Thank you, Mr. Chairman, and congratulations on your election as head of the Fifth Committee. We wish you the very best of success in the very important deliberations which have been launched today and which will continue intensively. And I also want to express my admiration for your predecessor, Ambassador Wensley, for the way she has conducted the discussions over the last year. I would also like to congratulate the members of the Bureau on their election, and to wish you strength and wisdom as you proceed. We have confidence that this process will ultimately strengthen the UN, although it's going to be a very difficult process indeed.

My fellow representatives to the United Nations, I appear before you again, and I'm so glad that so many other Permanent Representatives share our view of the importance of this and are here in the hall today to participate in Fifth Committee because of the great importance of what is being undertaken here. We are launching today nothing less than an effort to improve and strengthen the UN by a process of reform and restructuring that takes into account new realities, including realities of an economic nature, but also enshrines and reinforces the historic criteria of the UN, including capacity to pay.

Less than one month ago, we all participated in the historic Millennium Summit. The 150 leaders from countries around the world who came to New York came here to create a new vision for this great and vital and indispensable organization, and to set forth a dynamic plan of action. While I think we all came out of that week a bit tired, I think we also came out of it with a sense of renewed appreciation for what the UN has achieved, for where its potential lies, and -- I hope - - for what it will take from all of us to see the promise realized.

Today the United Nations is at a watershed. Let us bear in mind, as we analyze our current situation, where we have been. In 1946, the United Nations' creators aimed to invent an institution that could prevent wars, protect human rights, and bridge divides between the peoples of the world. In the ensuing decades of the Cold War, that dream proved elusive. Polarization bred paralysis and the membership grew disillusioned. Discouraged, many threw up their hands - and this unfortunately included many Americans -- and allowed the UN's structures and systems to atrophy. The UN became bloated by a bureaucracy which was not responsive to the needs of the peoples of the world. The Security Council and regional groups often became frozen in time, and ignored clear signs of waste within the Secretariat.

As the geopolitical climate began to change over the last 11 years, the UN did its best to forge a new role in areas ranging from peacekeeping to development to environmental preservation. With a weak infrastructure and uneven support, the UN took halting steps forward, steadily reasserting its role and slowly winning back the trust of its membership. I would say in this regard, that the United States of America's population and people have shown increasing respect for the United Nations in the recent months and over the last year or two.

Last June, after extensive consultation and experimentation, Secretary-General Kofi Annan set out a bold new vision for the UN. His blueprint inspired the world, prompting leaders around the world to unite around a set of goals that are ambitious and concrete. The Secretary-General deserves great credit for what he has done. During the Millennium Summit, our heads of state, to a considerable and remarkable degree, succeeded in harmonizing competing priorities, values, and beliefs to lay out a shared plan. Today, we have the historic opportunity to back this resolve with action. I implore you --I beseech you -- let us not squander the opportunity.

No part of the UN System has a more pivotal role than the Fifth Committee. In the coming months and years, the Fifth Committee will determine whether the UN can marshal the human resources needed to implement the Millennium Summit agenda. We will determine whether the Secretariat will be adapted for the global information age. And most importantly, the Fifth Committee will set out to create new, more modem and more equitable financial structures for the UN.

If there is one thing the Millennium Summit's targets have in common, it is that each will require that the UN have the means to deliver on its mandates. This will not be easy. As we all know, the UN has for the past decade been in a financial straight-jacket. This problem has no single cause. Arrears from member states, including my own, are undeniably an element, and one that I deeply regret. All of my friends here in the United Nations will know that no issue has been more important to us in the year since I took this job, and I have committed myself-- in public and in private -- to make UN reform, including the settlement of our arrears problem, my number one sustained priority. I think many of you are well aware of the effort that Ambassador Hays, Ambassador Cunningham and my other colleagues have made in this regard. Almost every Mission in this room has been contacted by the United States in an effort to build a consensus for reform which will make it more possible for us to meet our full financial obligation. I do not shirk from admitting that our failure to pay our dues on time has contributed to the problem we are here for. As President Clinton has repeatedly said, we do not feel comfortable in arrears, and we wish to end that anomaly in our own participation. As I said when I addressed the Fifth Committee for the first time a year ago, I commit myself personally through the remainder of my tour to dealing with this issue in an open and frank and transparent way. But we need your help. We need your help and your understanding.

The roots of this issue run deep, and they don't relate solely to the United States' failure to pay all of its dues on time. We need to stop the ossification of the UN's financial structures. We need to stop the concretization, the locking in stone of a system predicated on old criteria and on old realities and that flouts the fundamental principle of our sovereign equality as Member States.

At the dawn of this new Millennium, we have the opportunity to turn the page and put the UN on a sound financial foundation. And this must begin by updating the United Nations scale of assessments, both the regular budget and, as we will discuss tomorrow, the peacekeeping budget.

Over the past months, momentum has built on this issue. More than seventy-five Member States have joined together to create a new agenda item to discuss revisions of the UN peacekeeping scale. This is a giant step forward - the first time in 27 years that the Fifth Committee will formally discuss a significant revision of this out-moded, out-dated, and inaccurate scale that covers the most important functions of the UN and peacekeeping. The breadth of participation in this request to create this new agenda item is in itself evidence that the political alignments of the past are giving way to a pragmatic, forward-looking consensus. As leaders of this organization, Russia and China - as members of the permanent membership of the Security Council -- have committed themselves in statements along with Great Britain, the United States and France, to fulfill our special responsibilities for peacekeeping financing through contribution rates commensurate with their countries' role and status. Nearly twenty other member states from all regions of the world have already announced their voluntary willingness to pay more under a more credible system of assessments. The Gulf Cooperation Council and the Geneva Group have called for revisions to the UN's regular and peacekeeping scales of assessment by the end of the year. And I need to underscore the extreme importance to my government of making some revisions -- even if incomplete, even if not fully adequate - of making some revisions before the end of the year in both the regular budget and the peacekeeping budget. The Security Council as a whole has endorsed the need for stable financing, and the entire membership - - in our Millennium Summit declaration - - cited the need for a reliable system for funding peacekeeping.

The Brahimi report gives us the lever and the rationale and a very impressive set of recommendations which cannot be carried out unless financial restructuring accompanies them, and I shall address this problem in more detail in the Fifth Committee tomorrow.

The political will appears to be here for the first time. Now it is up to us, the Member States and the representatives of them in this room, to overcome our differences and confront the devil in the details. There is growing agreement but not yet a full consensus on the fundamentals of a new system: more up-to-date economic data, and a broader burden-sharing among Member States based on two criteria - real ability to pay and real responsibility to contribute.

The base period, in our view, should be shortened in order to better reflect current realities. In a world where business cycles can happen overnight, and technological revolutions take hold in months rather than years, ability to pay can no longer be measured in data that is 10 years old. We need action also to broaden the UN's tax base by introducing a sliding gradient that better reflects the ability to pay of the world' powerhouse developing economies. The debt burden adjustment should be predicated on actual debt flows rather than a theoretical estimate that is at odds with readily available, concrete data. Together, these steps will culminate in a scale that should be more transparent, more in tune with economic realities, and more fairly distributing the burden and privileges of financial responsibility here at the UN.

There is one more element. As it moves into the twenty-first century, the UN must leave behind the unhealthy practice of placing excessive reliance on a single contributor. The principle of avoiding over-dependence on any one Member State was embedded in the UN's methodology from the outset, but has fallen victim to politics, inertia and actions on all sides. We wish to recommend strongly, and request strongly, that it be reasserted so that we help promote the UN's financial and political well-being.

Let me be more specific. Since 1946, the United States has recognized that the principle of "capacity to pay" -- and the whole UN has recognized that the principle of capacity to pay --must be modified by other critical imperatives: a limitation on reliance on any one single member state, that is, the ceiling; appropriate acknowledgment of the status of those who have very limited capacity to pay, that is, the floor; and, a mitigation of commitment to pay for those whose economies are still developing, that is, a gradient. "Capacity to pay," as I've said repeatedly, is the cornerstone, but it is not sufficient in and of itself to provide an adequate and sustainable foundation for this edifice. If the scale was not political, we would have turned responsibility over to a technical committee decades ago. Instead, we are deeply engaged, continually, in these triennial debates.

In the post-war period, when the U.S. accounted for roughly 50 percent of world GNP and the UN had only 55 members, the scale ceiling was set at 39 percent out of recognition that it would be unhealthy for the UN to over-rely on one Member State. Since then, as the UN has grown, the ceiling was gradually lowered to maintain political balance. In 1973 the ceiling was reduced to 25 percent. Since then, 56 new Member States have joined the UN and the world economy has been transformed. New economic powers have emerged, while others have retreated. Productivity and trade flows have skyrocketed, energy and industrial production have grown exponentially, illiteracy and infant mortality rates have declined in most of the world. These new realities should be taken into account in any revision of the scale. With these trends, and in light of our overriding responsibility to ensure that this organization can move forward on solid financial ground, the time has come to reestablish the balance that the original framers of the Charter sought to strike.

Mr. Chairman, I want to make clear that in proposing this adjustment, the United States is not backing away from our unique responsibility to this organization. Of the nearly $3 billion that the U.S. will contribute to the UN in this calendar year, just $830 million is for assessed contributions for the regular budget and peacekeeping. More than $2 billion goes toward voluntary contributions to UN development, health, disarmament, humanitarian aid, human rights, and environmental activity. The United States has played this role as the largest contributor to the UN by far for the entire 55 years the UN has been in existence. We are proud of this role and we are determined to sustain it for the next 55 years. We seek a reduction in the ceiling not to shirk our commitments, but to strike a more appropriate balance.

My fellow Ambassadors, our task is clear. Our work is before us. If we are to give life to the vision we share for this institution we must come together and join in partnership to transform the UN. If we succeed, we will have delivered on the commitments our leaders made here in September. If we fail, the spirit of the Millennium Summit will die very rapidly, and undercut the hopes of millions of men and women throughout the world who look to the UN to make their lives better.

In conclusion Mr. Chairman, let me end on a personal note. This administration will remain in office until noon on January 20th and we will be committed until noon on January 20th to work with you and your colleagues for reform of the United Nations financial structure - both regular budget and peacekeeping - as our highest priority. We have crises in Sierra Leone and East Timor and in the Congo and in the Middle East - where the situation has gotten more serious over the weekend in Israel. In all of these areas, the United Nations has had or will have a role to play. In order to make it succeed, we must improve and reform the system. Therefore, I consider the debate that has begun today of historic importance, and again, I commit the United States government -- the U.S. Mission to the United Nations, the Administration in Washington including President Clinton and Secretary Albright, and especially myself-- to this effort for the next four months.

Thank you and I congratulate you on your assumption of this job -- which you may wonder later whether you were right, whether you were sane to take or not - but we congratulate you on your willingness to undertake it and we wish you the best of luck.

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