General Assembly’s budget committee lifts cap on UN spending

28 June 2006 –

The General Assembly’s budgetary committee today decided to lift the spending cap on the remainder of the United Nations’ two-year fiscal period, authorizing Secretary-General Kofi Annan to utilize the remaining funds in the budget for 2006-2007.

Saying that not enough progress had yet been made in the reform of the Organization, the United States, Japan and Australia dissociated themselves from the consensus decision to lift the cap, which stems from a December decision of Member States to adopt a budget for the 2006-2007 biennium but to limit spending authorization to six months and $950 million, pending significant progress on such reform.

Last week, UN Controller Warren Sach warned the budget Committee that under the cap the “last dollar available” would be spent before mid-July.

Mr. Annan has recently expressed optimism that the cap, backed by major donors and opposed by many developing countries, would be lifted since progress in UN reform is ongoing and the Organization is involved in too many crucial operations at the current time for the world to allow them to stall.

In that vein, before today’s vote, General Assembly President Jan Eliasson sent a letter to Member States listing reforms achieved so far during the Assembly’s 60th session, including the creation of the Peacebuilding Commission, the Human Rights Council, the Central Emergency Response Fund and the Ethics Office.

He also detailed the work being done on management and procurement reform, two priority concerns of the donor nations. Along with lifting the cap, he urged all Members to commit themselves to agree on a resolution containing “concrete and substantive measures” on the management and oversight issues by 30 June.

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