Harmonisation of UNDG Agencies: Towards One United Nations in Viet Nam

CONTENTS Summary ............................................................................................................................. 2 I. Introduction ..................................................................................................................... 4 II. Why Vietnam, why now?............................................................................................... 4 Global context................................................................................................................. 5 Viet Nam context ............................................................................................................ 6 Why One UN?................................................................................................................. 8 III. Principles....................................................................................................................... 9 Key Principles................................................................................................................. 9 Focus on UN mandate, role and comparative advantage.............................................. 10 III. Roadmap ..................................................................................................................... 10 Two or more tracks ....................................................................................................... 11 Components of the roadmap ......................................................................................... 11 The roles of others ........................................................................................................ 15 Timing........................................................................................................................... 16 IV. Conclusion .................................................................................................................. 17

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Summary In September 2005, Viet Nam’s UN Resident Coordinator and UNICEF Representative jointly presented a paper on UN reform in Viet Nam as a contribution to the global discussion on this vital topic. The paper made a case for bold and rapid steps towards One United Nations at country level, and enjoys the support of the UN Country Team, government and many donors in country. This interest has led to requests from a number of development partners to elaborate on how the ideas of that paper might be realised in practice. This paper responds to those requests. It describes the current context in which the UN Country Team in Viet Nam operates and argues that the conditions necessary for for an accelerated programme of harmonisation are already in place. At the global level momentum is building within the United Nations and among development partners for real UN reform. In Viet Nam, the government has taken the lead among developing countries as an advocate of aid effectiveness agenda. The donor community in Viet Nam has responded to Viet Nam’s enthusiasm for ODA harmonisation and simplification, and has asked the United Nations to play an active role both in terms of UN reform and in support of government institution and capacity building. The UNCT itself is extraordinarily cohesive and committed to country level harmonisation. The approach adopted in this paper is premised on the idea that agencies that can move immediately harmonise should do so now, while at the same time respecting those UN agencies that are unable take part in the first wave of reform. We suggest the rapid harmonisation of UNDP, UNFPA and UNICEF operations in Viet Nam, while leaving the door open for other agencies join in when circumstances permit. We identify four steps to achieving harmonisation: 1) harmonisation of plans; 2) harmonisation of the budget; 3) harmonisation of management; and 4) harmonisation of management practices. Each of these steps has associated actions and a timetable for completion. The approach envisages one management by mid-2006, one plan and one budget by end 2006 and one set of management practices by end 2007. We also stress that each of these areas of harmonisation, although mutually reinforcing, are valuable in their own right, and therefore obstacles confronted in one areas is not sufficient reason to halt progress in others. We recognise the reform progress that has been achieved through the efforts of the United Nations Development Group (UNDG). Common analytical tools and programming have helped the UNCT to cooperate more closely and focus on the comparative advantage of the UN. However, owing to a special set of circumstances in Viet Nam this UNCT has a unique opportunity to build upon these global reforms to move towards One United Nations in country. We are convinced that failure to do so would not only represent a missed opportunity, but would also jeopardise the reputation and relevance of the United Nations in a particularly dynamic developing country.

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We sincerely appreciate the interest and commitment of our partners in Viet Nam and globally, and we hope that the ideas presented in this paper will provide a basis for discussion, decision and action.

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I. Introduction In September 2005 Jordan Ryan, then UN Resident Coordinator and UNDP Resident Representative and Jesper Morch, UNICEF Representative in Viet Nam drafted an informal discussion paper on United Nations reform from the country perspective. The paper was intended as a contribution to internal UNDP, UNICEF and United Nations Development Group (UNDG) discussions. It stressed the urgency of UN harmonisation at country level and the risks associated with incrementalism and indecision on the part of the United Nations Country Team (UNCT) in responding to the reform agenda at country level. The central theme of the paper was that the United Nations agencies need to drive the harmonisation and simplification process proactively, and that the time had come to embrace real harmonisation in the form of One United Nations at country level. Subsequent discussions within the UNCT, and among government counterparts, bilateral donors and other development partners have stimulated interest in the One United Nations concept. Government and donors have independently requested clarification from the UNCT regarding the practical steps required to realise One UN in Viet Nam, This paper is an initial response from the perspective of the Viet Nam UNCT. Section II briefly sets out the context of UN harmonisation in Viet Nam, presenting a UNCT view on the timeliness and urgency of rapid harmonisation. We address international factors that have contributed to the momentum for country level UN reform and factors specific to Viet Nam. Section III restates the key principles underlying the ambition of One United Nations at the country level. The practical steps required to achieve One UN are set out in Section IV, which presents an action plan for the medium term.

II. Why Vietnam, why now? A number of factors have come together in Viet Nam to produce an unusual opportunity to advance harmonisation at the country level. First, the UN has a special relationship with Government based on mutual understanding and trust. The UN, as a long-time proponent of country ownership of development policy, is viewed as an impartial yet sympathetic actor. Viet Nam and the UN share a common concern for social equity and protection of the most vulnerable. Second, Viet Nam has emerged as a leader among developing countries in the aid effectiveness agenda. Viet Nam’s position as a champion of harmonisation and simplification presents a challenge as well as an opportunity to the UNCT. The UN is a long-time advocate of alignment of aid to national development strategies, untied aid and ODA accountability, and therefore naturally embraces the new aid effectiveness initiatives. Yet both government and donors have explicitly voiced the concern that the United Nations agencies’ rhetorical commitment to aid effectiveness is not yet matched by real UN reform at the country level. From the perspective of the UNCT it is readily apparent that progress on United Nations harmonisation, efficiency and focus is necessary if the UN is to remain relevant and valued by our partners within Viet Nam.

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This section reviews the global and local reform contexts and their implications for One United Nations in Viet Nam. Third, the main donors and development partners of the United Nations in country generally support and recognise the need for bold steps if the UN is to play the role that they see as necessary and appropriate in Viet Nam’s current development environment. Donors demand a strong United Nations that complements their efforts through focused, specialist interventions. The rapid advancement of the aid effectiveness agenda has created space for country-led approaches that, alongside the requisite in-country capacity, could even expand the role of the UN. Finally, there is a readiness and enthusiasm within the UNCT to take the necessary steps to make the principles of UN reform a reality in Viet Nam. The experience of drafting the Common Country Assessment (CCA) and United Nations Development Assistance Framework (UNDAF) and the formulation of joint programmes, has shown that we can achieve more together than separately. But the limits of common programming are also apparent to all of us. Ensuring that the United Nations remains relevant to Viet Nam’s development requires that we accelerate and deepen harmonisation at the country level.

Global context Over time, the member states of the United Nations have created a plethora of institutions. The UNDG group alone has 25 members, all of which are work on various aspects of national development. Viet Nam has eleven agencies, funds or programmes of the UN in country, with other agencies without a country presence also involved to greater or lesser degrees. Coordination is challenging in Viet Nam as elsewhere, even with the institutionalisation of the CCA and UNDAF processes. Costs of representation and administration remain too high. In some cases agencies compete globally and in specific countries for donor funding and in country for the attention of government counterparts. The case for reform is uncontentious. It is widely recognised that reform at country level will need to deliver harmonisation and simplification of structures, financing and management practices. The Secretary General, in his report to the 2005 UN Summit, argues for harmonisation and simplification. He writes that ‘the senior United Nations official present in any given country — special representative, resident coordinator or humanitarian coordinator — should have the authority and resources necessary to manage an integrated United Nations mission or “country presence” so that the United Nations can truly function as one integrated entity.’1 Integration and harmonisation at country level is a prerequisite for an effective and efficient UN that is able to optimize use of development resources and represents a strong and unified voice in exercising its global mandate to promote human rights.

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Kofi Annan, In Larger Freedom: Towards Development, Security and Human Rights for All, New York: United Nations, May 2005.

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This view was echoed in the 2005 Summit outcome document approved by the General Assembly, which supports ‘stronger system-wide coherence’ through ‘a more effective, efficient, coherent, coordinated and better-performing United Nations country presence with a strengthened role for the senior resident official…including appropriate authority, resources and accountability, and a common management, programming and monitoring framework’.2 Paris Declaration on Aid Effectiveness The Millennium Declaration established ambitious global development goals and called on donors and developing countries to step up efforts to achieve a real reduction of poverty and deprivation by 2015. The International Conference on Financing for Development held in Monterrey in 2002 considered financing options to realise the Millennium Development Goals, and attracted renewed commitments to make the necessary resources available. But the conference also noted that the volume and sustainability of increased aid flows depends on progress towards increasing the effectiveness of ODA. Aid must be aligned to nationally formulated and owned development strategies and delivered in efficient, transparent and accountable ways. The Paris High Level Forum was a milestone in the promotion of aid effectiveness. Building on the agreements reached in Rome in 2003, the Paris meeting produced a declaration signed by more than one hundred donor organisations and recipient governments. The Paris Declaration went beyond the general principles agreed in Rome to establish a set of concrete targets and indictors to track progress towards harmonisation, simplification, efficiency and accountability. Donors agreed, among other provisions, to align ODA to partner countries’ development priorities, systems and procedures; to help recipient countries develop and improve institutions to take the lead in developing national strategies and to integrate ODA into government operations; to untie aid; and to reduce transaction costs associated with aid delivery. Recipient countries agreed to use ODA in accountably and transparently and to redouble their efforts to reduce poverty and deliver essential services. The Paris Declaration has raised the stakes for UN reform. It presents the United Nations with an opportunity to prove its worth in supporting national ownership and implementation. However, it also requires UN agencies themselves to achieve greater focus and efficiency within a realistic time frame.

Viet Nam context Viet Nam is widely recognised as a leader among developing countries in advocating aid effectiveness. The first analyses of ODA harmonisation were carried out in Viet Nam in 2001, and an OECD Development Assistance Committee Harmonisation Workshop was held in Ha Noi in May 2002. Viet Nam was selected as a leader in harmonisation at the Rome High Level Forum in 2003, and the Viet Nam Harmonisation Action Plan was presented at the Paris Forum in 2005. 2

General Assembly, ‘2005 World Summit Outcome’, New York: United Nations, 15 September 2005.

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Immediately following the Paris meeting, the government and donors ‘localised’ the Paris Declaration in the form of the Hanoi Core Statement. This statement, which has since been approved by the prime minister as national policy and endorsed by donors at the 2005 Consultative Group meeting, includes harmonisation, simplification and alignment targets and indicators for both government and donors. The UN has offered concrete support to Viet Nam to implement strategic parts of the aid effectiveness agenda. UNDP has transferred responsibility for ODA data management to government, and has joined the Ministry of Planning and Investment in a project to acquire the best available technology for this purpose. The UN Resident Coordinator was co-chair of the Partnership Group on Aid Effectiveness for six months in 2005. Nevertheless, in key respects the UNCT has not yet confronted the implications of Viet Nam’s forward-looking aid effectiveness programme for its own country presence. The development environment has changed quickly and profoundly in Viet Nam. In the first decade of UN presence the United Nations represented a large proportion of overall ODA, and was one of a small number of development partners that maintained a presence in country. Today, UN resources make up less than two percent of ODA to Viet Nam, and a growing contingent of multilaterals, bilaterals and international NGOs present in country provide support to government. Moreover, donors are keen to align to national strategies and to provide support to policy formation, and government is increasingly open to policy dialogue with a wider range of donors. The United Nations must demonstrate its comparative advantage in specific areas and in a credible manner if the organisation is to remain relevant in the years to come. As an active member of the G77, Viet Nam has consistently supported UN requests for increased core funding to enable the organisation to remain a neutral and independent development partner. Viet Nam recognises the UN as a consistent advocate of national ownership, and still considers the UN an important player in Viet Nam despite its limited resources. At the same time, the government has urged the UN to accelerate internal processes of harmonisation and simplification. Vice Minister of Foreign Affairs Mr Le Van Bang at a workshop commemorating the 60th anniversary of the United Nations last year stated that: UN agencies should continue the harmonisation of program instruments and procedures that is critical to the effectiveness of UN development cooperation. There are two issues that require immediate attention in coordinating the implementation of the Millennium Declaration and outcomes of the global summits and conferences, namely the partnership at the headquarters level and joint action at the field level. The work in this area should not be left mainly to just a small number of organisations. In this connection, we share the view that the UN Resident Coordinator system in developing countries, including Viet Nam should be further strengthened and provided with adequate resources, including human resources.

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This is a challenge that the UNCT in Viet Nam is eager to accept. UN agencies in Viet Nam have already embarked on an ambitious programme of joint activities and have consistently been among the first countries in the world to embrace procedures and mechanisms provided by our headquarters to facilitate reform. But the team also recognises that efforts at ‘joint programming’ have demonstrated the problems as well as the benefits of incremental reform. The experience of the UN Avian Influenza Joint Programme and planning for the Kon Tum joint programme has shown that setting up cooperative endeavours will require a protracted and difficult planning process as long as the UN agencies maintain separate management, plans, budgets and practices.

Why One UN? The main vehicle of UN reform at the country level is the United Nations Development Group (UNDG) created in 1997 to improve effectiveness of operational development agencies. The UNDG consists of 25 members, four of which are members of the Executive Committee (UNDP, UNFPA, UNICEF, and WFP). The Executive Committee reports directly to the Secretary General, and is chaired by the UNDP Administrator. Among other activities, UNDG has promoted common country programming processes such as the CCA and UNDAF and harmonisation of programming mechanisms. UNDG has achieved some notable successes. However, there have been constraints, in part arising from the difficulty of driving reform from the top down in a predominantly New York led process. Incentive structures in agency headquarters are not necessarily identical to those in programme countries. The Executive Committee implicitly recognised this in a recent statement: It is very clear that we do not want to reduce the ability of ExCom agency representatives to take initiative, and to develop programmes with government Ministers, or work directly with donors. We do not want to interfere with agency money, staff or implementation decisions. We also do not want to get between agency governance or management (Executive Board, Headquarters/Regional structures) and their country representatives. Finally, we do not want to inhibit our ability to respond very quickly to emergencies, or seize opportunities that may arise, or speak out forcefully on sensitive issues that fall within agency mandates.3 Institutional rigidities are generally considered to have placed limits on the scope of UNDG-led reforms in its ten years of existence. Joint analysis and programming are useful, but fall short of what is possible and necessary at the country level. Only one common country programme has been completed, and this in Cape Verde, a country of 500,000 inhabitants. The UN is well aware of these shortcomings. In a major review of operations, the Secretary-General reported to the General Assembly that:

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‘Outcome of the UNDG Executive Committee Retreat on Strengthening the Resident Coordinator System’, 15 July 2005. Published at www.undg.org. Accessed 12 February 2006.

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Reform measures have not yet generated overall simplification of processes. Further progress is required to harmonise the United Nations development system’s country programming, in order to reduce the transaction costs associated with more intensive coordination. At the same time, individual organisations that have adopted harmonised procedures and new common tools tend to retain their own administrative procedural requirements... Although these new tools have been adopted by all the members of the United Nations Development Group, their use by different parts of the system and generally in field-level coordination mechanisms is uneven…Gaps in field-level coordination need to be filled by the full participation of all funds, programmes, agencies and other entities of the United Nations system, including the regional commissions, in processes that aim at intensifying field-level coordination of operational activities for development. This greater participation should be geared to providing a more comprehensive and coherent response to national needs and priorities and to bringing more fully to bear the overall capacities of the United Nations system in assisting developing countries to effectively translate internationally agreed development goals at the country level.4 The UNCT in Viet Nam believes that the current situation in Viet Nam presents an opportunity to attempt an approach to harmonisation that would satisfy the shared ambitions of the Government, the donors and Executive Board members and the UN itself. It considers this to be the most hospitable climate possible for experimentation and innovation. At the same time, there exists a great sense of urgency in the UNCT that failure to act could do permanent damage to the standing and relevance of the United Nations in Viet Nam. There is a consensus on all sides that time is now.

III. Principles The previous section presented the context and various arguments for accelerated harmonisation in pursuit of One United Nations in Viet Nam. This section sets out the key guiding principles behind this and its core objectives. These are well-known and represent either international standards adopted by the UN or to which the UN has unequivocally committed itself.

Key Principles The key principles of United Nations development activities are encoded in its Charter, elaborated in fundamental documents such as the Universal Declaration of Human Rights and most recently presented as a plan of action in the Millennium Declaration and its Goals. The United Nations is not an aid donor. It is an international organisation consisting of member countries that have made a commitment to abide by the Charter and other 4

‘Triennial comprehensive policy review of operational activities for development of the United Nations system: Conclusions and Recommendations’ 28 September 2004

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agreements. Like the World Trade Organisation, the organisation was established to promote the principles contained in agreements developed through it, to inform members of their rights and obligations and to increase accountability and transparency in the implementation of agreements. In the case of the WTO the core principle is free trade. For the United Nations it is human rights in the broad sense, encompassing, in the Secretary-General’s compelling formulation, personal and political freedoms, freedom from want and freedom from fear. The Universal Declaration of Human Rights and the overall body of UN-sponsored human rights law include civil, cultural, economic, political and social rights. The Millennium Declaration reiterates these principles and applies them to concrete development goals and targets.

Focus on UN mandate, role and comparative advantage Whatever form the UN presence eventually takes in Viet Nam, its responsibility and mandate will primarily be expressed through four key contributions to the country: 1. Support for and promotion of international standards including the Millennium Declaration, MDGs and human rights standards for all areas of rights. 2. Strengthening national capacities as a prerequisite for national ownership. 3. Providing objective monitoring and evaluation of government activities as a contribution to their ongoing refinement and improvement. 4. Giving access to international experience, expertise and best practice. Any proposal for harmonisation and reform will only be justified if it results in an improved capacity for the UN to respond in these areas. In addition, harmonisation and simplification should in the long-term deliver lower transaction costs and general improvements in the efficiency and cost-effectiveness of what we do.

III. Roadmap The proposals of the September 2005 paper were welcomed by Government and a wide range of development partners in Viet Nam and endorsed by the UNCT. This has resulted in a request to provide a ‘roadmap’ to present an initial picture of how this might work in practical terms. There is no question that the ambitious and extensive harmonisation that the UNCT and its partners envisage would present a range of challenges and difficulties. It is also likely that some disadvantages relative to previous practice and additional costs would appear over the short to medium term. We believe it is not possible to identify an exhaustive set of steps that would immediately and painlessly result in a seamlessly harmonised UN country presence. We do provide an indication of approaches that UNDG members view as practical and that would achieve a harmonised county presence that would meet the high standards for reform set globally and, most importantly, by the Government and other development partners in Viet Nam.

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Two or more tracks Progress on reform of the United Nations at the country level has been hampered by the genuine practical challenges associated with bringing together a large number of diverse agencies that have built up different management practices, governance institutions and mandates. Attempts to move all parts of the system along concurrently and at the same pace have broken down in part because agencies that are ready to proceed more rapidly towards harmonisation have been constrained by those less able to do so. In recognition of this, the UN Heads of Agency in Viet Nam recently agreed that it would be to the benefit of everyone to allow those agencies ready to move towards greater harmonisation to do so immediately, leaving it open for other agencies to harmonise to the degree possible and on a timetable more suited to their governance structures and planning mechanisms. This proposed approach applies at the moment to UNDP, UNFPA and UNICEF only. These represent the UNDG ExCom agencies represented in Viet Nam. These three agencies are already joined by a set of shared UNDG procedures and practices. However, the approach is broadly supported by the UN Country Team as a whole. Non-ExCom agencies that are unable to participate in the first stages of this roadmap recognise the benefits for their agencies and for the objectives of the UN as a whole of a more consolidated UN Country Team. They have stated their hope that at a later stage they might be in a position to join with the ExCom agencies in a harmonised structure. In the short to medium term, the UNCT would continue to operate as it does now with a number of agencies represented under the coordination of the Resident Coordinator, but with the three ExCom agencies working as a single, harmonised agency. The Resident Coordinator would maintain his or her current relationship with non-ExCom agencies and agency heads, and provide coordination within the same context as at present.

Components of the roadmap There are four main areas in which harmonisation will be pursued, leading to the transformation of the three agencies into one agency by the end of 2007. These four areas can be described succinctly as one plan, one budget, one management and one set of management practices. Achieving any one of these harmonisation benchmarks would be worthwhile in its own right. They are mutually reinforcing but not interdependent in the sense that progress on one front can continue even as obstacles are encountered on other fronts. One Plan At present the UNDG agencies and to a lesser extent non-UNDG agencies are committed to the implementation of the UNDAF, which is a unified United Nations development assistance plan. In principle, this brings together the objectives of all of the agencies under one framework. However, in practice each agency goes on to produce separate Country Programme Documents for their individual Executive Boards, as well as separate Country Programme Action Plans, separate project documents and separate 11

Annual Work Plans. Harmonisation is minimal at the lower level of results where budget is allocated. The absence of one plan (at all levels) means that government counterparts, the Resident Coordinator and each agency’s management cannot easily see the complementarities among the efforts of different agencies. The chances that the UNCT as a whole will identify opportunities to capitalise on the comparative advantage of each agency are therefore reduced. The absence of a single detailed plan increases the risk of poor coordination, duplication and inefficiency. The steps required to achieve one plan are: • •

• •

Consolidation into a single plan of the plans of all three agencies down to the Annual Work Plan level. A comprehensive review, in collaboration with the Government as appropriate, of the consolidated plan to identify areas in which activities can be aligned, merged or rationalised. Where such opportunities arise, project documents will be amended into joint programme format in line with the UNDG Joint Programming Guidelines. An example of this approach already in use is the UN Joint Programme on Monitoring and Evaluation with the General Statistics Office. Following this process a combined plan will be produced drawing upon the format of the Country Programme Action Plan. This would represent the substantive consolidation of the three separate CPAPs currently in existence. Future activities will be placed within the framework of the joint plan. During Annual Work Plan preparation the Resident Coordinators Office will review inputs (in the context of the management authority of the Resident Coordinator described below) to ensure harmonisation.

Some progress has already been made in these areas, and there are a range of proposed joint programmes including in Kon Tum province in the Central Highlands, on Monitoring and Evaluation and a Joint Social Policy Programme. These have been prepared or are in preparation and will be ready to begin when the requisite funding is made available. One budget At present each UNDG agency’s separate plan is linked to a separate budget. The absence of a consolidated budget makes it difficult to arrive at an overview of the financial inputs and outputs of all of the agencies taken together. It obscures the picture of how and where the UN agencies are spending money, where their funding comes from and where the funding shortfalls are. It leads to sub-optimal allocation of resources from donors that must attempt to provide strategic support to the UN in the absence of reasonably complete knowledge of the organisation’s overall funding situation and priorities. Together with a consolidated plan, a consolidated budget provides a full and proper account of the agencies’ harmonised objectives, role, funding shortfalls and financial allocation decisions.

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The steps required to achieve one budget are: • • •

Consolidate all three agency budgets into a single budget sheet encompassing all of the three agencies’ present and predicted resources. Produce a consolidated budget analysis including analysis of where money is coming from, where it is going and where the overall funding shortfalls are. Prepare a consolidated donor request for the overall funding shortfall of the merged agency.

One management At present, each UNDG agency has separate representation and management, each reporting through and accountable to different structures. While the Resident Coordinator is the senior UN representative in country, he or she has no direct authority over representatives of other UN agencies. The RC has no say in recruitment, assignment of tasks and responsibilities or performance evaluations, and therefore must rely on moral suasion to influence the work of the other UNCT agencies, including the other ExCom members. The RC is less a manager than an advocate for UN coordination and cooperation. Like in most countries, in Viet Nam, the UN Resident Coordinator also has the function of the UNDP Resident Representative. Under the proposed One Management principle, the UNRC will be assigned the representational function of all three UNDG ExCom agencies to ensure equal representation of the concerned agencies. This will require UNDP to establish a Country Director’s post with delegated authority to manage UNDP programme along with UNICEF and UNFPA taking formal steps to assign representational functions to the UNRC. The current UNICEF and UNFPA Representatives functions and job-descriptions will be amended accordingly. The UNRC in his capacity as the Representative of UNDP, UNICEF and UNFPA will report to the UNDG through the UNDP Regional Director with a matrix reporting system to the UNICEF and UNFPA Regional Directors. The absence of a single management structure complicates efforts to harmonise the work of UN agencies and rationalise resource deployment, including staffing. Without a unified chain of command UN coordination becomes a task assigned to agency staff rather than a core responsibility of each and every United Nations official and staff member. When conflicts arise, agencies naturally look to their own managerial hierarchies to set priorities, and these are not necessarily in line with the requirements of harmonisation and simplification. The RC’s reliance on moral suasion means that his or her ability to achieve coordination is too dependent upon the good will of individual agency heads and personal relationships between the RC and his or her senior colleagues. The end result is that the United Nations is unable in many cases to speak with a single voice, to the detriment of the organisation’s influence and effectiveness in Viet Nam. The steps required to achieve one management are:

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• • •

• • • • •

UNDP will appoint a Country Director to be responsible for the agency’s programme, allowing the Resident Coordinator to devote all of his or her time to the RC position and ensure an equal representation of the three ExCom agencies. The Resident Coordinator will become the direct supervisor of the Representatives/ Country Directors of UNDP, UNFPA and UNICEF. This will entail assignment of tasks and performance assessment authority. Representatives, Country Directors or their equivalent will continue to be employees of their agencies, bound by the staff rules of those agencies under the same terms and conditions. Their terms of reference will be amended to reflect their primary reporting line to the Resident Coordinator (this is a procedure used for staff hired under UNOPS contracts that are placed in agencies, for example). The Resident Coordinator will chair the selection panels for future recruitment into senior positions contributed by the three agencies. The Resident Coordinator will be required to undertake orientation on the programming processes and management practices of all three UNDG agencies. Representatives/ Country Directors will maintain a secondary reporting line through their existing agency structures. The necessity for separate representative positions in all three UNDG agencies will be reviewed in the context of the midterm review of the present UNDAF (to be held in 2007 or 2008). The Resident Coordinator will work with Government and supporting bilateral donors to establish single premises (a UN House) for the combined agencies.

One set of management practices At present, each UNDG agency has a different set of management practices. The three agencies use different financial procedures, charge different recovery costs, and follow different procedures relating to personnel, supply and procurement.5 The absence of harmonisation of management practices increases transaction costs for Government and other partners, results in inconsistencies in donor relations and impedes coordination between the agencies. Efforts are underway to harmonise some of these procedures, such as the new Harmonised Cash Transfer Modality. These are first steps but fall short of the establishment of one set of management practices for the UNDG agencies. Many other areas must still be harmonised. The area of harmonisation of management practices presents the most daunting procedural challenges, but the potential benefits in the form of lower transaction costs are very large. However, harmonised management practices are not a prerequisite for harmonisation on other fronts, and should not be allowed to obstruct progress with regard to one plan, one budget and one management, all of which could be achieved, albeit awkwardly, in the context of multiple management practices. The area of management practice harmonisation may be best achieved with external support, either from an agency such as UNOPS or an external management consultancy. 5

UNDP and UNFPA share many rules and regulations and share the financial management system ’ATLAS’, while UNICEF’s systems are markedly different from the other two.

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In order to achieve one set of management practices the steps will include: • • • •

Harmonisation of financial procedures in line with the new Harmonised Cash Transfer Modalities. Replacement of individual programme management software (e.g. UNICEF’s ProMS and UNDP/ UNFPA’s Atlas) with a single unified system (either one of the existing systems, a hybrid of existing systems or a new system). Establishing a single consolidated operations function with harmonised procurement and supply systems. Undertaking a review of remaining management practices, identifying areas of divergence and developing harmonised practices as required and appropriate.

It is understood that flexibility will be needed in this area so that revisions to management practices can be made in response to progress at the global level.

The roles of others The harmonisation of the United Nations agencies in Viet Nam cannot be achieved in isolation from other development partners. It is both appropriate and essential that the full range of key stakeholders lead, guide and support progress towards harmonisation. Government As noted above, the Government of Viet Nam is an enthusiastic advocate of UN reform and harmonisation in Viet Nam. The government is and must remain the main driver for reform within the context of the aid effectiveness agenda and the government’s support for a strong, focussed and effective UN. The government must continue to show leadership in realising the harmonisation of the three UNDG ExCom agencies and other agencies as opportunities arise. It would need to guide the UN in Viet Nam in ensuring that a harmonised presence complies with government practices and legal provisions relating to ODA, and delivers targeted and high quality inputs aligned to Viet Nam’s development strategy. Headquarters The cooperation and ownership of the headquarters of the three agencies is essential to the creation of a harmonised UN presence in Viet Nam. The three headquarters would provide technical guidance and advice to help resolve many of the issues identified in the implementation road map. They will also provide external monitoring and evaluation of progress and effectiveness in achieving harmonisation, feedback to the UNCT in Viet Nam to allow for adjustments and support drawing of lessons for broader application outside of Viet Nam. The three agencies would be required to respond to the initiative in Viet Nam at a high level in order to ensure rapid decision making and timely delivery of technical backstopping as problems arise.

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Regional Offices Similarly, as a front line for support of UNDG Country Offices in Viet Nam, Regional Offices of the respective agencies will provide technical backstopping and monitoring and evaluation support as required by the country office. Bilateral donors Harmonisation comes at a cost, and cost savings may take time to materialise. Experience elsewhere has shown that in the short-term harmonised structures may be more staff intensive and therefore more expensive. For example, the shift from multiple to single representations will eventually save money, but in the short term additional staff may be required to effect the transition. Many other steps outlined above, notably recourse to external assistance to harmonise management practices, would require new resources. Donors supportive of these efforts should be prepared to help finance these efforts. Donors will need to ensure consistency in their approach to UN harmonisation in country and globally. Donor agencies have voiced strong support for One United Nations in Viet Nam. The rationale for this support would need to be communicated to the respective headquarters and other management structures to which these agencies are accountable to ensure that donors take a consistent approach at all levels. Consistency of support is particularly important for those donors represented on the Executive Boards of the various UN agencies. Through their representation on these bodies donors can guide, advise and help the UN agencies to respond in appropriate and supportive ways to harmonisation initiatives in Viet Nam.

Timing The proposed completion date for One United Nations in Viet Nam is end 2007. The ordering of components will be determined by the practicalities of implementation, not by progress in other areas, since components are not interdependent. The first step will be to achieve one management, with contracts of the UNFPA and UNICEF Representatives amended accordingly and UNDP management arrangement put in place to ensure the Resident Coordinator’s overall management authority is effective by the end of June 2006. The production of the consolidated plan and budget are comparatively straightforward but time consuming. Both are possible by the end of 2006 if adequate capacity is available for the task. Harmonisation of management practices is foreseen to be the most complicated and detailed task. Given this, it is unlikely that this will be completed prior to end 2007.

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This timeline suggests that the three agencies will begin to operate programmatically in a concerted and harmonised way with the general appearance at the programmatic level of a single agency by end 2006, and be effectively harmonised by end 2007.

IV. Conclusion The United Nations in Viet Nam operates within the global context of enthusiasm for reform in principle but limited progress in practice. In Viet Nam, government, donors and indeed the UNCT recognise the urgency of UN harmonisation and consider many of the obstacles that have limited global progress not to be in place. The UN’s constituencies have articulated their expectations in a particularly clear and cohesive manner in Viet Nam. The UNDG members in Viet Nam take the view that we must respond positively and creatively to these expectations if the UN is to remain a vital and relevant contributor in Viet Nam’s development. We must deliver One United Nations with one plan, one budget, one management structure and one set of management practices. One United Nations will help us to achieve greater focus and efficiency, and thus more effective support to the government and people of Viet Nam. This paper has presented concrete proposals for implementation steps to achieve a country presence that is appropriate to the mandate, responsibilities and comparative advantage of the United Nations. The road map initially covers the UNDG ExCom agencies in Viet Nam, but we would hope that as the benefits of One UN materialise other agencies would also seek to harmonise along similar lines, depending on the flexibility afforded to them by their headquarters, executive boards, donors and government, We do not claim that the implementation steps presented in this paper are comprehensive or represent an immediate solution to all of the problems outlined in this paper and familiar to proponents of UN reform. We do argue that these steps represent a solid foundation on which we can ultimately build a unified, focused and efficient UN presence in Viet Nam, and one that is relevant to Viet Nam and its development. We are convinced that due to an unusual confluence of circumstances—including a supportive government and donor community and a cohesive United Nations Country Team—Viet Nam provides a uniquely conducive environment to experiment with innovative approaches to UN harmonisation. While we do not imagine that the process will be easy, we are convinced that the costs of inaction are far greater than the potential costs of transition to One United Nations. Most importantly, we believe we will emerge from reform better equipped to provide the support to Viet Nam’s development upon which our country presence is premised. In our view there is no stronger argument.

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