Global Policy Forum

NGO Letter to US on UN Finance


UN Foundation
October 21, 2009


Dear Dr. Brimmer:

Thank you for your exceptional leadership in ensuring that the United States pays its dues to the United Nations and other international organizations on time and in full.  We write today for your continued assistance in moving forward with concrete plans to "resynchronize" our dues to these important organizations.

As you know, the U.S. began deferring payments to some international organizations back in the 1980s with the adoption of a budgetary mechanism (the so-called Stockman plan) to garner one-time budgetary savings by withholding dues payments by nine months-into the next fiscal year.  In justifying these deferrals initially, the United States assumed that international organizations could continue without U.S. payments until October because other countries would pay their bills on time.  In the intervening years, other countries have begun to follow the United States' lead, however, in not paying their dues on time.  Further, continuing and chronic U.S. budgetary impasses mean that foreign operations appropriations bills are rarely, if ever, finished by October 1, and often not finished until the next calendar year.

This delay leaves the U.S. chronically in arrears in treaty-based organizations and requires international organizations to take fiscally undesirable measures to meet their payroll and other obligations, including extensive internal and external borrowing.  For example, the UN must sometimes borrow from its separate peacekeeping budget to meet its operating expenses, which means that countries that contribute to UN peacekeeping missions are not reimbursed on a timely basis.  These dues deferrals have also led to regular urgent pleas for cash at the end of every fiscal year from organizations like NATO and the IAEA.  In addition, when the U.S. falls behind in the timing of its payments, advancing the U.S. financial and management reform agenda becomes more difficult as other nations, particularly those which are not like-minded, use our late payment of assessed contributions as a distraction in negotiations.  Payment delays also make financial management by international organizations more complicated and difficult to track.

In this year's FY 2010 budget request, the Administration included $175 million to begin reversing the practice of deferring payments of assessed contributions to major international organizations. This amount is about thirteen percent of the total needed to resynchronize U.S. contributions with international organizations' billing cycles.  The original request has been reduced to $75 million by House and Senate State - Foreign Operations Appropriations subcommittees, and we hope the Administration will make every effort to preserve these remaining funds in any omnibus spending measure. We also hope that the Administration will build on its prior support for resynchronization as it lays the groundwork for the FY 2011 budget.

In planning for the FY 2011 budget, we recommend that the Administration devise a multi-year plan to catch up on $1.3 billion in timing differentials in the Contributions to International Organizations (CIO) account.  In particular, we are requesting the Administration formulate a plan on implementing section 404 of the Foreign Relations Authorization Act of 2003 (PL 107-228). The inclusion would both demonstrate to Congress the Administration's commitment to ending dues deferrals and further convey to the international community the U.S. resolve to honor our obligations.

Thank you for your consideration.



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