FC 95/13


Finance Committee

Ninety-fifth Session

Rome, 25 - 29 September 2000

Annual Reports of the ICSC and UN Joint Staff Pension Board to the General Assembly, and Summary of the Decisions taken

 

1. The purpose of this paper is to inform the Committee of recent developments in the activities of the International Civil Service Commission (ICSC) and the United Nations Joint Staff Pension Board (UNJSPB).

I. International Civil Service Commission (ICSC)

A. RESOLUTIONS AND DECISIONS ADOPTED BY THE GENERAL ASSEMBLY AND THE LEGISLATIVE/GOVERNING BODIES OF OTHER ORGANIZATIONS OF THE COMMON SYSTEM

2. The Commission had before it documents providing information on resolutions and decisions of interest to the Commission adopted by the General Assembly at its fifty-fourth session and by the governing bodies of other organizations of the common system.

3. The Commission decided to take note of the information. It also decided to request the secretariat to make the necessary preliminary preparations on the Geneva matter taking into account its established work programme. It further decided to request its secretariat to summarize in future documents new requests by the General Assembly in its annual resolutions.

B. CONDITIONS OF SERVICE OF THE PROFESSIONAL AND HIGHER CATEGORIES: ESTABLISHMENT OF GRADE EQUIVALENCIES BETWEEN THE UNITED STATES FEDERAL CIVIL SERVICE AND THE UNITED NATIONS SYSTEM: PROGRESS REPORT

4. The Commission decided to request the secretariat to review the methodology for future grade equivalency studies with a view to simplifying the process and reducing administrative costs, without jeopardizing the quality of the results. The Commission also invited the organizations to reflect in CCOG codes emerging occupations.

C. CONDITIONS OF SERVICE OF THE PROFESSIONAL AND HIGHER CATEGORIES: RENTAL SUBSIDY SCHEME

5. The Commission decided to note that the CCAQ secretariat would work with the organizations to resolve some of the problems raised regarding the determination and application of maximum reasonable rents at headquarters duty stations. It requested its secretariat to report on progress regarding this matter at its summer session and finally requested both the CCAQ and ICSC secretariats to gather additional data on practices outside the common system and provide additional information regarding usage and cost of the current scheme.

D. CONDITIONS OF SERVICE OF THE GENERAL SERVICE AND OTHER LOCALLY RECRUITED CATEGORIES: SURVEY OF BEST PREVAILING CONDITIONS OF EMPLOYMENT IN MONTREAL

6. The Commission noted that, although General Service and other locally recruited staff in the Montreal survey had decided not to take part in the survey, the survey had been conducted in full accordance with the headquarters methodology. The staff's decision to forego its right to participate in an exercise which so clearly affected their conditions of service was most regrettable.

7. The Commission decided to use data from 20 surveyed employers.

E. CONDITIONS OF SERVICE OF THE GENERAL SERVICE AND OTHER LOCALLY RECRUITED CATEGORIES: REVIEW OF THE HEADQUARTERS SALARY SURVEY METHODOLOGY: DECISIONS OF THE INTERNATIONAL LABOUR ORGANIZATION ADMINISTRATIVE TRIBUNAL REGARDING THE PHASING OUT OF THE LANGUAGE FACTOR AT ROME AND VIENNA

8. The Commission decided that a) at the time of the next survey at headquarters duty stations where the local language was not a working language of the organization, employers be carefully surveyed to find out what, if any, bonus or other payment were made to staff members required to work in a working language of the organization and b) that the results of that determination be appropriately reflected in the pay scales established by the survey.

F. HUMAN RESOURCES MANAGEMENT: REPORT OF THE WORKING GROUP ON THE FRAMEWORK FOR HUMAN RESOURCES MANAGEMENT

9. The Commission considered that work on the system of pay and benefits should be guided by the framework for human resources management and should contribute to making organizations more competitive. It reaffirmed its intention to proceed with caution in that area and to take the time necessary. In that connection all questions must be answered regarding concepts used and ideas put forward and the effectiveness of any new system should be proven by its practical application in pilot projects. The advantages and disadvantages as well as the financial impact of proposed reforms should also be identified.

10. The Commission decided that the system of broadbanding and the merging of salary scales of staff members with dependants and those staff members without dependants would be the subject of an in-depth review by the secretariat so that no aspect of the subject remained unclear. Based on the results of those feasibility studies, pilot experiments could then be envisaged in the organizations.

11. The Commission approved the proposal of its secretariat to organize prior to its fifty-second session a retreat to review such themes as broadbanding, competency-based pay systems and the establishment of a Senior Executive Service (SES) within the international civil service.

12. It also decided that an open-ended working group would consider the specific problems posed by the introduction of a system of broadbanding in the common system at the fifty-second session.

13. The Commission adopted the Framework for Human Resource Management and concluded that it was a dynamic tool which should be continuously updated as needed. It is intended to use it to guide its future work It recommended to the organizations that the Framework for Human Resources Management form the basis of their future work on human resources policies and procedures and that they bring it to their attention of their governing bodies.

G. HUMAN RESOURCES MANAGEMENT: DRAFT STANDARDS OF CONDUCT FOR THE INTERNATIONAL CIVIL SERVICE

14. The Commission decided to inform the General Assembly that it had updated the 1954 report of the International Civil Service Advisory Board (ICSAB) entitled Standards of Conduct in the International Civil Service, in consultation with the organizations and staff. It adopted the text of the Standard of Conduct and further decided to submit the Standards to the General Assembly and the organizations of the common system.

II. United Nations Joint Staff Pension Board (UNJSPB)

15. . The fiftieth session of the United Nations Joint Staff Pension Board was held in Geneva from 5 to 14 July 2000.

A. SELECTION OF THE NEW CHIEF EXECUTIVE OFFICER OF THE FUND

16. The Selection panel (consisting of six board members and chaired by the Chairperson of the Board) had submitted a short list of four candidates. Mr. Cochemé - national of France, received the absolute majority of the votes and was then elected by acclamation. He will be appointed in January 2001 upon retirement of the current CEO Mr. Raymond Gieri.

B. ACTUARIAL EVALUATION

17. For the second consecutive time the actuarial evaluation showed an actuarial surplus. The actuarial surplus that in 1997 represented the 0.36% of the Pensionable Remuneration, at 31 December 1999 had grown to 4.25% of the Pensionable Remuneration. The growth is mainly due to the good return of investments and to the fluctuations of the US $ value vis-à-vis the local currencies. The report of the Committee of Actuaries showed that the rate of Contribution currently needed could be reduced from 23.7% to 19.45%. The Committee of Actuaries however indicated that, should the board decide to improve the benefits or reduce the rate of contribution, the intervention should not cover the entire 4.25% but should instead leave untouched a 2% of the surplus.

18. There were discussions in the Board on the actions to be taken also in view of the recommendation of the General Assembly to refrain from any intervention until a trend in the growth of the actuarial surplus could be determined. It was therefore decided to:

  1. Confirm the measures indicated by the previous Board and noted by the General Assembly, namely:
    1. To reduce the trigger point for the adjustment of pensions in payment from 3 to 2 % to start from 1 April 2001;
    2. To reduce the interest rate for the Lump Sum commutation from 6.5 to 6% for the service after 1 January 2001.

  2. Create a tripartite Working Group to examine the possible measures to be applied in case the next actuarial evaluation confirms the present trend to actuarial surplus and to study a possible long-term strategy in this respect.

C. ENTITLEMENT TO SURVIVOR'S BENEFITS FOR SPOUSES AND FORMER SPOUSES

19. Divorced surviving spouses: The Board recommended to the General Assembly the addition of the following new paragraph to article 35 bis:

divorced spouse of a former participant who separated before 1 April 1999 and, in the opinion of the Secretary, met all the other eligibility conditions in sub paragraphs (a) and (b) of this article shall be entitled as from 1 April 1999 to a benefit equal to twice the minimum surviving spouse's benefit under article 34 (c), subject to the proviso that the amount of such benefit cannot exceed the amount actually payable to a surviving spouse of the former participant.

20. Remarriage penalty: The Board recommended by consensus to the General Assembly the removal of remarriage penalty for surviving spouses who remarried before 1 April 1999. The payment shall be effective 1 January 2001 and shall be subject to recovery (with interest) of the lump sum payment that had been made to that surviving spouse upon remarriage, as provided in the regulations then in effect.

21. Payment facility under article 45: The Board recommended to the General Assembly an amendment to Article 45 giving the Secretary of the Fund the possibility of assigning, in absence of a request from the participant, part of the benefit to a former spouse under the requirement of a court order.

22. Partial deferred retirement benefit: The Board decided that the possibility of requesting the payment of a lump sum benefit in case of deferred pension should be abolished.