Alternate Funding Sources for the International Atomic Energy Agency

Since 1957, the International Atomic Energy Agency (IAEA) has worked to ensure the safe and responsible promotion of nuclear technology throughout the world. The IAEA operates at the intersection of the Nuclear Nonproliferation Treaty’s (NPT) fourth and third articles, which guarantee Parties to the Treaty the right to peaceful uses of nuclear technology, provided those activities are placed under safeguards verified by the IAEA. However, while the IAEA has enjoyed substantial success and prestige in the international community, there is a concern that its resources are being stretched to a point where it may no longer be possible to execute its multifaceted mission in its entirety. As noted by the Director General (DG) in 2008, demographics suggest that every aspect of the IAEA’s operations will be in higher demand due to increasing reliance on non-carbon-based energy and the concomitant nonproliferation, safety, and security risks that growth entails. In addition to these nuclear energy concerns, the demand for technical developmental assistance in the fields of food security, resource conservation, and human health is also predicted to increase as the rest of the world develops. Even with a 100% value-for-money rating by the U.S. Office of Management and Budget (OMB) and being described as an “extraordinary bargain” by the United Nations Secretary-General’s High-level Panel on Threats, Challenges and Change, real budget growth at the Agency has been limited to zero-real growth for a better part of the last two decades. Although the 2012 regular budget (RB) received a small increase for most programs, the 2013 RB has been set at zero-real growth. As a result, the IAEA has had to defer infrastructure investments, which has hindered its ability to provide the public goods its Members seek, decreased global security and development opportunities, and functionally transformed the IAEA into a charity, dependent on extrabudgetary (EB) contributions to sustain its mission and capabilities. To resolve these resource constraints, we recommend the creation of an endowment, funded entirely through private contributions. Our initial estimates for the endowment are that a €2B principal. This level of capitalization could provide significant support to all aspects of the IAEA’s mission, including Capital Investment and Innovation; Technical Cooperation; as well as incentivizing the policy and technology entrepreneurship that will be necessary for the future health of the nonproliferation regime. Given this potential, our future efforts will focus on a more rigorous assessment of the financial requirements, while simultaneously creating the beginnings of a functional organization. These include: organizational structure, metrics for grant-making and performance evaluation, and outreach and fundraising strategies. At the end of this process, there should be sufficient information and engagement to begin to operationalize the endowment through external funding sources

Alternate Funding Sources for the International Atomic Energy Agency

Since 1957, the International Atomic Energy Agency (IAEA) has worked to ensure the safe and responsible promotion of nuclear technology throughout the world. The IAEA operates at the intersection of the Nuclear Nonproliferation Treaty’s (NPT) fourth and third articles, which guarantee Parties to the Treaty the right to peaceful uses of nuclear technology, provided those activities are placed under safeguards verified by the IAEA. However, while the IAEA has enjoyed substantial success and prestige in the international community, there is a concern that its resources are being stretched to a point where it may no longer be possible to execute its multifaceted mission in its entirety. As noted by the Director General (DG) in 2008, demographics suggest that every aspect of the IAEA’s operations will be in higher demand due to increasing reliance on non-carbon-based energy and the concomitant nonproliferation, safety, and security risks that growth entails. In addition to these nuclear energy concerns, the demand for technical developmental assistance in the fields of food security, resource conservation, and human health is also predicted to increase as the rest of the world develops. Even with a 100% value-for-money rating by the U.S. Office of Management and Budget (OMB) and being described as an “extraordinary bargain” by the United Nations Secretary-General’s High-level Panel on Threats, Challenges and Change, real budget growth at the Agency has been limited to zero-real growth for a better part of the last two decades. Although the 2012 regular budget (RB) received a small increase for most programs, the 2013 RB has been set at zero-real growth. As a result, the IAEA has had to defer infrastructure investments, which has hindered its ability to provide the public goods its Members seek, decreased global security and development opportunities, and functionally transformed the IAEA into a charity, dependent on extrabudgetary (EB) contributions to sustain its mission and capabilities. To resolve these resource constraints, we recommend the creation of an endowment, funded entirely through private contributions. Our initial estimates for the endowment are that a €2B principal. This level of capitalization could provide significant support to all aspects of the IAEA’s mission, including Capital Investment and Innovation; Technical Cooperation; as well as incentivizing the policy and technology entrepreneurship that will be necessary for the future health of the nonproliferation regime. Given this potential, our future efforts will focus on a more rigorous assessment of the financial requirements, while simultaneously creating the beginnings of a functional organization. These include: organizational structure, metrics for grant-making and performance evaluation, and outreach and fundraising strategies. At the end of this process, there should be sufficient information and engagement to begin to operationalize the endowment through external funding sources