Bizarre and Absurd - UN rules require it to 'credit' dues countries never paid : Shared by Tom McDermott
Talk about absurd rules! How can the UN 'return' funds it never received?
Tom
UN Aims to Fix Budget Rule Cutting Cash Availability Amid Crisis
Emma Farge
Reuters
December 19, 2025
Related Commentary:
Speakers Suggest Delaying Credit Returns, Call Out United States' Payment Defaults as Fifth Committee Discusses UN Financial Situation amid Severe Cash Crunch
UN Meetings Coverage and Press Releases
October 23, 2025
Summary:
UN officials are seeking to overhaul a financial regulation that could require the organization to credit member states nearly $300 million in 2026, reducing the planned budget of $3.2 billion by close to 10%.
Under current UN financial regulations, any money unspent—often because states paid too late or not at all—is automatically subtracted from their future dues. This means the UN must return credits to member states even when those countries never paid their contributions in the first place, effectively rewarding non-payment while punishing countries that fulfill their obligations. Tatiana Valovaya, director general of the UN in Geneva, called the rule "bizarre," saying the organization has to return to member states money which it hasn't received, which could make the situation for 2026 even more difficult. Reforms have been sought for years but have not succeeded.
The UN is already facing a 15% budget reduction as it seeks to cut costs in its 80th year amid a cash crisis driven largely by arrears from top contributor the United States. As of September 30, 2025, 57 member states owed $1.87 billion out of $3.5 billion in mandatory contributions, including $1.5 billion from the United States. Total outstanding assessments have reached $5.6 billion, representing nearly 60% of the total budget.
The rule made sense when countries paid their dues punctually and in full, but as of December 15 only 148 had done so. Catherine Pollard, Under-Secretary-General for Management Strategy, Policy and Compliance, called attention to the organization's extremely limited cash position. Many fear US President Donald Trump will not pay outstanding US fees after criticizing the body. A decision on reforming the rule is set to be made as part of ongoing talks on the 2026 budget, with the General Assembly expected to make a decision before year-end.
Secretary-General Antonio Guterres is seeking to temporarily suspend the return of credits as part of the budget package, according to a UN document. In October, he estimated the amount to be credited to states will rise to $600 million in 2027 based on unspent funds from 2025, calling it "a race to bankruptcy." Guterres told the Fifth Committee in December: "It is difficult to give back money because we didn't receive it."
Commentary on the absurdity of this rule has intensified from multiple quarters. Writing in AmeriNews TV in June 2025, Ahmed Fathi described the situation as "a financial paradox that undercuts [the UN's] credibility and capacity," noting that refunds are processed to countries in arrears, "effectively rewarding non-payment while punishing those who fulfill their obligations." He called it a "structural flaw, rooted in financial rules drafted under the assumption that every member state would always pay in full and on time" and characterized it as "financial self-sabotage."
Quotes:
"It is difficult to give back money because we didn't receive it." - UN Secretary-General Antonio Guterres
"The organisation has to return to the member states the money which it hasn't received, and that could make our situation for the year 2026 even more difficult." - Tatiana Valovaya, director general of the UN in Geneva
"The United Nations is facing a financial paradox that undercuts its credibility and capacity: it is refunding unspent funds to countries that never contributed them in the first place. When funds go unspent due to cash shortages, refunds are still processed to countries in arrears, effectively rewarding non-payment while punishing those who fulfill their obligations." - Ahmed Fathi, AmeriNews TV
"The root cause of this crisis remains unchanged: the lack of full, timely and predictable payment of assessed contributions by all Member States." - European Union representative
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This seems to me to have an easy solution: The 'Payback' should be in the form of a paper IOU, leaving the auditors to sort it out. . . . . .
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