Sixty-third General Assembly GA/AB/3904

Fifth Committee

44^th Meeting (AM)

UNDER-SECRETARY-GENERAL FOR MANAGEMENT PROVIDES ‘MIXED PICTURE’ OF UNITED NATIONS

FINANCIAL SITUATION IN BRIEFING TO BUDGET COMMITTEE

 

Provides Overview of Main Financial Indicators for Regular Budget,

Peacekeeping Operations, Debt to Member States, Tribunals, Capital Master Plan

Angela Kane, Under-Secretary-General for Management, painted a “mixed picture” of the United Nations financial health in the Fifth Committee (Administrative and Budgetary) today, saying that, while 2008 had seen progress, a negative trend had emerged in 2009, with a growing number of States not fully meeting their financial obligations, an evolving situation whose outcome would depend largely on actions taken by Governments.

Outlining the main indicators of the Organization’s financial health -- assessments issued, unpaid assessed contributions, available cash and debt to Member States -- she said assessments and payments both were lower in 2008 than in 2007, by $174 million and $96 million respectively.  On 31 December 2008, unpaid assessed contributions had been lower by $11 million, at $417 million versus $428 million a year earlier.  She was pleased to announce that 146 Member States had paid their regular budget assessments in full by end-2008, 6 more than in 2007.

Of the $417 million outstanding at 31 December 2008, she said that 94 per cent -– or $394 million -- was owed by one Member State, with 3 per cent owed by another two States and 3 per cent owed by the remaining 43 States.  Some 76 Member States had paid their assessments in full by 7 May 2009, 10 less than a year earlier, while payments received after that date resulted in the addition of Guatemala, Indonesia, Kuwait and Thailand that had paid in full.

The financial position of the regular budget as at 7 May 2009, compared to a year earlier, reflected the net result of both higher assessments and payments received, she said.  Unpaid assessed contributions were $216 million higher year-on-year, and although payments received by 7 May 2009 were $392 million higher than on 7 may 2008, there was also a $619 million increase in the 2009 regular budget assessment, mainly due to increased provisions for special political missions.  Of the $1.5 billion outstanding on 7 May 2009, nine countries accounted for over 94 per cent of that total: United States, United Kingdom, Germany, Republic of Korea, China, Norway, Iran, Mexico and Brazil.  However, since that date, Brazil had paid $12.2 million, which reduced its amount due.

A “positive change” was seen in the cash resources for the regular budget –- comprising the General Fund, to which assessed contributions were paid, the Working Capital Fund and the Special Account -– which showed $1.18 billion available at 30 April 2009, versus $411 million at 31 December 2008.  That was due to a net increase in payments in the first quarter over expenditures.  The final position would depend on actions taken by the nine countries.

Turning to peacekeeping, she said various factors complicated a comparison between the financial situation of peacekeeping operations and those of regular budgets and the tribunals, namely the unpredictable nature of demand; a different financial period, which ran from 1 July to 30 June rather than from 1 January to 31 December; assessments issued separately for each operation; and the fact that assessments were issued for different periods throughout the year.

The total amount outstanding for peacekeeping operations at the end of 2008 had been just under $2.9 billion, about $165 million more than the $2.7 billion outstanding at end-2007, which was due mainly to expanded peacekeeping operations and their related impact on assessments.  More than two thirds of that amount was owed by Japan and the United States, she added.

Although more than $2.7 billion in cash had been available for peacekeeping at the end of 2008, that amount was divided between separate accounts maintained for each peacekeeping operation and had restrictions attached to its use, she explained.  General Assembly resolutions specified that no mission would be financed by borrowing from other active ones.  Also, the terms of reference of the Peacekeeping Reserve Fund restricted its use only to new operations and expansion of existing ones.

At the end of 2008, active missions had had $2.1 billion of available cash, closed missions held $504 million and the Peacekeeping Reserve Fund held $143 million.

However, she said, “significant improvement” had been seen as of 7 May 2009, compared to both a year ago and end-2008, with new assessments of over $1.4 billion issued by that date.  Against that, contributions of over $2.6 billion had been received, lowering the amount outstanding from over $2.8 billion to $1.75 billion.  Of the total owed as of 7 May 2009, about 60 per cent was owed by the United States and Japan.  Payments received after that date included $192.6 million from Japan.

Based on information available, she expected that total cash available in peacekeeping accounts at the end of 2009 would hit $2.3 billion, with $1.7 billion in the accounts of active peacekeeping missions, $449 million in those of closed missions and $152 million in the Peacekeeping Reserve Fund -– estimates that were based on projected receipts and disbursements, and the proposed retention of cash balances in closed peacekeeping operations.

Of the $449 million in closed mission accounts, some $219 million related to amounts to be paid for outstanding liabilities, such as troop and equipment payments, leaving only $230 million available for cross-borrowing for other accounts (regular budget, international tribunals and active operations).

Cross-borrowing from the accounts of closed missions had been required in 2008 for seven operations: the United Nations Mission for the Referendum in Western Sahara (MINURSO); United Nations Stabilization Mission in Haiti (MINUSTAH); United Nations Peacekeeping Force in Cyprus (UNFICYP); United Nations Interim Administration Mission in Kosovo (UNMIK); United Nations Mission in Liberia (UNMIL); United Nations Operation in Côte d’Ivoire (UNOCI); and the United Nations Observer Mission in Georgia (UNOMIG).

She said the amount owed for troops/formed-police units and contingent-owned equipment at 31 December 2008 had been $431 million, a $689 million decrease from the amount owed at the start of the year.  New obligations were projected to increase in 2009 due to the increased troop deployment in the African Union-United Nations Hybrid Operation in Darfur (UNAMID), deployment of a military contingent in the United Nations Mission in the Central African Republic and Chad (MINURCAT), and more military and formed police units in United Nations Organization Mission in the Democratic Republic of the Congo (MONUC).  However, those increases were partially offset by reductions related to the termination of the United Nations Mission in Ethiopia and Eritrea (UNMEE) mandate, downsizing at UNMIK and reductions in authorized military strength at UNMIL.

By the end of 2009, it was projected that debt would grow to $765 million, she added.

The financial positions of the International Tribunals for Rwanda and the former Yugoslavia had improved in 2008, she continued, with outstanding assessments falling from $34 million at end-2007 to $26 million at the end of 2008.  Two Member States –- United States and Indonesia -- accounted for more than 80 per cent of that total, with 84 other countries comprising the remainder.

However, she said, the Tribunals’ situation in 2009 had worsened, with 18 fewer Member States having fully paid their assessed contributions by 7 May.  Unpaid assessments stood at $158 million at 7 May 2009, versus $147 million a year earlier.  The Tribunals should end the year with positive cash balances, but the actual outcome depended largely on whether States honoured their obligations.

Taking up the Capital Master Plan, she said $1.8 billion had been approved by the General Assembly on 22 December 2006.  While 12 Member States had opted for a one-time payment, 180 countries were under the multi-year payments system.  As of 7 May, 185 nations had made payments totalling $1 billion, with $139 million currently outstanding.  In addition, various Member States that had not opted for a one-time payment had made advance payments totalling $118 million.

In addition to the cost of the project, the Assembly had approved the working capital reserve of $45 million, to be funded by advances from Member States.  As of 7 May, 163 Member States had made payments for the capital reserve, which totalled $44.9 million.  As of 7 May, 84 Member States of the total 185 had paid in full for the Capital Master Plan, while another 101 had made partial payments.  Regrettably, 7 Member States had not yet made any payments to the Plan and the amount outstanding was $139 million.

Concluding her presentation, Ms. Kane paid special tribute to those Member States that had paid in full all assessments for the regular budget, International Tribunals, peacekeeping operations and the Capital Master Plan as at 7 May 2009: Austria, Azerbaijan, Canada, Croatia, Czech Republic, Finland, Ireland, Italy, Monaco, New Zealand, Republic of Moldova, Singapore, Slovak Republic, Switzerland, Tajikistan and Uganda.  A subsequent payment had been received by Australia, making it possible to add it to the list of countries that had paid in full.

“The financial health of the Organization depends on Member States, including major contributors, meeting their financial obligations in full and on time”, she said.

Her statement will be issued as an addendum to the Secretary-General’s report on improving the financial situation of the Organization in document A/63/514/Add.1.

The Fifth Committee will reconvene at 10 a.m. on Monday, 18 May.  It plans to revert to agenda item 120 -- “Improving the Financial Situation of the United Nations” -– on Friday, 22 May.

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For information media • not an official record