UN running out of cash, warns Guterres

SECRETARY-GENERAL ANTONIO GUTERRES
SECRETARY-GENERAL ANTONIO GUTERRES

UN chief: Cash supply badly depleted due to delayed contributions by many member states

UNITED NATIONS • UN Secretary-General Antonio Guterres has said the world body's cash supply had been severely depleted because of what he described as delayed contributions by many member states, and he warned the organisation's employees that they must find ways to cut expenses.

"Our cash flow has never been this low so early in the calendar year, and the broader trend is also concerning," Secretary-General Antonio Guterres said in an internal memorandum to employees shared with The New York Times.

"We are running out of cash sooner and staying in the red longer."

Mr Guterres said in a letter sent to member states on Wednesday that as of June 30, the core United Nations budget had a deficit of US$139 million (S$189 million).

According to a tally known as the "honour roll" on the UN website, 112 of the organisation's 193 members have paid their annual assessments in full.

The United States, by far the biggest single contributor at 22 per cent of the budget, has not yet paid, but diplomats said the Americans typically completed their payments towards the end of the year.

CONCERN OVER BROADER TREND

Our cash flow has never been this low so early in the calendar year, and the broader trend is also concerning... We are running out of cash sooner and staying in the red longer.

SECRETARY-GENERAL ANTONIO GUTERRES, in an internal memorandum to United Nations employees shared with The New York Times.

Japan, China, Germany and France - which rank just behind the US in the list of top financial contributors to the UN - have all paid their dues.

Mr Guterres did not single out any particular country among the 81 that had not yet paid, and he acknowledged that countries followed different fiscal calendars.

Nonetheless, he said, "this new cash shortfall is unlike those we have experienced previously".

It is not unusual that so many members have yet to pay their assessments. By this time last year, 77 had not yet paid. In July 2016, 95 had not yet paid.

Assessments to fund the UN budget are based on a formula tied to each member's ability to pay, which takes into account national income, population and debt levels, among other factors.

UN peacekeeping operations are funded by a budget that is calculated separately.

Under the UN Charter, if a member is in arrears in an amount that equals or exceeds the assessment due for the previous two years, that member could forfeit its General Assembly vote unless there are extenuating circumstances.

Mr Guterres did not specify precisely how the organisation would conserve its cash, but he said that "for our part, we will need to take measures to reduce expenses, with a focus on non-staff costs".

The reminder came against a backdrop of pressure on the UN to control its expenses, led by US Ambassador Nikki R. Haley.

After the budget committee of the General Assembly agreed in December to a US$5.4 billion budget for 2018-19, Ms Haley took credit for a US$285 million cut from the previous budget.

"The inefficiency and overspending of the United Nations are well known," she said at the time.

"We will no longer let the generosity of the American people be taken advantage of or remain unchecked."

NYTIMES, REUTERS, AGENCE FRANCE-PRESSE

A version of this article appeared in the print edition of The Straits Times on July 28, 2018, with the headline 'UN running out of cash, warns Guterres'. Print Edition | Subscribe