The United Nations has approved a 7 percent reduction in its budget from last year as the organization grapples with a financial crisis driven largely by the refusal of the US to pay what it owes.

The UN General Assembly on Tuesday voted to adopt an operating budget of $3.45 billion Tuesday for 2026, down from $3.72 billion this year, to fund administrative and operational activities.

The reduction, which includes cutting 2,900 positions, comes as the UN tries to cut costs wherever it can. Earlier this month, the organization announced that it would no longer provide paper towels at the restrooms in its global headquarters in New York.

“Liquidity remains fragile, and this challenge will persist regardless of the final budget approved by the General Assembly — given the unacceptable volume of arrears,” said UN Secretary General Antonio Guterres earlier this month in his own proposal for the revised budget for the coming year. The approved budget is some $200 million higher than the UN leader had proposed.

Guterres, who has been working on a financial survival plan for the UN for months, suggested cutting the budget by $577 million and slashing 18 percent of jobs. He cited arrears from past years — most of which is owed by US — for the drastic measures.

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The US usually contributes 22 percent of the UN’s regular budget, but the Trump administration has not paid the $826 million bill for 2025 and it still owes some $660 million in arrears. On Monday, the US pledged $2 billion to the organization’s humanitarian arm.

US President Donald Trump has accused the the UN of wasting taxpayer dollars, and US officials in his second term have embarked on an effort to bring the organization “back to basics.”

“We are ‘DOGE-ing’ the United Nations,” US Ambassador Mike Waltz said in a post on X on Dec 17, referencing the Elon Musk-led effort to slash the US bureaucracy while celebrating a plan to cut 2,600 UN jobs and 25 percent of peacekeepers.

“It’s time for the UN to get back to basics: stopping wars and preventing conflict, NOT funding bloated bureaucracy on the American taxpayer’s dime.”

The regular budget for the United Nations is only a fraction of the total expenditures of its affiliates. Agencies like Unicef and Unesco face fiscal shortages of their own and are also planning major cutbacks.