Despite Record $1 Billion Received in Regular Budget Contributions, Late Payments Still Hindering Mandate Implementation, Speakers Tell Fifth Committee
Delegates Adopt Resolution Granting Secretary-General $45.72 Million in Commitment Authority for Darfur Hybrid Operation
The recent improvement in the United Nations cash position isn’t something to celebrate yet, as the world body continues to face difficulty carrying out its mandates without adequate financial resources, the Organization’s top budget official told the Fifth Committee (Administrative and Budgetary) today.
“We should not be carried away” with the $1 billion in regular budget contributions collected in April, said Chandru Ramanathan, Assistant Secretary-General and Controller, explaining that the Organization still faces the challenge of budget implementation. Reiterating his request for full payments on time, he also asked Member States to let the Organization know when they will pay their dues because it will help the Secretariat plan better.
Today’s debate on the financial situation of the United Nations followed the Secretariat’s detailed presentation last week on the matter.
“Assessed contributions are not voluntary contributions — they are legal obligations each of us have as Member States of the United Nations,” said Canada’s representative, who also spoke for Australia and New Zealand. The United Nations remains the only truly universal global organization that can address challenges that transcend national borders. But, the Organization is forced to operate on the availability of cash, not on strategic direction, he warned.
Guinea’s representative, speaking on behalf of the “Group of 77” developing countries and China, acknowledged that the Organization’s cash position has improved in April, but cautioned against complacency. This improved situation can be attributed to austerity measures and controlled spending due to the pandemic, he said, emphasizing that budget management must be driven by programme delivery, not by cash on hand.
“It is extremely concerning that one Member State currently owes approximately two thirds of all outstanding assessments to the United Nations, despite having the capacity to pay,” he said, adding that that Member State continues to unilaterally withhold its contributions for political reasons while also clinging to its special privileges in the Security Council.
The representative of the United States said her country takes pride in being the largest contributor to both the assessed and voluntary budgets of the United Nations system, and in total, it contributes more than double the amount of the next largest contributor. Due to the timing of its fiscal year, her country pays its regular budget assessment in the last quarter of the year. “This year, we plan to pay our assessment in full in the last quarter of the year,” she informed.
The speaker from Cuba said that the recent willingness expressed by the United States delegation to pay its debts to the Organization is “the first step of a long path”, but the policy of wilful withholding must definitively stop.
Sri Lanka’s delegate called for stronger oversight of the budgets, arguing that the time has come for an audit of the procedures followed for the appropriation of resources. Resources must go towards actual requirements and not forays into “extra‑jurisdictional activity” or politically motivated agendas, he said.
Botswana’s speaker pointed out that the scaling down of non-post resources and other extreme measures taken by the Secretary-General in response to the liquidity crisis negatively affected the implementation of the Sustainable Development Goals.
The representative of the United Kingdom joined a few others in welcoming the partial relaxation of hiring restrictions, as he encouraged the Secretary‑General to identify and implement more ways to help alleviate liquidity challenges.
Injecting the view of troop- and police-contributing countries, Bangladesh’s delegate warned that the failure to reimburse these countries may make them less willing to contribute troops to United Nations peacekeeping missions in the future.
Catherine Pollard, Under-Secretary-General Management Strategy, Policy and Compliance, gave an update on her last briefing on the Organization’s financial situation, reporting that 52 Member States are now fully paid in all categories of the United Nations budgets.
In other business today, the Fifth Committee adopted a draft resolution by which the General Assembly authorized the Secretary-General to enter into commitments for the African Union-United Nations Hybrid Operation in Darfur (UNAMID) in an amount not exceeding $45.72 million for the period from 1 January to 30 June.
Also speaking today were the representative of Singapore (for the Association of Southeast Asian Nations), Mali (for the African Group), Morocco, Japan, Norway, Russian Federation, China, Philippines and the European Union.
Improving the Financial Situation of the United Nations
CATHERINE POLLARD, Under-Secretary-General Management Strategy, Policy and Compliance, said that, since her briefing last week, Haiti and Niger have paid their assessed contributions to the regular budget in full, bringing the total number of Member States that have done so to 101. For peacekeeping operations, Algeria, Georgia, Japan, Niger and Tuvalu have paid in full all due assessments, which brings the total number of Member States that have fulfilled their obligations to 58. For the international tribunals, Algeria and Niger have paid in full, bringing the total number of Member States in this category to 79.
Georgia, Japan and Niger are now fully paid for all categories and are reflected in paragraph 31 of the Secretary-General’s report on the United Nations financial situation as of 31 December 2019 and 2020 and of at 30 April 2020 and 2021 (document A/75/387/Add.1). Subsequent to the issuance of the report, Algeria and Tuvalu made their payments and are now fully paid for all categories. This brings the total to 52 Member States. In addition, payments have been received from Afghanistan and Libya for the regular budget, Afghanistan and Italy for peacekeeping operations, Afghanistan for the tribunals.
BOUBACAR DIALLO (Guinea), speaking on behalf of the “Group of 77” developing countries and China, acknowledged that the Organization’s cash position has improved slightly, due to record collections in April. But, Member States should not be complacent, as this improved situation can be attributed to austerity measures and controlled spending due to the pandemic. Budget management must be driven by programme delivery, not by cash on hand. Expressing concern that the regular budget’s implementation rate has consistently fallen short over the past decade, and that there may still be a need to borrow from the closed peacekeeping account by the end of this year, he urged Member States to keep paying their assessments in full, on time and without conditions. Turning to the peacekeeping budget, he said it is encouraging to see that the cross-borrowing mechanism approved by the General Assembly through resolution 73/307 has facilitated the timelier payment of liabilities to troop- and police-contributing countries. Outstanding payments as of 30 April totalled $65 million, confined to just one mission, but that is still one mission too many.
“It is extremely concerning that one Member State currently owes approximately two thirds of all outstanding assessments to the United Nations, despite having the capacity to pay,” he said. That is particularly egregious, given current circumstances. That Member State benefits from a fundamental distortion in the way in which the Organization is financed, yet it continues to unilaterally withhold its contributions for political reasons while also clinging to its special privileges in the Security Council. Member States in a position to do so must put their words and commitments into action, settle their arrears and pay their assessments in full, on time and without conditions. He expressed appreciation for those Member States that have made a real effort to reduce their outstanding contributions, despite the pandemic’s impact on their economies, and empathized with those which are genuinely unable to meet their obligations for reasons beyond their control.
BOB RAE (Canada), also speaking for Australia and New Zealand, said the United Nations remains the only truly universal global organization that can address challenges that transcend national borders. To this day, the Organization is forced to operate not on the basis of strategic direction, but rather on the availability of cash for both its regular and peacekeeping budgets. In other words, the operations of the United Nations are not driven by organizational priorities, but by the dictates of liquidity. “Assessed contributions are not voluntary contributions — they are legal obligations each of us have as Member States of the United Nations,” he insisted, adding that paying for budgets are not like paying at a cafeteria.
As the international community begins to shift from vaccine preparedness to vaccine distribution and administration, it is entering a new phase of the pandemic where solidarity is needed like never before, he said. “The long-standing record of Australia, New Zealand and Canada of paying our assessments in full, on time and without conditions is an indication of its commitment to the United Nations,” he said, stressing: “We want the United Nations to implement the budgets we approve instead of being guided by the cash at hand” and urging Member States with pending assessments and arrears to pay their past dues as a matter of priority.
TERRENCE TEO (Singapore), speaking on behalf of the Association of Southeast Asian Nations (ASEAN) and associating himself with the Group of 77, commended those Member States which have fulfilled their financial obligations. Hopefully, full and timely payments to the regular budget, peacekeeping budget and the tribunals will become the norm rather than the exception going forward. However, current unpaid assessments remain large enough to pose serious liquidity challenges, particularly during the “dry months” of the third quarter. The Organization should not be perpetually operating in a cash-conservation mode, which has serious negative impacts on mandate implementation.
While cash pooling for active peacekeeping missions and the advance collection of peacekeeping assessments have helped to improve the liquidity situation, such measures only alleviate the symptoms and do not address the root cause of the problem, he said. The simplest and most effective solution remains for all Member States to pay their assessed contributions in full, on time and without conditions. That is both a legal obligation, enshrined in the Charter of the United Nations, and a moral obligation to ensure the implementation of the mandates which Member States have given to the Secretary-General. He emphasized that ASEAN member States remain strongly committed to fulfilling their financial obligations, even as their collective assessed contributions have been growing.
THIBAULT CAMELLI, European Union, commended the Secretary-General for his commitment to managing the Organization’s persistent liquidity challenges. Such measures as the suspension of regular-budget hiring, the scaling down of non-post expenses and postponing payments to troop- and police-contributing countries have helped to manage the liquidity shortages, but they could jeopardize the United Nations ability to implement its mandates in full. Addressing the financial situation is a joint responsibility, shared by the Organization and Member States, he said, adding that all European Union member States had paid their contributions to the 2021 regular budget by the beginning of April, representing 24 per cent of overall assessments. Regarding peacekeeping operations, those same member States accounted for nearly half of the honour roll as of 30 April with more than 20 per cent of whole assessed contributions paid. However, the bloc regrets that not all Member States have fulfilled their financial obligations, he said, urging those with pending assessment to address the matter with utmost priority.
“The diagnostic is now clear,” he said. “Arguing about its timing or pointing fingers will not contribute to address the root causes or yield any improvement.” The Fifth Committee must rise to the challenge and ensure sustainable financing for the Organization. Citing the measures set out in General Assembly resolution 73/307, he said that cash pooling between peacekeeping missions and the possibility to pay peacekeeping contributions for the full 12‑month budget period have been helpful. It is regrettable, however, that only a partial solution was found for the peacekeeping budget and that there has been no consensus on the regular budget, resulting in the Secretary-General having to consistently borrow from closed peacekeeping missions to compensate. He encouraged the Secretary-General to continue to manage resources for efficient and effectively manage mandates, and called on Member States to revisit the proposal laid out during the Committee’s seventy-third session that would allow the Secretary-General to manage his budgets more strategically to the highest standards of transparency and accountability.
MIKE MARTIN AMMANN (Switzerland), speaking also for Liechtenstein, said that, despite the current improvement in the United Nations liquidity situation, the persistent and alarming trend of uneven collection of regular budget contributions each year, as well as over the years, calls for prudent cash management by the world body to ensure that operations are not compromised during the year. With the pandemic still raging and considering the countless people who rely on United Nations support in the fight against COVID-19, adequate financial resources are of the utmost importance. Welcoming the positive effect that the measures introduced in 2020 have had on improving the budgetary flexibility of the Secretary-General, he called on all Member States that have not yet done so to pay their annual contributions in full and on time to ensure the continuation of United Nations operations and enable the Controller to present more reliable forecasting.
MOHAMED TRAORE (Mali), speaking on behalf of the African Group, said that the Group was pleased to see that 76 per cent of the year’s total assessments, a record $1 billion, were paid by the end of April and encouraged all Member States in a position to do so to pay their contributions in full, on time and without conditions. However, the Group is concerned that the regular budget’s cash situation was a source of grave concern in 2020 and that the year ended with a record $808 million in outstanding contributions. It is untenable that the United Nations, due to a severe liquidity crisis, had to borrow from the Working Capital Fund, the Special Account and closed peacekeeping missions in 10 out of 24 months in 2019 and 2020. “This simply cannot become business as usual,” he said. The Group is also concerned that most of the Secretariat’s austerity measures are affecting mandate delivery, he said, emphasizing that the Organization cannot be expected to do more with less.
The Group is encouraged by a positive trend in the cash balances of peacekeeping operations, he said, adding that General Assembly resolution 73/307, which removed the restriction on cross-borrowing of cash for active missions, made a positive contribution, together with the assessment and collection for non‑mandated periods and the management of cash for peacekeeping operations as a pool. The Group is particularly pleased that payments for troops and formed police units and contingent-owned equipment are current for all active missions, except for $65 million for the African Union-United Nations Hybrid Operation in Darfur (UNAMID). All efforts should be made to ensure that all reimbursements to troop- and police-contributing countries are settled as soon as possible, he said, adding that a permanent solution must be found very soon, as borrowing from active and closed peacekeeping operations is not ideal. He went on to say that the Group empathizes with those Member States which, due to a difficult financial situation exacerbated by the COVID-19 pandemic, are genuinely unable to meet their obligations for reasons beyond their control.
PEDRO LUIS PEDROSO CUESTA (Cuba) said that the cost-saving measures implemented by the Secretariat, along with the contributions of most Member States, have led to a deficit at the close of 2020 that was $186 million lower than in 2019. The deficit reduction means that, so far in 2021, the reserves of the Working Capital Fund and the Special Account have been replenished at a faster pace than in previous years. Highlighting the more stable situation of outstanding assessments to the international tribunals and peacekeeping operations, he said the United States continues to top all lists as the main debtor. The recent willingness expressed by the United States delegation to pay its debts to the Organization is “the first step of a long path”. The policy of wilful withholding must definitively stop. Cuba has met almost all its financial obligations with the Organization, despite the serious impact of COVID-19 on its income, and the economic, commercial and financial blockade imposed by the United States against his country.
OMAR KADIRI (Morocco), associating himself with the Group of 77 and the African Group, shared the concerns expressed by the Secretary-General in his letter to Member States on 17 March regarding the liquidity crisis. Morocco supports the measures taken by the Secretary-General to align expenditures to income, he said, adding that his country also welcomes the fact that, during the pandemic, the United Nations system has done its utmost to implement its mandates and ensure global recovery. He congratulated the Secretary-General and the Secretariat for reimbursing troop‑contributing countries, including Morocco, which has paid its 2021 regular budget assessment in full and a significant portion of its peacekeeping assessment.
RENA AKATSUKA (Japan) said that her country is glad to see improvements in the liquidity of the regular budget thanks to the increased collection of contributions and the Secretariat’s ongoing efforts at better cash management. It also appreciates those Member States which have tried to shift away from delayed payments and encouraged them to continue doing so to bring back complete normalcy. Welcoming the relaxation of hiring restrictions, she said that the Secretary‑General should consider the long-standing challenge of the underrepresentation and non-representation of some Member States when recruiting personnel for vacant posts. She went on to emphasize that Member States’ resources are not unlimited and that they and the Secretariat have a common responsibility to keep improving the effective and efficient use of resources, thus allowing a high level of accountability to taxpayers.
MOHAMMED NORE ALAM (Bangladesh) urged the major contributing Member States to ensure full and timely payment of their assessed contributions. “The United Nations would be on a firmer financial footing if the major contributors lived up to their Charter obligations,” he said, adding that his country is paying its assessed contributions in full and on time. Calling for expeditious and timely reimbursement to troop- and police-contributing countries for their personnel and equipment support, he cautioned that reimbursement delays might impact troop rotations and their willingness to continue their services to the peacekeeping missions and may even exacerbate the financial burden on those countries. There is no better platform than the United Nations to achieve the common goals of peace, security and prosperity, he said, urging Member States to ensure that the Organization is best equipped with adequate resources, and it manages its financial resources soundly, to fully deliver its mandate.
BORGAR OLSEN TORMODSGARD (Norway), recalling that the Fifth Committee has previously adopted measures to alleviate the liquidity situation for the peacekeeping budget, welcomed the positive effects of cash-pooling on troop reimbursements, and how this has contributed to the safety, security and predictability of United Nations staff in the field. However, repeated letters from the Secretary-General show that the Organization is still facing serious liquidity constraints, he pointed out, expressing concern about the regular budget cash situation and the liquidity measures’ potential impact on mandate implementation. Commending those countries that have paid their assessed contributions in full and on time despite the COVID‑19 crisis, he said that last week’s presentation on this topic showed the need for more Member States to do their part.
PETER MOHAN MAITHRI PIERIS (Sri Lanka), associating himself with the Group of 77, said that the Fifth Committee must give life to its power of regulatory oversight and not abdicate that responsibility to administrative functionaries who have the power to undermine the Charter of the United Nations. Consultation, consensus and respect for the sovereignty of Member States must be the overarching consideration. Perhaps the time has come for an audit, not of numbers, but of the procedures followed for the appropriation of resources, he said, adding that resources must go towards actual requirements and not forays into “extra‑jurisdictional activity” or politically motivated agendas.
EVGENY V. KALUGIN (Russian Federation) stressed that the late payment of Member States contributions has a negative impact on the functioning of the United Nations, including the results of its work. The approach of the Secretariat is effective, which is confirmed by the positive changes, especially regarding the regular budget. More Member States have transferred their full contributions to the regular and peacekeeping budgets, compared with previous years. He, however, asked the Secretariat to inform Member States in future presentations about what “austerity measures” are lifted or relaxed, in relation to financing through the regular budget departments and offices of the Secretariat, taking into account the payments received from Member States. The removal or relaxation of the current restrictions, as well as increased transparency in this area, will encourage Member States in arrears to follow the example of those that fulfilled their financial obligations in full.
KATLEGO BOASE MMALANE (Botswana), associating himself with the Group of 77 and the African Group, said that the extreme measures taken by the Secretary‑General in response to the liquidity crisis — including the scaling down of non-post resources, which prompted the non-implementation of key developmental mandates, which, in turn, affected the implementation of the Sustainable Development Goals — inevitably undermine the Organization’s purpose and effectiveness. The liquidity crush also threatened its ability to respond to emerging crises, including the COVID-19 pandemic. He emphasized that the United Nations does more if it is financially sound, especially for vulnerable Member States. “A United Nations with inadequate funds is a United Nations tied to its knees and this, esteemed colleagues, we must never allow to happen again,” he said, adding that the world will be able to build back better after the pandemic so long as Member States meet their obligations.
RICHARD CROCKER (United Kingdom) said that Member States cannot expect the United Nations to carry out its mandates with high-quality results — especially during a pandemic — without the right resources and tools. “Time and resources spent managing and mitigating the impact of liquidity shortages are time and resources that could be better spent enhancing delivery on the ground,” he said, emphasizing that all Member States must pay their assessed contributions in full and in good time. Welcoming the partial relaxation of hiring restrictions, he encouraged the Secretary-General to identify and implement more ways to help alleviate liquidity challenges, and where necessary, to promptly bring them to the Committee.
DAI BING (China) stressed that financing is the foundation of United Nations governance and a prerequisite for implementing the mandates and reforms of the Organization. As the largest developing country and the second-largest contributor to the regular and peacekeeping budgets, China is fulfilling its obligations in a demonstration of its commitment to multilateralism and the United Nations-centred global order. Noting that the Organization is facing a liquidity crisis, he emphasized that arrears affect troop- and police-contributing countries by delaying reimbursements. One Member State accounts for 70 per cent and 66 per cent of arrears, respectively, for the regular and peacekeeping budgets, he said, urging this country to settle its dues. Calling for better internal control, he stressed the importance of ensuring that every taxpayer’s money is well spent.
ARIEL P. PEŃARANDA (Philippines) said that unpredictable cashflows could make it difficult for programme managers to strategically position the Organization’s common goals and ensure mandate delivery. Member States must keep making earnest efforts to fulfil their financial obligations to the United Nations in full, on time and without conditions. Despite a challenging fiscal environment and the pandemic’s devastating effects, the Philippines will endeavour to pay its contributions in full and on time. He added that the Organization must use its available resources in a cost-efficient manner to ensure the continuity and sustainability of its operations.
GRACE LEIGH LEVIN (United States) said that her country takes pride in being the largest contributor to both the assessed and voluntary budgets of the United Nations system. In total, the United States contributes more than double the amount of the next largest contributor. Citing information that the Under‑Secretary‑General shared with the Fifth Committee last week, she said that the $1 billion in regular budget contributions collected in April was perhaps the most that the United Nations has ever collected in a single month. Many Member States collectively contributed to that record collection, but it would not have been possible without the United States’ contribution of more than $300 million in the first four months of the year. She went on to say that, due to the timing of its fiscal year, the United States pays its regular budget assessment in the last quarter of the year. “This year, we plan to pay our assessment in full in the last quarter of the year,” she added.
CHANDRU RAMANATHAN, Assistant Secretary-General and Controller, said that “we should not be carried away” with the $1 billion in regular budget contributions received from Member States in April, explaining that the Organization still faces the challenge of implementing its budgets. Reiterating his request for full payments on time, he also asked Member States to let the Organization know when they will pay their dues. That will be a “big help to us” as the world body can plan better, he said.
Action on Draft
The Fifth Committee then adopted, without a vote, a draft resolution contained in document A/C.5/75/L.30, titled “Financing of the African Union-United Nations Hybrid Operation in Darfur”, by which the General Assembly endorsed the conclusions and recommendations by the Advisory Committee on Administrative and Budgetary Questions, and authorized the Secretary-General to enter into commitments for the Operation in an amount not exceeding $45.72 million for the period from 1 January to 30 June.