The contingency plan for peacekeeping financing, explained
Not a budget cut
Earlier this month, the Secretary-General instructed peacekeeping operations and the UN Support Office for Somalia (UNSOS) to implement contingency plans to reduce their expenditures for the remainder of the financial period. These measures were necessitated by the expected cash shortfall caused by non- and under-payment of assessed contributions by Member States, especially the United States.
This week’s column is presented in two parts. The first part is a peacekeeping financing primer that explains peacekeeping budgets, how they are financed, and how existing liquidity mechanisms work. The second part explains why the contingency plan for peacekeeping financing is necessary and how it is being implemented.
A peacekeeping financing primer
The financial period for peacekeeping operations (and UNSOS) runs for the 12-month period from 1 July to 30 June. The current period is 2025/26.
Budgets
Budgets for each mission are broken down into three groups of expenditure.
Group I consists of military and police personnel costs, including reimbursement for personnel and contingent owned-equipment.1 Military and police personnel costs are the largest portion of mission expenditures, and represent approximately 46% of the approved mission budgets for 2025/26.
Group II consists of civilian personnel costs, including salaries, allowances and benefits for international and national staff members, and UN Volunteers. These represent approximately 26% of the approved mission budgets for 2025/26.
Group III consists of operational requirements, including costs related to travel, facilities and infrastructure, ground transportation, and air operations. These represent approximately 28% of the approved mission budgets for 2025/26.
Financing
Peacekeeping budgets are financed using assessed contributions provided by Member States. The appropriations for each mission are apportioned amongst Member States using the scale of assessments for peacekeeping operations, approved every three years by the General Assembly.2 Under financial regulation 3.5, contributions are due within 30 days of the start of the financial period.
With the exception of two legacy missions included in the regular budget, each mission has a separate special account which is used to finance the requirements for the mission itself as well as the mission’s pro-rated share of the costs of the support account for peacekeeping operations, the UN Logistics Base, and—for missions in Africa—the Regional Service Centre in Entebbe.
Liquidity mechanisms
The late or non-payment of assessed contributions by Member States means that the budgets approved by the General Assembly are never fully funded. Uncertainty over when contributions will be paid creates cash flow challenges for the UN. Under normal situations, the Secretariat utilizes a variety of methods to manage liquidity, including implementing spending restrictions to manage the risk of spending beyond the expected pace of collections. If missions face a cash shortfall despite these restrictions, missions can avail of various mechanisms to manage liquidity.
The Peacekeeping Reserve Fund was established at the level of $150 million to finance the start-up or expansion of peacekeeping operations. In 2022, the General Assembly approved the use of up to $110 million of the Fund as the liquidity mechanism of first resort.3 The Assembly also authorized the management of cash balances of all special accounts in a pool (a practice also referred to as “cross-borrowing”) through 30 June 2027 to allow missions with weaker cash positions to borrow from missions with stronger cash positions, as long as such borrowing would not undermine mandate implementation in lending missions.4 Any cash borrowed by a mission from either the Fund or from other missions is repaid once assessments are received. Further shortfalls are addressed by deferring reimbursement to troop- and police-contributing countries (under Group I), with payments made after cash is available.
Understanding the contingency plan
The contingency plans being executed consist of reductions of 15 percent in peacekeeping operations and 25 percent in UNSOS. These are not changes in the mandate (which require Security Council approval) or budget cuts (which require General Assembly approval), but are cash management measures that reflect the reality that the United States does not intend to pay a significant portion of its assessments for 2025/26 (i.e., over half of what it will owe, including the costs of the new UN Support Office for Haiti), let alone its arrears from prior financial periods.
Existing approaches to liquidity management are insufficient for the current situation because they are premised on missions repaying sources of liquidity (e.g., the Peacekeeping Reserve Fund, other missions through cross-borrowing, or deferred reimbursements) once assessments are received. Because of the expected U.S. non-payment, missions need to dramatically reduce expenditure to avoid having peacekeeping operations end the financial period in bankruptcy.
The reductions cover all three groups of expenditure, but affect each differently. Salaries and benefits for civilian staff (Group II) are not discretionary expenditures, and therefore missions have very little flexibility other than implementing hiring freezes and declining to renew contracts. And while missions can work to reduce operational requirements (Group III) by taking measures such as reducing official travel, the bulk of expenditures are ones required to keep a mission operating, such as those related to fuel (required for ground transport, air operations, and electricity). Moreover, missions are obligated to pay vendors for services provided. The limited flexibility under Group II and Group III means that reductions will disproportionately fall on military and police personnel (Group I).
It is not enough to defer reimbursements, as the funds require to pay these will not be forthcoming. Reducing Group I expenses therefore requires repatriation of military and police personnel.5 The contingency plans being executed call for an overall reduction of approximately 25 per cent of troops and police. The Secretary-General is able to make such reductions in UN peacekeeping operations because he has the discretion to determine the level of military and police personnel to deploy in each mission as long as the level does not exceed the maximum authorized strength set by the Security Council in the mission mandate.
Final thoughts
The specific reductions to be made will differ from mission to mission, and the Secretary-General has stated that missions
…will continue to implement their mandates to the extent possible under these financial circumstances. The protection of civilians, the advancement of peace processes and support to fragile communities cannot and will not be abandoned. However, given the magnitude of the problem and the challenging context in which our missions operate, it is difficult to predict the impact on the ground.6
The contingency plans are a stopgap measure and are not sustainable in the long term. For the next financial period (2026/27), the Secretariat and Member States must avoid falling into the trap of proposing or approving budgets at a level in line with the reduced expenditures for this year.7 To reduce approved budget levels will only exacerbate the liquidity crisis as this would necessitate another round of reductions and repatriations by missions, therefore creating a downward spiral that will progressively handicap missions until they are entirely nonfunctional.
The only way out of such a spiral would be for the General Assembly to approve exceptional measures to fill the gap between the approved budget and expected collections, such as a supplemental assessment. This is, of course, unless the United States under the Trump administration stops being a deadbeat and begins honoring its financial obligations to the UN.
As I noted last week, this is unlikely to happen.
© 2025 Eugene Chen under CC BY-NC-ND 4.0
Reimbursement for members of military and police contingents is paid to troop- and police-contributing countries at a rate of $1,448 per person per month based on monthly troop and police strength reports. Reimbursement for contingent-owned equipment is paid for serviceable equipment, as determined during quarterly verification inspections.
The current assessment rates (2025-2027) are published in A/79/318/Add.1.
The ring-fencing of $40 million reflects the fact that, in the past, no more than $40 million from the Fund has been required at any time to support mission start-up and expansion.
The impending closure of the UN Interim Force in Lebanon, whose mandate will end on 31 December 2026, will negatively affect the overall liquidity situation for peacekeeping because it has a more favorable cash position than most other missions.
Repatriation, of course, results in one-time costs, but as long as personnel are repatriated early enough in the financial period, this will result in net reductions during the financial period and reduced baseline expenditure moving forward.
Guterres, António. Letter dated 10 October 2025 to all United Nations personnel.
The 2026/27 budgets will be finalized by the Secretariat in advance of submission to the Advisory Committee on Administrative and Budgetary Questions in January 2026 and consideration by the Fifth Committee of the General Assembly in May 2026.