EXECUTIVE BOARD Special session on WHO reform Provisional agenda item 3
EBSS/2/INF.DOC./2 25 October 2011
Financing of the World Health Organization A. TRENDS IN BUDGET, INCOME AND EXPENDITURE
Figure 1: Trends in budget, income and expenditure, 1998–2013 (US$ millions)1 5000 4500 4000 3500 3000 2500 2000 1500 1000 500 0 1998– 1999 2000– 2001 2002– 2003 2004– 2005 2006– 2007 2008– 2009 2010– 2011 2012– 2013 Budget Income Expenditure
Year
1 Income and expenditure data exclude in-kind contributions. For 2010–2011 and 2012–2013 income and expenditure are projected.
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Figure 2: Trends in assessed and voluntary contributions, 1998–2013 (US$ millions)1 4000 3500 3000 2500 2000 1500 1000 500 0 1998– 1999 2000– 2001 2002– 2003 2004– 2005 2006– 2007 2008– 2009 2010– 2011 2012– 2013 49% 42% 40% 31% 24% 27% 25% 24% 51% 58% 60% 69% 76% 73% 75% 76%
Year Assessed contributions Voluntary contributions
Data exclude in-kind contributions. For 2010–2011 and 2012–2013, assessed contributions and voluntary contributions are projected.
1
Figure 3: Sources of voluntary contributions, 2010–2011 (projected)
8% 18% 53% 21% Member States Other United Nations bodies/Global health partnerships Foundations Other3 2 1
1 2
e.g. United Nations Multi-donor trust funds, GAVI Alliance. e.g. United Nations Foundation, Bill & Melinda Gates Foundation. 3 e.g. European Commission, nongovernmental organizations.
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Figure 4: Distribution of salary and activity costs as a percentage of total expenditure, assessed contributions and voluntary contributions, 2010–20111 % 100
22% 80
55% 60
74% Activity Salary
40
78% 45% 26%
20
0 Total Assessed contributions Voluntary contributions
1
As at 31 August 2011.
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B.
TRENDS IN SPECIFIED INCOME
Figure 5: Trends in the proportion of WHO's income that is specified, 2006–2011 (US$ millions) 4500 4000 3500 3000 2500 2000 1500 1000 500 0 2006–2007 2008–2009 Year Specified Assessed contributions + flexible voluntary contributions 2010–2011 (Projected)
72%
71% 66.5%
28%
33.5%
29%
C.
PREDICTABLE INCOME AS A PROPORTION OF THE PROGRAMME BUDGET
Figure 6: Predictable income at the start of the biennium 2010–2011 (US$ millions)
21% Assessed contributions Other predictable income 1
55% 24%
Funding gap in predictable income
1 Other predictable income includes framework agreements, multi-year agreements and flexible funds provided to the core voluntary contributions account. It excludes funds carried forward.
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D.
TRENDS IN FINANCING OF MANAGEMENT AND ADMINISTRATION
Costs of administration are currently estimated to constitute approximately 15% of overall programme budget expenditure. The majority of administrative costs are financed using assessed contributions and funds generated through a programme support cost levy on voluntary contributions. In 2010 a post occupancy charge on gross salary costs was introduced as an additional levy, to complement the programme support cost levy. Over the last ten years, income from programme support costs has been steadily declining as a percentage of voluntary contributions as illustrated by Figure 7 below. This has resulted from: (i) United Nations system-wide common agreements for lower rates of programme support costs; (ii) the requirement by some donors of a reduction in the standard 13% rate of programme support costs.
Figure 7: Programme support costs income as a percentage of voluntary contributions, 2000–20111 % 12 10.8% 10 8 6 4 2 0 2000– 2001 2002– 2003 2004– 2005 Year 2006– 2007 2008– 2009 2010– 2011 9.9% 8.5% 8.1% 7.7% 6.7%
1
Projections for 2010–2011.
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Figure 8: Assessed contributions, programme support costs and post occupancy charges as proportions of funding for administration, 2010–2011 (projected)
19% Assessed contributions Programme support costs 23% 58% Post occupancy charges
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E.
TRENDS IN EXCHANGE RATES AND THEIR IMPACT ON PURCHASING POWER
The base currency for WHO is the United States dollar. A large proportion of income and expenditure is in other currencies.
Figure 9: Currency mix, total income and expenditure
Income currency mix 2010–2011 Currency Other
14%
Euro
10%
United States dollar 0 %
76%
Expenditure currency mix 2010–2011 Currency Euro
12.6%
United States dollar
21.4%
Other
33.5%
Swiss franc
32.5% 0 %
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Over the last decade there has been a significant decline in WHO’s purchasing power as currencies of income have devalued against the Swiss franc – the currency in which the Organization has the biggest net expenditure exposure.
Figure 10: Exchange rate movements since 2000 in major offices United States dollar value against the Swiss franc 2 1.8 1.6 1.4 1.2 1 0.8 0.6 2000 2011 0.9 0.8 0.7 0.6 2000 2011 1.2 1.1 1 United States dollar value against the euro
United States dollar value against the Philippine peso 55 60 50
United States dollar value against the Indian rupee 6.5 6
United States dollar value against the Egyptian pound
55 50 45 40 35 2000 2011
5.5 45 40 35 30 2000 2011 5 4.5 4 3.5 3 2000 2011
The United States dollar has weakened against all major cost currencies for WHO operations, resulting in higher United States dollar costs. The only exception is the Egyptian pound, against which the United States dollar has strengthened over time.
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Figure 11: Changes in WHO’s weighted purchasing power, 2000–20101 % 100 80 60 40 20 0 2000 2002 2004 Year 2006 2008 2010 100 90 78 76 69 64
1
Purchasing power compared with 2000.
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