US embassy cable - 05ROME2743

UNCLAS  ROME 002743 
 
SIPDIS 
 
 
USDA FAS FOR DUS BUTLER, MCHAMBLISS, LREICH, RHUGHES; 
STATE FOR IO DAS MILLER, IO/EDA, OES/E, E, EB; 
AID FOR EGAT, DCHA/OFDA, DCHA/FFP 
 
FROM THE U.S. MISSION TO THE UN AGENCIES IN ROME 
 
E.O. 12958: N/A 
TAGS: AORC, EAGR, EAID, KUNR, FAO 
SUBJECT:  RESULTS-BASED MANAGEMENT AT FAO 
 
1.  Summary:  In light of a long history of continued 
calls for UN reform, the Food and Agriculture 
Organization (FAO) over the past seven years has 
implemented a Results Based Management (RBM) reform 
initiative. The process proceeds in three planning tiers. 
Supporting the Program of Work and Budget (PWB), a two- 
year budget plan, is a six-year Medium Term Plan (MTP) 
and a 15-year Strategic Framework that was adopted by the 
FAO Conference in 1999. Measuring the progress of these 
planning processes is an extensive independent evaluation 
program accompanied by oversight and inspection units. 
Although long-term planning can enhance transparency and 
is a right step forward, utilization of too many planning 
tools could potentially overburden the system and stymie 
the overall goals of reform measures.  The September 
Program and Finance Committee meetings will continue a 
discussion on how RBM can be improved. End Summary. 
 
Strategic Framework 
-------------------- 
 
2.  In 1999 FAO introduced a Strategic Framework intended 
to structure a program approach to long-term goals. 
Twelve strategic objectives became the basis of all 
program planning within the FAO. The Strategic Framework 
also defined key cross-organizational strategic issues 
that needed to be addressed in order to ensure that the 
Organization had or acquired the capacity to provide the 
services sought by Members. In addition, the Strategic 
Framework included criteria for priority setting, with a 
view to their application in the Medium-Term Plan. 
 
3.  Since that time the results-based planning and 
accountability framework laid out in the Strategic 
Framework has aimed to ensure that actions achieved 
desired results in a cost effective manner.  The model 
uses logical framework planning, including establishing 
rationales, objectives and outputs, and an evolving suite 
of planning and post-factum reporting documents for the 
comprehensive review of programs by the governing bodies 
with an emphasis on accountability, evaluation and 
oversight. 
 
Medium Term Plan 
----------------- 
 
4. The strategic framework was accompanied by medium and 
short-term planning.  The six-year Medium Term Plan (MTP) 
played a central role as it proposed programs that 
addressed each strategic objective in the Strategic 
Framework. These would be accompanied by information on 
the planned results, including outputs, effectiveness 
criteria and indicators. It was a rolling plan, updated 
every two years by deleting completed program entities 
and including the new ones for the upcoming planning 
period. The revision would also take account of the 
outcome of evaluations and implementation performance 
reporting. 
 
5.  The program entities constituting the MTP fell into 
three categories: Technical Projects, Continuing 
Programme Activities, and Technical Service Agreements. 
The latter two concerning outputs and services to be 
provided on a fairly constant or continuing basis.  As 
Technical Projects have a duration of up to six years, 
only one-third were new in any one biennium, thus 
reducing the volume of work involved in reviewing the 
Plan. 
 
Program of Work and Budget 
--------------------------- 
 
6.  The Program of Work and Budget (PWB) has become more 
of a budget document that represents the detailed 
implementation plan for a two-year slice of the MTP. As 
such, it is a vehicle for fine-tuning agreed activities 
to match available budgetary resources. The MTP and PWB 
documents improved the basis for appraisal, evaluation 
and performance reporting to both management and 
governing bodies. Fundamentally, however, it was only in 
the two-year PWB where member states decided resources 
levels. 
 
Evaluation and Oversight 
------------------------- 
 
7.  Evaluation, a core feature of the RBM process, covers 
 
both normative and technical cooperation and compares the 
needs of FAO member countries to program priorities. 
Evaluations have an accountability function in terms of 
results, but the emphasis is on organizational and 
program improvement.  The Program Committee supervises 
the evaluation routine and an internal evaluation 
committee advises the Director General on evaluation. 
 
8. The FAO has been conducting evaluations with steadily 
increasing rigor for more than twenty-five years. In 1999 
FAO shifted to more independent policy-oriented 
evaluation, with less emphasis on the evaluation of 
individual small programs. Two to three major evaluations 
are carried out by FAO each year. Since 2001 there have 
been twelve evaluations.  One of the most recent, for 
example, is the 2004 evaluation on decentralization that 
provided a comprehensive assessment of decentralization 
and tabled recommendations to enhance the future benefits 
of decentralization to member countries. The Evaluation 
Service manages evaluations constitutes teams to conduct 
them. The teams always include external consultants and 
generally have members from the Evaluation Service. In 
addition to a core evaluation team, the external input 
and independence are normally strengthened through a 
wider panel. 
 
9. Oversight in the FAO is carried out by both internal 
and external audit committees.  The internal audit 
committee advises the Director-General and the Office of 
the Inspector-General on internal audit matters. The 
Office of the Inspector General, in turn, conducts 
comprehensive audits comprising financial, compliance, 
and management or value-for-money audits, and 
investigates waste, abuse of authority, fraud, 
presumptive fraud, and undesirable activities. The 
External Audit is the independent oversight tool, which 
reports directly to the Governing bodies.  The financial 
audit is the most important aspect of external audit as 
it provides assurance that the financial statements are 
free from material inaccuracies.  While the Joint 
Inspection Unit (JIU) also functions as an oversight 
mechanism, it falls outside of the FAO RBM process but 
has the broadest powers of investigation in all matters 
having a bearing on the efficiency of services and the 
proper use of resources and may make inquiries and 
investigations. The JIU enhances the efficiency of the 
administrative and financial functioning of the overall 
United Nations system. 
 
10. Within its RBM framework, FAO therefore enjoys a 
sophisticated goal-oriented management process that may 
be more extensive than that found in many UN 
organizations.  In addressing RBM systems within the 
United Nations the Joint Inspection Unit report of 2004 
cited FAO for a good practice examples amongst UN 
agencies that had implemented an effective evaluation 
system. 
 
Comment 
-------- 
 
11.  While the FAO has made great strides in improving 
its programming and evaluation functions, discussions 
have begun on the feasibility and redundancy of having 
three planning documents.  More specifically, many in 
both the Secretariat and among the permreps are coming to 
the view that the 15-year strategic framework presents 
too long a horizon and should be replaced by a more 
comprehensive MTP. In this instance FAO would continue to 
use the two-year PWB as the major implementation and 
budgetary plan that is updated on a biennial basis and 
the MTP would be the more strategic planning document. 
This discussion will continue with a paper being 
developed by the Secretariat for the September Program 
and Finance Committee meetings.  Nevertheless no change 
is likely to be proposed before the Fall 2005 Conference. 
 
12.  An inherent shortcoming in FAO's (as well as any 
other) RBM process, however, is that it works only within 
the context of priorities established by the governing 
bodies.  It is aimed at achieving and measuring progress 
within existing parameters.  In a situation where the 
size of the budget is determined in the short-term PWB 
process, the Medium Term Plan has tended to be 
unrealistic in assuming the availability of resources, 
and RBM, in turn, has measured effective management of 
resources only within the PWB set of assumptions.  At 
 
least as applied, the RBM process is ineffective in 
reestablishing priorities so that resources can flow to a 
more optimal mix of outcomes. 
 
13. The Independent External Evaluation (IEE) agreed at 
the 127th Council session launched an evaluation organized 
directly by the governing members of FAO, itself. The 
goal is to establish an objective independent baseline of 
programmatic strengths and weaknesses in order to 
facilitate what ultimately should be a re-definition of 
the organization's structure and programs.  If 
successful, the RBM process could provide a streamlined 
process toward a more modern and responsive FAO. 
 
HALL 
 
 
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	2005ROME02743 - Classification: UNCLASSIFIED