STU/65th Council/13/023
15 November 2013
On Friday 8 November, the APX Commission approved a draft resolution on item 12.4 “The state of the Medical Benefits Fund and introduction of the new governance structure”, deciding to amend the rules of the MBF as contained in the document 37 C/38 Add. Part 3.
STU respectfully suggests, for reasons of legality, that the original draft decision in the document be approved, without amendment, namely:
“The General Conference,
Having examined document 37 C/38 and Add. and Add.2;
Takes note of the information contained in this document with regard to the governance structure revisions;
Approves in principle the revised 60:40 cost-sharing formula with a view to implementing it as of 1 January 2016 or until such a time as the financial expenditure plan of the Organization improves;
Authorizes the Director General to establish a charge of 1 per cent of total staff costs across all funding sources with effect from 1 January 2016 as funding for After Service Health Insurance (ASHI) liability in respect of active staff members;
Invites the Director General to continue improving the management of the Fund;
Further invites the Director General to report to the 38th session of the General Conference on the state of the Medical Benefits Fund.”
Some facts -some questions.
1. Legal Affairs (LA) ruled that as it was the General Conference which established the Medical Benefits Fund in 1948, the General Conference also has the right to change the rules, and hence to invalidate and change the existing rules of an independent and self-financing medical insurance scheme.
Does the General Conference have the MORAL right to change the rules, when those directly concerned – the co-owners/participants - have reservations about the proposed changes, and wish to have more time, more information and an independent review of the situation?
2. Documents 37 C/38 and Add . were only made available 24 hours before they were due to be discussed. The rules presented in the Addendum are not the full set of new rules proposed by the Administration; other changes are envisaged and parts are incomplete.
Did delegates have sufficient time to read and absorb the changes proposed, e.g. that:
- the Joint Administration-Participants Management Board is to be replaced by an Advisory Board;
- management will be given to a co-ordinator, accountable only to his/her immediate superiors;
- the MBF will cease to be “an autonomous health insurance scheme”;
- Member States will lose their observer status?
3. Document 37 C/38 Add.2(STU’s comments on the item) was only made available in Room XII on 8 November 2013.
Did all the delegates receive it? Did they have sufficient time to read and absorb STU’s comments?
4. Changing the governance structure will not solve the financial problem.
Surely, the current alarming financial situation is due to the persistent unwillingness of the UNESCO Administration and the Member States to increase contributions from the Organization over the past 16 years, while over the same period, participants have been willing both to increase contributions and to cut benefits?
Will not the long-term contract with Deloitte[1] add to the administrative costs, which are not shown in the MBF accounts, as they are covered entirely by the Administration, but which were estimated several years ago to add about a further 10% to the Organization’s share of the costs?
5. The APX Commission avoided any commitment to an initial funding of the after-service health insurance (ASHI) liability
If there were an ASHI reserve, would not retired staff be reimbursed from this reserve, or from the interest from it, (as is the case in the World Health Organization (WHO)), thus taking pressure off the MBF?
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1- « “Deloitte promotes Mauritius as tax haven to avoid big payouts to poor African nations.” See the recent article at http://www.theguardian.com/business/2013/nov/03/deloittes-tax-savings- investments-in-poor-countries. Should UNESCO have a long term contract with this kind of enterprise?