UNHCR makes almost US$4 million from sales last year of used assets

GENEVA, March 21 (UNHCR) - As part of an effort to work more effectively and efficiently and reduce wastage, the UN refugee agency made US$3.7 million last year from the sale of second-hand vehicles, old computers and other assets. A quarter of the money raised was ploughed back into UNHCR operations overseas, while the rest went to the agency's central budget.

"We are very pleased with the returns, which are way beyond most expectations," said Supply Officer Rita Richter, adding that UNHCR would continue and expand such sales this year.

UNHCR decided on a change of course after internal and external audit reports criticised its asset data and management. The agency's then financial division controller, Saburo Takizawa, launched an inventory in 2005 of UNHCR vehicles in 20 major operations around the world.

The purpose of the exercise was to establish the number and condition of these assets and, ultimately, improve and maximise their management. The survey showed that UNHCR had some 12,000 vehicles, including cars, pick-up trucks, 4x4 vehicles, trucks and other heavy duty vehicles, forklifts, tractors and even armoured vehicles.

The exercise also showed that many UNHCR vehicles were given to implementing partners or local institutions once they had reached the end of their serviceable lives, while some others were just left idle. A considerable number of vehicles were looted or stolen in the course of operations, many of which take place in high-risk environments.

All these vehicles were included in inventories, but their entry in the UNHCR database was not always amended when they were sold, destroyed or went missing. As a result, UNHCR's vehicle fleet was constantly growing in the database.

But the field inventories ordered by Takizawa gave headquarters in Geneva a much clearer picture of the true situation, enabling it to redeploy roadworthy vehicles where necessary and auction old or damaged vehicles. Control mechanisms were put in place; each sale had to be justified and each item had to meet a strict set of criteria.

"This was not a simple task for already overloaded operations. It was, in fact, a lot of additional work for everybody involved," said Arnauld Akodjenou, UNHCR's director of operational support. "That's why there was an incentive put in place - 25 percent of [auction] proceeds is kept by the operation which made the sale. The rest goes back into the agency's annual budget."

The sell-off started in December 2005 and the purchasers of around 300 UNHCR vehicles were mainly private users and scrap metal merchants. After a successful first three months, other used assets started to go under the hammer, including computers, furniture and telecommunications equipment.

After a final audit in February, UNHCR discovered that the year-long initiative had netted US$3.7 million. The benefits were multiple - in addition to extra funding for programmes directly assisting refugees, internally displaced people and asylum seekers, the exercise raised levels of accountability and financial responsibility while UNHCR's data and asset management became more dynamic, efficient and accurate.

The agency also made considerable gains in secondary savings by reducing expenses on warehouses, parking lots, spare parts and vehicle maintenance. These savings are still being calculated.

Today, UNHCR is helping some 20.8 million people in 116 countries. The total value of the agency's 107,000 registered assets worldwide is US$92 million.

By Andrej Mahecic in Geneva