57th Session of the Advisory Body on Administrative and Financial Matters (ABAF)

Dear Mr Chairperson, Distinguished Members of the ABAF, Welcome to the Fifty-Seventh Session of the ABAF. Allow me to take this opportunity to thank you, once again, for your important contributions to the work of the OPCW. Several significant topics are before you this week. These include the Mid-Biennium Draft Revised 2025 Budget and the long-form report from the External Auditor. You will also discuss changes to internal legislation as the OPCW prepares to take over the management of the OPCW Provident Fund, and anticipates joining the United Nations Joint Staff Pension Fund. The ABAF has also been asked to meet the External Auditor Evaluation Panel, composed of State Party representatives, before the Panel interviews the two candidates that have submitted proposals for providing annual audit services. This is the first time that the new selection process, approved by the CSP, is being used. The Secretariat has provided a report on the proposals received from the supreme audit institutions of India, the current auditor, and Indonesia. ***** On 2 July 2024, the Director-General published the Draft Revised Programme and Budget of the OPCW for 2025. This will be discussed during informal State Party facilitations in September and considered by the EC in October, for recommendation to CSP-29, which will make the final decision. Regarding the review of the Programme and Budget for 2025, there are three key matters for the Technical Secretariat: Firstly, as discussed at the last Session, the budget will address the impact of OPCW Provident Fund management by the Secretariat, following a decision by the external provider to discontinue pension management services. The proposals relating to the management of the Provident Fund would be funded through savings within the Administration Programme. Secondly, the pending physical security requirements of the Main Building, including a new perimeter fence and new guardhouses. Thirdly, replenishment of the special funds that are used for major capital replacement. For the physical security requirements and the capital replacement fund, the Secretariat proposes to allocate 5.4 million Euros of the 2022 cash surplus. This includes three million Euros to fund half of the estimated costs of a total of six million Euros for the new perimeter fence and guardhouses. The Secretariat has formally requested the Host Country to contribute the remaining 50% of the costs for these last crucial security upgrades, following the violent incursion of 3 December 2021, and in light of the Host Country’s responsibilities for OPCW security. I would also note that the Secretariat is stepping up its efforts to explore the implications of artificial intelligence for the implementation of the Convention and the operations of the Organisation. In its initial phase, this process is funded through voluntary contributions and certain regular budgetary resources, for example by revising job descriptions for some posts. In the future, the Secretariat expects that resource requirements will be included in the draft 2026–2027 biennium budget. The financing for the 2025 draft budget revision includes proposals for the timely and effective reallocation of the 2022 cash surplus, which is made up mainly of a significant amount of assessed contributions that were owed by some States Parties from prior years. These proposals would reflect a reduction of 1.49 million Euros in assessed contributions for 2025, representing a reduction of 1.8% compared to the approved Programme and Budget for 2025. This would bring the change in assessed contributions to a 7% increase compared to 2024. ***** Dear Members of the ABAF, As we received the draft long-form report from the External Auditors just before your last Session, it was impractical for the ABAF to review it at that time. In any case, the Auditors’ conclusions were presented at ABAF-56 and the final long-form report is consistent with the June presentation. Eleven of the thirty-five External Audit recommendations from previous years have been closed. ***** I will end my remarks by highlighting a few administrative matters. The Board of the United Nations Joint Staff Pension Fund will meet next week in Bangkok to consider the OPCW’s application for membership. As discussed at the last session, the OPCW’s Provident Fund management service provider will terminate its services in November this year. Although the timing is unfortunate, given the parallel process of preparing for membership of the UN Pension Fund, considerable work has been completed to ensure that staff members are aware of the change and that the transition will be smooth. Modifications to the Interim Staff Regulations and Rules and the Financial Regulations and Rules have been prepared for review and endorsement by the ABAF, before submission to the Council in October and the Conference of States Parties in November. The main proposed changes to the Financial Regulations and Rules include adjustments to accommodate direct management by the Secretariat of the Provident Fund. The further changes to the Financial Regulations and Rules are aimed at enabling a gradual increase of the Working Capital Fund by permitting interest received on the Fund to be added to it, rather than being treated as miscellaneous income. We look forward to receiving the benefit of your reflections and advice on these and other key topics for the Organisation. Allow me again to extend my welcome and my appreciation for your important service to the OPCW. I would also like to thank Chris, Adam and their teams for preparing this Session of the ABAF, and I am sure that they will provide you with all the support you may need. Thank you for your kind attention *******