1. Financial Situation June 2010 Presentation to Advisory Commission

2. 2 2010 Income Statement, General Fund - Resources US$ m * *Donor income decrease E (EOY) : a) $4.4m decreased Donor funding and b) $10.7 Actual and forecast forex losses on receipt of monies. ** Fx Losses on subsequent revaluation of Foreign monies (Non USD)

3. 3 2010 Income Statement, General Fund Movement in Deficit US$ m

4. 4 General Fund US$ m

5. 5 Decisions Informed by Financial Situation UNRWA has fundamentally changed its ERP strategy (funded as a project- not GF). UNRWA has moved away from development of its own ERP solution, expected to cost $30m over the next 3 years. UNRWA’s new ERP strategy is to develop a strategic alliance with a UN entity that has a fully functioning ERP solution, to partner with this UN entity to share in the utilization of its ERP solution. Whilst still to be fully dimensioned, the lead time may be 18 months and costs (Service Level Agreement, License fees less reduced IT/ERP costs) around $15m over 5 years. Discussions have commenced with other UN agencies.

6. 6 Already cut or reduced –Hiring freeze (Syria Jordan Lebanon) - $1.3m (GF Leb) –Breast cancer screening, physiotherapy and mental health - $0.2m (GF Syria) –Special education needs initiatives put on hold - $0.8m (UR) –Maintenance and replacement of equipment- $6.7m (UR), $0.2m (GF Syria) –Some fields reduced provision of textbooks (Syria Jordan) -$0.5m (GF Syria) –Reduction of services in VTC (Jordan West Bank) – To be confirmed –Hospitalization reduced across Agency (Qalqilia, Syria) - $5.6m (UR), $0.5m (GF Syria) –Lebanon reduced number of schools (-3) –No funding for SHC in Jordan, Syria, and Lebanon fourth quarter – $5m –Pregnant and nursing mother programme as of 1 July - $2.2m (GF) –Not compliant with UN safety standards - $4.3m (UR) –Not able to follow UN standards on environment - $2.6m (projects)