Commissioner-General’s Opening Statement to UNRWA Advisory Commission, June 2011

22 June 2011

21 June 2011
Dead Sea, Jordan

Mr. Chairman,
Ambassadors, and Distinguished Delegates,

It is my pleasure to welcome you to this session of the Advisory Commission. I am grateful to the Deputy Prime Minister and Minister of the Interior of Jordan for his important, timely message of resolute support for UNRWA and for a just peace in the Middle East.

Let me also welcome Kuwait, attending a meeting of the Advisory Commission for the first time in their capacity as a new member.

Our world has changed since we last met in November. The events sweeping the region have resonated in Palestinian refugee communities, where grievances about long-denied rights, as well as aspirations for a better life, both run deep. Through our work, we in UNRWA encounter many of the pains and ambitions that are reflected in events around the region. In the hundreds of thousands of refugee youth we reach through our programmes, we hear energetic, and powerful demands for quality education, for more effective health care and for a better life, now and in the future. At times refugees’ aspirations are projected externally, as we saw on 15 May when refugees in Lebanon, Syria and the occupied Palestinian territory marked Nakba Day with large protests. The tragic loss of refugee lives which ensued was deplorable, exposing – once again – the lack of restraint that has been a recurring feature of the Israeli-Palestinian conflict.

The events underline the urgent need for a solution to the conflict which must be just, durable and based on United Nations resolutions. Within this solution, the time has come to address the plight of the Palestine refugees who have endured statelessness, exile and dispossession for 63 years. This must be forcefully and urgently addressed by the parties, with the support of the international community.

Mr. Chairman:

UNRWA’s Field Directors will brief you in more detail later today about the situation in their respective areas of operations. Let me highlight here, however, a few notable points, which will provide you with a sense of the challenges confronting us throughout the region. We continue to face the most intractable problems in the occupied Palestinian territory. The blockade of the Gaza Strip is a primary concern, despite its easing in June of last year that led to improved access for some commodities and construction materials.

Our fundamental request remains the same: that the blockade must be lifted. Meanwhile, UNRWA has negotiated with the Israeli authorities arrangements to secure approvals to import, according to an agreed schedule, construction materials required for urgent reconstruction projects. Although a welcome improvement, quantities approved for import still fall short of needs, and UNRWA must contend with exceptionally cumbersome import procedures resulting in delays in project implementation. I am encouraged, however, to have been informed literally moments ago that the Government of Israel has just approved 20 more projects – these include 18 schools and 2 re-housing schemes.

These approvals – which we hope to see implemented swiftly, and to be followed by approvals for other pending projects – will make a difference to beneficiaries severely affected by the slow pace of reconstruction. The implications of the situation in Gaza – aggravated by the absence of significant exports and the deterioration of public services and infrastructure – are serious. Refugees awaiting reconstruction of their demolished shelters, some of them since 2003, have in recent days paralyzed our operations in the south in desperate acts of protest, reminding us that – notwithstanding our appreciation for Israel’s security concerns – reconstruction projects which we submit for approval are about people’s lives, people’s education, and people’s health: in other words, their own, and equally important, human security. The anger of the affected communities has led some to accuse UNRWA of “complicity” in the blockade. Added to our concern about these developments is our financial vulnerability, seen in the continuing decline in funding of our emergency appeals for the occupied Palestinian territory; in 2010 we received just 50% of our needs. The volatile situation will only worsen – potentially with adverse implications for the credibility of the United Nations – if UNRWA is forced to reduce food support and emergency employment for a population almost wholly dependent on aid, and suffering one of the highest unemployment rates in the world.

The recent decision by the Egyptian authorities to open the Rafah border crossing is an important development for Gaza and one that we warmly welcome, as I made clear during my meeting two weeks ago with the Foreign Minister of Egypt. We hope that the steps taken so far will be maintained and extended, to eventually allow the people of Gaza a real measure of the free movement they have been denied for so long. This would not under any circumstances diminish Israel’s international legal responsibilities to lift its blockade on Gaza.

In the West Bank and East Jerusalem, many Palestinians continue to suffer restrictions on movement and fundamental freedoms. The occupation remains entrenched, home demolitions, evictions, and revocations of residency permits continue, while Israeli settlements expand relentlessly on Palestinian land. There has been notable economic growth helped by the Palestinian Authority’s strong financial performance and foreign aid. However, some segments of the population remain vulnerable - a story told by growing refugee unemployment as documented by UNRWA in a recent comprehensive survey of the labour force in the occupied Palestinian territory for 2010. It is crucial that these vulnerable groups continue to be adequately supported.

More broadly, the sense of anxiety amongst Palestinians grows with the conspicuous lack of progress in Israeli-Palestinian peace, and the uncertain outcomes of recent moves including the reconciliation agreement, which, it should be noted, most Palestinians hope will contribute to progress towards peace. The United Nations Secretary-General has recently and rightly described the situation of the peace process as an “unsustainable status quo”. Allow me to go further: a status quo is static; instead, a situation that has for many years been grim for many Palestinians continues to move negatively on a downward spiral gradually eroding the viability of a durable solution to the conflict.

In Lebanon, we welcome the recent formation of a new government. I regret to report that a lengthy transition has impeded progress on key refugee issues in the past few months. In particular, last year’s legislation granting refugees access to a range of professions is yet to be implemented. Frustration is mounting among refugee communities in Lebanon, increasing the pressure on UNRWA to address longstanding problems such as limited access to health care and poor camp conditions. UNRWA recently held positive discussions at the highest levels of government and with several donor representatives in Beirut regarding the urgent need to address the long-standing needs of refugees in Lebanon: the repair of dilapidated homes; upgrading of infrastructure in refugee camps; and access to hospital care for a variety of diseases. With the new government in place, and having received assurances from some donors, I am confident that we will receive the support necessary to address the various challenges.

In spite of progress in work carried out on two of the eight packages of the project, the reconstruction of Nahr el-Bared Camp has suffered recurring delays. This aggravates the frustration of refugees who are entering their fifth year of displacement. Also worrying is the bleak funding outlook. With $205 million still to be contributed, I renew my appeal to all, particularly our partners in the Arab region, to rise to the challenge of ensuring that we keep our promise to provide what the displaced refugees of Nahr el-Bared – and the Lebanese community – need and deserve.

In Jordan, where the refugee situation remains stable, the government has responded to popular demands with a range of measures, among them salary increases for public sector employees. Though indirect, the impact on UNRWA is significant, as the salaries of our own local staff – numbering 7,000 in Jordan – are linked directly to public sector salaries. As an illustration I approved in January an increase of 20 Jordanian Dinars per month for each UNRWA staff following a Royal Decree to the same effect. This necessitated an unbudgeted addition of $2.8 million to our expenditure in 2011, further eroding our ability to invest in the quality of programmes and to relieve the conditions of poverty affecting some of the refugees in Jordan.

The situation in the Syrian Arab Republic is of concern to UNRWA. As a United Nations agency with a significant operational presence, we are concerned about the circumstances of violent unrest which pose grave risks to public order and to civilian lives – including the lives of refugees – and call for all to respect and protect the sanctity of human life as required by international law. The situation on the ground has at times prevented access of beneficiaries and staff to some schools, health clinics and camp service facilities, in the most-affected areas in Syria. UNRWA remains apprehensive about the immediate future. We have made our concerns known to the Government of Syria and received assurances about its commitment to facilitating our operations and protecting refugees.

Mr. Chairman, colleagues:

Within this difficult context, UNRWA is moving forward with its initiatives to modernize and improve. The outline of our Sustaining Change plan, the second of our two major reform efforts that began in 2006 with the Organizational Development process, was finalized last month and should complete the envisaged institutional transformation over the next two biennia. Where the OD started to revitalize management, Sustaining Change aims at invigorating our programmes, ensuring quality and effectiveness are improved where this is needed most, at the point of delivery in our over-crowded schools, clinics and camp service centers.

These reforms are neither a luxury nor optional. As I have said in previous meetings, a commitment to self-scrutiny and a constant search for self-improvement are hallmarks of the UNRWA of today, regardless of the context, and irrespective of funding constraints. The launch of substantial programme reforms under the Sustaining Change banner will ensure that the achievements of the OD process are followed by improvements to the quality of services that the refugees, and all other stakeholders – in particular the donors and hosts – require.

It is important to note that the reforms UNRWA is pursuing in its services to refugees resonate with the popular demands being heard across the region, notably from youth, for improved services and better conditions of life.

Allow me to briefly cite a few examples. Through our education reforms, we seek to raise the quality of learning and to promote critical thinking skills and a greater understanding of UN values. In our vocational training centers, we are intensifying our efforts to provide graduates with skills relevant to the market. Reforms in health have introduced the concept of an integrated “family health team”. This will ensure a holistic, coordinated approach to the well-being of the refugee community, with a particular view to addressing non-communicable diseases which are currently the major health threat to refugees, and are far more costly to treat than communicable diseases. In addition, an “e-health” initiative will digitize patient files, bringing inter-connectivity and electronic patient management to all UNRWA clinics.

With progress underway on education and health reforms, it is crucial that we focus on improving our approach to assisting the most vulnerable refugees. The imperative to find new ways to give substantive meaning to poverty alleviation for refugees is evident in many ways, including the crisis facing our key social safety net intervention when funding for food aid runs out in the fourth quarter of this year with no resources projected for 2012. I have asked the Deputy Commissioner-General, Margot Ellis, to give in the coming period priority to the reform of our relief and social services programme, and to plan on updating the Advisory Commission at its next meeting in November.

I take this opportunity to commend Margot for her excellent work in leading the refinement of the Sustaining Change plan and in general coordinating the development of programme reform strategies at its core. She will present on these topics tomorrow.

Mr. Chairman,

An element of importance to Sustaining Change - and to UNRWA’s overall mission - is our resource mobilization strategy. This strategy, which will be presented in full to the Advisory Commission ahead of its November meeting, is being developed under the able leadership of Magnus Lindell, the Director of External Relations and Communications. Building on elements developed over recent months, the strategy will take a fresh approach to diversifying the donor base, in particular attracting “emerging” donors as well as partnerships in the private sector and among foundations, investing more in our servicing of donors, and increasing the share of our overall income contributed by existing donors in whom we see scope for further generosity.

I would particularly like to appeal to Arab donors, who give generously for projects and relief, also to give generously for our core budget. While their share of that budget increased last year to 3% we really need a much bigger increase. Our ability to operate effectively, and improve the quality of services in line with the major reforms in which the donors have invested much, will rest in no small measure on the success of our fundraising in this area.

In sum, we are cautiously confident that a resource mobilization strategy can deliver to our main budget lines an appreciable margin of extra income in the medium to long-term. Of great concern, however, remains the continuing financial insecurity that we face annually in our General Fund.

In mid-2010, UNRWA faced a projected deficit of $103 million in our operational budget, itself an expenditure “floor” that does little more than sustain a shoestring operation. After intensive fundraising throughout 2010, generous and unanticipated additional contributions by donors enabled us to bridge the deficit by year’s end, aided by a range of cost containment measures.

We started 2011 with a lesser projected deficit, which currently stands at approximately $63 million. This relative improvement, in spite of declining contributions from a number of donors due to their own budgetary constraints, is attributable to the commitment and generosity of a handful of donors who are increasing their contributions to the General Fund this year, or sustaining their higher-than-usual contributions of last year, in spite of very serious financial difficulties at home – a decision which we applaud as courageous and forward-looking.

Another explanation for our reduced shortfall is the cost containment measures we are imposing in a variety of areas. As one example, more rigorously then ever before, we are ensuring that when staff retire or leave the Agency voluntarily, the posts which fall vacant are filled only after a thorough staffing review. The aim is to obtain a 2% attrition-based reduction in our overall staffing numbers while maintaining the efficiency of our operations. We are conscious that internal cost efficiency is a requirement of management best practice whatever its impact on resource mobilization might be. At the same time, we are also aware that cost efficiency can go only so far and that beyond a certain point, enforced measures to balance the budget will have negative impacts on our programmes and on refugee conditions. This is of some concern to us, especially given the uniquely unstable environment of the region.

While we will continue to exert every effort to contain costs in 2011 and beyond, unfortunately, the intense new political and social pressures in the region are adding to our costs in the form of salary increases, prompted by the significant increases for government employees in host countries during recent months. In Syria and Jordan, increases will cost UNRWA an extra $9.3 million in 2011 and $10.8 million in 2012. In Lebanon the increase in salaries will add $2 million in expenditures this year, and lead to further increases in 2012 resulting from delayed impact. Our wage bill will likely increase even more following planned salary surveys this year in our other fields. Therefore, we must again turn to the donors in the hope that some will find additional financing to cover the gap we face in 2011, while we also seek help from new donors to support UNRWA in 2011 and thereafter.

Against the backdrop of the Agency’s rising cost base, members of the Advisory Commission have recently requested a consolidated overview of UNRWA’s budget portals and the needs that they meet. I welcome their initiative to further enhance the transparency of our budget, whose structure reflects the funding opportunities, limitations and requirements of our major partners. It bears repeating that the combination of our funding portals is important to overall programme integrity, and that our General Fund is the first priority.

In conclusion, as the stagnant peace process adds to the risks of instability in the region, we trust that the international community, led by the members and observers of this of this Commission, will continue to recognize that a fully funded UNRWA is an high-value asset not only to Palestine refugees, but also to efforts to address the variety of socio-economic, geo-political and security challenges that continue to confront the region. Support for UNRWA must remain a worthwhile investment as long as Palestine refugees and the issues they represent are included in strategic calculations of national interest across the Middle East.

Mr. Chairman,
Ambassadors, and Distinguished Delegates,
Colleagues,

UNRWA’s mission is centred on creating opportunities for refugees and equipping them to better seize those opportunities. Graduates from our schools can be found contributing their skills and drive to the world’s leading multinationals, to globally renowned academies of learning and to economic success regionally and globally. They are, equally, contributing to peaceful development in the countries that host them and in the occupied Palestinian territory. The refugees’ achievements owe much to you – to donors who have financed their wellbeing over three generations, and to hosts who so generously accommodate them, without prejudice to the rights the refugees enjoy as enshrined in General Assembly resolutions.

The prolonged stagnation of the peace process is an increasing threat to the region’s stability. I will repeat my call for political actors to take the bold steps necessary to embrace urgently a framework to end the conflict leading to the establishment of a viable Palestinian State thriving in peace and mutual security with its neighbours, and to a just and lasting solution to the refugee question. As the refugees emerged from - and exist as a consequence of - the 1948 conflict, addressing their plight, with their engagement and consent, is a prerequisite for the resolution of that same conflict.

Until the advent of a just and lasting solution for the refugees, our Agency will remain committed to fulfilling the mandate given to it by the General Assembly. In pursuing its mission, UNRWA will thus continue to draw on the vital support – moral, financial and political – of the Advisory Commission as it serves the refugees, amidst the complex and difficult challenges of today and beyond.

Background Information

UNRWA is a United Nations agency established by the General Assembly in 1949 and is mandated to provide assistance and protection to a population of some 5 million registered Palestine refugees. Its mission is to help Palestine refugees in Jordan, Lebanon, Syria, West Bank and the Gaza Strip to achieve their full potential in human development, pending a just solution to their plight. UNRWA’s services encompass education, health care, relief and social services, camp infrastructure and improvement, and microfinance.

Financial support to UNRWA has not kept pace with an increased demand for services caused by growing numbers of registered refugees, expanding need, and deepening poverty. As a result, the Agency's General Fund (GF), supporting UNRWA’s core activities and 97 per cent reliant on voluntary contributions, has begun each year with a large projected deficit. Currently the deficit stands at US$ 69 million.

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