GENEVA - The UN refugee agency plans to scale back its budget by nearly a fifth next year due to "financial constraints", even as the war in Sudan and other crises cause a surge in people fleeing their homes, its projected budget showed.

The UNHCR agency also plans to close its Southern Africa bureau and scrap nearly 4,000 jobs as cuts leave it with $8.5 billion to spend in 2026, down from $10.2 billion in 2025, according to the document published online on Monday.

It did not go into details on the constraints. A UNHCR spokesperson said the budget, even after the reduction, was aspirational since it has only been half-funded in recent years.

Aid agencies have been rocked by funding cuts from major donors, led by the US and other Western powers which have prioritized defence spending.

The Geneva-based body expects the number of forcibly displaced and stateless people to rise next year to a new global record of 136 million, up from 129.9 million in 2024.

The UNHCR spokesperson added that the figure was a planning figure for a meeting in Geneva next month and not a forecast. He added that donor cuts are already creating greater risks for refugees, warning that the vulnerable will die.

ALSO READ: UN chief condemns additional detention of UN personnel in Yemen

The closure of the bureau in South Africa's capital Pretoria will take effect on October 1 and offices in East Africa and West Africa will absorb its operations, the document said.

Southern Africa hosts refugees fleeing conflict in the Democratic Republic of Congo and those displaced by the northern Mozambique insurgency. The regional office employed 72 staff, according to the document, and covered 16 countries.

"We have already started seeing the impact of reduced funding across different operations," said Duniya Aslam Khan, UNHCR spokesperson for Southern Africa.

"If we were giving cash assistance, it's reduced cash assistance. Health care services have been affected. Education programs have been affected. Food assistance has been affected."

The US has historically been by far the largest donor to the UNHCR which relies heavily on voluntary donations.

The UN World Food Programme also closed its Southern Africa bureau citing funding constraints earlier this year.