtors’
accounts
A provision for debtors’ accounts is maintained in order to
provide a more correct valuation of the arrears shown as assets in
the balance sheet of the Union. The interest on arrears charged to
the debtors' accounts is also credited to this account. The assets
on a debtors' account can only be used to write off nonrecoverable debts to the Union. Any write-off requires a specific
decision of the Council. Reference: Article 26 of the Financial
Regulations.
Reserve for installation and
repatriation
A provision for staff installation, change of duty station and
repatriation, the accounts of which shall show the following
amounts: on the credit side, a percentage, set by the Council, of
the remuneration of staff other than those engaged for
conferences and other short-term service; on the debit side,
payments actually made to cover removal and travel costs on
appointment, change of duty station or separation from service,
installation and repatriation grants, grants on death, termination
indemnities, accrued paid annual leave. Reference: Article 25 of
the Financial Regulations.
Results-based budgeting
Results-based budgeting (RBB) is the programme budget process
in which (a) the programme is formulated in order to meet a set of
predefined objectives and expected results; (b) the expected
results justify resource requirements, which are derived from and
linked to outputs produced to achieve the expected results; and
(c) actual performance in achieving results is measured by key
performance indicators.
S
Salary scale
There are two salary scales: one for the Professional and higher
categories and one for the General Service category.
The Professional and higher categories salary scale is
recommended by the International Civil Service Commission
(ICSC) and approved by the United Nations General Assembly
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once a year, effective 1 March of the following year. The scale
indicates the gross salary including staff assessment (internal tax)
and net salary after staff assessment.
For the General Service category in Geneva, the scale is
recommended by the International Civil Service Commission
(ICSC) and implemented and updated by the Secretary-General
once a year. The scale indicates the gross salary including staff
assessment (internal tax), gross pensionable salary for pension
purposes, net salary after staff assessment and net pensionable
salary.
Secondary cost
Costs for providing internal services that are charged directly
using drivers (time or volume) or indirectly using keys (pro-rata
basis) to a cost centre or an output. In ITU, secondary costs are
typically allocated on the basis of activities (e.g. using TTS), with
remaining costs allocated on the basis of keys.
Service-level agreement
A service-level agreement (SLA) is a bilateral contract between a
service provider and a service receiver (inside or outside the
organization). The objective of an internal SLA is to optimize the
type and quality of internal services and to ensure they are
adapted to real needs and to the achievement of objectives. An
SLA template describes the service concerned in terms of
business expectations, such as planned volume and price, which
may be the subject of a negotiation process between the two
parties, and of the service characteristics (service components,
expected results, related key performance indicators, etc.).
Special arrears account
An account established to reflect arrears for which an agreement
has been reached with the respective debtor, including on a
schedule for repayment. Any new special arrears account is
opened only after such an agreement has been concluded with the
Secretary-General. See also Resolution 41 (Rev. Marrakesh,
2002) of the Plenipotentiary Conference.
Special Fund for Technical
Cooperation
The Special Fund for Technical Cooperation is credited with
voluntary contributions to meet the telecommunication needs of
developing countries and urgent requests for assistance they
submit to the Union.
Strategic budgeting
Strategic budgeting is a bottom-up process, which extends the
results-based budgeting process upwards by establishing the
linkage with strategic planning. As strategic planning and the
setting of strategic priorities is often related to objectives, total
budgeted amounts for each of the objectives, through the
identified outputs, provides valuable information. By linking
outputs, Sector objectives and overall objectives, the budget
numbers per (aggregated) output can be rolled up to the level of
objectives.
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Strategic plan, ITU
The strategic plan of the Union, covering a four-year period, is
the main instrument embodying the Union's strategic vision. It is
approved by the Plenipotentiary Conference. The current strategic
plan, contained in Resolution 71 (Rev. Marrakesh, 2002), covers
the period 2004-2007.
Support cost
Costs associated with and incurred in supporting technical
cooperation projects or trust-fund activities.
T
Trust fund
Account established with specific terms of reference or under
specific agreements, to record receipts and expenditure of
voluntary contributions for the purpose of financing wholly or in
part the cost of activities consistent with the organization’s aims
and policies. The Union is accountable for these funds. It is also
responsible to donors for the use of their contributions under
trust-fund arrangements, but it may assume no additional
financial liability through such arrangements without the prior
agreement of the appropriate governing organ.
U
United Nations exchange
rate
The official monetary exchange rate between the US dollar and
other currencies used by the UN for all financial transactions.
V
Variable costs
Variable costs are costs that vary with changes in volume of
activity. The classification of costs into variable and fixed costs is
not only based on their relationship to changes in volume of
activities, but also on the period of cost accounting. To ensure a
coherent classification, the cost-accounting period has to match
the budgeting period, which in the case of the ITU is biennial. All
costs that can be influenced within this period will be considered
as variable costs. Although a relatively large proportion of costs
are fixed costs, individual fixed costs still have to be analysed to
determine whether they can nonetheless be reduced within the
period, for example by rescinding the underlying contract (work
contract, lease contract, etc.). Accordingly, all standard reporting
on variable costs should be interpreted very carefully.
Any portions of fixed costs for which no mid-term or long-term
commitments or obligations are undertaken (e.g. funded vacant
posts) are considered as variable costs.
Variances
Variances are the difference between planned and actual data.
They are used in results-based budgeting and cost controlling for
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all major controlling objects (cost centre, activity, output, but also
expected results for objectives and goals). Variances can be
caused by different reasons (e.g. price variance, resource
variance, volume variance). Variances are flagged by standard
reporting within the information system, so appropriate actions
can be proposed to management to improve critical situations.
Voluntary contribution
Subject to its acceptance by the Union and, if applicable, the
recipient country, a contribution (outside the regular budget) in
cash or in kind, which may include funding of conferences,
meetings and seminars, expert services, training services,
fellowships, equipment or any other related services or
requirements.
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Annex V
DRAFT DECISION 5 (Rev. Antalya, 2006)
Income and expenditure of the Union for
the period 2008 to 2011
The Plenipotentiary Conference of the International Telecommunication Union (Antalya, 2006),
considering
the strategic plans and goals established for the Union and its Sectors for the period 2008
to 2011,
considering further
[Resolution 91 (Rev. Antalya, 2006) of the Plenipotentiary Conference on general principles for
cost recovery],
decides
1
that the Council is authorized to draw up the two biennial budgets of the Union in such a
way that the total expenditure of the General Secretariat and the three Sectors of the Union is
balanced by the anticipated income, taking into account the following limits:
1.1
that the upper limit of the amount of the contributory unit of Member States for the years
2008-2011 shall be CHF [];
1.2
that, for the years 2008-2009, the contributory unit of Member States shall not exceed
CHF [];
1.3
[that expenditure on translation and text processing in respect of the official and working
languages of the Union shall not exceed CHF [] million for the years 2008 to 2011;]
1.4
that, when adopting the biennial budgets of the Union, the Council may decide to give
the Secretary-General the possibility, in order to meet unanticipated demand, to increase the
budget for products or services which are subject to cost recovery, within the limit of the income
from cost recovery for that activity;
1.5
that the Council shall each year control the expenditure and income in the budget as well
as the different activities and the related expenditure contained therein;
2
that, if no plenipotentiary conference is held in 2010, the Council shall establish the
biennial budgets of the Union for 2012 and thereafter, having first obtained approval for the
budgeted annual values of the contributory unit from a majority of the Member States of the
Union;
3
that the Council may authorize expenditure in excess of the limits for conferences,
meetings and seminars if such excess can be compensated by sums within the expenditure limits
accrued from previous years or charged to the following year;
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[4
that the Council shall, during each budgetary period, assess the changes that have taken
place and the changes likely to take place in the current and coming budgetary periods under the
following items:
4.1
salary scales, pension contributions and allowances, including post adjustments,
established by the United Nations common system and applicable to the staff employed by the
Union;
4.2
the exchange rate between the Swiss franc and the United States dollar in so far as this
affects the staff costs for those staff members on United Nations scales;
4.3
the purchasing power of the Swiss franc in respect of non-staff items of expenditure;]
[5
that, in the light of this information, the Council may authorize an amount of the
contributory unit beyond the amounts indicated in decides 1.1 and 1.2 above, adjusted to take
account of paragraphs 4.1, 4.2 and 4.3 above, giving weight to the desirability of achieving
savings within the Union, while also recognizing that certain expenditures cannot be adjusted
quickly in response to changes outside the Union's control. However, the actual expenditure may
not exceed the amount resulting from the actual changes under paragraph 4 above;]
6
that the Council shall have the task of effecting every possible economy and, to this end,
that it shall establish the lowest possible authorized level of expenditure commensurate with the
needs of the Union, within the limits established by paragraph 1, if necessary taking into account
the provisions of paragraph 7 below;
7
that the Council may exceed the limit established in decides 1.2 above for the years
2008-2009 by up to [1]%, in order to meet expenditure on unforeseen and urgent activities
which are in the interests of the Union; within the upper limit established in decides 1.1 above,
the Council may exceed the limit of CHF [] by more than [1]% only with the approval of a
majority of the Member States of the Union, after they have been duly consulted, within the
upper limit of CHF []; they shall be presented with a full statement of the facts justifying this
step;
8
that, in determining the value of the contributory unit in any budgetary period, the
Council shall take into account the future programme of conferences and meetings and the
estimated related costs as well as other sources of income in order to avoid wide fluctuations
from period to period;
9
that, in determining the value of the contributory unit, the Council should also take into
account the budgetary impact of the introduction of new cost-recovery charges for activities that
were previously funded from assessed contributions and should, to the greatest extent possible,
reduce the value of the contributory unit by an appropriate amount;
10
that the Council, in determining the amount of withdrawals from or allocations to the
Reserve Account, should aim under normal circumstances at keeping the Reserve Account (after
integration of unused appropriations) at a level above [3]% of the total budget,
instructs the Secretary-General
to provide to the Council, no less than five weeks before its ordinary 2007 and 2009 sessions,
complete and accurate data as needed for the development, consideration and establishment of
the biennial budget.
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