U.S. Participation in the United Nations Development Program
NSIAD-97-8: Published: Apr 17, 1997. Publicly Released: Apr 17, 1997.
- Full Report:
Pursuant to a congressional request, GAO conducted a follow-up to its 1990 review of U.S. participation in the United Nations Development Program (UNDP), focusing on the: (1) actions taken in response to recommendations in GAO's 1990 report to improve coordination, project evaluation, and the allocation of resources; (2) amounts and sources of UNDP budget support; (3) cost of administering UNDP's headquarters and overseas operations and the extent to which UNDP has reduced these costs, including a comparison of UNDP and Agency for International Development (AID) compensation expenditures; (4) system of audits and internal controls UNDP employs to oversee its operations; (5) criteria UNDP employs to graduate recipient countries from assistance; and (6) extent to which UNDP projects coincide with U.S. national security and foreign policy objectives.
GAO noted that: (1) since the publication of GAO's 1990 report, UNDP has strengthened its coordination of U.N. programs and activities, begun to improve its project evaluation system, and increased funding to the world's least developed countries; (2) among other things, UNDP has been assigned new coordination responsibilities, has strengthened the role of the U.N. resident coordinator in country offices, and has begun to enforce requirements to conduct project evaluations; (3) however, these efforts have not fully addressed all problems in the areas of coordination and evaluation; (4) UNDP's total budget was approximately $1.9 billion in 1995 and was funded primarily by donor nations' voluntary contributions; (5) although contributions to UNDP's budget have grown since 1966, the U.S. contribution to UNDP has declined as a percentage of the total budget; (6) GAO also noted that since 1992, UNDP has decreased its administrative expenses, primarily through reductions in staff; (7) GAO found the relative differences in UNDP and AID compensation expenditures varied by location and grade level, but UNDP's expenditures were generally greater than AID's for comparable grade levels, except at the higher grade levels; (8) UNDP's operations and programs are audited by its internal Division for Audit and Management Review and biennially by the U.N. Board of Auditors; (9) although UNDP has increased the size of its internal audit staff, the number of internal audits conducted annually, and has sought to improve its internal controls, the U.N. Board of Auditors has continued to raise concerns over audit coverage; (10) the board has reported that the internal audit staff is still too small to provide adequate audit coverage, strategic audit planning is insufficient, and not enough projects executed by recipient governments are being audited; (11) UNDP's single criterion for graduating countries from being a net recipient of assistance is based on per capita gross national product (GNP); (12) according to UNDP documents, this basis is problematic because per capita GNP assumes an exactitude that does not actually exist; (13) UNDP's mission is consistent with U.S. national security and foreign policy objectives, and its projects promote many of the same goals in developing countries that the U.S. government tries to advance; (14) however, UNDP does fund projects in countries that are covered by U.S. statutory funding restrictions; and (15) in accordance with these restrictions, the State Department withholds from the U.S. contribution to UNDP the U.S.' proportionate share for projects in these countries.
Matter for Congressional Consideration
Status: Closed - Implemented
Comments: After GAO discussed the matter with the Senate Foreign Relations Committee, it considered the issue and decided not to take action.
Matter: If Congress wishes to ensure that no U.S. contributions to UNDP will be used for overhead expenses in countries covered by section 307 of the Foreign Affairs Act of 1961 (22 U.S.C. 2227), it may wish to explicitly require that the State Department include field office administrative costs when calculating the amount of the U.S. withholdings.
Recommendation for Executive Action
Status: Closed - Implemented
Comments: The U.S. delegation at the May 1997 session of the UNDP Executive Board brought GAO's recommendations to the attention of the Administrator. The head of UNDP's evaluation unit confirmed that corrective steps are under way and that UNDP would respond to GAO. The U.S. delegation also shared the conclusions and recommendations in the GAO report with other interested delegations and asked for their support in addressing its findings. In September 1998, the Administrator's office stated that systems were in place for: (1) identifying all projects that are subject to mandatory evaluation; (2) tracking the implementation of evaluations; and (3) monitoring the implementation of evaluation recommendations. The Administrator's office stated that it is too early to evaluate the improvements made in UNDP's evaluation process. However, additional steps are being taken to strengthen UNDP's project evaluation system.
Recommendation: To further improve UNDP's ability to assess development impact, the Secretary of State should seek the support of other major donor countries to require that UNDP: (1) adopt a system to identify all projects that require a mandatory evaluation and track whether the evaluations are conducted; (2) establish a system to track whether evaluation recommendations are addressed; and (3) conduct periodic assessments of the recently implemented evaluation system improvements to determine their effectiveness in helping UNDP measure the impact of its development assistance projects.
Agency Affected: Department of State