THE United Nations is strapped in a downward spiral" of financial crises that is threatening its very survival, the Secretary General, Dr Boutros Boutros Ghali, warned yesterday. He promised to pursue a rescue plan that will include deep staff cuts.
At the same time, however, he appealed to member states to acknowledge the depth of the budgetary predicament and take steps to avert it. The implied target of his appeal was the United States, which accounts for a very large part of the contributions to the UN that have not been paid.
"Time is running out," Dr Ghali told a General Assembly committee on financial reform. "I regard the financial crisis as my top priority in the period ahead and I will do all that I can to avoid financial collapse."
Urging an emergency meeting of the assembly to address the issue, Dr Ghali said the UN was currently owed $3.3 billion in unpaid membership fees. Of this, $1.2 billion is owed by Washington. Officials warn that without action, the UN will simply run out of money before the end of the year.
Dr Ghali was speaking one day after Mr Joseph Connor, the Undersecretary General in charge of finances, stunned the organisation by proposing that 1,000 jobs be eliminated from its bureaucracy over two years, equivalent to 10 per cent of its payroll, as the only means to make ends meet.
The reductions would come mainly at the New York headquarters and at five other offices abroad. Satellite agencies such as Unicef and the High Commission for Refugees would not be affected.
Last year, the UN's 50th the organisation kept the lights burning only by topping up its regular budget with funds from the separate peacekeeping budget. But as a result it owes about $1 billion to members involved in peacekeeping and cannot repeat the trick.
Dr Ghali said he would be appealing personally to each head of government for help. He said he would ask those countries that are in arrears at least to present him with a payment schedule.
While pledging to protect morale among UN staff, the Secretary General said that necessary budget cuts would make job losses inevitable. He recently proposed a 1996-97 budget that will be the first zero growth budget in the UN's history. From that however, the General Assembly trimmed another $256 million.
"It is evident that the budget reductions are of such magnitude that they can be realised only through a combination of staff reductions and non staff reductions," he said.
By moving to prune its bureaucracy, the UN will be hoping to soften some of the criticism in Washington and especially on Capitol Hill. So far, however, critical members of Congress, who are holding up payment of US contributions, appear less than overwhelmed.
"We're not impressed by 1,000 lay offs. This is a cynical public relations attempt to shame Congress," according to a spokesman of Mr Jesse Helms, the arch conservative chairman of the Senate Foreign Relations Committee. Mr Helms has asked for a 50 per cent cut in UN bureaucracy.
The UN is, however, pursuing reform from several angles, including a broader restructuring of the administration and an enlargement of membership of the Security Council.
Of special interest to the US, however, are recently unveiled Franco British proposals for a complete review of the formula whereby contributions of the member states are calculated.
Most notably, the new system would dramatically reduce the burden on Washington and require much higher contributions from the nations of South
East Asia.
Reuter adds from Geneva: The internal telephone system at the UN's European headquarters broke down yesterday when too many anxious staff dialled a special number for a live relay of Dr Ghali's cost cutting speech.
UN officials have said 10 per cent of the 2,500 permanent posts at Geneva's Palais des Nations could be lost in the economy drive caused by the failure of member states to pay their dues.