UN faces crisis after reforms voted down

A powerful group of developing nations has blocked reform proposals that would have given Secretary-General Kofi Annan more budget power, and rich countries warned the move could push the world body toward financial crisis.

The vote yesterday in the main UN budget committee raises the threat that some wealthy countries – including Japan and the US – might withhold their UN dues after June. That’s when member states will review how much movement has been made toward Annan’s reform proposals to streamline UN operations and cut jobs, unveiled in March.

The wealthy nations promised not to abandon their reform push, but their diplomats didn’t rule out withholding dues to intensify pressure for results.

The vote capped days of often acrimonious debate and was likely to widen the deep rifts between wealthy and impoverished nations over the best way to run the United Nations.

The resolution proposed by China and the Group of 77 – which actually includes more than 130 countries – passed by a vote of 108 to 50, with three abstentions. Opposing were nations that collectively contribute some 85% of the annual UN budget, among them the European Union, the US, Japan, and Australia.

Annan’s reform proposals were unveiled in March, six months after world leaders had agreed at a summit that the UN system, created in the aftermath of World War II, was out of date and inefficient.

Allegation of waste and fraud surrounding the Iraq oil-for-food program added new pressure for change.

At the core of the debate were two proposals that would take some power away from the UN General Assembly, where each of the 191 member states gets one vote.

One would give more power over the UN budget to a small group of nations. The other would empower the secretary-general to make decisions to cut staff and make other managerial decisions.

Rich nations also wanted the Group of 77 to drop language from their resolution that would have pushed the UN to recruit more staff and hire more companies from developing countries.

Led by South Africa, chair of the G-77, poorer nations said they were committed to UN reform but that Annan’s proposals would violate the UN Charter by leaving power in the hands of a few.

“We don’t think this is how the organisation should be run,” said Egypt’s Ambassador Maged Abdelaziz, whose nation is a member of the G-77. “We think that every single country has the right to take its own decision according to its own interests.”

The next step will be to take the budget committee’s resolution before the full UN General Assembly, where it must also be adopted.