The UN80 Solvency Imperative: Successful Reforms Need Clean Finances First

The United Nations (UN) is running out of cash and time. The Secretary-General’s latest report on the UN financial situation, presented to the General Assembly on October 9, revealed that as of September 30, 57 member states still owed a total of USD 1.9 billion in mandatory contributions—including USD 1.5 billion from the United States. The UN has already borrowed the full amount of its reserve (Working Capital Fund) and expects to draw again on its last liquidity buffers. As the President of the General Assembly warned: 

“We are literally at a crossroad, make-or-break moment, politically and financially.”

Because the UN80 reform agenda was born in the shadow of this liquidity situation, the Secretary-General’s proposals have inevitably been interpreted as the UN’s response to its financial crisis: the timing of the UN80 reports and the tone of early presentations (framing reform as a condition for restoring confidence) fueled the impression that the initiative was a fiscal rescue plan. In both his most recent addresses to the General Assembly on October 15 and October 17, however, the Secretary-General drew a clear line: 

“UN80 is not about solving the financial crisis; it is about making the UN sustainable for the long term.”

A Crisis of Credibility

The distinction is essential, but it also exposes a deeper paradox. Reform and solvency cannot be separated in practice. Without fiscal stability, no management reform, mandate rationalization, or structural redesign will endure. Conversely, without a credible reform roadmap, member states are unlikely to pay in full or on time. The UN cannot implement the very efficiencies or consolidations now under debate if it cannot meet payroll, reimburse peacekeepers, or fund ongoing mandates. UN80 may not have been conceived as a financial rescue, but unless it helps restore solvency, it risks being overtaken by current events.

The liquidity crisis is not new. The UN’s financial regulations were designed and put in place under the assumption that member states pay in full and on time. But this condition has been unmet for decades. In 2025, only 49 member states paid their regular budget assessments in full within the thirty-day due period (by February 6, 2025). When late payments come from the two largest contributors, the impact multiplies: the United States (the largest contributor with 22 percent of the UN budget) has only just agreed to pay some of its obligations, while China (20 percent of the UN budget) paid its own 2024 contribution on December 27, 2024. With almost half of the UN budget on hold, the UN operations run a high risk of paralysis. 

The liquidity problem has become a governance problem. The deeper issue lies in rule-design itself: the legal and institutional framework governing UN financing provides almost no effective incentive for compliance. Article 19 of the Charter suspends a member state’s voting rights in the General Assembly once in arrears, but that is only triggered when the amount exceeds two years. And beyond that, there are no enforceable consequences for late or partial payment. The system’s architecture thus relies on voluntary discipline within a structure built for a different era, leaving the UN exposed whenever political will erodes.

In striking contrast to this absence of incentive, the political leverage of non-payment has become self-reinforcing. Late or partial contributions risk turning budgetary discipline and fiscal responsibility into an avenue for political leveraging, priority bargaining, and strategic pressure. The Secretary-General therefore reaffirmed that assessed contributions must remain unconditional, and the cash-pooling system cannot become an à la carte mechanism. 

“A Race to Bankruptcy”

In practice, the outstanding work of the UN Controller’s office has been instrumental in keeping the Organization afloat, but only through increasingly severe cash conservation measures (including freezing recruitment and delaying mandates). Early in 2025, the Secretariat cut USD 600 million in spending, nearly 17 percent of the budget, to avert payment default that would have emptied all liquidity reserves by August, with dramatic consequences on staff and for High-Level Week.

However necessary, these ad hoc measures are neither sufficient nor sustainable. Their outcome is a system that manages liquidity but never resolves it: the UN now operates on the basis of cash availability rather than mandate requirement. What began as a technical cash-flow issue has evolved into a structural distortion of mandate delivery, affecting both accountability and trust between member states and the Secretariat. 

The consequences on mandates are cascading across all three pillars. Recurrent delays in peacekeeping reimbursements directly affect troop-contributing countries—most of which are from the Global South—while the latest contingency plans jeopardize the safety and security of peacekeepers. In the development pillar, liquidity shortages and reductions in core and flexible funding are already constraining the UN Development System, forcing UN country programs to scale back or suspend initiatives mid-cycle. Because of the liquidity shortage, several human rights mandates remain unimplemented, and even the continuity of the Human Rights Council is at stake. 

These effects are even compounded with the UN finance framework. Under financial regulation 5.3, the Secretary-General must reimburse member states for unspent appropriations at the end of each budget period. This rule was not designed, however, for situations where programs are delayed or frozen because some member states have not paid their assessed contributions. When non-payment forces the Secretariat to postpone activities, the resulting underspending automatically generates credits that must be returned to all member states, including those in arrears. Paradoxically, this drains cash precisely when liquidity is most needed, locking the UN into a self-perpetuating shortfall. In 2026, these credits are expected to reach nearly USD 300 million, almost 10 percent of the budget. This could even double in 2027. Over time, as the Secretary-General highlighted, this situation is turning into a “race to bankruptcy.”

To prevent a further collapse in liquidity, the Secretary-General has requested that the General Assembly temporarily suspend the return of these credits. As the UN Controller warned: 

“This measure becomes imperative for the Organization to continue delivering on its programme of work during 2026.” 

The appeal underscores how narrow the UN’s fiscal margin has become, and how political inaction risks turning a temporary liquidity constraint into systemic insolvency.

Toward a Solvency Framework

Insolvency risks are eroding not only the UN’s operational capacity but also its political legitimacy. Each new reform proposal now carries the shadow of austerity. Without fiscal credibility, “efficiency” risks becoming a synonym for retrenchment, deepening cynicism among member states and staff alike, the exact opposite of what it purports to achieve.

To get out of this conundrum, the UN needs a solvency framework that precedes reform. Restoring solvency requires a systemic review of how the Organization is funded and how cash reserves, assessments, and credit returns interact. The Secretary-General has already issued several reports with this diagnosis, but member states failed to rise up to the challenge: they view financial governance as a zero-sum negotiation rather than as a collective insurance mechanism. This dynamic is a classic prisoner’s dilemma: member states know that reform would benefit all, but withhold taking individual initiative. Financial reform lacks the leadership of a champion. As a result, the UN’s financial architecture remains fragmented, with outdated financial regulations and rules, insufficient liquidity reserves, rigid budget practices, and a ban on external borrowing. 

Solvency, in contrast, is an act of political responsibility. Clearing arrears is not the glamorous part of reform. It will never headline a summit or feature in a communiqué. However, it is what enables the UN to function as a credible institution of global governance. The legitimacy of multilateral reform rests on the ability of member states to honor their own decisions.

Three principles should guide this effort.

1. Transparency. Member states must have a clear, real-time view of liquidity conditions. The Secretary-General has already made ample disclosure but politics have prevailed over the financial responsibility toward the Organization and its mandates.
2. Predictability. The UN must be equipped with adequate reserves and could consider other liquidity management options, such as borrowing authority commensurate with its mandates. A revolving liquidity reserve (similar to mechanisms used by international financial institutions) could buffer against cyclical arrears.
3. Accountability. Solvency cannot rely on ad hoc cash conservation alone. It requires political commitments, especially from major contributors, linking payment behavior to shared reform outcomes.

Reform Begins with Credibility

The UN80 process has revived long-dormant debates about the future of the UN: its structures, its priorities, its coherence. But the most urgent question is simpler: can the UN pay its bills? The Secretary-General was right to stress that UN80 must not be reduced to fiscal firefighting. Yet he should be equally clear that without solvency, there can be no sustainability. The distinction between financial repair and institutional reform may hold conceptually; operationally, it cannot.

Reform begins with credibility, and credibility begins with solvency. Before the UN can reimagine its architecture for the future, it must restore the fiscal foundation on which that architecture rests. The invitation for member states to pay on time, in full, and without conditions is clearly insufficient. Member states must adopt real, sustainable measures to reaffirm their collective commitment to the solvency of the United Nations. It is not merely a budgetary concern; it is the condition of UN relevance.