Report on Financing the UN Development System Launched

11 September 2018: At a special session for UN Member States, UN organizations, and civil society organizations in Geneva, the UN Multi-Partner Trust Fund Office (MPTFO) and the Dag Hammarsköljd Foundation launched a report titled, “Financing the UN Development System: Opening Doors.” This publication is the fourth in a series of reports published annually. It provides a big picture perspective of what financing looks like across the UN system and within the context of global financial markets.

The event was kicked off by Michael Møller, Director General of the UN Geneva, who underscored the importance of multi-stakeholder partnerships in advancing the SDGs. He noted that the partnership between the UN MPTFO and Dag Hammarsköljd Foundation has for years provided crucial information about the financial situation for the UN system and discussed what it means for realizing the 2030 Agenda and other UN priorities.

Bruce Jenks, Senior Advisor to the Dag Hammarsköljd Foundation, explained that the report is broken into two major parts that, taken together, tell an interesting story about the current state of finance for sustainable development. The first section is research focused and compiles information about revenues and expenditures across the UN system. The second section is a “free marketplace of ideas” around financing the SDGs that shows “an idea of finance that is radically shifting in the rapidly changing world that we live in.” Jenks commented that the report uncovers the need to dig deeper into the nature of the assets that are unique to the UN and the role it can play in the financing world.

Jennifer Topping, Executive Coordinator of the Multi-Partner Trust Fund Office (MPTFO), presented an overview of the report, stating that its innovation lies in that it presents a comprehensive view of the entire UN system, whereas most other the publicly available data are shared by a single agency or program. She noted that the majority of the data in the report comes from the Chief Executive Board (CEB) as well as United Nations Department of Economic and Social Affairs (DESA) and the OECD Development Assistance Committee (DAC).

Topping said that, in 2016, the UN had US$49.3 billion in revenue, up approximately US$1 billion from 2015. She noted that this indicates that 2017 will likely be the year that the UN crosses the threshold of US$50 billion in total revenue. The revenue of the UN system is split among a number of categories: 54% earmarked, 28% assessed contributions, 10% voluntary core contributions, and 8% fees. Topping noted that there is a challenge in the highly ear-marked nature of funds because it reduces flexibility. She said this is especially true in relation to other multilateral organizations (such as the World Bank, IMF, EU and other regional development banks), which have a much smaller share of their budgets earmarked. It was also noted that while the vast majority of funding is “tightly earmarked”, meaning provided by a single donor to a single agency for a specific project, there are some interagency pooled funds that are less restrictive and, for example, allow for use among multiple entities. Sixty-six percent of funding for the UN is for operational activities (28% humanitarian, 38% development), and the remaining is split between peacekeeping at 20%, and 14% for norms, standards, policy and advocacy.

According to the report, the 12 largest donors to the UN system are the US, Germany, UK, Japan, Sweden, Norway, Canada, Netherlands, Brazil, Switzerland, Australia and Saudi Arabia. The 12 largest recipient countries for program expenditures (for development and peace or security related activities) are South Sudan, the Democratic Republic of the Congo, Sudan, Lebanon, Afghanistan, Somalia, Syrian Arab Republic, Mali, the Central African Republic, Occupied Palestinian Territory, Iraq, and Ethiopia.

The second part of the report consists of a series of concise essays that provide an overview of the current state and coming trends in finance for sustainable development. These essays are presented in four chapters:

The Big Picture, which explains the wider financing environment beyond the UN, including public and private financing flows.
Broadening Perspectives, which looks at new activity in global South development finance, in particular China and India but also including South-South partnerships.
Game Changers, which shares insights and experiences on transformative financing initiatives and instruments including through science and technology and blended finance.
Innovations in Multilateral Instruments for the 2030 Agenda, which examines the role of UN and international financial institutions in global financial systems and at the country level.

[Full Report] [SDG Knowledge Hub Sources] [MPTFO Website] [Dag Hammarskjold Foundation website]