Mr. Chair,

1. I have the honor to speak on behalf of the Group of 77 and China on agenda item 138: "Financial performance report on the programme budget for 2021".

2. The Group would like to thank Ms. Maria Costa, Director Finance Division, Office of Program Planning, Finance & Budget for introducing the report of the Secretary-General on this agenda item. We also thank Mr. Abdallah Bachar Bong, Chair of the Advisory Committee on Administrative and Budgetary Questions (ACABQ) for presenting the Advisory Committee's related report.

3. The Group notes a significant value of under-expenditure i.e $206.8 million in the regular budget of 2021 which is 6.4% less than the approved appropriation. The highest under-expenditure was observed in Special Political Missions under Section II- Political Affairs amounting to $63.8 million or 8.7%, Human Rights (Section 24)- amounting to $22.4 million or 17.2 % and Economic & Social development in West Asia amounting to 12.8 million or 22.7% of the approved appropriation. The report attributes this under-expenditure to Covid-19 stating that a number of plans activities were postponed, modified or even cancelled. The planned resources particularly in heads of hospitality travel and supplies & materials were affected the most. Similarly, on Income side, we noted a decrease of 5.2% representing decrease of $15.6 million.

4. We also noted that due to unpaid assessments, the Secretary General had to impose ceiling of 90% on expenditures to avoid disruption of operations. Following the injection of $100 million working capital fund pursuant to last year's resolution, the group would also like to see its impact over liquidity management in next Program budget.

Mr. Chair,
 
5. Meanwhile, we also note upward trajectory of over-expenditure under the section "consultants" for consecutive three years. The same trend is observable in the current year with 99% of funds already consumed on 30th September, 2022. We encourage the Secretary General to provide more information on the rising trend of this over-expenditure in hiring consultants in the upcoming performance reports. We also expect that the lessons learned during the previous budget periods will continue to be applied in the preparation of future proposed programme budgets.

Mr Chair,

6. The Group also noted the net return of surplus of $178.8 million in 2021 and that it would be reflected as the credit against member states for the year 2023 as per the financial rules of the United Nations. In the same breath, we observe the accumulation of $448.5 million in surplus in cost recovery fund and its gradual increase to 129% in 2021 as compared to 2016. We would like to know more about it in greater detail and the need of identification of credits back to member states.

7. Having considered the impact of forward purchasing of foreign currency for year 2021, we note that it resulted in exchange loss of $9.4 million. We noted the follow up actions of the Secretary General on the recommendations of Advisory Committee including the lessons learnt on the implementation of the annual budgeting.

8. In conclusion, Mr. Chair, the Group of 77 and China would like to assure you of our continued commitment to work constructively with all delegations and to present alternatives for the fruitful conclusion of this agenda item.

I thank you Mr. Chair.