On October 17, UN Secretary-General Guterres warned the Fifth Committee, which is responsible for administrative and budgetary affairs of the General Assembly, that if member states fail to pay their dues on time and in full, the United Nations would face a "bankruptcy crisis" when submitting the proposed 2026 program budget. This regular budget of $3.238 billion represents a reduction of nearly $500 million from its initial proposal and a 15.1% decrease compared to the approved 2025 budget.

Guterres pointed out that the current financial outlook for the United Nations is "extremely fragile." High levels of arrears, delayed payments, and refund credits are threatening the UN's cash flow and undermining its core operational capacity.

The regular budget of the United Nations is funded by mandatory contributions from member states, mainly used to maintain the core programs and operations of the Secretariat, calculated according to the regular calendar year. In addition, the UN has an independent peacekeeping budget, which operates on a fiscal year running from July 1 to June 30 of the following year.

The revised budget reduces the original proposal of over 13,800 positions (including more than 10,000 regular positions and over 3,000 special political mission positions) to less than 11,600, a decrease of 18.8% from 2025.

These cuts mainly focus on large departments and administrative functions, with projects directly serving member states being prioritized, especially those related to the least developed countries, landlocked developing countries, small island developing states, and the Africa initiative.

Guterres warned that the current liquidity crisis will not only affect next year but could also impact 2027.

As of the end of 2024, member states had accumulated arrears of $760 million. At the same time, according to regulations, the UN must refund $300 million in deductions to member states at the beginning of 2026, which is equivalent to nearly 10% of the budget that cannot be collected. If member states delay payments at the start of the year, the UN will be forced to further reduce expenditures, meaning the UN may face a risk of refunding $600 million in 2027, equivalent to 20% of the budget.

Guterres emphasized, "This means the UN is heading toward bankruptcy," and it is necessary to reduce arrears and suspend the refund of deduction credits.

The revised 2026 proposed program budget reflects the current financial reality and the reform direction of the UN's 80th anniversary initiatives, which aim to improve the effectiveness of the Secretariat, making it more flexible and resilient.

The proposed efficiency measures include integrating salary payments into a single global team, relocating some functions to low-cost offices, and establishing a unified administrative platform in New York and Bangkok, among others.

In the coming weeks, the Fifth Committee will discuss the budget with department heads and program directors of the Secretariat. Subsequently, the committee will submit a report and recommendations to the plenary meeting of the General Assembly, and the UN budget is expected to receive final approval by the end of December.

Guterres also mentioned a report on improving the financial situation, which recommended suspending the refund of unused credit notes to member states when funding shortfalls threaten the execution of the next year's budget. However, member states have not yet reached consensus on this mechanism, so the report was postponed for consideration at this session.

Guterres emphasized, "If no agreement can be reached on the deteriorating liquidity issue, the key work programs of the United Nations will face serious threats."

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