NEW YORK – United Nations Secretary-General António Guterres has warned that the UN is on the brink of financial collapse as delayed payments and high arrears threaten to cripple operations, forcing the organisation to slash its 2026 regular budget by over $470 million.
Presenting the revised $3.238 billion budget to the Fifth Committee of the General Assembly — which oversees the UN’s finances — Guterres said the organization was caught in a “race to bankruptcy” unless member countries settle their dues in full and on time.
The proposal marks a 15.1 per cent cut from the $3.715 billion plan initially tabled for 2026 and is sharply below the $3.8 billion appropriation for 2025.
“High arrears, delayed contributions and the return of credits are wiping out liquidity and undermining our core operations,” the UN chief told delegates in New York on Friday.
Staffing Cuts and Fiscal Strain
The revised plan includes sweeping staff reductions — from 13,809 posts in the earlier 2026 proposal to 11,594 — representing an 18.8 per cent drop from 2025. The cuts will primarily affect large administrative and support departments.
However, Guterres said programmes directly benefiting Member States — especially Least Developed Countries, Landlocked Developing Countries, Small Island Developing States and African development advocacy — would be protected.
The UN’s regular budget, funded through assessed contributions from its 193 Member States, covers the core functions of the Secretariat, while peacekeeping operations are financed separately on a mid-year cycle.
Liquidity Crisis Deepens
Guterres painted a grim picture of the UN’s cash flow, warning that without urgent action, liquidity could evaporate entirely by 2027.
At the end of last year, arrears stood at $760 million. Adding a mandatory $300 million in credit returns to Member States at the start of 2026 would wipe out nearly 10 per cent of available cash.
“Any delays in collections early in the year will force us to reduce spending even more — and then potentially face the prospect of returning $600 million in 2027, or about 20 per cent of the budget,” he cautioned. “That means a race to bankruptcy.”
The UN began 2025 with a $135 million deficit. By the end of September, only 66.2 per cent of Member State contributions had been received — a steep drop from 78.1 per cent over the same period in 2024.
As of that date, 136 of the 193 Member States had paid their dues in full, but several major contributors, including the United States, China, Russia and Mexico, had yet to complete their payments.
Reforms and Efficiencies
The 2026 proposal reflects both fiscal pressures and reforms under the UN80 Initiative, aimed at making the Secretariat leaner and more cost-effective.
Planned efficiencies include consolidating payroll under a single global team, relocating administrative functions to lower-cost duty stations, and creating shared service hubs in New York and Bangkok.
Despite the cutbacks, Guterres pledged to maintain key priorities, including continued support for 37 Special Political Missions, $53 million for the Resident Coordinator System, and $50 million for the Peacebuilding Fund.
The Office of the High Commissioner for Human Rights (OHCHR) is also set to expand its regional presence in Addis Ababa, Bangkok, Beirut, Dakar, Panama City, Pretoria, and Vienna.
Over the coming weeks, the Fifth Committee will review the revised budget with UN department heads and programme managers before submitting recommendations to the General Assembly for final approval in December.
Guterres also urged Member States to adopt a proposal allowing the suspension of credit returns during liquidity crises. The measure was deferred last year after Member States failed to reach agreement.
“Failure to address the deteriorating liquidity situation could jeopardize critical elements of our programme of work,” he warned.
