(Item 3 of the provisional agenda for the preparatory segment) Budget of the Trust Fund for the Montreal Protocol and Financial Reports on the Trust Funds for the Vienna Convention and the Montreal Protocol (Item 3 of the provisional agenda for the preparatory segment)

Meeting – everyday Draft decision by Friday at the latest The tasks of the Budget Committee The Budget Committee is expected to: Review the financial report for 2017 Agree on Revised 2018 budget Budget for 2019 and levels of contributions for 2019 Indicative budget for 2020 and levels of contribution for 2020 Review the results-based budgets (RBB) Agree on the next steps Agree on the draft decision to present to the plenary for consideration for adoption (30/3/Rev.1) Meeting – everyday Draft decision by Friday at the latest 2

Financial report for 2017 - highlights UNEP/OzL.Pro.30/5 Contents Financial report for 2017 - highlights UNEP/OzL.Pro.30/5 Revised budget for 2018 Budget proposals for 2019 and 2020 UNEP/OzL.Pro.30/4/Rev.1 Results-based budgets UNEP/OzL.Pro.30/4/Rev.1 Next steps 3

Special circumstances affecting 2017 budget utilization Financial Report for 2017 – highlights (UNEP/OzL.Pro.30/5) Utilization rate = 65% Special circumstances affecting 2017 budget utilization Higher than expected programme support cost allocation Provision of earmarked funds from EU for A5 travel Unplanned earmarked contributions from parties Relatively low utilization does not indicate a lack of budgetary discipline The savings add to the fund balance Reserves & fund balance = $7.9 million Cash balance = $5.3 million 4

2018 Budget proposals are provided in traditional format Revised budget for 2018 and Budget proposals for 2019, 2020 (UNEP/OzL.Pro.30/4/Rev.1) Budget proposals are provided in traditional format Assessed contributions for the budgets proposed are also provided 2018 Revised 2018 budget is $220,000 less than the approved budget Savings (personnel, OEWG40 and MOP30) now in reporting costs (data reporting, website) Expected utilization rate for the proposed revised budget for 2018 = 94% 5

Revised budget for 2018 and Budget proposals for 2019, 2020 (UNEP/OzL.Pro.30/4/Rev.1) 2019 & 2020 Pursuant to XXIX/24, proposed and ZNG budgets are presented for 2019 and 2020 proposed budgets - based on the usual, cost category budgeting by the Secretariat ZNG budgets – based on the proposed revised 2018 budget (2019 budget at the same level as 2018 revised budget and 2020 budget $307,360 less because of additional funds in VCTF) 6

Summary of the budget proposals 7

Objective 1: Finance and logistics of meetings Results-based budget (RBB) (UNEP/OzL.Pro.30/4/Add.1/Rev.1) Objective 1: Finance and logistics of meetings Objective 2: Substantive support to the parties, Assessment Panels and subsidiary bodies Objective 3: Implementation of the Kigali Amendment to the Montreal Protocol Objective 4: Manage data/information and compliance Objective 5: Strategic communication activities Objective 6: Ensure cooperation with other agreements and programmes Expected accomplishments, indicator of achievement and target dates for each objective Budget for each accomplishments – MP, VC, PSC 8

Potential benefits and challenges of RBB Results-based budget (RBB) (UNEP/OzL.Pro.30/4/Add.1/Rev.1) Potential benefits and challenges of RBB More meaningful presentation of Secretariat activities Clearer relationship between “inputs” to “outputs” Could enhance planning, prioritization, monitoring, reporting and assessment but.. Is it really appropriate for Secretariat, given the year-by-year work planning? Implementation may require changes, e.g., to improve synchronization between the two trust funds Financial system does not support recording and reporting by objective 9

Budget presentation from next year? Next steps? Budget presentation from next year? RBB has been useful in better understanding the Secretariat's operations and may be further developed in the coming years Practicality issue – timing of decisions and budget approval Budget format in the decision? UNEP has been developing RBB in the recent years but Umoja still supports recording by traditional budget lines Format used by UNEP under the umoja system 10

Proposed 2019 Budget format for Umoja system – a hybrid Next Steps? Proposed 2019 Budget format for Umoja system – a hybrid 11

If parties wish to reduce the cash balance, options could include: Next steps? Cash balance? Forecast cash balance at the end of 2018 is $5.5 million, out of which 15% required cash reserve is $844,595 Available cash balance of $4.7 million is equivalent to 85% of the proposed budget for 2019 If parties wish to reduce the cash balance, options could include: Keeping the contributions at 2018 level (i.e. ZNG), approving the 2019 proposed budget, drawing down from cash balance to cover the deficit Approving a ceiling amount outside the approved budget, to fund specific activities which draw down on the cash balance a 12

Additional points the Secretariat would like to mention Next steps? Additional points the Secretariat would like to mention The Secretariat has calculated the proposed budgets based on prudent and lean budgeting. More accurate budgetting for meetings based on actual venues New budget line: public awareness and communication – important 13

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