Board agrees for UNAIDS to use its reserves for restructuring

The UNAIDS board has authorized its secretariat to utilize a portion of the joint program’s operating reserves to cover the cost of its ongoing restructuring efforts.

The decision allows UNAIDS’ executive director to draw up to a maximum of $15 million from its Operating Reserve Fund, which holds a total of $35 million. The money from the reserve fund will be used to implement its activities, including the secretariat’s restructuring, which is estimated to cost $32.8 million in 2025 and 2026. Without it, UNAIDS could face a shortfall of $8.7 million in 2026.

UNAIDS is a joint program made up of 11 United Nations agencies, called cosponsors, as well as a secretariat that has its headquarters in Geneva and several regional and country offices that coordinate the work of the program. UNAIDS relies entirely on voluntary contributions, which are shared between the secretariat and its cosponsors.

Due to declining donor funding and calls for changes within the program and the broader U.N. system, however, the secretariat embarked on a restructuring effort. At its recent board meeting, it presented a new operating model that will see the secretariat operate with less than half of the staff it has now, downsize its country offices, and deprioritize a significant number of its current activities. Many of its functions will also be relocated outside of Geneva. A high-level panel also recommended that the program reduce its cosponsors.

The Operating Reserve Fund’s main purpose is to ensure UNAIDS has the money it needs to cover its budget while waiting for donor contributions. Drawing down from the fund is meant to be a “last resort” when there isn’t enough cash for UNAIDS to implement its activities.

Why is this important: UNAIDS had an “adequate” fund balance at the beginning of 2025 to implement its work and was able to allocate funding for some of its cosponsors. However, it now faces a funding crisis following significant donor funding cuts, notably from the U.S. government. Without additional contributions from donors, it won’t be able to transfer any more funding to its cosponsors.

In addition, UNAIDS expects it will have a balance of $27 million by the end of the year, significantly below the minimum amount of 22% of its biennial budget that the board requires to ensure the joint program can smoothly implement its activities the following year while waiting for donor contributions.

What’s next: The board wants the secretariat to present a plan on how the Operating Reserve Fund will be replenished at its meeting in December.

By Jenny Lei Ravelo