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THE GLOBAL FUND TO FIGHT AIDS, TUBERCULOSIS AND
MALARIA: POTENTIAL, PROGRESS AND CHALLENGES
FOR THE FUTURE
2:00 p.m. - 3:30 p.m.
Thursday, July 1, 2004
Peter G. Peterson Conference Center (IIE)
1750 Massachusetts Avenue, N.W.
Washington, D.C.
[TRANSCRIPT PREPARED FROM A TAPE RECORDING.]
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FEATURING
Steven Radelet
Senior Fellow
Center for Global Development
WITH COMMENTS FROM
Anil Soni
Executive Director, Friends of the Global Fight
Former Advisor to the Executive Director
Global Fund to Fight AIDS, TB and Malaria
And moderator
Ruth Levine
Senior Fellow
Global Health Policy Research Network
Center for Global Development
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MS. LEVINE: Welcome to this session. We're very pleased to have you here. We're
sorry, there doesn't look like there are quite enough chairs, but I think that situation is being
worked out.
I'm Ruth Levine, Senior Fellow at the Center for Global Development, and I lead the
Global Health Policy Research Network at the Center.
Let me just start by saying a couple of words about CGD for those of you who are not yet
familiar with our relatively young institution, and then immediately turn to Steve Radelet. He will
present the highlights from the paper, which I think has been made available to all of you, and
then Anil Soni will be asked to make some comments, both on the paper and then more generally
about where things stand in the Fund.
The Center for Global Development is a relative newcomer to the community of think
tanks on Massachusetts Avenue. We were incubated by the Institute for International Economics,
which is where you currently are. Our mandate is to conduct policy research and share the
knowledge that's generated from that around questions of how the policies of rich countries affect
the prospects for development of poor countries. That is a very broad mandate as I'm sure all of
you can imagine, and covers development aid, development aid effectiveness, debt, migration
policy, trade policy and related topics.
We have been very fortunate to have been able to make some significant contributions in
the short period of time that we've been in existence, which is about two-and-a-half years,
particularly in the area of development aid effectiveness, and instrumental in that has been the
work of Steve Radelet. Steve is a Senior Fellow at the Center for Global Development, and
previously was Deputy Assistant Secretary at the Department of the Treasury.
The work that you're going to hear about today and that you have available to you is an
interesting take on the Global Fund to Fight AIDS, TB and Malaria. It's not about, in a sense, the
direct question of whether the Global Fund is making a difference in the epidemiology, in the
transmission patterns, in the treatment and care of people who are affected by those ailments. It's
about whether the Global Fund is achieving its--and what the prospects are for the Global Fund to
achieve its aims to be a different sort and a better sort, perhaps, of development aid delivery
mechanism. It was quite explicitly set up with an aim to help to solve some of the problems, the
chronic persistent problems that have been observed with more traditional forms of development
assistance.
So that's the angle that Steve looked at and we'll discuss today.
So I'm going to turn it over to Steve.
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MR. RADELET: Welcome to everybody. Thanks for coming. I'm really glad that
you're here. As Ruth mentioned, what I'm going to try to do today is talk about an analysis that
I've been doing on the Global Fund as an aid delivery mechanism, not on health aspects. If you're
interested in talking about what kind of treatment they should be using for malaria, read the
Lancet. Don't talk to me because I don't know anything about that. Not that I know much more
about foreign aid institutions, but a little bit more than I know about malaria and TB and AIDS.
The idea here is to think about the Global Fund at this stage, two years, two-and-a-half
years into its existence, as an aid delivery mechanism and what's going well and what's not going
well. It's too early to do an analysis of its achievements in terms of cost benefit analysis or
anything along those lines, but it's not too early to begin to ask some questions about what seems
to be going well, what's not, what the big concerns are and what some of the big questions are
that need to be asked. So that's my approach.
I want to thank the William and Flora T. Hewlett Foundation for providing for this. This
was not funded by the Global Fund. I was not working for them. I was working in cooperation
with them, but this was an independent analysis of their operations.
I guess the bottom line is that in my view the Global Fund has great potential in two
dimensions. One is to provide significant resources to finance the fight against these three big
diseases which are killing 6 million people a year, every year, with a large percentage of them in
Africa. And it has enormous potential to leverage more funding in that fight.
The second dimension where it has great potential is to influence how we think about
foreign aid because it is structured in a very different way from most aid delivery mechanisms,
and a lot of the assumptions underlying--or challenges a lot of the assumptions underlying any
other aid delivery mechanisms, and it's really that latter question that I want to focus on here
today.
My own view is that it's come very far in two years from a start-up organization literally
from scratch, where there weren't even offices just over two years ago, much less workers or
people in the field in the recipient countries that knew what was going on. I think it's come a very
long way. At the same time I think it faces very significant challenges. Its programs are
beginning to work quite well in some countries. In other countries, they're doing okay. In other
countries they're not working particularly well at all. There are a number of significant
challenges that I want to go through, but I believe with some modifications and some changes
that this can be a really effective and important organization, and it's worth our very strong
support going forward.
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Let me start by talking about some of the key differences between the Global Fund and
other aid mechanisms, and I think this is really quite central to what we want to talk about. First
of all, Number 1, this is a recipient driven approach. They really take the idea of a participatory
country ownership approach very seriously, not just at the level of rhetoric that some countries
do, but they take it very seriously. Whether that is the appropriate model in all countries or not I
think is an open question, but they definitely take the idea of participation and recipient-led and
driven approaches very strongly. The idea is to engender country ownership and to create
stronger incentives for good performance, and to increase capacity on the ground. If the
recipients are in the lead, that's going to help them to develop their capacity to think through what
a good program would look like and how to implement it more on the ground.
That approach, we should note right at the front, takes time. There is absolutely no way
that you can have a participatory approach that is focused on building capacity on the ground
among recipients without realizing that it's going to take a little bit of time to do that. But that's
one key way that the Global Fund is quite different.
Second is that it's a much smaller bureaucracy and a lighter touch than most aid
organizations. There are 80 people who work for the Global Fund, all based in Geneva, no one
in any recipient countries at all. And as we'll look at 80 people working on 122 countries, it
would be hard to accuse them of having a very heavy, bloated bureaucracy. Let's put it that way.
It's very small, very light touch, and I think actually perhaps a little bit too small and a little bit
too light a touch.
Third, that it operates as part of a network. It has a very focused specialized approach.
It's a financing instrument and that's it. It does not implement programs. It does not provide
technical assistance. It is not a full-fledged development agency the way many donors are.
Instead it takes a different approach: We do one thing. We provide the financing. What that
relies on is other actors to fill the other needs for technical assistance and for other kinds of things
that are needed to make a whole program work, and again, that's a very different approach, to be
very specialized and to take one element on. But it requires other partners in this network to take
on other parts.
It's a public/private partnership in terms of its board structure, in terms of people on the
ground. The Global Fund is not a UN agency. A lot of people think it is. It is not. It is not a
multilateral organization. It's a foundation founded under Swiss law in Geneva. It's a private
foundation but it takes a lot of its funding, most of its funding from governments, but it also takes
funding from private corporations, and its board structure is that way as well. There are
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governments, both recipient and donor governments represented on the board, as well as people
from NGOs, people from foundations and people from private corporations. So it's very mixed in
terms of the board, and also on the ground. Proposals are put together by a group called the
Country Coordinating Mechanism, which also represents government, nongovernment, private
corporations, foundations, donors. So it's a real mix in a true public/private partnership.
Fifth, it's performance based, or it hopes to be. It's a little early to tell, although the early
signs I think are pretty good, performance based in the sense that money follows results, and
programs that are going to work well will get continued financing, and those that don't work well
will reduce their financing. We'll look at that a little bit more in depth.
And lastly, it's very transparent and open. It's remarkable actually what's on their website.
You can get anything off their website, much more than any other donor agency. You can get
any proposal that's been approved. You can find out what's going on in any country. You can
find out who has donated how much money. You can find out how much they've spent in any
country by spending 10 minutes on their website. Board documents are all open to the public.
They're open for critique. There's a lot of openness and transparency in this organization that
doesn't exist in most aid agencies, and I think that's a good thing.
Those are some of the ways that it's different from most aid agencies. Let's take a quick
look at where things are.
At this stage they've got programs, approved proposals now in 129 countries. It was 122
until yesterday. They've approved Round 4 as of yesterday, and Anil will update us on that.
About 300 different programs in those countries, 300 different disease programs that they work
on in those 129 countries. They've signed grant agreements in 89 countries and have begun
disbursements in 85. Down at the bottom right-hand corner you can see that at this stage they've
disbursed $423 million against those countries--or in those countries. So that's a snapshot of
where things are in terms of the overall financing.
Just quickly, the breakdown, about 60 percent of the funds have gone to HIV/AIDS, about
20 percent to malaria. This is percentage of disbursed funds. And about 15, 16 percent for TB.
Regionally about half the money has gone to Africa in terms of the amount disbursed. For the
amount under proposals, it's a little higher, but for under disbursed about half has gone to Africa
and about a quarter to Latin America and a quarter to Asia. This is not by policy. They don't
have specific policies that say this much money has to go to HIV or this much money has to go to
Africa. This has been driven by the quality of the proposals that they have received.
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By the way, every proposal does go through a Technical Review Committee, which is a
committee of experts that verify the quality of the program before it is approved by the board, but
more on that later.
What's done so far? I think the key achievements were, Number 1, establishes new
international organization from scratch with all new procedures, and offices in Geneva and all
new procedures on the ground in 122 countries. That's a lot just to get an international
organization going and going fairly quickly. So just getting up and going relatively smoothly is
one achievement.
They've raised a lot of awareness and raised funding. They've got pledges of $5.4 billion
so far, actually received $3 billion as of the other day, and mostly that's additional in the sense
that this is new money for HIV/AIDS as far as we can tell. It's not so much governments that
were already doing AIDS programs for something else and now they've shifted it to the Global
Fund. There's some of that, but a lot of it has been truly additional.
There's much greater participation in the recipient countries in terms of efforts to fight the
disease than had previously been the case, and the people that I have spoken to on the ground in
the countries that I've visited have used words like "revolutionary," "empowering" and "path
breaking" in terms of reaching out to NGOs, to civil society, to groups outside the government
that often feel marginalized and excluded, and getting them involved in this process. There's no
question there's been a big change there.
Other achievements, it's very flexible I think and adaptive. It does have the capacity to
co-finance SWAps, sector-wide adjustment approaches, to finance budget supports or to do
projects. It can finance current costs as well as investment costs. It's very flexible or it has the
potential to be a very flexible mechanism. It's begun to use its big leverage to do other things that
are based on it size. It's reached agreement with the Clinton Foundation and others for bulk
purchases of drugs and other commodities, to use its size to leverage better and cheaper prices.
It's also negotiated a "Monitoring and Evaluation Toolkit" with 8 other donors. And it's
beginning to provide prevention and treatment and beginning to save lives in some countries.
Anil will talk a little bit more about the progress that has actually been made in countries, but
they're treating 4,000 TB patients in Ghana right now. There's about 3,000 people in Rwanda that
are on antiretroviral treatment, and in other countries they're actually beginning to achieve the
substantive goals.
Let me turn though to some of the major challenges that I think they face, and here is
really the meat of what I want to talk about. There are seven major challenges that I've got here
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that I think the Global Fund is facing if it's really going to reach its promise and potential going
forward.
The first one is financial sustainability. I'm a little reluctant to talk about finances first. I
actually like to talk about finances last usually. But in the 100 or more people that I interviewed
as background for this project, this was the number one concern on almost everybody's mind as to
whether the finances would be there. So I lead with it even though I'm actually more comfortable
talking more about substance first and financial stability later.
If they continue to be demand driven, that is, receive proposals from any country that
meet the quality standards of the Technical Review Committee, and sort of put aside a budget
constraint and just receive the proposals that were high quality, estimates vary, but it looks like
the estimates vary between 3 to 8 billion dollars per year of high-quality proposals that would be
approved by the Technical Review Committee. The 2004 receipts were about half of the lower
end estimate of that. So they're beginning to enter a period here where it looks like they won't be
able to finance all of the proposals that are recommended by this Technical Review Panel.
But at the same time I hear from lots of people that the Global Fund is either bankrupt, or
other people will say it's absolutely swimming in money, and I don't think either of those are
actually correct characterizations. What they do have are sufficient funds on hand to fully and
completely finance for the first two years every project that's been approved, every proposal that's
been approved by the Board. So there is no proposal out there that has been approved where they
will abruptly run out of money. So the idea that they're bankrupt in that sense is wrong. There is
sufficient money on hand for the first two years.
On the other hand, they're not swimming in money because they may not be able to fund
any new proposals now for the next two years, after the round that was just approved yesterday,
and Anil will tell us more about the Round 4, but it doesn't look like there's going to be sufficient
financing for any new proposals perhaps for the next two years. And renewals is the third part.
As I said, they've got enough money for the first two years for every program that's been
approved, but most of those are five-year programs, and the board has approved the first two
years, and they're beginning to come up for their renewal for their second phase which will be
three years, and it's not clear that there will be sufficient funds available to finance the renewal
phase for all of those programs.
So let's look just really briefly at some of the financial issues. These are both the pledges
and the contributions actually paid in by each of the major donors. This isn't all the donors.
Concentrate, I guess, I'm more interested in the amount that's actually been paid to date in the
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right-hand column. The United States is the largest, as of the other day. Secretary Thompson I
think brought a check with him to Geneva for about 360 million, so as of today the United States
has actually provided in the bank 982 million and is by far the largest donor. Some other donors
have done quite well. France has contributed quite a large share. Italy has done quite well for its
size. The European Commission has made some major contributions.
Some other normally major donors have not contributed very much. Japan has
contributed just 7 percent so far, which is much lower than its normal share for most international
organizations, and Germany 3 percent, and several other countries have not contributed quite as
much. So there's a variety here of contributions.
The issue for the United States, the U.S. has provided a lot of the funding so far, but the
Bush administration is proposing cutting that funding way back, and I'll come back to that in a
minute, but so far they've provided quite a lot, but it looks like it's going to be cut back going
forward.
This is just a quick summary of commitments and available finance. This is on this issue
of are they bankrupt or are they swimming in money? The top shows the commitments so far.
As of yesterday, they've approved $3 billion worth of proposals, and this year later in the year, as
the first renewals come up, they expect to have about 300 million in renewals. So the
commitments by the end of this year will be $3.3 billion.
On the bottom, how much money do they have to meet that? Well, they've got $3.4
billion, almost exactly the amount needed to finance what they have already approved.
Now, because they're a private foundation and not a multilateral agency, they have no way
to be absolutely certain, to be certain that donor funding in the future will be what it is now.
There are not contributions that each country has agreed to make, 20 percent, 30 percent of the
funding over time. Not at all. It is absolutely voluntary. So because of that, they need to be
much more risk averse than most other donors. They don't have Congress or other contributors
that have said absolutely certain what they will contribute. It's all voluntary.
But on the other hand they need to give the recipients certainty about their programs. You
cannot have a recipient start an antiretroviral program and not be sure that next year there will or
will not be the money. So the board has taken a position that they will approve the proposals
only if they've got either the cash on hand or pledges coming in for this year, and they will only
approve proposals up to that amount, which I think is a relatively prudent way to go.
What that means is that the cash is going to be on hand before they disburse it. So this is
set up it will always have large amounts of cash on hand. And that's consistent with the idea of
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the cash following performance. We've got the cash. Only when you perform and actually meet
your benchmarks will the money be disbursed. But it gives the recipient the confidence that the
money is there.
What that means is that the Global Fund will always have some cash on hand. What
they've got on hand, the $3 billion, 3.4 by the end of this year, is precisely what they need to meet
the commitments that they've already made for proposals that are approved. But it gives them
absolutely nothing, or not much going forward for new proposals or for renewals, and that's
where it kicks in next year.
On the top we've got the commitments next year. It looks like for the two-year programs
now in place that come up for renewal, there will be a need for about $1.4 billion, but pledges are
only .9 at this point, which means there will be a shortfall next year of half a billion dollars. If
that remains the same, if there are no additional pledges and receipts by next year, there will not
be enough money to renew all the programs that have been approved for their second phase,
which means they would have to begin to cut back some of those programs. In the third column
in '06, you see the problem gets a little bit bigger.
And you see the line on the top where I've got "new proposals," I've got nothing. So this
is before funding any new proposals at all. This is where this debate comes. Some people say,
"Well, they've got all this cash on hand. They're swimming in cash." Well, that stems from this
idea that you need to make the commitments up front and be certain of the money before you
disburse it, but at the same time some people say they're bankrupt. Well, they're not bankrupt, but
they don't really have enough money going forward to ensure that they can renew the programs
that have already been approved for their second phase or we think will be approved for the
second phase, or for new proposals. So that's where the financing issue comes.
I think that the U.S. position on this is absolutely going to be central going forward. The
U.S. has said that it would fund up to one third of the amounts that other donors put in, and so far
it has done exactly that, but the administration wants to cut its funding back to $200 million for
next year. That would mean that total global--if it is one third of the total, 200 million times three
would be $600 million, which is a smaller Global Fund than we have today.
My own view is that the allocation that we have between this program and PEPFAR, I
think they're both important, they both need support, but I think the administration's proposal
gives far too much on its bilateral program and not enough here on the Global Fund, but we can
talk more about that going forward. Anyway, that's the first challenge.
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Second is balancing the tension between the idea of country ownership with a light
administrative touch and speed. Lots of concerns about the Global Fund is too slow. Well, if
you're going to rely on a country-led, recipient-led approach, as I mentioned earlier, that's going
to take some time, but at the same time this is an urgent problem. We can't wait forever and we
need to get programs going and going fairly quickly. So there's been a lot of concern about the
speed. And in some countries it's gone reasonably well, but I think it's true, in other countries it's
been very slow. I think it has been too slow and the pace of disbursement--of approving
programs and getting money out on the ground really does need to improve.
There's some evidence that it has begun to improve. Here we show a table that has the
first half, if you will, of one measure of pace, which is the time between the board approval and
the first disbursement. The next slide I'll look at the pace of disbursements once they get started,
but this is the time between board approval and the first disbursement. Overall it's taken 339 days
on average, for the--this is looking at the 150 or so grants that are already disbursing, and it's take
280 days on average between the board approval and actually signing the grants, and an average
of 59 days, about 2 months, between the time of the grant signing and the first disbursement.
The bottom breaks that up by principal recipient, that last part, the 59 days. And if the
government is a principal recipient, it's taken even longer, 72 days on average between grant
signing and the first disbursement. The UNDP, which is one of the major principal recipients, 37
days, and others, the NGOs, civil society, 41 days.
Then I break that up between the three rounds. As you can see, Round 1 it was really
slow, 434 days on average. That's not surprising. This is a brand new organization. When the
first round was approved, there were very few people that were even working for the Global Fund
at that point. I think the board kind of rushed to approve its first set of approvals in April of '02.
They didn't even hire an executive director until July. So it's not surprising that the first round
took a little while because they were a little quick off the gun I think to approve that first round,
and it took a long time. The second round has been much faster and the third round, although
there have only been a few proposals that--or programs that are disbursing, has been even faster
still.
So that's the good news, is that the time taken has improved steadily by each round, and so
there's definite progress there. But I still think that these numbers are pretty slow.
You also see this striking pattern that I found at the bottom, that when the government is
the principal recipient, when the money is going through government agencies, the process is
much slower than if there are other recipients. I think Round 2 is the interesting one to look at,
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probably the most informative, 69 days between the grant signing and first disbursement for the
government, 26 for UNDP, 24 for others. So there's a significant difference there.
The second half on disbursements is the disbursements--once first disbursement actually
happens. So we've got a program. We're beginning to disburse. Now what's the speed look like?
We've got a two-year timeframe for this program. How are we doing in terms of actually
disbursing the funds once the program gets going? Here the news is much better and they're
basically more or less on track. For all of the grants that are disbursing so far, 38 percent of the
funds have been disbursed and 40 percent of the time period has gone by of a two-year time
period. So this is a simple measure of how much money has been disbursed, how much time has
gone by. So for a two-year program, you'd expect after one year that half the money would be
disbursed. It would be better if we could gage it against what was scheduled to be disbursed, but
we don't have that information, at least I don't.
But they're basically on track once the disbursements start, and there is some new
evidence that just came out this week that shows that this varies actually by performance, that for
the programs that are meeting their benchmarks disbursements is moving quickly. For programs
that are not meeting their benchmarks, they're much slower, which is what we had hoped, and
Anil has some information on that.
But again, you get a difference by the principal recipient. When governments are the
principal recipient, they are 6 percentage points behind schedule, if you will, 6 percentage points
of the two-year period. The other recipients are 6 percentage points or four percentage points
ahead of schedule. The difference between those is about 10 percentage points of a two-year
period. 10 percentage points of a two-year-period is a couple of months.
So if you combine my last slide where the government was about a month behind on the
bottom in terms of getting to its first disbursement, and here once disbursement starts, they're
another two, two-and-a-half months behind. When governments are the recipients of the Global
Fund, they're about three-and-a-half months behind programs where the government is not the
recipient, and these findings are statistically significant at a 5 percent level. There is a very
strong difference so far in performance depending on who the recipient is.
So how can we speed up this process? Right now the assessments of the principal
recipients come after board approval. I think a lot of them should come before the board
approval. The board essentially approves a proposal on its technical merits, but not whether the
recipient has been assessed and has the capacity to actually implement the program. That comes
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later, and I think one way to speed that up would be to try to do those before board approval.
There are some issues around that, but I think that would help speed things up.
Second, we can penalize or give rewards to the local fund agents for slow assessments and
reward them for fast ones. The local fund agents are groups hired by consulting firms, hired by-or accounting firms mostly--hired by the Global Fund as their agent in-country to do assessments
of the recipients on their capacity to implement programs, on their procurement abilities, on their
financial accounting methods, and on their substantive results.
But right now the incentive structure around the local fund agents are rather screwy and
they are not penalized or rewarded for slower or faster performance. These assessments of the
recipients are one of the big reasons for the very slow pace of getting to disbursements, and so I
think to actually introduce some financial incentives to these guys--if you do the assessments
faster, you get paid more; if you do them slower, you get paid less--would be a step in the right
direction.
Another more radical would be to replace these local fund agents. Instead of one office in
the recipient country that's responsible for doing all of these assessments, to have a global pool of
assessors that specialize in procurement, another group, or a pool, a separate pool that specializes
in fiduciary standards, a separate one that specializes in the capacity, the institutional capacity
that--instead of one organization on the ground that tries to do all of the assessments at the local
agent have a pool, a global pool, and when the global fund needs an assessment done in Rwanda
or Senegal, they can draw from this pool of more specialized people to move more quickly and
more efficiently.
Finally, countries where there's only been the government as recipient is where things are
going very slowly and I think a simple requirement to have more than one principal recipient and
one of those nongovernment would help speed the process. That's the second challenge. Those
are the slower ones.
I'll go through these other ones a little more quickly. The third challenge is strengthening
the CCM process. The CCM is the Country Coordinating Mechanism at the country level, which
is this group with the government, the NGOs, civil society, the donors, that come together in an
informal way but they formally take proposals from groups around the country, put these into one
proposal and send it off to the Global Fund for funding.
So it's a mechanism to get participatory approach and widespread engagement from lots of
different groups in society. In some countries this process is working pretty well. In others it's
not. There are lots of questions about how well this process is working. In some places the
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government completely dominates it. In some places groups are shut out. In some places this
group of people come together and they all fight with each other and don't make much progress.
In others it works quite well to get a good proposal out, but once the proposal's done, they sort of
stop meeting and don't take much initiative going forward.
So there's been a lot of questions about how to make the CCMs work well. There's two
proposals out there as to how to improve CCM performance. One is to tell them what to do.
You've got to have 10 percent of your membership as government, 90 percent as nongovernment.
You've got to have two people living with AIDS. You've got to have six donors on your
committee. You've got three of this, you've got to have two of that, and we're going to tell you
how this thing should be organized. This was actually debated at the Global Fund Board Meeting
yesterday. I think it's actually a really bad idea for the Global Fund to tell countries how they
should be organized and to put a bunch of rules and regulations in process.
Instead, a second proposal which is being kicked around, which I support, would be to
rate the CCMs in the way that Moody's or Standard & Poors rates a government for its bond
rating, and you basically classify, have a ratings system and categorize the CCM system as an A,
B or C, working very well, working moderately well, not working very well at all, and if you rate
it as a high-functioning CCM, faster process, less oversight, move things much more quickly, less
of an assessment. If you're a poorly rated one, much more oversight, slower process. So you
begin to distinguish the recipients and reward the ones that are doing well and penalize the ones
that are not doing well, and try to build in the incentives for better performance rather than just
setting up some regulations of what this thing should look like and how it should operate.
The fourth challenge, coordination of harmonization with this network. As I said, the
Global Fund works as just a financing agent, as part of this broader network that includes other
donors, includes the recipient countries, includes the local fund agents, each of which play a role
in fighting the diseases, and the Global Fund is playing this role as a financing instrument only.
But for a lot of countries, instead of being a light tough where they're going to have a light
burden, the Global Fund has in fact introduced its whole new set of new requirements and is
actually adding to the donor burden to say, "You've got to do things our way with our CCM, with
our monitoring and evaluation systems, with our way of doing things." I don't think that that's
what was intended or that it's particularly helpful.
So they've got to figure out a way to harmonize these systems to work more in tandem
with other donors, and to move more towards a more coordinated and more harmonized system.
They are honestly trying to move in this direction where other donors are net. A lot of U.S.
15
bilateral programs don't do a particularly good job of this at all, and we also impose our own very
stringent requirements to do things our own way, but I think that the Global Fund is at least trying
to move towards a more harmonized system but has had a lot of difficulty doing so.
How to do that depends on whether the system's already working well in some countries,
in which case you can adapt those systems. You don't have to reinvent the wheel. In other
countries where there aren't other donors then they're going to have to create the wheel because it
doesn't exist. The Global Fund works--in 122 countries there's a lot of countries where there
aren't any other donors working on HIV/AIDS, malaria or TB, and they've got to build the
systems. It's not a coordination issue. It's a building issue. Or in countries where there are poor
systems--and this is the difficult one--where there are a lot of donors working. They all have
their own systems. There isn't much coordination or harmonization. So I think this is a real
challenge going forward.
Challenge Number 5 is a broader one, becoming an agent for change. There's a little bit
of a problem in being just a financing agent. It works fine if financing is the only problem, but
financing isn't the only problem in fighting this disease, and we're beginning to realize that more
and more, that there are absorptive capacity issues, there's human resource problems. There's
infrastructure problems. There's a whole range of issues out there, obviously, that financing
alone, if you alleviate that constraint, which has been a big constraint, without paying attention to
the other problems, then you're not going to get very far.
There's two ways to approach that. One would be for the Global Fund to take on more of
these roles, to supply technical assistance, to have people on the ground to try to fight all these
problems. The problem with that is that's what a lot of other agencies are already doing, and the
Global Fund would be just duplicating everyone else's efforts, so I don't think that's the right
thing to do.
But I also think they need to think more clearly about how they can use their leverage and
their size to make other systems outside of financing work better. They've done that with this
monitoring and evaluation framework that I mentioned earlier. They've done this with the
Clinton Foundation and with others, but they need to think strategically about how they can use
their leverage to help WHO work better, to help the World Bank work better, to help USAID
PEPFAR work better in terms of everybody working better to better achieve their goals.
The Global Fund has something that a lot of these other agencies don't have, money. And
that brings people to the table, and if they can use that leverage in clever ways to get other parts
of the system to work better, not to take over the other people's jobs, then you can make more
16
progress. Exactly how you do that, I don't know. But what I do know is it takes a strategy and it
take thinking, and that requires time and resources and staff and effort to think about what that
strategy is and to work with the other agencies, and they're really just beginning to do that.
Sixth challenge--there's only seven, so I'm getting there--operating on performance based
principles. Many have tried, few have succeeded. This is really critical though, because if they
don't operate on performance based principles, they're dead. Without those you're not going to
have the proper incentives. You're not going to be able to supply information on what programs
work and which do not, and you're not going to be able to maintain the support of the donors. I
think it's absolutely critical that they be performance based. It's not clear to me that they will be
because when push comes to shove, the donors are going to be under a lot of pressure to continue
to finance programs even if they're not performing particularly well.
The early signs are, however, that the Global Fund will do well. It had one program in
Ukraine that was not working very well, and they immediately took some pretty strong efforts to
find a new principal recipient and get that program back up on its feet. So they sent out a pretty
good signal that poor performance would not be rewarded, would in fact be penalized. But that is
a huge issue for them going forward that remains to be seen exactly how they can do better.
Just quickly, a couple things that they can do that other donors do not do. One is to give
partial disbursements, and I believe this is what they will do. Most donors, if you make threequarters of the conditions, they're stuck. They have a dilemma. Do we give them the money or
do we not give them the money? Because for most donors that's the choice. We're scheduled to
give a disbursement. You've met three-quarters of the conditions. We've either got to give you
the disbursement or we don't.
Well, most donors opt in that circumstance to give you the disbursement, and the
recipients quickly learn that they don't have to meet all of the conditions, they only have to meet
three-quarters of the conditions, and it's a great way for performance to go down, and it happens
in almost every donor agency.
The Global Fund, as a new independent private foundation, can do things differently, and
what they're, I think, moving to do is give partial disbursements. If you make three-quarters of
the conditions, we'll give you three-quarters of the money, or something like that. That will
create the incentives on the margin for much better performance, so it's a very subtle way that
they can act differently from most donors that I think will improve the incentives. They can
switch principal recipients on the ground more easily than many other donors can do. They can
17
do the CCM rating system that I talked about earlier. They can improve the local fund agent
incentives, as I've mentioned before.
Last challenge is the size of the secretariat. 80 people working on 122 countries and 227
grant agreements. Look, I'm all for being efficient, and I'm all for small bureaucratic costs, but 80
staff I think is too small for this organization. 19 country portfolio managers, 19 for 122
countries. That means they've got 12 grant agreements and 6.4 countries each, each. If you're a
country portfolio person in the Global Fund you have to track 6 countries and 12 grant
agreements.
Now, just by contrast, the World Bank has about 12 people per country.
[Laughter.]
MR. RADELET: This is one person per 12 countries, or one person per six countries.
Lean and mean is great, but frankly, if you're working on six different countries, one person, and
you're the only person working on that country, that means by definition you've got five or six
hours a week maybe to think about that country. It isn't much, and I think that raises a lot of
issues about communication, about getting grant agreements done, about getting progress going.
Going forward, when they get up to 300 grant agreements and a billion dollars disbursed per year,
this will be an even bigger problem.
This just shows disbursements and staff size for about 20 other organizations around the
world, other development organizations, the Asian Development Bank; private banks, Bank of
America; foundations, the Gates Foundation; Citigroup, Packard, DFID, which is the UK's aid
agency, Ford Foundation. And I've got total number of staff and the funds disbursed for their
budget in the second column, and then the ratio in the third column.
The highest ratio, the highest number of the funds per staff there is the Inter-American
Development Bank at 4.5. The Global Fund at the bottom is already 5. It's already much thinner
than any of these organizations, private, public, foundation, in terms of its staff size per
disbursement, for the money that's been disbursed as today. It has a ratio of 5. I don't know if
you can see that at the bottom because the table's in the way, but the Global Fund, as of now the
ratio is 5, and by the end of the year when they've disbursed a billion dollars, the ratio will be 12,
about three times higher than any other organization on this list in terms of funds per staff. So it's
very lean and mean, and I think too lean and mean, and that's one of the problems going on the
ground. If they're going to think strategically, if they're going to improve the pace of
disbursements, if they're going to deal with a lot of these challenges going forward, there has to
be more than 80 people working for the Global Fund.
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Let me finish just by looking at two possible ways to restructure operations on the ground
to try to improve performance. One would be to do three things. Require at least two principal
recipients in each country to rate the CCMs and replace the LFAs, basically package three of the
things that I've talked about here today. So since the government principal recipients are not
doing well, you insist that there be at least two principal recipients in each country, and I think
that would help do a lot of things, ease bottlenecks and help expand capacity, lots of things.
Second, you'd rate the CCMs as I talked about, and highly rated CCMs would be
rewarded with better things and poorly rated ones would have more hurdles to jump through.
And then you could replace the LFAs with a global pool of assessment experts. This is one way
that they could on the margin change some of the operations in ways that I think would actually
help speed disbursements and improve performance, and I think there's a lot to be said for this
alternative, and there is some movement in this direction which I think is quite positive.
A more radical change would be to reorganize the CCMs and the principal recipients into
what I call grant coordinating agencies. Think of a foundation that you'd establish on the ground.
Get rid of the CCM. The CCM becomes the board of this foundation. So you get a participatory
approach of the government, NGOs, civil society in a formal structure as the board members of a
foundation. This foundation can receive grants from the Global Fund, from the--not the World
Bank because they only work with governments--from USAID, from the Gates Foundation, from
whoever. So it acts as a coordinating mechanism in a formal structure, and then that foundation
disburses grants to NGOs and civil society throughout the country. All smaller groups, church
groups, civil society groups, NGOs, would make proposals to that foundation on the ground, not
directly to the Global Fund, but to that foundation. That foundation would put those proposals
together, submit them to the Global Fund, and that foundation would have the incentives for
watching the performance for each of these subrecipients and making their performance work
well in order to encourage its own funding going forward.
So in effect you'd get rid of the CCMs, you'd get rid of the principal recipients, and you'd
wrap them into this one organization. This is obviously a more radical approach. Whether it's a
great idea or not, I'm not sure, but I think it's an idea sort of thinking out of the box a little bit of
how things could be structured going forward.
Let me stop here and just summarize. I think this thing has come a long way. In two
years there's lots of promise, but I do think there are a lot of problems and some issues going
forward that it needs to address. They are in the mood actually to adapt procedures. They are
very flexible and very interested in getting a lot of outside critique, and that's a good thing.
19
Whether this particular model of participation and country ownership works or not going
forward I think is an open question, but my view is that it deserves our support along with
something like PEPFAR and the other approaches until we have a better idea of what the best
way is to fight these diseases on the ground. As long as it can continue to adapt and be
performance based, I think it deserves our support.
Thank you very much.
[Applause.]
MS. LEVINE: Thank you, Steve, for a terrific presentation.
Now, we'll ask Anil Soni to provide some comments, maybe about 15 minutes of
comments, so we'll leave some time for questions at the end. Anil comes to us as Executive
Director of the artfully named new organization, Friends of the Global Fight, which is a new
nonprofit in Washington, and, Anil, maybe you'll tell us a little bit about the organization, and is
well-known undoubtedly to most people in the room as formerly the senior adviser to the
Executive Director of the Global Fund. So he knows these challenges inside out.
And, Anil, I know you don't like challenges, but perhaps you can comment on some of
them and give us any information you can about the recent board meeting of the Fund.
MR. SONI: Sure. Thanks, Ruth. And let me just start by saying a very sincere thank
you to Steve and to CGD for this study. The Fund, as Steve said, encourages constructive
criticism, and I think that you've been a very fair and thoughtful critic in analysis that you've
done, which is very thorough.
Let me take two seconds to tell you about Friends of the Global Fight so you know where
I'm coming from, and then I thought I would spend a few minutes giving you an update from the
Global Fund, given that it just completed a board meeting yesterday, in fact, and respond, based
on my experience with the Fund and my knowledge of the Fund, to the suggestions that Steve has
made.
In terms of an introduction, I have moved to Washington, D.C., to work with a great team
of people here, including Jack Valenti, the outgoing CEO of the Motion Picture Association of
America, and an organization that wants to add to advocacy efforts in Washington, D.C., around
the fight against these three diseases and specifically in support of the Global Fund, given that it
doesn't have representation, formal representation, itself in the United States and also work to
engage Americans at-large in these issues, working with again the many organizations that are
already doing that.
There were a few documents out front at the start of the meeting. I don't have any slides,
but we brought with us a number of documents in binders like this one that are out in front, which
include a number of fact sheets about the Global Fund, including fact sheets about the latest
round of proposals that was approved and the board meeting that just completed, as well as
updates on resource mobilization, on disbursement and other such matters.
It also includes results profiles about things that are happening on the ground today as a
result of Global Fund grants, which I think many of you would find interesting. So please pick up
a copy of that on your way out.
Another thing that's out there is a report that the Fund itself is releasing at the
International AIDS Conference in Bangkok, which is essentially its own self-assessment, at 30
months, of how it's doing, both at the country level and at the global level, and it includes again
five particular country portraits about how grants are performing 30 months into the organization.
So I have pitched the documents that are out front.
The two subjects that I said that I'd like to address, the first one is an update on the Global
Fund, particularly in light of the board meeting that just completed. I'll break that up into a few
points.
First, on new grants. The Fund has had four proposal rounds, as Steve mentioned. The
fourth one was just approved in the last three days when the board met in Geneva. It's a very
large round, valued at about a billion dollars over two years, so that the Global Fund's total
portfolio is now $3 billion to actually 128 countries. It was 129 because it was Kosovo, and that's
not really a country, so we pulled it back to 128, but it's $3 billion to 128 countries.
And there's a few things that are significant about the grant that was just approved. One of
them is actually that there was a huge amount of financing to malaria. Forty-two percent of the
billion dollars that was just approved over two years is actually to malaria programs. And to give
you an indication of the impact, there's been a lively debate about the transition in countries from
the use of first- and second-line treatments for malaria to third-generation malaria treatments,
particularly artemisinin-based derivative combination therapy or ACT.
And there was an article published in the Lancet in January that made ultimately--I mean,
it was a bit derisive-- but ultimately it made a very legitimate point, which is are we sure that this
big new financing agency is putting money into the right drugs in countries where drug resistance
is rising rapidly? Did it make the right decisions at the start? And even if it did, are we at a point
now two years in where drug resistance has reached a level where, in fact, the Fund should be
supporting ACT rather than first- or second-generation treatments?
I'll come back to this, but the answer by the Fund was an emphatic, yes, let's take a look at
that, and let's also make sure countries know this is a new mechanism. You can ask us for the
more expensive drug. We will fund it.
As a result, in rounds one through three, approvals of ACT were already 23 million or 22
million combination treatments over five years. By the way, that compares to 10- to 20,000
treatments in sub-Saharan Africa, on an annual basis, prior. So this was already a huge leap
forward.
In round three, that number has gone up to 145 million. So, from 22 million to now 145
million ACT treatments over a 5-year period, from 10- to 20,000 annually in sub-Saharan Africa-huge increase. I mean, this is really groundbreaking in terms of the global response to malaria.
It, also, this new round has a lot of new commitments to HIV/AIDS and TB. For AIDS,
in particular, there's a large component for antiretroviral therapy and over five years the Fund is
now committed, with the proposals that it's approved, to providing treatment to 1.6 million
people, which is an increase from about 600,000 prior to yesterday. So those are new grants.
A second point, in terms of an update, is on performance. One of the points that Steve
brought up, but that comes up repeatedly in Washington and among any donor capital is, is the
Global Fund performing? It's 30 months old. Where are the results? Show me that 5 million
lives have been saved.
Well, quite honestly, as many of you will appreciate, changes in morbidity and mortality
will take time, but the Fund is fairly at a point now where it should be saying is it working and is
it not and also is money moving at the right pace? Let me just hit those points individually.
On disbursement, Steve went through this in great detail and explained it with a clarity
that I think is often lacking, but let me just give you another figure. The $423 million that have
been disbursed to 154 grants in 85 countries, what that represents is basically 36 percent across
those 154 grants, 36 percent of the 2-year commitment disbursed after about 40 percent of the 2year time span. So 36 percent of the commitment, 40 percent of the time span, that's about on
track. So money is moving on track. It needs to move more quickly, but it gives you a different
portrait on disbursement.
What's happening on the ground? Well, in terms of anniversary grants, this is an analysis
that the Global Fund just completed in advance of Bangkok. It said let's look at the grants that
are a year old, as of the end of April, so we have a bit of time to do some analysis and then report
when the world gathers to talk about the fight against AIDS and say what's happened.
So the Fund looked at that exactly, and it found that 25 grants were a year old as of the
end of April 2004--again, because of how young the organization is. And if you look at those 25
grants, it turns out that about 12 fall into a category where all of the targets, all of them, are being
met or exceeded by quite a substantial margin. About eight of them have been rated a B, as
opposed to an A, because they're reaching a lot of their targets, but not all of them, but they are
generally on track for renewal, presumably, and five of them have been rated a C. In other words,
these are not on track. Whether because of particular circumstances in the country or because
performance has simply lagged, these are simply not on track.
In general, I think people have been surprised by that--25 grants, 20 are on track, 5 or 20
percent aren't. That's fair, I think, if not better than fair after a year of implementation.
Steve mentioned the disbursement rates vary across those. In fact, they do, and this is
interesting. For the A grants, the disbursement rate is 97 percent. For the B grants, the
disbursement rate is 65 percent. For the C grants, the disbursement rate is 21 percent.
Again, there's more to prove in terms of whether or not the performance-based model
works. And this isn't to suggest complacency about that question and that challenge, but it shows
that disbursement is, in fact, varying, based on the performance of a grant--meaning that it is
tracking to whether or not countries are achieving their targets, and therefore making legitimate
their request for more money.
Then, the question of, well, what's been achieved across those anniversary grants? I'm
thrilled--thrilled--to say that 2.3 million people have received AIDS, TB and malaria services in
15 countries, those 25 grants, after a 1-year period, and that includes large numbers for some
interventions, including voluntary counseling and testing for HIV, which has reached 80,000
people as a result of those grants, 45,000 people have been treated for DOTs TB treatment, and
340,000 insecticide-treated bed nets have been distributed.
The number for antiretroviral treatment is much more modest. Across those grants, it's
something like 4- to 5,000. Across all of the grants that are providing ARV therapy, my guess-and don't quote the Fund on this. You can quote me on it--but my guess is that it's probably in the
order of 10- to 20,000, currently, given the disbursements that the Fund has made. I think that
number is going to rise rapidly. I don't think it will rise as rapidly as expectations have been set,
nor do I think it should because these things do take time to implement, but that is where
antiretroviral therapy is likely to be at now.
There's anecdotal evidence, but I'm going to stay off of that so I can be more brief, but
there is good evidence of countries that are well-exceeding their targets, and that is in the binders
outside.
Last quick point of update is in terms of the needs of the Global Fund. In terms of 2004,
the needs are relatively met with the current U.S. allocation, as well as the allocations from other
countries, though the Fund needs to do better at bringing in money from non-U.S. donors to
maximize the U.S. allocation.
For 2005, the need is now a bit different than it was. The Fund was trying to raise, and
said that its need was $3.6 billion for 2005. That basically was two new rounds at a billion
dollars per round--that would be three new rounds over the course of 2004 and 2005--and then
$1.6 billion required for renewals. Again, Steve had these numbers on his chart.
The board, at its meeting, decided that the fifth round, round five, would be launched, at
the earliest, after the November Board meeting. As a result of that, logistically, given the time it
takes to launch a round, receive proposals, review proposals and approve them, it's unlikely that
there is going to be two rounds in 2005. That drops the need in 2005 by a billion.
And in addition to that, the renewal process has been refined, and I think this is actually a
very good thing, and they are making sure that when countries are up for renewal, they really do
have time behind them, from the point of disbursement, as opposed to from the point of a grant
agreement being signed, and Steve pointed that out to you, so that they can make a case about
performance. And as a result of that, the need has also fallen. So the need for 2005 now looks
more like $2.4 billion.
That's it for an update. In terms of responding now to essentially what Steve presented
and what he has in his paper, my brief response is, yes, I think that what Steve has suggested is
that this is a promising model, it's made good progress, there are real challenges, but the way to
address those challenges and to reach the promise of the organization, as it was set out, is to
consolidate support and provide greater support in a way that addresses those challenges, but also
grows the organization. I think that's absolutely the right conclusion.
It's timely that on the front page of the Wall Street Journal today, there is an article about
the Global Fund and the President's emergency plan for AIDS relief. And in it the Fund's
Executive Director, Richard Feachem, makes the quote that "The Fund has made extremely rapid
progress in the right direction. On the other hand, it's nothing like enough." And I think that that
in itself is an endorsement of what Steve said, which is there is progress, but there's a lot to do,
both to address the challenges and also to keep on going in the right direction.
The challenges specifically that Steve raised, I want to throw out some thoughts against
the ones that he, the challenges that he provided and the suggested solutions to encourage a
debate. And what I look forward to is, both in this setting, but also in other settings in which we
sit down, we continue to talk about this to provide to the Fund very concrete ideas about how it
can do its job better.
There was one point that was made about financial stability. That was one of Steve's
seven challenges. Let me just take a second to say financial stability is absolutely a challenge of
the Fund, and it's at multiple levels. And this is really important. It's not that the Fund has a need
in year and is it falling short, but one level of financial challenge is the fact that the Fund needs
more money simply to sustain current programs, as Steve said. So, if it actually closed its door to
new proposals today, for the rest of time, it actually needs a lot more money simply to sustain the
programs that have started, which need to continue to place people on treatment and scale-up at
the rate that they're now scaling up, and these are programs that require donor assistance.
There's a second level of financial challenge, which is to sustain the current magnitude of
the Fund, in terms of the overall fight against these three diseases. Whether that's $3 billion per
year or $4 billion per year, it's not what was originally set out, but even to sustain that current
level and current expectations, that's yet another challenge.
And then beyond that, there's actually the challenge of, well, what should the Fund's place
in the global fight be, and how do you sustain that over time, given that global needs are
growing? I think that, in thinking about investment into these three diseases, it's very important
to consider that if we did everything right today, and tomorrow, and the next day, needs for these
diseases, financial needs, are going to continue to grow, and these are not countries that have the
income or the development where they will be able to assume those financial requirements any
time soon, not in two years, not in five years, not in ten years. And so we have to be prepared for
real sustained commitment to this fight, but also increased commitment to this fight over the
medium term if we are to achieve real progress in the fight against the diseases.
I am just going to turn to the second challenge--there's a balance in the tension between
country ownership with a light touch and speed--and talk about one of the specific suggestions
that Steve made, which is to initiate assessments of principal recipients prior to approval. Just to
say that that's pretty much already happening. Given that four rounds have now been approved, a
number of principal recipients are going to be receiving ongoing grants in future rounds and, as a
result of that, assessments are already in place and the overall pace is actually going to be much,
much faster.
One of the things that I was also very happy to see in the analysis you did, Steve, is,
starting in round three, you actually see that the time from assessments being completed, a grant
agreement being signed, to disbursement is now down to something like 10 days, which is a great
achievement. And I think what it shows is that the Fund is trying to consolidate by making the
assessments, completing them, and then making a disbursement, and as existing PRs become PRs
of additional grants, that whole process will speed up.
Other points were mentioned under that challenge about LFAs, which I'm going to come
back to.
The third challenge--finding the right balance between an exclusive focus on performance
and a focus on process, especially the CCM process--let me again here give you an update from
the board meeting.
The board considered recommendations made by the Secretariat on how to improve
CCMs, and they included a set of recommendations and also a set of proposed requirements of
CCMs which would be tied to funding decisions.
The board rejected the idea of requirements, consistent with Steve's logic, though that's a
personal frustration to me because I think some of the requirements, for example, the Chair and
the Vice-Chair of this committee not both being from government or the Chair and the ViceChair of the committee not being the principal recipient, to avoid a conflict of interest. I don't
think those are difficult requirements. But the board felt that they were too prescriptive and said
these aren't going to be requirements, but they will be recommendations.
Well, the good news is that those are quite specific recommendations, and they send a
strong signal. The bad news is that they're recommendations, not requirements, and so the actual
accountability of them is murky.
The board also decided, to Steve's second recommendation on this point, to consider, at its
next meeting in November, a set of auditable standards for CCM performance, which is exactly
the point that Steve made. So the board will consider standards that can be audited, that can be
used to assess CCMs and give them a rating. I think the challenge that remains, though, is that
even if you had those standards, the board has not yet adopted a system of incentives to be tied to
those standards. So you can rate CCMs, but if it's a bad CCM, what does that mean? And the
board has yet to figure that out. But I think it is progress, and I think it is consistent with the
recommendations Steve was making.
The fourth challenge, coordination and harmonization within the network, I just want to
give you a few examples here. In Steve's paper, he said, "In countries with good systems, the
Global Fund essentially should integrate with those systems." And I think it's trying to do that.
In Ghana, with the Poverty Reduction Strategy Papers, those have been the basis of the
grant to Ghana and the request from Ghana. In Zambia, the Fund is actually giving money into
the Central Board of Health, which actually maintains a healthwide basket. At the same time, it's
giving money to NGOs, but the money it's giving to the government is largely going to an
existing basket and therefore supporting the current system.
Steve also said, "In countries without other donors, the Global Fund should take the lead
because there is no precedent to build on." The Fund has also done that. An example is the
Western Pacific Islands, 11 islands that are small enough that if you walk and close your eyes,
you might fall off them. But the point is that these are islands where a nation-by-nation countrycoordinating mechanism wouldn't make any sense at all, and so they gathered together to create a
multi-country mechanism and actually has a single set of requirements for that entire population.
And, finally, Steve said, in countries where systems aren't working well, well, here's
where the Fund has to be creative and not be tied to its own requirements, but at the same time,
again, take a lead if the other donors aren't coming together. And I think that's happened in a
couple of cases.
One is in Mozambique, where a number of donors with the Fund sort of realized this is a
country that's about to get an enormous amount of money from the U.S., from the Fund, from the
World Bank, Multi-sector AIDS Program, and a number of other sources, and they all sat down at
the table a few months ago and said, let's not all be sort of tied to our own requirements, but come
up with a single model that works. They did that successfully, and I think that was a good
example.
Another is Kenya, which is an interesting story simply because, in Kenya, in the first
round, the proposal from the government or from the CCM was rejected because a letter from two
dozen NGOs was received saying, "We had nothing to do with this. So the NGOs that signed the
proposal, they weren't us."
And the Fund rejected that. In round two, it approved a proposal, and the NGOs said,
"Well, now we're part of the process." But then in round three we heard from Kenyan NGOs who
said, "Now, that the grant is approved, we're out of the process again because the CCM doesn't
need to get together any more."
And the Fund took that to the Minister of Health, who is a remarkable woman, and the
Kenyan CCM has now been reformed to be 16 members, I think, only 3 of whom are government
and 13 of whom are nongovernment. The nongovernment representatives select themselves, and
they're now coordinating all of public health, all international financing into public health for
Kenya. So the CCM has really risen above a particular mechanism for the Global Fund and
become something that can be shared.
Let me try to push through the rest.
Fifth, moving beyond the narrow role of the financing instrument to a broader agent of
change, again, agree with Steve that the Fund does need to think creatively about that, as does the
board. And I think this is difficult. The board managed to create a Fund with consensus, after a
lot of disagreement and debate about what it would do and what it wouldn't do. And they said it
shouldn't be a procurement agent, and it shouldn't do this, and it shouldn't do this, that it only be a
financing mechanism.
I think we're at a point now where the opportunity for the Fund to do more is obvious, the
ability for it to do so and its exact role is much less clear, but I think it is showing willingness to
consider what it can do. Certainly, at the country level, the Fund is trying to play a catalytic role
where performance is not up to par or where it sees opportunities that require other partners to
come in and provide support.
So the Secretariat created something called the Operational Partnership and Country
Support Team, which does just that. And in the five anniversary grants that aren't performing,
they're now saying, well, let's go to our partners and say, please, come and help and address why
implementation is not occurring in this setting.
At the global level, the Fund is also trying, but not necessarily with dedicated staff. The
Clinton Foundation deal is a good example. And just to take a pause here, there's been a lot of
skepticism about that, but I recently received information confirming that several millions of
antiretroviral units purchased under that deal have actually been procured and are now being
distributed at the country level.
The $140 has been topped off by a 1- to 3-percent increase in handling at freight, for those
of you who know procurement, but essentially there are per-patient, per-year antiretroviral
packages being distributed, two pills per day, for $150 per year now, which I think is good news
that I wanted to share. The Fund, though, is doing that very much currently on an ad-hoc basis,
and I think it is a good recommendation to say that it should consider how to do that more
explicitly.
To the last points on performance-based operation, I think that the current evidence of
performance-based disbursement, as Steve mentioned, are the Global Fund's response in the
Ukraine, where basically a grant wasn't working, and the Fund said the money is stopped, and
we're no longer going to stick with these PRs.
I think another good example is the current anniversary grants that show that
disbursement rates are, in fact, varied, depending on how performance is appearing. And I think
the big sign of whether or not the system is going to truly work is the two-year decisions. But I
certainly think the Fund is moving in the right direction because, even in its projections of what's
required for 2-year renewals, it's actually saying it's not 100 percent of what's been requested in
the proposals, but it's 85 percent. So it's already making a very clear signal that it's not going to
approve all of it.
I'm getting these looks I should stop.
The last points, then, on LFAs, particularly, and also on the size of the Secretariat, let me
do size of the Secretariat first and then say something about LFAs.
The size of the Secretariat, good news-- again, an update from the Global Fund's board
meeting--the board decided to increase the size of the Secretariat, as of yesterday, by 29 people
who are all going to be portfolio managers. So that's good news. The size of the Secretariat is
now going to be increased immediately by a third of its current size, and that's all going to be
dedicated towards managing an extremely large grant portfolio. So they're listening, Steve.
The suggestion Steve made about possible ways to package some of these
recommendations, in terms of alternative structures in recipient countries--my two cents. The
first one, where you suggested two PRs in each country rate the CCMs, discontinue the LFAs.
Two PRs per country, absolutely. I think that's a fantastic idea, and I think that the Fund is trying
to move in that direction. If you look at their Bangkok report-- which again some of you have;
others will pick up on your way out--they're trying now to be very clear that there are different
models about how money can be moved in countries, and the different models have different
performance associated with them, and those are available to countries, and I think it's
encouraging countries to pick up those models. I think how it's going to make that more explicit,
open question.
In terms of CCM evaluations and incentives, again, the Fund is taking steps in the right
direction, but it's not clear that there are going to be the incentives, as opposed to the standards.
In terms of LFAs, here's a point of disagreement--and, again, just to encourage the debate-I actually do not think that LFAs should be scrapped or deferred to global pools of experts, as
opposed to country-specific LFAs. And the reason I think that is because the role of an
organization like Price Waterhouse Coopers or KPMG in a particular country, where
understanding how the grant is working and how the recipients are working and whether or not
they are legitimate or not is very much a country-specific expertise and requires country-specific
capacity.
And, in fact, if you go to PWC in Tanzania, you don't see ex pats; you see Tanzanians
who staff PWC there. And I think that's an important role, and it's an important signal and
symbol relative to the grants. And I think that that is an aspect of the LFA model that's
performing. However, I think there's other aspects of the LFA model that are not performing,
particularly around procurement, where the skills, and expertise, and capacity associated with
doing procurement assessments are not specific to Tanzania or Malawi and are, in fact, being
drawn from a global pool of experts already. So it's already become a bit of an inefficient
mechanism in that there is a pool of experts that are now being selected by each individual LFA,
as opposed to centralized. And the Fund is looking to change that, both at the level of the
Secretariat, which is trying to implement some immediate refinements to the model and also the
Board is considering a comprehensive LFA assessment.
Final 60 seconds on reorganizing the CCMs and PRs into two grant-coordinating
agencies. Again, here I would disagree, saying I guess that it's interesting because, immediately,
it seemed to be a bit more attractive to say, well, that would actually separate the whole challenge
of governments and nongovernmental organizations working with one another. You just put
them on separate sides of the room in like items, and they can get along with themselves--the
Ministries of Finance, the Ministries of Health somewhat and certainly other NGOs.
I think, though, that bypasses the very worthy challenge of sitting nongovernmental
organizations and governments at the table and forcing them, encouraging them, incentivizing
them to cooperate.
And, again, I'll come back to Zambia as a good example. In Zambia, the governments
agree to split the grant between the Ministry of Health, the Ministry of Finance, the Churches
Health Association of Zambia and the National AIDS Network of Zambia. And it's not for show.
It's not simply that a small amount of money is going to those NGO principal recipients. A third
of the $122 million granted to Zambia over a 2-year period is going to the faith-based
organization, and that's unprecedented. But I think that that would be more difficult to achieve in
the model that you propose, Steve, and I also think that, as you said, it makes accountability more
difficult when it's a single grant-coordinating agency, as opposed to individual PRs.
Apologies for dragging on, but what I hope to do in those words is simply say I think
Steve's suggestions are very good ones. I think the Fund is already making progress on some of
them, and that's the point of the update. And I think in those ares where it's not, it needs
advocates and friends like you, like Steve, to continue to provide very thoughtful input on how it
can do its job better, and I think we all hope that it will.
MS. LEVINE: Thanks very much.
[Applause.]
MS. LEVINE: Great. Thank you very much, Anil.
Why don't we take about 15 minutes or so to take questions, and I'm assuming that both of
you will be willing to respond. What I think we can do in the interest of time is collect questions
from maybe three people and then have our small panel here respond and then see how far we can
go with that.
MR. TAYLOR: My name is Adam Taylor, with Global Justice and the Student Global
AIDS Campaign. I want to thank both speakers.
A two-part question, but a quick one. One is related to something you alluded to in your
paper, Mr. Radelet, which is looking at disbursement, I think it's important certainly to look at
disbursement to principal recipients, but I've heard a lot more concern more at the next level
down, which is at the subrecipient level, and I'm wondering would your analysis address that and
certainly how could we overcome some of those blockages?
And the second part is a political question that maybe goes a little bit outside of your
direct study, but in light of the board meeting and in light of the markup that just took place in the
Foreign Operations Committee, I'm aware that there have been some conditions that some
members of Congress want to place in the Fund in terms of efficiency and accountability. And
my sense is that will create a very dangerous precedent if that goes through.
So I'm wondering what your thoughts are about conditionality by the United States or any
other donor country and what that will mean.
MR. RADELET: There's a lot. Which conditions do you mean?
MR. TAYLOR: The ones that I know of are conditions around disbursement and
conditions around restructuring the Fund itself so that it is more streamlined. Again, I wish I
knew all of the details, but this is what was in the markup itself.
MS. LEVINE: Thanks. Let's take a couple more.
MR. MERRITT: Hi. I'm Gary Merritt, a public health sociologist.
Anil, I wonder if you feel at liberty to share some of the sense of the proceedings of the
board with respect to the experiences to date in articulating the Global Fund and the PEPFAR. A
lot of us would really like to get a better feeling for the board's sense of the situation.
Second, I wonder if there's anything you could share about the board's considerations of
European proposals, whether there were any particular considerations with respect to
Montenegro, Albania, some of those in that region, I mean.
MS. LEVINE: One more?
MR. SUD: Inder Sud from George Washington University.
I kind of wonder whether you have understated the implementation issues in your paper.
You know, if you look at $1.2 billion over two years, particularly for an organization that
essentially seems to me is funding concepts, not projects, so far, and then you couple it with the
point I think which was made earlier that disbursement is not really the good indicator because of
disbursement to the final level. I think Global Fund is doing the same thing sometimes World
Bank does, which is show disbursement to somebody's bank account, and they'll feel very good
about it.
And I kind of wonder whether the problem is much more serious than you make it out to
be, and I also wonder whether a highly centralized, Geneva Center-based organization, with all of
the procedures which it has, which are all centered around Geneva, can ever be effective and
efficient in reaching down to the grassroots level.
MS. LEVINE: Thanks very much.
We've got more than three questions in those three questions.
MR. RADELET: On Adam's first question, on the subrecipients, which actually comes
back to the last question as well on this issue of subrecipients--I didn't mention that. I talk a little
bit about it in the paper--this is an issue. I don't have the data actually to analyze what's going on
between recipients and subrecipients. I'm not sure if the data actually exist, but it is a problem-it's definitely a problem and received less attention up front.
There was a lot of focus of getting the proposals done, getting the grant agreements
signed, getting the disbursements started to the principal recipients, and there wasn't a lot of
attention paid, actually, early on, as far as I can tell, to this next issue of from the principal
recipients to the subrecipients.
The stories that I hear, again, are that this is particularly an acute problem when the
government is the principal recipient, and they're trying to, money going from the Global Fund to
a government and then to an NGO subrecipient. And sometimes this is an issue where no one is
trying to be obstructionist, but the governments don't have great procedures to disburse money to
NGO groups. In other places, as you can imagine, it is more obstructionist, where the
governments aren't interested in disbursing money to NGO groups.
Now, that, I don't have any evidence to back that up, but that's what people say; that this
problem is more acute in those circumstances. But I didn't put a lot of analysis on it because, as
far as I know, the data aren't there to mention it. So that's on that one.
Most of these other issues I think were more for Anil, in terms of the board and the
relationship with Congress-MS. LEVINE: And the conditions.
MR. RADELET: Well, that's the congressional conditions. He knows all about those.
MR. SONI: Have you handed over to me?
MR. RADELET: Yes.
MR. SONI: In terms of conditionalities on donors, I mean, I think what you're referring
to is in the current Foreign Ops bill from the House side there are statements that are made that
this money is--it's actually I think a little bit softer than conditional on the Fund doing X, Y, and
Z, including making sure the disbursements are moving and other such things.
Generally, I feel that conditionalities are not in the interest of the Fund, working as a
multilateral financing mechanism, because that's why you move money bilaterally, to put
conditions on how you move the money. There need to be technical and consensus-based
conditions on how the Fund works, which is determined by the board, but beyond that I think
conditions that specify on a donor-by-donor basis what should be required of the Fund become
challenging simply logistically, given the number of donors that the Fund has.
In the current Foreign Ops bill, I think that the conditions are really more of suggestions,
making clear that the Congress has expectations about how the Fund is going to perform if it's
going to get more money in FY '06, and I think that's quite fair, actually. It's just making a
statement with some of the text that's been provided.
On the Global Fund and PEPFAR, to be put in the hot seat a bit, I think that there's a
difference between, first of all, the President's Emergency Plan for AIDS Relief, to be fair, is
actually a name that should be given to the $15 billion that's being provided over five years,
which includes money to the Fund, which includes a new bilateral, a larger bilateral commitment
to 15 particular countries--it was 14, now 15 with Vietnam--and existing support by the U.S.
Government to these three diseases, which has already been substantial.
Using PEPFAR colloquially to talk about the significant bilateral support to 15 countries
and comparing it to the Global Fund, I would say that the response, at a theoretical level, has been
very positive in the sense of potential complementarity. And let me say that for two particular
reasons:
One, there are high-burden countries that PEPFAR is now going to invest in which need a
lot more support than the Global Fund or any single donor can provide. So the fact that there is
more money moving to those settings and moving in such a way that it's really trying to catalyze
implementation, that's a great thing.
And, secondly, what PEPFAR is doing with that money is not simply moving money, but
also unleashing the capacity of existing U.S. staff, and services, and skills and expertise in those
countries, whether through the NAH or the CDC or USAID or other agencies. That also is a very
good thing.
I think the challenges--and they are challenges--are twofold, and I think that to answer
them, I can't answer them, but I think you should ask anyone in those 15 countries. One of them
is, whether it's PEPFAR or whether it's a European bilateral program, any new program means
new requirements, and we are trying very, very hard to streamline the requirements on countries
and not have it continue to be an incremental ask in terms of administration, but that's yet to be
determined if we can manage to do that, and that's something I think PEPFAR and the Fund are
committed to together.
Secondly, I think there's an open question, and this I turn over to development finance
experts, about the approach of the grants--who the money is being granted to, who's developing
the proposals. Certainly, the Fund's approach to that is different than the bilateral component,
and I think it's a worthy subject of debate.
You asked about Eastern Europe. I'll actually defer that to some of the information that's
in the documents, but there's a lot of support to Eastern European countries, and you can look up
the countries that are receiving support.
There was a question about disbursement and is disbursement the right measure?
Absolutely not. I'm not sure who asked that. But disbursement is, saying that money has been
disbursed does not mean the Global Fund has achieved anything. It means that is the Global
Fund doing its part to enable achievement on the ground. And if the disbursement rates are
sufficient so that countries have the money they need to be making progress, then the Fund is
doing its part.
And that relates to the second part of the question, which is can any Geneva-based
organization ever do this? And depending on what we mean by "do this," the answer is, no. I
mean, the Fund was not created to be the panacea to the challenges of implementation to the fight
against AIDS, TB and malaria in developing countries. It's intended to play one particular role,
which is make more efficient and move more money--make more efficient the process of moving
money and move that money and do it in a way that enables implementation, but then defer the
hard stuff to everything everyone else.
MR. RADELET: If I can just follow up on that. The question had been about how the
board perceives the Global Fund versus PEPFAR, which is why I deferred on it because I have no
idea what the board thinks. But I just wanted to reiterate my own view of that issue, which is
obviously not the board's. But I think Anil's got it just right. It's really a mistake right now to
think about PEPFAR versus the Global Fund. It's really a dumb way to think about the issue.
The PEPFAR programs--the new ones--are 15 countries. The Global Fund is 122
countries. PEPFAR isn't doing anything--the existing programs are important in a lot of these
other countries, but there's an awful lot of countries that the Global Fund is working on in these
three diseases that PEPFAR isn't addressing. Whether that's good or bad, they're different.
PEPFAR is doing nothing on malaria and TB, and the Global Fund is.
So that, again, to say that these are competitors and one can replace the other is just not
the right question. They take very fundamentally different approaches. We don't know which
approach works yet, in what kinds of country circumstances. I suspect that one approach will
work better in some circumstances and another approach will work better in another set of
circumstances. We don't know yet, but it's too early to start talking about turning off the tap on
one or the other.
And I do think that when you think about it that way, if you actually do the numbers for
the 15 countries within PEPFAR, in that block of PEPFAR, the U.S. is going to allocate about
$140 million per country. If you take the $200 million it's proposing for the Global Fund, it's
about $1.6 million per country. So it's a ratio of $140 million to $1.6-. I don't know what the
right ratio is, in terms of allocating our resources, but that's not the optimal allocation. That's my
own personal view on it.
MS. LEVINE: Let's spend another five minutes or so. Let's take three more batches of
or three more questions and then give time for responses. Obviously, people are free to go at any
time, and I would encourage you to sign up on our mailing list, if you haven't already.
Please.
MR. BARAT: Hi. Larry Barat, Academy for Educational Development. And just for
disclosure, up until last week, I was the malaria adviser to the World Bank and an alternate
member on the board of RBM.
I think, Steve, I think you have hit the nail on the head, in terms of the challenges. From
my perspective, I think you've got them all right, but I would add one category or subcategory.
And I think Anil and all of the people at the Fund deserve a lot of credit for doing what they've
done in the last two years, but so do WHO, and UNICEF, and CDC, and all of the partner
agencies that are actually helping countries write the proposals and implement the proposals.
The problem is that they don't get paid by the Global Fund to do that, and most of the
donors are, in fact, shifting their money from WHO and CDC and into either bilateral initiatives
or to the Global Fund. And so I can tell you that the Rollback Malaria Partnership Secretariat is
almost broke. And I think that is a significant challenge, that if this is the model we are going to
work with, we have to acknowledge that it's not just a Global Fund model; it's a partnership
model and that these other agencies have to be part of that.
Secondly, I think I was just two weeks ago at the Wilton Park meeting, which was hosted
by the Global Fund, and virtually everybody I talked to had a story about how this Global Fund
money is supplanting other money, and sometimes it's not so obvious.
For instance, in a country that the Bank works in, they submitted a proposal to the Global
Fund for Malaria. It didn't get funded. They were sitting on a basket funding of several hundred
million dollars, and yet their response was to file another proposal with the Global Fund rather
than use the money that was sitting there unspent.
And so that's one example of something that may not be quite so obvious, but there are
also examples of Ministries of Finance reducing the Ministries of Health's global budget because
of the Global Fund allocation, and there are examples of the Ministry of Health shifting money
from one disease to another. For instance, if they get funded for malaria, they shift their funds
more to AIDS and TB. Whether that's a good thing or not, I don't know, but certainly it's
something I think that is underestimated.
MR. LAXMINARAYAN: Ramanan Laxminarayan from Resources for the Future.
I think Anil made reference to the point about artemisinin combinations and that countries
are perfectly welcome to use whatever they wanted to and ask money for that, but they often
didn't. And I think one important reason for that is financial sustainability. They could choose to
move from chloroquine to ACT, but if the Fund stopped paying for these two years from now,
they'd really be stuck, which brings to light the more important question of what kind of changes
countries would have to make in their own policies on how they treat diseases. If they want to
move to sort of the next generation and how this is impacted by the Fund's lack of commitment
beyond a couple of years, I mean, as part of the suggestions, could it be possible that maybe the
Fund could consider longer-term commitments for things like ACTs, but it wouldn't have to make
the same longer-term commitments for bed nets, for instance. You could pay for bed nets for one
year, but if you didn't have money for two years, that's perfectly fine.
So some heterogeneity here might be useful.
MS. LEVINE: Last question.
MS. DUVVURY: Hi. Nata Duvvury, National Center for Research on Women.
And, Steve, I just wanted to congratulate you on a wonderful presentation and wanted to
inform you that ICRW is also doing an exercise of looking at the effectiveness of civil society
participation in the Global Fund. And I think that's a very important principle of the Global Fund
that we should recognize, that it's a new initiative for including civil society in governance in a
financing mechanism, and that's something unique.
And I wanted to take the opportunity of Anil being here to say that in our analysis of civil
society participation, the stark finding has been that gender is not at all incorporated into the
Global Fund's structure, policies, processes, and which is a very important concern. So I'd like
your reaction to that.
MS. LEVINE: Thanks very much.
Brief responses, please.
MR. RADELET: On Larry's question about the unfunded mandates really for other
partners of the responsibilities of donors spending resources on the Global Fund proposals and
that money is shifting away from WHO and Rollback Malaria, absolutely right. This is a real
problem, and it's what I was alluding to, and I talk a little bit more in the report that financing for
the Global Fund is not the only constraint in the system.
There are other partners here that
need to work well and that aren't working particularly well, and I think the Global Fund can play
a role in helping these other agencies. It actually did it recently in its last board statement a few
months ago. The Executive Director came out very clearly saying that he thought the WHO
needed more funding, which was quite unusual for him to say in his Board statement to his own
board, that WHO needed this extra assistance. So I think it's a step in the right direction.
There's been an issue from the beginning about the Global Fund proposal comes in, and
these other agencies have to send donors to the table, and use their own money for TA, for
technical assistance. And one of the challenges for the Global Fund is to move away from the
perception that this is a Global Fund proposal that other agencies need to help with and move
towards, that this is a country proposal that all of these other agencies have to contribute to, and
it's not an unfunded mandate, but in fact we're all working toward the same goal. Now, that
sounds very nice. How to get there and how to do that is tricky, but there is a problem that the
initial perceptions are this is for the Global Fund program, as opposed to a larger program.
Your other point on supplanting the donor funds I think is, we don't yet, in terms of how
additional this is. There's always going to be a little bit of substitution, and there should be
probably on the margin. I'm not an absolute full advocate that every new dollar actually has to be
fully additional, but we don't know the extent to it, but I think it's true that that's happened.
These other issues on treatment, I will leave for you. They asked specifically for you, so
I'll-MR. SONI: Thanks to all of you for being the diehards who are sticking out longer than
we were supposed to go. But quick responses are, on other organizations, absolutely. The Fund,
you know, I'm going to suggest to Richard the next time he's in town that there's a meeting on the
Global Fund where he doesn't talk about the Global Fund and he just talks about all of the other
organizations that are critical to the Global Fund succeeding.
It's a common misperception that the Fund doesn't appreciate that. It's quite the opposite.
And I think that everyone at the Fund is quite committed to providing support to other agencies
and making sure that, as you grow the overall financing, and a portion of that is always going to
be about moving from the donor to the recipient, but some of that has to be moving to other
agencies. And for sake of brevity, I won't go through all of the examples of why those other
agencies are so important, but I wholeheartedly agree.
On this point about financial sustainability, I think, to me, your point underscores Steve's
first challenge, which is the Fund has to be funded in order to do what it's meant to do, but there's
a challenge in terms of longer commitments for ACT. Because whatever category you put into
those interventions requiring longer commitments, ARVs is going to be in that category as well.
And then you start actually getting the largest budget items within the Global Fund's grants into
the category that requires larger commitments. And you're talking about a very different model
than the current model of the Global Fund.
Quite honestly, I would put it this way. This is another maybe a distinction of the Global
Fund, Steve, to add to one of your up-front statements. It is a huge risk. And when the Fund was
created, people said we are putting a lot on the table, and developing countries and NGOs are
putting an enormous amount of faith in donors, who said we will fund this, and we will sustain
those programs that are successful and that perform.
And it would be, I can't even begin to quantify or qualify in words how damaging it would
be I think in terms of overall development for existing programs not to be funded. And I think
that this point about ACT being supported over a medium term and a long term, and the same
with ARVs and other interventions, it needs to be proven in practice in the next couple of years
with existing grants continue to be funded.
That said, this is a little bit more technical. There are ways, by the way, to take accounts
for the purchase of ACTs which has a lot of capital risk involved in the manufacturers and use
escrow accounts to actually ensure a steady supply and actually make larger up-front purchases,
which also gives you the advantage of lowering the price, but that's a separate item.
On civil society participation and gender, first, the Fund should actually thank ICRW.
They initiated a project about a year ago to work with the Global Fund Secretariat to see how its
proposal process could be adapted a bit to include more questions about gender which actually
was incorporated into the last couple of rounds. It should do more to address issues of gender.
So I agree, and I look forward to the results of the finding and to concrete suggestions on how to
improve that.
A couple of points to note, actually, in terms of updates from the board and just, in
general, in terms of what does the Fund represent in terms of civil society participation, the ViceChair of the board is actually a nongovernmental representative, a woman named Helen Rossert,
who runs an NGO in Paris. First of all, NGOs having voting seats on the board sitting next to the
largest donors in the world, that was innovative. The fact that they now have governance
positions is great. The fact that it's a woman I think is even better.
In the latest board meeting, there's something that's gone even further, which is there was
a nonvoting seat for a person living with HIV. That's for a delegation of communities affected by
the three diseases. The board decided to give that representative a vote at the table, which again
is quite innovative for a multibillion-dollar mechanism to have an explicit vote dedicated to
affected communities, but that's not enough. But I think it is some progress in the right direction.
Let me just make a last sort of wrap-up point about that, which is another point of
distinction about the Fund is the board and the fact that at the board, perhaps earliest and also at
the level of governance, perhaps more importantly than any other mechanism of the Fund, it
really has to show, and I think does show, that the Fund is committed to equal participation of
different sectors.
For those of you who don't know, the board consists of members who are donor
representatives, recipient representatives, NGO representatives, as well as private sector
representatives. There is no veto on the board. The U.S. cannot veto a decision if everyone votes
against it. It's going to go whether the U.S. or any other board member likes it or not.
And I think what's been interesting is, for me, spending two years at the Fund, at first you
saw the typical alliances in terms of how groups would gather together on issues, and now you
see a board where it really is about the issues, and it's about the individuals, and it's about honest
and healthy debate.
And one thing that I think represents that better than any other is the chair of the board is
currently Tommy Thompson, the Secretary of Health and Human Services in the United States,
and he has been a tremendous chair, and he has, better than the previous chair, in fact, made sure
that the debate at the level of the Fund is about the issues. So he pulls in civil society issues and
sometimes says, you know, wait a second. We're not listening to what's being said here. And
he'll often disagree with, in acting as a chair, with his own delegation, much to their frustration
sometimes.
But I think it's been a remarkable thing to see how the voice of civil society at the level of
the board has been respected, in my opinion, remarkably and in an unprecedented way.
MS. LEVINE: Thanks very much.
Before closing, I just want to make one comment on this point on financial sustainability .
There's another alliance, the Global Alliance for Vaccines and Immunization that is a couple of
years ahead of the Global Fund in facing precisely this challenge with the more costly vaccines
and the questions that are quite pressing about whether or not governments and their donor
partners are willing to take on the long-term responsibilities for funding and what the feedback
of that uncertainty is both to the pharmaceutical market and also to the country-level
decisionmaking. So I think there are a lot of opportunities to join forces and learn from that.
Thank you very much for your hanging in there and for your continued interest. Please do
sign up for our mailing list, if you're interested in hearing about future events.
Thanks very much.
[Applause.]