WORKING DOCUMENTS OF THE 5 TH EXTRAORDINARY SESSION OF THE PAPU PLENIPOTENTIAIRY CONFERENCE AFRICAN SUPPORT COMMITTEE

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1 WORKING DOCUMENTS OF THE 5 TH EXTRAORDINARY SESSION OF THE PAPU PLENIPOTENTIAIRY CONFERENCE AFRICAN SUPPORT COMMITTEE ANTANANARIVO MADAGASCAR, JULY

2 5 th Extraordinary Plenipotentiary Conference Original English African Support Committee PAPU/PC/EXT/V/ASC/ Doc No.1 26 th July, 2018, Antananarivo, Madagascar AFRICAN SUPPORT COMMITTEE MEETING (ASC) DRAFT AGENDA MEMBERS: EQUATORIAL GUINEA, GUINEA, SOUTH AFRICA, TUNISIA AND UGANDA OBSERVERS: COTE D IVOIRE AND ETHIOPIA, SUB REGIONAL POSTAL ORGANIZATIONS (EACO, COPTAC, CRASA, SAPOA AND WAPCO) AND UPU. BUREAU CHAIR : TUNISIA 1 st VICE-CHAIR : SOUTH AFRICA 2 nd VICE CHAIR : GUINEA 1 st RAPPORTEUR: EQUATORIAL GUINEA 2 nd RAPPORTEUR: UGANDA SECRETARY : PAPU AGENDA 1. Opening remarks by Chairperson 2. Reminder of ASC Decision and ToRs by PAPU 3. Adoption of the agenda 2

3 4. Harmonization of positions on UPU Key thematic issues 4.1 Governance issues: - Reform of the Union; - Long-term financial viability of the Union (proposed alternative contribution model); - Long-term sustainability of the Union's Provident Scheme; 4.2 Operational issues: - Integrated Product Plan; - Integrated Remuneration Plan aimed at rationalizing, modernizing and integrating remuneration systems. 4.3 Support to the host Country (Ethiopia) 5. Adoption of the decision requesting the support for the Palestinian Post for the granting of terminal dues and the exchange of international mail with UPU member countries 6. Closing 3

4 5 th Extraordinary Plenipotentiary Conference Original English African Support Committee PAPU/PC/EXT/V/ASC/ Doc No.2 26 th July, 2018, Antananarivo, Madagascar Subject Integrated Product Plan (IPP) Decision: References Istanbul Congress Resolution C 15/2016 POC C 2 PSDEIG Doc 6 Come up with an African common position 1. Introduction The Istanbul Congress approved the original IPP. Through resolution C15/2016 Congress supported the implementation of all recommendations in the IPP Doc 39 Rev 1. One of the recommendations was to submit an updated version of the IPP to the Extraordinary Congress in Main objectives of IPP The main objectives of IPP are as follows: It is UPU s response and roadmap to modernized and integrated physical postal services (letter post items, parcel post items and EMS); Opportunities created by e-commerce are realized for the entire UPU membership; An updated, modernized and differentiated portfolio of UPU physical services that are aligned to current needs; Revised remuneration systems that support sustainable end-to-end network reliability, quality and viability; Creates a classification based on content (documents and goods), remuneration and product features; Satisfies the need to provide a seamless 0 30 kg weight range for items containing goods (elimination of any weight silos); Facilitates efficient compliance with emerging security and customs requirements for electronic advance data (EAD). 4

5 3. IMPLEMENTATION STEPS OF IPP Congress approved the IPP and its various elements in 2016 in Istanbul; Implementation of IPP Step 1 has been done since Jan 2018-use of bar codes for small packets; Further studies have been undertaken on implementation of Step 2 and its impact. 4. UPDATED PRODUCT PORTFOLIO The POC came up with an updated product portfolio to be presented to the Addis Ababa Extra Ordinary Congress as a proposal of a general nature. The portfolio can be summarized in the diagram below: 5. RECOMMENDATIONS It is recommended that Member States should support the POC proposal on IPP since it meets the principles and objectives of Congress. Any alternative proposal should be strictly scrutinised to ensure that it does not impact negatively on terminal dues and QSF contributions. 5

6 5 th Extraordinary Plenipotentiary Conference Original English African Support Committee PAPU/PC/EXT/V/ASC/ Doc No.3 26 th July, 2018, Antananarivo, Madagascar Subject Integrated Remuneration Plan (IRP) Decision: References Istanbul Congress Resolution C 24/2016 POC C 2 RIG Doc 4 Come up with an African common position 6. Introduction The Istanbul Congress approved Resolution C24/2016 relating to the Istanbul Business Plan (IBP) including all work proposals contained therein. IBP work proposal 024 covers the development and implementation of the IRP with focus on rationalization, harmonization and integration of the current UPU remuneration systems while responding to the need and modernization of UPU portfolio of physical products. 7. Aim of IRP The main aim of IRP is to provide the strategic direction, goals and roadmap to deliver proposal for an integrated, modern and forward- looking remuneration system to be submitted the 2020 Congress. The Integration Remuneration System needs to reflect the modifications to the UPU product portfolio as well as relevant regulatory, operational and accounting changes. It is expected to be implemented in a gradual manner taking full account of the results of different studies to be undertaken. 8. NEXT STEPS IRP and the updated IPP will be presented as a single document for the Extra Ordinary Congress in Addis Ababa; Proposals to the regulations will be presented as a package to ensure consistence; Proposals of a general nature will be considered separately (IPP and IRP); Current rates for all basic products will not change for the remainder of the Istanbul cycle. No proposals will therefore be submitted to that effect by the POC to the Extra-ordinary congress; Only a proposal to revise the remuneration rates for tracked items (former express service) will be submitted. 6

7 9. RECOMMENDATIONS It is recommended that Member States should support the POC proposal of a general nature to adopt the Integrated Remuneration Plan, to enable the continuation of work and studies with a view to developing a proposal for an Integrated Remuneration System to be presented to the 2020 Congress. 7

8 5 th Extraordinary Plenipotentiary Conference Original English African Support Committee PAPU/PC/EXT/V/ASC/ Doc No.4 26 th July, 2018, Antananarivo, Madagascar Subject Reform of the System applied to Contributions by Union Member Countries References Resolution C 29/2016 of the Istanbul Congress CA C Doc 8c Decision: Come up with an African common position 1. Introduction Following resolution C 29/2016 of the Istanbul Congress, the CA decided to review the UPU's contribution system, which in its current form is no longer able to address the funding challenges faced by the Union in today's economic environment. The continuous decline in the number of contribution units (down 10% from 1997 to 2017), as well as the de facto freezing of the value of the contribution unit, has led to a reduction in the regular budget in the years 2013 to 2016, posing a risk to the operating capacity of the UPU and to the general sustainability of its funding base in the long term, notwithstanding the fact that, through resolution C 26/2016, the Istanbul Congress reaffirmed the constitutional principle of solidarity. 2. Current funding model and need for change Currently, the UPU is funded through a volunteer contribution model, whereby member countries unilaterally decide on their level of contributions upon accession, and are allowed to change their contribution class once every four years (a situation which, in many cases, cannot be deemed to be commensurate with the benefits derived from membership of the Union, or with the economic capacity of member countries). As acknowledged by resolution C 29/2016 and explained above, this funding principle does not provide a stable, solid and predictable funding base for the Union and, as such, it poses a serious risk to the sustainability of the UPU, as well as for the long-term financial planning of member countries. The Union therefore concluded that the model needs to be changed, with a view to providing a more stable funding base. 8

9 3. Fundamental principles of the future contributions model The Union identified a number of major underlying principles for a successful future contribution model, which should, among others: Enable sustainable funding of the Union in the long term; Introduce a mandatory component based on fair and transparent criteria; Be in line with the best practices of the United Nations, providing for funding caps and floors correlating with the economic capacity of each member country; Provide for a transition period from the existing contribution model to the new one (to last at least two Congress cycles); Encourage sovereign decisions on improving the financial support of the organization as well as serving to protect against inefficient use of the system against the best interests of the Union; Introduce funding floors (protection of lowest-paying range), funding caps (protection of highest-paying range), and a mandatory component which replaces the principle of solidarity (protection of middle paying range); The proposed model was based on the following variables: GDP; Gross national income (GNI); Volume factor (based on inbound and outbound international letters and parcels processed through UPU systems (measured at 10% and 20% volume rates); GDP/GNI dynamic smoothing factor over ten (10) or fifteen (15) years; Phased implementation period (measured from one to three project cycles). The CA favoured a model based on GDP allocation criteria, modified by high-debt-burden and low-income-percapita alleviation adjustments for fast-growing economies, implemented across three Congress cycles. 4. Implications of the proposed model The following would be the implications of the proposed model: 124 member countries would see no change in their contribution level; 36 member countries' current contributions would be above their respective fair minimums; 32 member countries' current contributions would be below their respective fair minimums, meaning that they will see their contributions increase; All African member countries are not negatively affected by the proposed model. 5. Recommendation The African position should be to support the proposed model since Africa is not negatively affected. 9

10 5 th Extraordinary Plenipotentiary Conference Original English African Support Committee PAPU/PC/EXT/V/ASC/ Doc No.5 26 th July, 2018, Antananarivo, Madagascar Subject Stability and sustainability of the Universal Postal Union's Provident Scheme References Istanbul Congress Resolution C 31/2016 CA C Doc 14a & CA C Doc 14b Decision: Come up with an African common position 10. Introduction The Provident Scheme is financed according to the system of partial capitalization by: a) The regular and special periodic contributions paid by the UPU; b) The language groups on behalf of the staff of their translation services under the authority of the Director General; c) The contributions of active participants in the Scheme; d) The revenue from its capital; e) The payments made by the UPU and by the language groups by virtue of the guarantees provided by them for the insurance of their staff; f) Any payments, donations and bequests of whatever kind that might be made to it. 11. Establishment of the Task Force In accordance with Istanbul Congress Resolution C 31/2016, a task force on the stability and sustainability of the Union's Provident Scheme was established. The broad objective of the task force was to study ways to ensure the continued stability and sustainability of the UPU Provident Scheme. Therefore, task force s discussions revolved around two objectives, namely, stability and sustainability. 12. Governance Task force agreed that the Provident Scheme is properly governed and professionally managed, as evidenced by the unmodified opinion of the External Auditor on the Provident Scheme's financial statements. 10

11 13. Assessment of the financial situation As at 31 st December, 2016, the actuarial balance sheet showed a shortfall. Given the Scheme's financial situation, and on numerous occasions, the actuary of the fund stated that the cumulative past deficit could only be remedied by recapitalization. 14. Recommendations by the CA The CA approved the following recommendations: Authorizing the Director General to use treasury resources, if such funds are available, to cover or reduce the amount of regular budget funds required; Reducing the guarantee threshold from 85% to 80%; Adopting a corridor approach with a 2% window and a three-year amortization period (in the event that the coverage rate were to fall below 78%); Giving the General Management a mandate to open negotiations with the United Nations Joint Staff Pension Fund (UNJSPF). The relevant proposals will be submitted to the 2018 Extraordinary Congress, subject to the conclusion of negotiations with the UNJSPF. 15. Recommendation In view of the foregoing, the proposal is to be supported since it does not involve extra contribution by African Member States. 11

12 5 th Extraordinary Plenipotentiary Conference Original English African Support Committee PAPU/PC/EXT/V/ASC/ Doc No.6 26 th July, 2018, Antananarivo, Madagascar Subject Reform of the Union Decision: References Istanbul Congress Resolution C 26/2012 & C27/2016 Come up with an African common position 1. INTRODUCTION The Seoul Congress in 1994 established the current organizational structure of the UPU, namely the Council of (CA) and the Postal Operations Council (POC). The aim was to equip the Union to keep pace with the fastchanging environment and make decisions much more quickly than before. Since then, the UPU has endeavoured to stay abreast of the swift developments in the postal environment and champion the interests of its Member Countries as well as other stakeholders of the broader postal sector. In this regard, a myriad of resolutions have been passed. 2. DOHA CONGRESS RESOLUTION By Resolution C 26/2012, the Doha Congress assigned the following mandate to the CA of the UPU: - Look into ways and means of structuring, organizing and allowing the UPU's bodies to operate more effectively with a view to easing the implementation of strategy, improve efficiency in decision-making and working methods of the Union's bodies as well as consider the issue of optimizing the use of resources; - Look into all the functions of the CA and the POC in order to clearly identify those that are inherently government-related and those that are operational. - Identify and implement all ways and means possible to improve management of the Union's activities in all areas. 3. THE NEED FOR REFORM The CA confirmed the following on reform of the UPU: 12

13 - The UPU needs to improve the performance of its different bodies; - The UPU must establish an agile and responsive decision-making process; - The UPU must be relevant, transparent and be able to make a positive impact on its Member Countries. The CA equally pinpointed the key areas where the Union's activities need to be managed more effectively. - There is an overlap between the hierarchical structures of the Councils and the Committees of the UPU; - There is duplication of roles between the Councils and the Committees (silos); - There are too many meetings and redundancy in documentation; - The time for indepth discussions and decision-making is inadequate; - The fact that there are two Councils with the same members undermines efficiency; - Organization of meetings is very costly. 4. THE AIMS OF REFORM Undertaking the reform would result in the following: - Make decisions more swiftly and enhance efficiency; - Manage resources more effectively; - Enhance the role and relevance of the Union. 5. PROPOSALS BY THE COUNCIL OF ADMINISTRATION The fundamental principles of the reform are as follows: - The UPU will remain an intergovernmental organization and an institution of the United Nations; - The UPU shall cherish the traditional values enshrined in its constitution, particularly to deliver efficient and affordable universal postal services to the inhabitants of the world. Based on the above principles, the CA identified the following areas of reform: a) Establishment of the single council The CA has proposed the establishment of a single Council. The Council will have two pillars with specific mandates as follows: - The "Operational Pillar" (Postal Operations Council) will be mainly responsible for operational and technical matters; - The "Governmental Pillar (Council of Administration) will be mainly responsible for governance, policy and regulation. The two pillars will continue taking decision in their own areas of competency with enhanced authority for the Governmental Pillar to take decisions on cross cutting matters. 13

14 Members of the UPU Council would be elected on the basis of the current procedures applied by the CA and POC, namely: - The current election process will be applied to designate members of the Operational Pillar and those of the CA to designate members of the Governmental Pillar; - Once elected, the Pillar members will make up the Council; - In this regard, the outcome of both elections will determine the total number of members of the Council; - All elected members of the Council will become members of both Pillars. Council meetings will be held twice yearly at the UPU headquarters in Berne. Each meeting will last for at most ten (10) working days. b) The Coordinating Body The current Coordination Committee shall be retained with its existing functions and composition. The Committee Chairman and the ten (10) Committee members from the two Pillars will make up the Coordination Committee. The Director General and the Deputy Director General of the International Bureau will respectively serve as Secretary and Assistant Secretary of the Coordination Committee. c) Working methods The Council may establish permanent groups, taskforces and user funded subsidiary bodies sitting on either Pillar. Each taskforce will be assigned a mandate, objectives, expected outputs and a specific timetable in line with the Union's strategy, activity programme and the relevant resolutions of the Congress. d) Mid-term Congress A mid-term congress was suggested to be a permanent structure with defined functions. It will address urgent postal matters and implementation of the UPU strategy. An assessment of the Extraordinary Congress to be held in Addis Ababa in September 2018 will be conducted to determine whether the mid-term congress will be a permanent feature. 6. AREAS OF CONSENSUS Several key meetings were held since the Istanbul Congress and culminated in the following consensus areas: 14

15 7. DISTRIBUTION OF SEATS IN THE NEW STRUCTURE 8. RECOMMENDATION The potential benefits of the planned reform cannot be overemphasized. It will cut down significantly on the number of taskforces, work groups, meetings, documents etc. Contracting meeting periods from three (3) weeks to ten (10) days per session will reduce travel and accommodation costs for participants in Council meetings. 15

16 The Plenipotentiary Conference is requested to adopt the consensus areas and related structure of the UPU for support during the Extra-Ordinary Congress in Addis Ababa. 16

17 5 th Extraordinary Plenipotentiary Conference Original English African Support Committee PAPU/PC/EXT/V/ASC/ Doc No.7 26 th July, 2018, Antananarivo, Madagascar Subject Support to Ethiopia for the organization of UPU Extraordinary Congress 2018 Decision: Take note of Ethiopia wish References Decision No. 07/PAPU/AC/XXXVI/2017 On the establishment of an African Support Committee (ASC) for the organization of the UPU Extraordinary Congress in 2018, the 27 th Congress in 2020 and monitoring of pending UPU matters Come up with a relevant decision 16. Introduction Within the framework of the preparations for the extraordinary Congress to be held in Addis Ababa, Ethiopia from 3 rd to 7 th September, 2018, the Host country, Ethiopia, made a presentation to the Council on the status of preparations for this meeting on the African continent. It was noted as follows: - Ethiopia had identified the areas of support for covering costs such as lunch and refreshments during the five (5) days of the Congress; - Countries could use this opportunity to promote their cultural values, opportunities for tourism, business activities etc.; - Countries could also offer their support as they deem appropriate. 1. Recommendations by the Administrative Council The Administrative Council took note of the presentation as follows: That African countries were ready to support Ethiopia in the organization of the Congress in various ways That the event was not only for Ethiopia but for all African member countries therefore need to support her Based on the above the Council made the following recommendations: 17

18 2. Conclusion Ethiopia should draft a list of requirements and formally request members for support through the African Support Committee (ASC); Ethiopia should provide the chart indicating a list what is required and available spaces for other member countries to choose according to their would offer; The need for Ethiopia to organize another meeting in Berne to discuss the preparations in detail; Members to take note of the short time remaining for preparations hence everything required should be done within the shortest time possible. The Plenipotentiary Conference is kindly invited to take note of the recommendations of the Administrative Council. 18

19 5 th Extraordinary Plenipotentiary Conference Original English African Support Committee PAPU/PC/EXT/V/ASC/ Doc No.8 26 th July, 2018, Antananarivo, Madagascar Subject Support to Palestine for payment of Terminal dues and exchange of international mail with Member Countries of the Universal Postal Union Decision: Come up with an African common position References Congress Resolution C115/1999 of the Beijing Congress, conferring upon Palestine in her capacity as an observer the rights of directly exchanging postal services with Union member countries; UPU Council of Administration Resolution CA 4/ in which it was resolved that Palestine shall be classified for Terminal dues and Quality of Service Fund purposes; Resolution adopted by the Postal Operations Council "Parcels" Committee on 30 th March, 2009; UPU Council of Administration Resolution CA 1/ instructing the DG of the UPU to pursue all efforts to ensure the establishment of direct postal exchanges and the implementation of all other decisions concerning Palestine. 17. Introduction During the 37 th Ordinary PAPU Administrative Council Session held in Algiers in 2018, Algeria and Egypt made a proposal for the reactivation of the decision of the 2012 UPU Council of Administration which allowed Palestine to be paid for the processing of incoming mail, parcels and express shipments from abroad in accordance with UPU rules. After considering the proposal made by the African Support Committee and mindful of the fact that the African postal fraternity had always recognized that Palestine's claim is legitimate, the Administrative Council unanimously agreed that PAPU Member States should implement Universal Postal Union resolutions on the entitlement of the Palestine to fulfill the ultimate goals of the Union as contained in the Acts. In this regard, the Council urged Member States of the Pan Africa Postal Union to give all the necessary support to the realization of this objective. The attached Draft resolution is submitted to the Plenipotentiary Conference for adoption. 19

20 Original: English Draft Resolution No.01/PAPU/PC-EXTRA/V/2018 On support to Palestine for payment of Terminal dues and exchange of international mail with Member Countries of the Universal Postal Union The Plenipotentiary Conference of the Pan African Postal Union (PAPU), during its 5 th Extra-Ordinary session in Antananarivo, Madagascar from 26 th to 27 th July, 2018; Acknowledging the request submitted by Algeria and Egypt through the African Support Committee and the 37 th Ordinary Session of the Administrative Council calling on PAPU members to support Palestine's claim of its entitlement to revenues for processing incoming international letter post, parcels and express items, pursuant to UPU rules; Affirming that it is the inalienable right of every member country of the Universal Postal Union to receive payment for services rendered to other member countries as enunciated in Article 28 of the Convention of the Universal Postal Union; Noting that Palestine has continued to receive and process mail for delivery within the confines of its territory; Recalling Congress Resolution C115/1999 of the Beijing Congress, conferring upon Palestine in her capacity as an observer the rights of directly exchanging postal services with Union member countries; Further recalling that in 2008 the UPU Council of Administration passed Resolution CA 4/ and decided that Palestine shall be classified for Terminal dues and Quality of Service Fund purposes; Cognizant of the fact that in 2012 the UPU Council of Administration passed Resolution CA 1/ on the matter and decided that Union member countries and their designated operators need to: Take all necessary steps, and make use of all necessary documents, to enable the Palestine Post to recover terminal dues and other remunerations relating to the handling of parcels and EMS items on the basis of the UPU Acts; Settle the sums due to the Palestine Post. Mindful of the fact that the African postal fraternity has always recognized that Palestine's claim is legitimate and should be respected; HEREBY RESOLVES AS FOLLOWS: That PAPU Member States should implement Universal Postal Union resolutions on the entitlement of the Palestine that fulfill the ultimate goals of the Union as contained in the Acts; 20

21 URGE Member States of the Pan Africa Postal Union to give all the necessary support to the realization of this objective; INSTRUCTS: The General Secretariat to implement this Resolution Done in Antananarivo, Madagascar, on 27 th July,