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1. Management of the
Adaptation Fund
Institutional Issues:
A UNDP Presentation to the UNFCCC
Workshop on the Adaptation Fund
May 2006, New York
Olav Kjorven, Director UNDP EEG

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I.UNDP’s Position
II.UNDP Mandate, Structure, and Decision-
Making Process
III.UNDP Programme Management Capacity
IV.UNDP’s Programme on Climate Change,
with focus on Adaptation
V.UNDP Fund Management
VI.Cost structure
Outline

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I. Management of Adaptation Fund: UNDP’s Position
UNDP is “committed to support the institutional
arrangements of the Adaptation Fund, as decided by
Parties in their deliberation. With our partners, our role
is to support and operationalize the Fund in a cost-
effective manner”
•UNDP believes that helping developing countries to
adapt to climate change impacts is central to our core
mandate for promoting development and poverty
reduction across the globe.
•GEFSEC: “It is about doing development differently.” We
agree with that!

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UNDP is the UN’s global development
network
•On the ground in 166 countries, UNDP is organized in five
Practices, which are: (1) Crisis prevention and recovery; (2)
Democratic governance; (3) Energy and environment; (4)
HIV/AIDS; (5) Poverty reduction
•UNDP's integrated menu of services spans project operations and
finance, service delivery, policy advice and knowledge.
• UNDP’s environment vision: at the interface of the MEAs and
MDGs, environment FOR the MDGs
II. UNDP’s Mandate

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II. UNDP’s Structure
UNDP is highly decentralized
Structure
•Most of non-annex I countries have UNDP
Country Office or a country program.
Backstopped by Regional Centers
- 166 Country Offices
- 6 Regional Centers
- Headquarters
UN Resident Coordinator System
•Coordinates activities of all UN
organizations in countries
•Ensures the most effective use of the
resources, expertise, and impact of the
UN system on the ground
Decision Making Body
•UNDP Executive Board (36 members)
- Africa 8
- Asia & Pacific 7
- Eastern Europe 4
- Latin America & Caribbean 5
- Western Europe & Others 12
•Project approvals decentralized
UNDP Country Offices
(166 countries)
Europe & CIS
Regional Center
(Bratislava)
Asia & Pacific
Regional Center
(Bangkok)
Asia & Pacific
Regional Center
(Colombo)
Asia & Pacific
Regional Center
(Fiji)
Africa
Regional Center
(Johannesburg)
Arab States
Regional Center
(Beirut)

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III. UNDP Programme Management Capacity
•UNDP draws on a network of close to 5,000 staff and a
wide range of knowledge networks with a membership
of approximately 14,000
• UNDP provides an integrated package of services:
- Integrated policy planning and implementation
- Human resources development
- Institutional strengthening
- Non-governmental and community participation
•Owning to its presence on the ground, UNDP’ strength
is its capacity to mainstream issues into broader
development context

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III. UNDP Programme Management Capacity
UK’s DFID assessed the organizational effectiveness of 23
multilateral institutions, and ranked UNDP highest
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agencies
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development banks
97989896UNDP
Total scoresPartnershipCountry-level
results
Internal
performance
Agency
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agencies
96808483Humanitarian
agencies
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agencies
82828084UN development
agencies
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development banks
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Total scoresPartnershipCountry-level
results
Internal
performance
Agency

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IV. UNDP’s Climate Change Programmes
•UNDP is the largest UN source for technical assistance for
global environment management - $ 6 billion (including $2.5
billion from GEF & MLF/ $3.5 billion co-financing)
•With the launch of MDG Carbon Facility, UNDP is able to
manage under the same roof ODA, GEF and Carbon resources
to address the existing policy, capacity and financing gaps to
implement the UNFCCC and the broader sustainable
development agenda, including the MDG agenda
•UNDP supported over 400 large and 1000 small-scale projects
for climate change, with $638 million from the GEF
•Given its development mandate, global network of country
offices and expertise in integrated policy design and
implementation, UNDP is well placed to support adaptation
within a broad vision of national sustainable development.

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IV. UNDP’s Climate Change Programmes: Experience in Adaptation
UNDP adaptation projects, include:
Enabling activities
•Second National Communications to the UNFCCC (100)
•NAPA (29), with 18 in Africa
Demonstration and pilot adaptation projects
•Full and medium size GEF projects (16)
•Resources included 50% SPA ($15M); 80% SCCF ($26M)
•43 countries, including 15 in Africa
Knowledge Management
•Adaptation Policy Framework
•Adaptation Learning Mechanism
•Adaptation Programming Site, etc.
Partnership with other UNDP Departments and several UN agencies
•WHO and Health Impacts of Climate Change
•BCPR and Natural Disaster Management
•WFP and Adaptation to CC in Dryland/Arid Area
•UNESCO, JICA, IUCN and Coastal Zone Management

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IV. UNDP and Adaptation: Areas of Convergence
Integration into broader national policy frameworks
Capacity development
Disaster risk management
Energy and environment: Comprehensive portfolio
Global knowledge management and learning

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IV. Our Climate Change Programmes/Pipeline:
Strategic Priorities for Adaptation
Sector/topic Country
Water management Tanzania, Ecuador (SCCF)
Agriculture Ethiopia, Kenya, Mozambique, Zimbabwe,
Swaziland, Namibia (SPA); Pacific (SCCF); India
(SCCF)
Health Fiji, Barbados, Jordan, Uzbekistan, China,
Bhutan, Kenya (SCCF)
Coastal zones Cape Verde, Mauritania, Gambia, Guinea Bissau
(SPA), Uruguay (SPA)
Tourism: Maldives (SCCF)
Community-based
adaptation
Samoa, Bolivia, Niger, Bangladesh (Morocco,
Namibia, Vietnam, Guatemala, Kazakhstan and
Jamaica to join in 2006/7) (SPA)
Disaster risk
management
India (SCCF), Pacific (SCCF)

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•UNDP manages a large number of global programmes and trust
funds:
- Thematic trust funds (energy and environment, democratic
governance, gender)
- Country trust funds (Reconstruction Fund Facility for Iraq,
etc.)
•UNDP acts as an Implementing Agency of a number of global Trust
Funds (GEF, MLF, Global Fund to fight Aids, Malaria and
Tuberculosis (GFATM), etc.)
• In 2005, UNDP delivered over $4.2 billion in core and trust funds
resources:
- Democratic governance - $1.4 billion
- Poverty reduction - $700 million
- Crisis prevention and recovery - $360 million
- Energy and environment - $320 million
- HIV/AIDs - $220 million
V. UNDP Fund Management

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V. UNDP’s New Initiatives to Improve Fund Management
•Robust and state of the art fund management system: i) fully
integrated system based on Peoplesoft/Oracle; ii) real time
access to information; versatile reporting (snapshot, donor, etc;
external access available shortly (Desk officers in-country, etc)
•State of the art monitoring and independent evaluation system
(PRINCE 2 certification as results based project management
methodology) that can meet range of requirements: project
level, programmatic, country-wide, thematic
•Efficient operational control mechanisms in place (CAP, ACP,
OLPS, OAPR)
•Minimal set-up costs at the country level required

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V. UNDP Fund Management
UNDP can provide a range of trust fund services
•Options include:
- Sole manager, UNDP rules and regulations (e.g., UNDP Thematic
Trust Funds)
- Joint or Pass-Through trust funds that operate in accordance with
respective rules and procedures of donors (e.g., International
Reconstruction Fund Facility for Iraq)
•UNDP respond quickly to changing needs:
- the administration of a Fund is fully delegated to its
designated Manager.
- UNDP processes can be customized to meet the unique
requirements of each fund: ex: UNDP adapted its financial systems and
created specific accountability procedures to respond to the unique
performance-based reporting requirements of the GFATM funding
mechanism.

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V. UNDP as a Sole Fund Manager:
the Energy/Environment Thematic Trust Fund
•6 service lines: (1) frameworks and strategies for sustainable development;
(2) effective water governance; (3) access to sustainable energy services; (4)
sustainable land management; (5) conservation and sustainable use of
biodiversity; (6) national/sectoral policy and planning to control emissions of
Ozone Depleting Substances and Persistent Organic Pollutants
•Donors are: Austria; Denmark; France; Germany; Monaco; Netherlands;
Norway; USA; World Bank
•Management of TTF: UNDP’s Bureau of Development Policy (BDP) is
responsible for fund management, oversight and policy design, reporting and
substantive backstopping
•Cost recovery = 5% General Management Services (GMS), plus
Implementation Support Services (ISS)

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V. Energy/Environment TTF - Structure
UNDP
Fund Manager
UNDP
Country
Office &
Gov
UNDP
Country
Office &
Gov
UNDP
Country
Office &
Gov
UNDP
Country
Office &
Gov
Resources Resources ResourcesResources

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V. UNDP as Administrative Manager of a Joint Trust Fund:
The International Reconstruction Fund Facility for Iraq (IRFFI)
•Launched in 04. 26 donors have pledged over $1.4 bn
•11 service lines: (1) education/culture; (2) health; (3) water/sanitation; (4)
infrastructure; (5) agriculture, water resources/environment; (6) food security;
(7) mine action; (8) refugees; (9) governance/civil society; (10) poverty
reduction/human development; (11) support to electoral process
•IRFFI has two trust funds: (1) UNDG TF = $600 million; (2) WB TF = $400
million
•For UNDG TF, UNDP acts as Administrative Agency (fund manager) as one of
19 UN Implementing Agency
•Decision making body of UNDG TF = Trust Fund Steering Committee
- Comprises representatives of 19 UN implementing agencies
- Supported by the Cluster Group for technical inputs
•Fee as the Administrative Agent = 1% of donor contribution. If a contribution
is less than $2 million, the fee is $20,000. If a contribution is over $10 million,
the fee is $100,000

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V. IRFFI - Structure
Donor Committee
- Meet twice yearly
UN/WB Facility Committee
- Meet monthly
UNDP TF [$600 million] WB TF
[$400 million]
Secretaria
t
1 WB & 1
UNDG
staff
Steering Committee
- Members from UN
participating agencies
Cluster
Group
UNDP
Administrative
Agency
UN
participati
ng
agency
UN
participati
ng
agency
UN
participati
ng
agency
UN
participati
ng
agency

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V. UNDP as an Implementing Agency of a Global Trust Fund:
The Global Fund to fight Aids, Malaria and Tuberculosis (GFATM)
Global Fund
A Public-private partnership and the largest
global fund of its kind, with over US$ 4.9 billion
approved by the Board
World Bank as Trustee
A mechanism created to give communities and
Civil Society Organizations (CSOs) a substantive
role in national responses and to ensure their
access to funds
Role of UNDP: Implementing agency
Principal Recipient in weak & fragile states
Provision of technical & management
assistance
Active support in Country Coordinating
Mechanisms (CCMs)
Support through UN country group
Support in Regional Meetings
All other grant recipients ($3.07
billion)
386 grants signed in 127 countries
UNDP grants ($517 million)
in 24 countries

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V. GFTAM-specific services provided by UNDP
Quality Control:
Project and Financial Management oversight for all country offices
Operational Manual and Guidelines produced for Country Offices
Legal agreements
Global Long-term Agreements for procurement
Global, regional and in-country training
Knowledge Management and Networking: Portal Workspace, Knowledge Network,
Quarterly Bulletin and distribution of resource materials for Country Offices
Disbursement Ratio: UNDP’s disbursement average 85% of grant funds - significantly
higher than other Principal Recipient types. Disbursements are made quarterly based
on performance and results achieved.
Cost structure: All grants incorporate 5% for General Management Services (GMS) and
variable support costs based on country specific needs (ISS).
UNDP PR countries include: Angola, Argentina (exited Sept. 2005), Belarus, Benin,
Burkina Faso, Central African Republic, Cote D’Ivoire, Cuba, Democratic Republic of
Congo, El Salvador, Equatorial Guinea, Gabon, Guinea-Bissau, Haiti (exited July 2005),
Honduras, Iran, Liberia, Mauritania, Myanmar, Niger, Panama, Sao Tome and Principe,
Sudan, Tajikistan, Togo and Zimbabwe.

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VI. Cost Structure
UNDP’ cost-recovery consist of 2 elements:
1. General Management Support (GMS): general oversight and management functions of HQ and CO
units:
- Project identification, formulation and appraisal
- Determination of execution modality and local capacity assessment
- Briefing and de-briefing of project staff and consultants
- General oversight and monitoring
- Receipt, allocation and reporting to the donor of financial resources
- Thematic and technical backstopping through Bureaus
- Systems, IT infrastructure, branding, knowledge transfer
2. Implementation Support Services (ISS): mostly provided by Country Offices to deliver
programmes:
- Payments, disbursements and other financial transactions
- Recruitment of staff, project personnel, and consultants
- Procurement of services and equipment
- Organization of training activities, conferences, and workshops
- Travel authorization, visa requests, ticketing, and travel arrangements
- Shipment, custom clearance, vehicle registration, and accreditation
ISS are direct costs of the project, therefore should not be considered as UNDP cost. Needs to be
agreed between the parties based on the scope of support expected from UNDP

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Thank You!