Financial situation of the United Nations

The Secretary-General reports on the financial situation of the United Nations twice a year under the agenda item "Improving the financial situation of the United Nations".

Reports and presentations
The Fifth Committee considers the report of the Secretary-General and receives a closed briefing from the Secretariat on the status of contributions under the regular budget and peacekeeping budgets and the cash flow situation of the Secretariat. This biannual briefing takes place early in the main and second resumed sessions. The briefing is followed one week later by general discussion during which delegations have the opportunity to make statements on the financial situation.

Measures to address past financial crises
At times, exceptional measures have had to be taken to address cash shortfalls resulting from unpaid assessments. Some of the most notable financial crises are described below.

In the 1960s, disagreements over the legal obligation to finance peacekeeping missions prompted a request for an advisory opinion from the International Court of Justice on the interpretation of Article 17 of the United Nations Charter and the establishment of the Special Committee on Peacekeeping Operations.

In the 1980s, the United States, under the Reagan Administration, began the practice of "deferred payment" in which the contributions for a particular calendar year would be met by funds requested for following fiscal year. In addition, the adoption of U.S. legislation popularly known as the Kassebaum-Solomon Amendment in the mid-1980s required the reduction of the United States contribution to the regular budget to be reduced to 20 per cent unless major financial contributors such as the United States were afforded a greater say in the budget process. The Secretary-General adopted a number of measures to address the expected cash shortfall, including a hiring freeze. In parallel, the General Assembly adopted resolution 40/237 of 18 December 1985 establishing the Group of High-Level Intergovernmental Experts (popularly known as the Group of 18), which issued a report (A/41/49) which led to the adoption of resolution 41/213, which in turn led to the introduction of consensus-based decision-making in the Fifth Committee.

In the mid-1990s, late payment of assessments and the peacekeeping budget process also contributed to a precarious financial situation, with $3.7 billion in unpaid assessments in 1994. This prompted the Secretary-General to take a number of unilateral measures, including another hiring freeze, suspension of new consultancies, and limitations to overtime and travel. Following an appeal by the Secretary-General to the General Assembly, the General Assembly adopted resolution 49/143 establishing a High-level Open-ended Working Group on the Financial Situation of the United Nations. The General Assembly also adopted resolution 49/233 on 23 December 1994 which, inter alia, changed the process for consideration of peacekeeping budgets and established the current 1 July-30 June peacekeeping financial period.