Since the UN’s inception in 1945, the U.S. has been its largest financial contributor. As a permanent member of the UN Security Council and host of UN headquarters in New York City, the U.S. enjoys a significant amount of clout at the UN, and its leadership in providing financial support to the organization reflects that influence.
Funding from Member States for the UN system comes from two main sources: assessed and voluntary contributions.
- Assessed contributions are payments that all UN Member States are required to make under the UN Charter. These assessments provide a reliable source of funding to core functions of the UN Secretariat via the UN regular and peacekeeping budgets. The UN’s specialized agencies have their own separate assessed budgets.
- Voluntary contributions are not obligatory, but instead left to the discretion of individual Member States. These contributions are vital to the work of the UN’s humanitarian and development agencies—including the UN Children’s Fund (UNICEF), World Food Programme (WFP), UN Development Programme (UNDP), UN Refugee Agency (UNHCR), and UN Population Fund (UNFPA)—which do not have assessed budgets.
ASSESSMENTS FOR THE UN REGULAR BUDGET AND SPECIALIZED AGENCIES
The UN regular budget funds the UN’s core bodies and activities outside of peacekeeping. These include:
- Special political missions operating in Afghanistan, Iraq, Somalia, Libya, Colombia, Yemen, and other countries that are either undergoing or emerging from conflict, where they work to advance peace negotiations and mediation processes, investigate human rights abuses, support the development of effective governing institutions, and facilitate free and fair elections;
- Efforts to ensure international implementation and compliance with sanctions adopted by the Security Council against terrorist organizations like ISIS and Al-Qaeda and rogue states like North Korea; and
- Much of the organization’s core international human rights monitoring and advocacy work, as more than 40 percent of funding for the Office of the UN High Commissioner for Human Rights comes from the regular budget.
The UN’s regular and peacekeeping budgets are approved by the UN General Assembly. For 2022, the regular budget totals $3.12 billion, approximately 20 percent of which is for special political missions alone. This covers nearly 40,000 employees in duty stations around the world at $1.6 billion less than the 2022 operating budget of the state of Delaware.
Member State assessment rates are also determined by the General Assembly, with renegotiations taking place every three years. The current assessment structure sets maximum (22 percent) and minimum (.001 percent) rates, with a country’s rate based on its ability to pay. That is determined by a formula which factors in a Member State’s gross national income, per capita income, and several other economic indicators.
Given the U.S.’s high level of economic development and per capita income relative to other countries, it pays the maximum rate. Over time, the U.S. has negotiated several reductions in its share, most notably an agreement in 2000 to establish the current maximum and minimum assessment structure, essentially capping U.S. contributions at 22 percent. Prior to this agreement, the U.S. was assessed 25 percent of the regular budget. Without this ceiling, the U.S. would likely today be assessed more than one-quarter of the regular budget and nearly one-third of the peacekeeping budget.
ASSESSMENTS FOR UN PEACEKEEPING OPERATIONS
The UN peacekeeping budget funds a massive global military deployment: 10 missions with 85,000 personnel spread across three continents. Nevertheless, at just over $6.5 billion annually, the UN peacekeeping budget comprises just oer 0.3 percent of annual global military spending.
Member State assessments for peacekeeping are largely based on the same criteria as the regular budget, with one additional factor: the five permanent members (P5) of the Security Council—the U.S., U.K., China, France, and Russia—pay a premium, and are therefore assessed at a slightly higher rate for peacekeeping than for the regular budget. Since the P5 hold veto power over UN Security Council decisions, no UN peacekeeping mission can be deployed without their support. The P5’s higher financial responsibility is therefore meant to reflect this unique role in authorizing peacekeeping missions and crafting their mandates. Similar to the regular budget, peacekeeping rates are revised every three years by the General Assembly, and new assessment rates for 2022-2024 were approved unanimously by Member States in December 2021. Over the last two decades, the U.S. rate has declined from a high of 31.7 percent in 1994. In 2021, the U.S. was assessed 27.89 percent of the peacekeeping budget. Following the most recent rate discussions, the U.S. rate declined even further, to 26.94 percent, the first time it has been below 27 percent since 2009. At the same time, other countries have seen their assessment rates increase. For example, China’s has risen dramatically, from just 3.14 percent in 2009 to 18.68 percent in 2022, a testament to the country’s expanding economy and growing role on the world stage.
WHY ARE ASSESSED BUDGETS NECESSARY?
Each year, the vast majority of the funding the U.S. contributes to the UN is voluntary. For example, in Fiscal Year 2020, Congress greenlit approximately $2.8 billion to pay U.S. assessments for UN peacekeeping missions, the regular budget, and other international organizations. That same year, the U.S. made more than $8 billion in voluntary contributions to the UN, approximately 80 percent of which was for WFP, UNHCR, and UNICEF. In total, just over one-quarter of all U.S. contributions to the UN in any given year are assessments.
Nevertheless, there have been periodic calls for the UN to do away with assessed budgets entirely and rely solely on voluntary contributions. Such proposals are impractical: instead of saving American taxpayers money, an entirely voluntary funding system could lead to significant budgetary shortfalls for critical programs and activities that advance our national interests, necessitating additional contributions above what we pay now.
- Assessed Funding Structures Require Other Countries to Share the Financial Burden: A major advantage of assessed funding is that it ensures the financial burden for core UN activities is spread across the entire international community, rather being than the primary responsibility of a single country. While the U.S. is the largest single contributor to the UN’s regular and peacekeeping budgets, the UN’s other Member States still shoulder the vast majority of costs. The fact that all Member States, even the least developed, are required to contribute to the organization at specified levels prevents the U.S. from being saddled with the burden of financing these activities alone.
- U.S. Leaders and Experts Agree that Voluntary Funding Is Problematic: Successive administrations and outside experts have recognized the limitations inherent in voluntary funding structures. A 2005 Congressionally-mandated bipartisan report on UN reform led by Newt Gingrich and George Mitchell noted that such schemes are often slow and lead to U.S. priorities being underfunded. Later that year, the House of Representatives passed ‘The United Nations Reform Act of 2005’, which proposed that the U.S. withhold dues from the UN unless certain specific reforms were met, including switching to a system of voluntary financing. The Bush Administration issued a Statement of Policy which said that it had “serious concerns” about the legislation because it “could detract from and undermine our efforts,” and requested “that Congress reconsider this legislation.”
- Voluntary Financing Could Lead to Shortfalls for U.S. Priorities: The UN’s assessed budgets fund many of the organization’s most consequential and politically sensitive activities, such as those described above. The reality is that any large organization needs stability and predictability in its budget. In particular, planning for massive logistical operations like peacekeeping efforts require significant lead time and preparation that can only happen with assured funding streams.
Adoption of voluntary financing arrangements for the UN’s regular, peacekeeping, and specialized agencies budgets would almost certainly lead to underfunding from other countries. For example, the UN’s voluntarily financed humanitarian and global health activities, far less controversial than the organization’s peacekeeping and human rights work, are perennially short of need. In 2021, UN humanitarian agencies and partner organizations needed a total of $37.7 billion to provide aid to 174 million people in 60 countries. At the end of the year, however, they had only received $17.2 billion, or 46 percent, of the total they requested. By requiring all Member States to contribute, assessed funding structures can help avoid these types of shortfalls.