Cash crisis: UN cuts spending, freezes hiring, scales services
By Tiamiyu Arobani
The UN says it has been forced to cut spending, freeze hiring and scale back some services as the global organisation faces a worsening cash crisis.
Member States on Monday urged members to pay up, warning that the deepening financial crisis threatened the world body’s ability to carry out vital work.
The General Assembly’s Fifth Committee met throughout Monday to discuss the multilateral organisation’s financial health.
With a growing shortfall in contributions, member states owed $2.4 billion in unpaid regular budget dues and $2.7 billion in peacekeeping.
Officials warned that the non-payment of contributions risked eroding the UN’s credibility and its capacity to fulfil mandates entrusted to it by member states.
Switzerland’s delegate, speaking also on behalf of Liechtenstein, said “Each delay in payment, each hiring freeze, each cancelled service chips away at trust in our ability to deliver”.
One proposed solution was to allow the UN to temporarily keep unspent funds at year’s end, instead of returning them to member states as credits.
Currently, this return is mandatory, even if the funds arrive late in the year, giving the UN little time to spend them.
The suggested change would be expected to act as a buffer to keep operations running, particularly in January when payments tend to lag.
Delegates also backed limited use of “special commitments”, which is emergency funding tools, early in the year to bridge gaps caused by delayed contributions.
While these fixes might help, several speakers, including delegates from Kazakhstan, Norway and the United Kingdom, emphasised that the root cause was the continued late or non-payment of dues.
Norway noted that such temporary measures would not solve the underlying problem and urged member states to support bold financial reforms.
The European Union stressed that the crisis was not abstract, adding they were real operational risks and the burden could not fall solely on countries that paid on time.
Singapore, speaking for the Southeast Asian group of nations, ASEAN, echoed concerns that the UN’s liquidity problems had become routine.
It cited the UN Economic and Social Commission for Asia and the Pacific’s (ESCAP) need to shut its offices for three months and suspend travel and hiring.
Particularly troubling to many delegates was the fact that one country, unnamed in the meeting but widely known to be the U.S. was responsible for over half of all unpaid dues.
The U.S. under President Donald Trump, is reportedly withholding the funds due to the UN for political reasons.
Russia called for more transparency in how the UN managed cash-saving measures, cautioning against actions taken without member states’ input.
Catherine Pollard, the UN’s top management official, noted that since May 9, a handful of countries had paid in full across several budget categories, while the number of nations who had paid in full for the regular budget stood at 106 for the year.
As of May 19, the UN records showed only 61 countries had met all their UN’s obligations in full.
The message from member states on Monday clearly states that without broad, timely financial support, the UN’s ability to serve the world, especially in times of crisis, is at serious risk. (NAN)(www.nannews.ng)
Edited by Kevin Okunzuwa
