UN Secretary-General To Call for Sweeping Fiscal Fixes for Budget
UNITED NATIONS, N.Y.
THE United Nations is facing such a serious financial crunch that some members may be asked to pay advances on their 1992 dues.Only 68 of the 159 members that received bills from the UN last January have paid in full. Almost $1 billion - what it costs to run the UN for a year - is still outstanding in past and present obligations. It is the highest level of unpaid member debt in history. UN Secretary-General Javier Perez de Cuellar, who has repeatedly reminded members of their obligation to pay up, says the UN is on the brink of insolvency. He concedes that much of the problem is perennial. The United States, for instance, which owes almost half the total, traditionally does not pay most of its dues until after its fiscal year begins in October. Some other members, too, delay payments until the end of the year or beyond for economic reasons. The Soviet Union, now the UN's second largest debtor, is particularly far behind on its assessed peacekeeping bills. All this puts the UN in a tight cash bind. Throughout the year it has been forced to borrow from its $100 million working capital fund and peacekeeping reserves. On Friday some 3,000 workers, almost one-fourth of the civil servants employed in the UN Secretariat, plan a public demonstration against what they see as unreasonably low salaries. Before he turns his job over to Boutros Boutros Ghali, who is to take the oath of office as secretary-general tomorrow and assume his new job in January, Mr. Perez de Cuellar wants the General Assembly to strengthen the UN's hand during rough financial periods. On Wednesday he will present a formal package of proposals to the Assembly that could lead to an additional $500 million member assessment. The changes include a bid to charge interest on late payments and to authorize him to borrow commercially as some specialized UN agencies now do. Perez de Cuellar also wants to increase the size of the working capital fund to $250 million and set up two new funds of $50 million each for emergency humanitarian needs and to help with initial peacekeeping costs. Peacekeeping is expected to be the UN's new growth industry in the post-cold-war era. The secretary-general wants to start a UN Peace Endowment Fund with an initial $1 billion base as a sort of trust fund. Members would be assessed $300 million. The other $700 million would come from voluntary contributions. "It's a major new proposal which we recognize may not be achievable overnight," notes UN deputy controller Susan Mills. The idea is potentially "brilliant," says David Scheffer, a senior associate at the Carnegie Endowment for International Peace. He says the private sector, always eager to increase trade, has a strong vested interest in a more stable world. "There is a rather direct link between what the UN is trying to do in the peacekeeping field and international commerce," he says. Such prompt UN bill payers as Canada, Australia, and New Zealand, three of the 11 members who paid their UN bills in full by the end of January, are sympathetic to the secretary-general's new package of economic proposals. But Graham Green, a spokesman for Canada's UN mission, says his nation would not favor any changes that could lead already delinquent nations to further delay their payments. He insists the UN would not be in its current bind if all members paid what they owed on time. The US has strong reservations about the new package. "Rather than increased calls for new money, the UN Secretariat should focus on better use of existing funds," says a US State Department official. "Adding more financial obligations to UN member states will not help the problem." The US, he says, is strongly opposed to any effort to charge interest on late payments. "We pay our calendar year assessments in October - that's the way it's always been and the UN should understand that," he says. The Assembly, which also must adopt its 1992-93 biennial budget in the next few weeks, has taken a consensus approach to most budget issues in recent years. US objections to the proposals are thus a major obstacle. The US does have a five-year plan to pay off its past UN debt. Funds were held back in the mid-'80s to prod UN reforms. A State Department official says the US has paid $223 million so far this year and that a payment of another $124 million is likely before the year ends.