Business Case and Intervention Summary
Intervention Summary
Title: Preventing HIV in Vietnam – 1-year extension
What support will the UK provide?
The UK will make available an additional grant of £6.2 million from January 2013 to December 2013 to
ensure a well-managed transition to the Global Fund financed programme and to the domestically
financed HIV National Targeted Programme. This will help the Government of Vietnam to sustain its
current achievements in HIV prevention and ensure sustainability of the initiatives supported over the
past decade by the DFID and World Bank funded HIV/AIDS prevention programmes. This will increase
DFID’s total contribution to the programme to £24.2 million. The additional grant by DFID will finance:
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Harm reduction for people who inject drugs, including needle/syringe programmes and methadone
maintenance therapy (for 9 months only) – £1,240,000
Condom social marketing – £2,052,000
Work among men who have sex with men – £437,000
Strengthening the national monitoring and evaluation system for HIV and AIDS – £282,000
Training and advocacy – £1,142,000
Programme management – £797,000
DFID-managed international consultancy support – £250,000
Why is UK support required?
DFID and the World Bank have been the main financiers of harm reduction programmes among the
highest risk groups in Vietnam. This work has been highly effective, Vietnam now seeing annual
incidence of new HIV infections in decline for the last four consecutive years, with prevalence among
people who inject drugs (until now the primary drivers of the epidemic) having come down from 29% to
13% during the time that DFID has been supporting prevention programmes.
The current joint DFID/WB project was scheduled to close in December 2012, with crucial HIV
prevention activities being handed over to programmes funded by other donors (mainly the Global
Fund) and by domestic resources (the National Targeted Programme for HIV). However, Vietnam is
facing an unprecedented and unexpectedly rapid loss of donor resources. The Global Fund cancelled
Round 11, on which Vietnam had placed high hopes, and has notified Vietnam that if the Phase 2 of
round 9 is granted there will inevitably be a funding gap for the first months of 2013. At the same time
the US Government’s PEPFAR programme is reducing its financial commitments to Vietnam much
faster than originally planned. Furthermore, Vietnam’s National Assembly cut financing to the National
Targeted Programme by 50% due to Vietnam’s own domestic economic problems.
These unforeseen funding problems mean that if the DFID/WB support ends in 2012, some crucial
prevention activities will be interrupted in the first half of 2013, severely jeopardizing the progress that
has been made to date and potentially losing much of the legacy that DFID wishes to leave in Vietnam.
This project extension will provide bridging funding for some essential activities pending additional
resources expected from the Global Fund from mid-2013 and will also allow time for more sustainable
1
models to be developed for some important activities. This will involve more work through the private
sector to ensure universal availability of condoms and needles/syringes.
Further work on
strengthening the evidence base and on advocacy with national and provincial policy makers will be
aimed at making increased and better targeted domestic resources available.
What are the expected results?
The project will ensure that HIV continues to be controlled in Vietnam, focusing on the most-at-risk
populations, as is appropriate for a concentrated epidemic. Prevalence among people who inject drugs
and female sex workers should continue to decline and the rising prevalence among men who have
sex with men should be halted. Specific targets are to keep the prevalence rate among adults aged 1549 at below 0.45%; the prevalence rate among people who inject drugs below 13%; the prevalence
rate among female sex workers below 3%; and the prevalence rate among men have sex with men
below 17%. It is not possible to measure prevalence rates accurately every year, but estimates will be
updated through surveys conducted every 2-3 years. Trends in prevalence rates can be roughly
estimated annually from sentinel surveillance data.
The project aims to scale up and institutionalize best-practice models of HIV and AIDS control which
can then be sustained in the longer term by the Vietnamese Government. A significant proportion of
project resources is allocated to training and advocacy, all of which is aimed at improving sustainability.
Annual performance of the project is measured in terms of maintaining low levels of high-risk
behaviours. Specific targets for the extension period are:
(1) consistent use of clean needles by people who inject drugs maintained at over 80% in the 32
participating provinces;
(2) consistent use of condoms by female sex workers maintained at over 90% in the 32
participating provinces;
(3) consistent use of condoms by men who have sex with men brought up to over 60% in the 10
provinces targeted for this work;
(4) 2,200 patients are retained on methadone maintenance therapy.
In order to help achieve these results the project will provide in 2013 22 million needles/syringes and
over 42 million condoms.
The original targets for the existing project were 80% condom use by female sex workers (baseline
60%) and 70% clean needle use by people who inject drugs (baseline 50%). As at mid-2012 both of
these targets have been significantly over-achieved. There was no target set for condom use by men
who have sex with men, but the limited survey data available suggest rates varying between 15% and
59% depending on location and type of partner.
There are currently about 1700 patients retained on methadone maintenance therapy in DFID/WBsupported clinics, which is less than originally planned. However, the number is constrained by the
availability of methadone, currently procured by USAID. USAID has budgeted for 40 methadone
clinics, which include 6 supported by the DFID/WB project.
2
Business Case
Strategic Case
A. Context and need for a DFID intervention
Epidemiological context
HIV was first recognized in Viet Nam in Ho Chi Minh City (HCMC) in 1990, and spread rapidly across
the country. As of 31 December 2011, HIV cases had been reported in all 63 provinces, 98% of
districts and 77% of communes. The cumulative total since records began was 249,660 reported HIV
cases, with 197,335 PLHIV still living and 52,325 AIDS-related deaths. In 2011 Vietnam had the
fourth highest number of people living with HIV in Asia (after India, China and Thailand).
The epidemic in Viet Nam comprises many sub-epidemics across the country and remains
concentrated primarily among three populations defined by high levels of HIV-transmission risk
behaviours: people who inject drugs (PWID) (predominantly men), men who have sex with men
(MSM) and female sex workers (FSW). According to 2011 sentinel surveillance, HIV prevalence
among PWID had dropped to 13.4%, down from 29% in 2001-2002. Prevalence among FSW was
3%, down from 6% in 2002. IBBS data indicates that prevalence among MSM was 16.7% in 2009
and rising, although only four major cities were surveyed.
Injecting drug use has been the primary route of HIV transmission until now, but a rise in reported
cases of HIV-positive women, who now represent 31% of newly reported cases, reflects a probably
slow but steady transmission of HIV to women by men engaging in highly risky behaviours, mainly
PWID and MSM. However, the scale-up of prevention of mother-to child transmission services and a
high HIV-testing coverage of pregnant women mean that it is likely that some proportion of these
newly reported cases comes from increased testing rather than increased transmission.
Overall the estimate of adult HIV prevalence (ages 15-49) remained at 0.45% in 2011, unchanged
from 2010. This is one of the highest prevalence rates in Asia. At two sentinel sites, in Dien Bien
province in the north-western hills and in Hanoi city, prevalence among pregnant women exceeded
1% in 2011.
Political, institutional and social context
Overall leadership and coordination of Vietnam’s response to HIV and AIDS is provided by the
National Committee for AIDS, Drugs and Prostitution Prevention and Control, chaired by a Deputy
Prime Minister. The current Deputy Prime Minister is steering a progressive path, gradually
dismantling the old “social evils” agenda (which focused on removing drug users and sex workers
from society by locking them up in detention centres for forced rehabilitation) and promoting more
modern (and proven effective) methods. The new law no longer requires sex workers to be detained,
but provides for their voluntary rehabilitation. There is a moratorium on the construction of detention
centres for drug users and the numbers in compulsory detention have dropped rapidly over the past
two years. The Government is now promoting the rapid scale-up of methadone maintenance therapy
and community-based treatment and rehabilitation of drug users. Nevertheless, there are still
conservative elements in the Public Security and Social Affairs departments, both of which play key
roles in controlling drug use and sex work. Furthermore, conservative elements in the National
Assembly and in other parts of Government are very influential in restricting the amount of funding
that is available for effective HIV control, with the preference generally being for a traditional punitive
approach. There is also a lot of variation between provinces, with some cities like Hai Phong and
Can Tho leading the way with progressive approaches and others like Ho Chi Minh and Da Nang
taking much more conservative and traditional approaches. The project, working together with the
3
UN agencies and US Government agencies, continues to advocate for more effective approaches
and a greater level of domestic resource allocation, and a key activity of the proposed extension will
be to build the evidence base still further, demonstrating the effectiveness of a comprehensive harm
reduction programme not only in reducing HIV transmission but also in controlling crime.
Of the three high-risk behaviours (commercial sex, injecting drug use and anal sex between men),
sex work by FSW is the least stigmatized in Vietnamese society. Despite there being no law against
sex between consenting adult men, all kinds of homosexual behaviour are highly stigmatized in
Vietnam. Until very recently the majority of Provincial AIDS Centres were in denial about the
existence of gay communities in their provinces. The hidden nature of MSM communities makes the
sub-epidemic among them much more dangerous. It is estimated that 3% of Vietnam’s population
belongs to the lesbian-gay-bisexual-transgender (LGBT) community, making it by far the largest highrisk population for HIV transmission. However, due to the emergence of compelling evidence
coupled with advocacy by internationally-funded projects, including this one, almost all provinces are
now factoring work among MSM into their annual action plans. With the exception of a few cities that
have developed more sophisticated approaches, most provinces are still learning how to engage with
MSM communities. Given the high rates of HIV prevalence recorded among MSM, developing
effective ways of working among MSM needs to be a high priority in Vietnam’s HIV prevention
strategy.
The day-to-day work of combatting the HIV epidemic in Vietnam is managed centrally by the Vietnam
Administration of HIV and AIDS Control (VAAC), a department that reports to the Ministry of Health.
At the provincial level, where most programme implementation takes place, the Provincial AIDS
Centres (PACs) manage the response. These report to the Provincial People’s Committees and
ensure coordination between key departments, especially Health, Public Security and Social Affairs.
All donor-funded projects are implemented under the overall control of VAAC and the PACs, although
many of the US Government funded activities are implemented by international agencies. The
DFID/WB funded work is implemented solely by the Government, with technical support provided by
WHO.
Complete social, institutional and political appraisals were conducted during the original project
design and are included in the Project Memorandum. These are still valid and relevant.
HIV prevention work in Vietnam
DFID and the World Bank have been the main financiers of HIV prevention programmes among the
highest risk groups in Vietnam. DFID started funding the £17 million “Preventing HIV in Vietnam
Project” in 2003 with the purpose of reducing vulnerability to HIV infection in Vietnam primarily
through harm reduction programmes involving increased availability of condoms and
needles/syringes, coupled with behaviour change communication and advocacy work. The project
covered 21 provinces. This project ran till 2009 and was found at the time of end-of-project
evaluation to have been very successful.
The World Bank launched its own “HIV/AIDS Prevention Project for Vietnam” in 2005 with a credit of
US$38.5 million. This provided more comprehensive support for a range of prevention and treatment
activities in 18 provinces, some of which overlapped with the DFID provinces, as well as national
components on policy studies and research, training, and innovation.
In 2009 when DFID was designing a follow-on project, it was decided to add resources to the existing
WB project, instead of having another stand-alone DFID project. DFID added another £18.3 million
grant to the WB project, which was extended until the end of 2012. The two sets of provinces were
combined, making 32 provinces. These include most of the provinces with highest HIV transmission
rates. A requirement of the DFID funding was that 60% of the combined project resources must be
allocated to harm reduction activities.
4
Vietnam also currently receives significant funding for HIV and AIDS programmes from the US
Government (PEPFAR) and from the Global Fund Round 9. PEPFAR is Vietnam’s largest HIV donor
in financial terms, although the programme is focused in a smaller number of provinces and spends
most of its resources on treatment (including AIDS treatment and methadone) and on technical
assistance and policy work. PEPFAR supports the social marketing of condoms in some provinces.
PEPFAR cannot support comprehensive harm reduction among PWID because of US Government
restrictions on procuring and distributing needles/syringes. PEPFAR is now reducing its budget in
Vietnam much faster than originally planned, and is currently transitioning from a focus on
programme delivery to a focus on technical assistance.
The Global Fund has been supporting harm reduction programmes on a smaller scale than DFID/WB
and generally in lower transmission areas. When Round 9 funding was approved, it was agreed that
when it enters its Phase 2 it would take on much of the harm reduction work supported by DFID/WB.
2012 was to be the transition year, with full support from 2013. Vietnam was also planning to submit
an application for major HIV/AIDS funding under Round 11. However, due to the Global Fund’s own
financial problems, Round 11 was cancelled and the transition to Phase 2 of Round 9 is no longer
fully assured. The Phase 2 application process has become more rigorous, is subject to new
conditions and is therefore, even if successful, going to be delayed. In the meantime, the planned
gradual transition of DFID/WB-funded harm reduction activities to Global Fund financing in 2012 has
not taken place, although some smaller programme components (the STI treatment programme and
the VCT programme) have been transferred.
There are also much smaller AusAID and ADB projects covering a handful of provinces in Vietnam.
Domestic funding for HIV and AIDS is very low, at around 13% of the total, less than half of which is
provided by central government. The Vietnam Authority for HIV/AIDS Control (VAAC) lobbied
successfully with the Government leadership to have HIV/AIDS included as a new National Targeted
Programme from 2012. However, the National Assembly cut back the proposed budget for 2012 by
50% due to nationwide budget constraints and a widespread sense among politicians that HIV is not
a high priority, being primarily a disease associated with “social evils”. Vietnam has committed to
increasing central government funding for HIV/AIDS from the current level of $10m per year by 20%
per annum up until 2020. This compares to current total programme expenditure of about $125m,
with an estimated need of about $200m by 2020. Nevertheless it is a great improvement on the
previous central government financial contribution of less than $7m per year up to 2009. According
to a recent study by AusAID, Vietnam currently has the third lowest domestic funding proportion for
HIV work in Asia, after Timor Leste and Laos.
An increasing proportion of domestic funding is allocated by provincial governments. Provincial
financing of HIV and AIDS programmes grew by 85% from $6.6 million in 2008 to $12.2 million in
2010. As Vietnam follows a path of increasing fiscal decentralization, this trend is likely to continue.
According to the most likely future funding scenario, GoV financing will overtake donor financing by
2015/16 and will cover over 60% of the estimated total need by 2020. Given that there are likely to
be savings through gradually increasing efficiencies, current GoV estimates of total programme need
are probably a little on the high side. So the actual funding gap may not be insurmountable from
2015 onwards, especially if Vietnam is successful in obtaining additional Global Fund financing when
new applications are accepted from 2015 onwards.
Annex 1 shows in both narrative and graphic terms the various future funding scenarios with and
without the DFID extension and with and without additional Global Fund financing. The DFID
extension plays two critically important roles: (1) it bridges an inevitable funding gap in 2013; and (2)
more importantly ensures continuity of vital prevention activities, which would otherwise be
interrupted for several months with disastrous consequences for the epidemic. Provided that the
Global Fund approves the Phase 2 of Round 9 and can provide new funding for Vietnam from 2015
to 2020, it looks as though Vietnam’s future funding needs can be met.
5
Justification for a 1-year extension to the existing project
Given the above background, DFID Vietnam proposes to allocate additional funding to the existing
project and extend it for one year to the end of 2013. The reasons are:
1. This is a very effective project which has achieved significant demonstrated impact on the course
of the epidemic in Vietnam. DFID Vietnam has available financial resources to extend it.
2. Vietnam is facing an unprecedented and unexpectedly rapid reduction in donor financing for HIV
and AIDS control. While domestic funding is increasing steadily, it cannot fill this large gap so
quickly, although it could expect to do so from about 2020. It is hoped that the Global Fund can
fill the gap from 2015 to 2020.
3. Because of recent changes in the Global Fund, there is likely to be a 6-month gap in financing in
the first half of 2013, just when the current DFID/WB project would have finished. This will almost
certainly lead to a disastrous interruption of crucial prevention programmes, which will result in a
resurgence of HIV infections, especially among PWID, bringing to a halt Vietnam’s progress
towards HIV control and severely damaging the legacy left by 10 years of DFID support.
4. The Government of Vietnam has formally requested DFID to extend the project, and this is
strongly supported by international partners in country, including USG and the UN agencies.
During the extension period the Government will use the project resources even more intensively
than before to develop cost-effective, sustainable approaches to HIV prevention that can make
maximum use of limited domestic resources and also make much more use of the private sector.
Strategic fit with DFID priorities in Vietnam
DFID formulated its Operational Plan in early 2011 with the following priorities, which are fully
embedded in the FCO-led UK-Vietnam Strategic Partnership:
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Support achievement of the MDGs, particularly off-track ones and areas with less progress
Step up wealth creation efforts by supporting Vietnam to benefit from global trade agreements
and achieve a growth path that is more private sector led
Enhance support on governance and accountability
Address challenges for women and girls, who will benefit from many of our programmes:
creating jobs, raising minimum incomes and pensions (social protection), and providing access to
education
Support the Government to address climate change challenges by enhancing the Government’s
technical expertise, coordination capacity, and by mainstreaming climate resilience
This HIV project primarily supports the first priority. MDG6 on communicable diseases is one of very
few that are still off-track in Vietnam. There are signs that Vietnam is now turning the corner on HIV
control. The MDG target states that the spread of HIV should have started to be reversed by 2015.
This means that the national HIV prevalence rate needs to be in decline. The number of new HIV
cases detected every year (a proxy for the incidence rate) has been in decline for four consecutive
years, but prevalence is not yet decreasing, as there are sufficient numbers of AIDS patients on ARV
treatment to ensure that the AIDS-related death rate is also declining. In order to meet the MDG, the
incidence rate still has to come down further, and this can only be achieved by continuing and if
possible intensifying the current prevention programmes among most-at-risk populations.
The project also supports the 2nd and 4th priorities. It encourages private sector development by
shifting the supply and distribution of commodities (condoms, lubricants, needles/syringes) away
6
from free public sector channels to commercial or partially subsidized private sector channels. It
empowers and protects women and girls. Sex workers are both empowered and protected by having
access to condoms and by being trained through their interaction with the project to be able to
negotiate successfully with their clients to ensure 100% condom use. Female partners of PWID and
MSM are protected from HIV infection when their male partners use safe sex and safe injecting
practices.
B. Impact and Outcome that we expect to achieve
The project will maintain the downward momentum of HIV prevalence among PWID. By the end of
2013 prevalence among PWID should be reduced to below 13%. Without this project extension,
further progress in reducing HIV transmission among PWID would be very unlikely and in fact
transmission could start to rise again, due to non-availability of clean needles/syringes when and
where they are needed by PWID and due to the discontinuation of the peer educator network. Peer
educators play a key role in identifying new PWID and getting them to adopt safe injecting practices.
The project will reduce dependence on the supply of free clean needles/syringes through
Government by developing innovative approaches through the private sector. Some provinces are
already piloting such approaches, and these will be scaled up rapidly during 2013.
The project will also continue to ensure that HIV prevalence among FSW is maintained below 3%.
For the past decade, prevalence among FSW has been fluctuating around 4% after a high of 6% in
2002, but dropped below 3% in 2011. Prevalence among FSW locked up in detention centres has
generally been higher, around 7-8%, but the Government has now stopped sending sex workers to
compulsory detention centres. This will greatly improve the access to HIV prevention services by all
sex workers. Following the new model implemented since the beginning of 2012, the project will
continue to shift the primary distribution route of condoms away from dependence on free condoms
provided by the Government to a greater reliance on the private sector, especially ensuring that high
quality condoms are widely available at an affordable price in all the venues where sex transactions
take place.
The project will also continue to develop effective approaches in a sub-set of 10 provinces aimed at
reversing the current increasing trend of HIV prevalence among MSM. Surveys in the supported
provinces should indicate no further rise in prevalence among MSM. This will be achieved
through strengthening MSM self-help networks and organizations, continuing to support peer
educators and ensuring an adequate supply of appropriate condoms and lubricants, primarily through
the private sector.
In order to achieve this three-fold impact, the project needs to be able to ensure low levels of highrisk behaviours among the three primary target groups of PWID, FSW and MSM. Specific targets for
the extension period are:
(1) consistent use of clean needles by people who inject drugs maintained at over 80% in the 32
participating provinces;
(2) consistent use of condoms by female sex workers maintained at over 90% in the 32
participating provinces;
(3) consistent use of condoms by men who have sex with men brought up to over 60% in the 10
provinces targeted for this work;
(4) 2,200 patients are retained on methadone maintenance therapy.
In order to help achieve these results the project will provide in 2013 22 million needles/syringes and
over 42 million condoms.
7
Appraisal Case
A. What are the feasible options?
The first consideration is whether DFID should do anything further to help Vietnam achieve progress
towards the HIV MDG. 10 years of support will come to an end, as planned, in December 2012.
However, as outlined in the Strategic Case, this will almost certainly lead to a discontinuation of
crucial HIV prevention activities in 2013, due to the situation Vietnam finds itself in with less money
than expected coming in from both the Global Fund and PEPFAR. This would most likely lead to a
resurgence of HIV infections, especially among PWID, bringing to a halt Vietnam’s progress towards
HIV control and severely damaging the legacy left by 10 years of DFID support.
Due to underspend in other areas of the DFID Vietnam-Cambodia portfolio, DFID Vietnam has
available financial resources to reallocate. Considering the significant impact that the DFID-funded
HIV work has had to date, as evidenced by the 2009 independent project evaluation of the earlier
project (conducted by WHO) and by the 2011 independent impact evaluation of the DFID-funded
harm reduction work (conducted jointly by UNAIDS and the University of New South Wales), further
investment in HIV control appears to be the most cost-effective way for these available resources to
be allocated. There is no other project in DFID Vietnam’s past or present portfolio that has had such
a demonstrable impact on achieving progress towards any of the MDGs.
If DFID money is to be used to help Vietnam maintain progress towards the HIV MDG, as set out in
the Strategic Case, the options for the approach are:
1. Design a new intervention, building on past successes and learning from less effective aspects of
previous work.
2. Provide funding to other international partners operating in Vietnam, such as the UN agencies or
other bilateral donors, to increase the scope of their own work using DFID resources.
3. Extend the current project, using the existing management and implementation mechanisms, but
with a tailoring of the activities to be supported to maximise both impact and sustainability.
B. Assessing the strength of the evidence base for each feasible option
In the table below the quality of evidence for each option is rated as either Strong, Medium or Limited
Option
1
2
3
Do
nothing
Evidence rating
Strong
Medium
Strong
Strong
What is the likely impact (positive and negative) on climate change and environment for each
feasible option?
This project does not offer any opportunities under any of the options to do any significant work on
climate change and the environment. However, there is a medium level environmental risk
presented by the disposal of used condoms and especially needles/syringes, which may be HIV
infected. As with previous DFID-funded work, steps will be taken to mitigate the risk by ensuring, as
far as is possible, safe disposal of used commodities, especially needles/syringes.
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Categorise as A, high potential risk / opportunity; B, medium / manageable potential risk /
opportunity; C, low / no risk / opportunity; or D, core contribution to a multilateral organisation.
Option
1
2
3
Do
nothing
Climate change and environment risks and
impacts, Category (A, B, C, D)
B
B
B
C
Climate
change
and
environment
opportunities, Category (A, B, C, D)
C
C
C
C
C. What are the costs and benefits of each feasible option?
The “do nothing” option has no cost to DFID, but would in effect have substantial negative benefit.
Although clearly some of the previously achieved benefits are “banked” in terms of HIV infections
averted over the past several years, the lasting benefit of setting up an HIV prevention system that
ensures a continuing low (and reducing) HIV transmission rate would be largely lost due to
interruption of key services, disbanding of thousands of peer educators and stock-outs of key
commodities, especially needles/syringes. This would lead to an almost certain reverse of progress
made so far in HIV control in Vietnam.
Options 1 and 3 would focus on harm reduction activities among the three most-at-risk population
groups (PWID, MSM and FSW). The cost-effectiveness of reducing new HIV infections through harm
reduction programmes has been tested and found effective in many global settings. The UK has
been a global leader in this area. In concentrated epidemics such as that in Vietnam (i.e. where the
HIV prevalence rate is still low among the general population but high among most-at-risk subpopulations), harm reduction is by far the most cost-effective approach. The latest global research
by the UN indicates that this should be supplemented by better integration of prevention and
treatment programmes with the aim of detecting HIV positive people earlier and getting them onto
ARV treatment earlier, thus reducing their infectiousness (i.e. “treatment as prevention”).
The original project design conducted an in-depth cost-effectiveness study, looking at three possible
approaches: (1) comprehensive prevention programme with emphasis on harm reduction in highest
transmission provinces; (2) similar programme but without the geographical targeting, to ensure
equity; and (3) harm reduction programme with narrower focus on outreach by peer educators and
condom/needle/syringe distribution. The analysis found that the first approach was the most costeffective, providing a net return on the DFID investment of between £26 million and £59 million. The
societal benefit would range from £1.86 billion to £4.39 billion. The return on DFID investment only
factors in healthcare costs of the averted HIV infections. The societal benefit also considers the
economic cost of lost productivity, quality of life and mortality.
Option 1 would allow better fine-tuning of DFID resources to ensure that all money was spent on the
most cost-effective interventions. This could include cutting support to some provinces and focussing
resources in the provinces where the most new infections are likely to occur, and possibly adding
some high-transmission provinces not currently supported by DFID/WB (e.g. Dien Bien which now
has the highest prevalence in Vietnam, and rising). However, this would involve an extensive redesign process which would take time and staff resources, which are in very short supply. DFID
resources must be fully spent by December 2013 when the MDGs programme in Vietnam comes to
an end, as agreed by Ministers. This is not therefore a practical option.
Option 2 offers very limited opportunities. The only like-minded donor in Vietnam in terms of
prioritizing harm reduction activities is AusAID. They have a small programme, limited management
resources and no plan to expand in Vietnam. DFID resources could be managed by USAID, but their
programme does not prioritize harm reduction, has very high management costs and would not be
9
allowed to procure needles/syringes – a critical component. DFID is already funding HIV advocacy
work and technical assistance through the “One UN” project, which runs till 2014. The UN would find
it very difficult to manage large service delivery components such as the needle/syringe programme,
the methadone programme and the condom social marketing programme. So the only practical
option is to continue to work with the World Bank, which is option 3.
The original economic appraisal has been revisited, re-examining the costs and benefits of the harm
reduction programme among PWID as proposed under option 3 and comparing this with the “do
nothing” option. This new appraisal estimates the net present value of benefits to DFID to be £5.8
million for the proposed additional investment of £6.2 million, and the net present value of societal
benefits to be £220 million. So even if the only benefits are from the work among PWID, the
investment is strongly justified. However, the extension is expected to deliver additional benefits
from the work among sex workers and among MSM. Due to a severe paucity of economic
evaluations of condom programmes globally, it is not possible to do this analysis for Vietnam without
commissioning a major new stream of research. Nevertheless, there is overwhelming non-economic
evidence, well accepted by the global development community, including UNAIDS, US CDC and
WHO, that 100% condom use programmes are an essential ingredient of any HIV prevention
strategy in both generalized and concentrated epidemics. The revised “light touch” economic
appraisal is attached at Annex 2.
Option 3 is therefore the preferred option. Within option 3 there are further options as to how to
allocate the resources. Despite this not being a new project offering maximum opportunities to
allocate resources completely rationally based on the most effective targeting of the appropriate mix
of interventions, the working relationship between DFID, World Bank, the WHO technical advisers
and VAAC is such that a very good prioritization of activities can be achieved within the existing
project. Resources are effectively allocated using a theory of change process, somewhat modified
by political realities.
The theory of change looks at interrupting HIV transmission routes and focussing resources at the
activities that will have the greatest effect on interrupting the key transmission routes. Transmission
among MSM, transmission from MSM to the general population and transmission from FSW to the
general population are all interrupted by consistent condom use. Transmission among PWID (the
most efficient HIV transmission route) is interrupted by ensuring zero sharing of injecting equipment.
Transmission from PWID to the general population and to other high-risk groups (FSW and MSM) is
interrupted by ensuring 100% condom use. However, it is recognized that ensuring 100% condom
use within long-term stable relationships is very difficult to achieve, so the project primarily targets the
highest risk sexual activity, i.e. transactional sex, sex with multiple partners and anal sex between
men.
The theory of change for the specific interventions to be supported can be illustrated by the following
diagram:
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FSW
Clients
Of
FSW
PWID
Regular
& casual
partners
of PWID
MSM
General
population
MSW
Clients
of
MSW
Female
partners
of MSM
Most-at-risk population groups are at the left. The general population is at the right. The arrows
represent HIV transmission routes. The thicker arrows show more intense transmission. The blue
arrows are routes of transmission specifically targeted by the 100% condom use programme. The
red arrow is the transmission route addressed through the needle/syringe and methadone
programmes. The areas of overlap between different most-at-risk populations have particularly high
risk of transmission. These are addressed by both types of programme. The black arrows represent
routes of transmission that are difficult to target, and so are not a major focus of the project.
It is important to address the intra-group transmission among PWID and MSM, because this reduces
the pool of HIV infected people within the groups, thereby reducing the risk of transmission out from
each group.
The intensity of HIV transmission along each route is reduced by three interventions: (1) reduce the
frequency of high-risk behaviour; (2) eliminate or greatly reduce the risk from the high-risk behaviour;
and (3) reduce the infectiousness of the HIV-infected people by treating them with ARVs to reduce
the viral load in their blood.

It is not generally possible to implement intervention (1) for sexual behaviour, although if sex
workers are able to earn enough money seeing fewer clients this does reduce the risk of
infection. Sex workers who have sex with several clients a day are much more likely to
receive and pass on the virus. For PWID, methadone eliminates or greatly reduces the need
to inject drugs (as methadone is administered orally).
11

The primary focus of the project is on intervention (2). 100% condom use and 100% use of
clean needles/syringes almost completely eliminates the risk of HIV transmission. However,
since it is never possible to reach 100%, attention also needs to be paid to interventions (1)
and (3).

The “Treatment 2.0” pilot addresses intervention (3). Treatment as prevention is a relatively
new intervention globally and Vietnam has agreed to pilot it, initially in two provinces.
The effectiveness of combined prevention activities among PWID and FSW was confirmed by the
independent “Evaluation of the epidemiological impact of harm reduction programs on HIV in
Vietnam” conducted jointly by UNAIDS and the University of New South Wales and published in
2011. Epidemiological modelling in six of the 32 supported provinces estimated that an average of
over 1,500 HIV infections were being averted annually through the free distribution of
needles/syringes and condoms just in these 6 provinces and not including commercially or socially
marketed commodities. When these estimates are extrapolated across the 32 provinces, and
assuming a similar pattern continued in subsequent years, it suggests that this intervention more
than accounted for the total annual reduction in new HIV infections in Vietnam since 2008, when the
downward trend started. In other words, without this DFID/WB supported programme, the number of
new HIV infections in Vietnam would still be increasing today.
DFID resources in 2013 will therefore be allocated first and foremost to comprehensive harm
reduction programmes in the 32 supported provinces. This accounts for 60% of the proposed
budget. The political reality is that provinces cannot be cut out of the project at this stage, although
more resources are allocated to provinces that have greatest need and have a good track record of
using the money most effectively.
Some resources are allocated to surveillance, monitoring and evaluation (4.5%) to training and
advocacy (15%) and to international technical assistance (7.5%). These are necessary to improve
the prospects of sustainability. Hitherto, most of Vietnam’s fight against HIV/AIDS has been
undertaken by internationally funded projects, albeit under the administrative leadership of the
Vietnam Administration for HIV and AIDS Control (VAAC). International partners have provided most
of the technical inputs, including clear steers on where and how money should be spent. The
capacity to lead and manage the response at the national level has been strengthened, but this
capacity is not yet well developed in most provinces. This is why more investment is needed over
this extension year of the project to provide more intense training to officials at local levels to ensure
that ongoing technical leadership can be provided domestically without dependence on international
projects. This particularly includes the ability to collect and analyse data and use it for evidencebased programming decisions, especially as an ever-increasing proportion of resources will be
allocated by provincial governments.
DFID and the World Bank will continue to work closely with other international partners over the
extension period to build the evidence base and advocate with key Government counterparts at
national and provincial levels with the aim of increasing Vietnam’s domestic budget allocation for HIV
and AIDS and ensuring that the scarce resources are allocated to the most cost-effective activities.
The remaining 13% of the proposed budget is for project management by the Government at national
level and in the 32 provinces. This proportion has been reduced below the previous level, again with
a view to achieving sustainability.
D. What measures can be used to assess Value for Money for the intervention?
The ultimate measures of value for money are in the cost per HIV infection averted and the resultant
economic returns in terms of (direct) medical costs averted and (indirect) societal costs averted.
These will be assessed again during the independent evaluation planned for the second half of 2012
and can be compared to international benchmarks.
12
During the period covered by the UNAIDS/UNSW epidemiological impact evaluation mentioned
above, coverage of the most-at-risk populations within the selected study provinces was not very
high (less than 50% of both PWID and FSW and very few MSM indeed). Furthermore, rates of
unsafe behaviour (sharing needles and unprotected sex) remained fairly high. Since then coverage
has improved significantly (although still needs to improve more) and levels of unsafe behaviour have
reduced dramatically in the supported provinces. These factors would suggest that the value for
money in terms of HIV infections averted will be even greater now than it was then. This is because
with generally lower levels of unsafe behaviour and generally greater penetration of the most-at-risk
populations, the same programmatic investment is likely to result in a greater proportion of HIV
infections averted. Lower coverage tends to include the easier-to-reach communities, whereas
higher coverage includes harder-to-reach communities who typically practise higher risk behaviours.
The current project (unlike the one previously evaluated) has both higher coverage and higher rates
of consistent safe behaviour.
E. Summary Value for Money Statement for the preferred option
The proposed extension represents very good value for money. The societal economic rate of return
is one of the highest of any potential DFID funded project anywhere. This was estimated at over £4
billion from the original £18.3 million investment, and it is now estimated that at least an additional
£220 million of societal benefits would be generated from this extension phase. The net present
value of direct benefit to DFID (in averted health sector costs) is £5.8 Million.
Commercial Case
Direct procurement
Almost all the procurement will be indirect (see below). A small proportion of the money (£250,000) is
retained by DFID for direct procurement of some international inputs, especially for training,
monitoring and evaluation. Such procurement follows DFID procedures to ensure value for money.
Indirect procurement
A. Why is the proposed funding mechanism/form of arrangement the right one for this
intervention, with this development partner?
Most of the procurement in the project is done by the Central Project Management Unit (CPMU) and
its provincial subordinates (PPMUs). These are Government of Vietnam units, so the aid modality is
classified as Financial Aid to the Government of Vietnam. Procurement is undertaken using
Government of Vietnam procurement procedures. Some procurement is done by the World Bank
office in Hanoi following the World Bank’s procurement regulations. All indirect procurement in the
project, whether through Government or World Bank, must follow World Bank procedures and is
subject to monitoring and audit accordingly. Procurement to date has been satisfactory according to
the World Bank procurement specialist. The project was selected for various audits and evaluations
by the UK Government, including DFID’s Internal Audit Department in 2010 and NAO audit in 2011.
There were no qualified audit opinions.
13
Given the nature of this final year during which the project activities are going to be transferred
gradually to the National Targeted Programme or other donor funded projects, the need for the
procurement work to follow Government procedures becomes greater. Therefore the project will help
strengthen the procurement processes by officially implementing at all levels the transparent
procurement framework that has been applied successfully in other DFID/WB funded work in
Vietnam. The CPMU and PPMUs are already implementing most of the steps in this framework
effectively.
B. Value for money through procurement
A realistic procurement plan for the remaining contract activities has been prepared by the PPMUs,
consolidated by CPMU, and approved by MOH. Procurement supervision missions will be carried out
on a semi-annual basis. Procurement of goods and services will be on a competitive bidding both
internationally and nationally, depending on the size of goods and service packages.
Financial Case
A. What are the costs, how are they profiled and how will you ensure accurate
forecasting?
The phased budget for the additional financing is as follows:
Description
FY 2012/2013
FY 2013/2014
Total
Trust Fund with the World Bank
£ 4.3 m
£ 1.65 m
£ 5.95 m
DFID managed consultancy
£ 0.2 m
£ 0.05 m
£ 0.25 m
Total
£ 4.5 m
£ 1.7 m
£ 6.2 m
The project will start its planning process for 2013 in Oct/Nov 2012 in consultation with all key
stakeholders including provinces, central agencies and donors. Final provincial action plans and the
overall project workplan will be approved by 31 Dec 2012. DFID forecasting is based on these
workplans. Payment to the Trust Fund with the World Bank will be made twice in FY12/13,
scheduled in Dec 2012 and Mar 2013 to align with the payment schedule of the project. There will be
one payment in FY13/14, scheduled in Oct 2013.
Based on preliminary estimates, to be confirmed during the above-mentioned planning process,
indicative financial allocations to the different areas of work will be as follows:







£1,240,000 for harm reduction for people who inject drugs, including needle/syringe programmes
and methadone maintenance therapy (for 9 months with transition to Global Fund starting from
July 2012)
£2,052,000 for condom social marketing
£437,000 for work among men who have sex with men
£282,000 for strengthening the national monitoring and evaluation system for HIV and AIDS
£1,142,000 for training and advocacy (including £210,000 for technical assistance provided by
WHO experts)
£797,000 for programme management (at central level and in the 32 provinces)
£250,000 for DFID managed consultancy
14
B. How will it be funded: capital/programme/admin?
Programme.
C. How will funds be paid out?
The project utilizes a joint financing/payment arrangement whereby DFID and IDA funds are comingled and channeled through a special account held by the Ministry of Finance. The
Administrative Arrangement between DFID and the World Bank and the Grant Agreement between
the World Bank and the Government of Vietnam will be amended to reflect the time and cost
extension in the funding. The World Bank is not committing additional funds for this time extension
period, but has agreed to extend the Trust Fund to enable DFID to finance another year of
operations.
DFID will then transfer the funds to the World Bank according to the above schedule, but taking into
account actual progress of the planned activities to ensure that funds would not be transferred in
advance of need. From the Special Account, the funds would be transferred to CPMU and PPMUs.
D. What is the assessment of financial risk and fraud?
No fraud or misuse of funds has been detected during the operation of the project so far. The
monitoring arrangements both of the Government and of the World Bank are robust. The fiduciary
risk is considered to be low.
E. How will expenditure be monitored, reported, and accounted for?
The assessment for the additional financing has concluded that the project will continue to meet the
minimum World Bank financial management requirements. Current reporting arrangements will be
maintained. PPMUs are committed to improving financial management and reporting and are
following up on 2010 and 2011 audit recommendations.
The CPMU will continue their frequent monitoring visits supported by two WHO technical consultants
to provinces and will send to donors six-monthly progress reports which cover up-to-date information
on disbursement and work progress.
Besides annual financial and reporting audits, an impact evaluation will also be carried out in 2012.
Management Case
A. What are the Management Arrangements for implementing the intervention?
The programme will be managed by the Vietnam AIDS Administration Control (VAAC) under the
Ministry of Health. Management and coordination will be organized as follows:

A Joint Steering Group (JSG), chaired by the former Vice Minister of Health (now a Special Adviser
to the Ministry), sets strategic goals, approves the annual work plans and budget, and oversees
implementation. Members include officials from VAAC and ODA management Ministries (MPI,
MOF), WHO (technical review), World Bank and DFID. The JSG meets twice a year.
15





A Central Programme Management Unit (CPMU) is in charge of programme management. The
CPMU is led by a Deputy Director General of VAAC with support from seconded staff from VAAC
and contracted staff.
A Technical Review Team (TRT) will review the annual work plans and provide support as
necessary. TRT comprises of technical experts from implementing Ministries, WHO and technical
epidemiology institutes.
At provincial level the Provincial AIDS Centre (PAC) is in charge of developing and reviewing
provincial work plans and facilitating implementation by ensuring support and participation of
multiple implementing agencies. It is led by the Vice Chairman of the Provincial People’s
Committee and attended by senior officials from Departments of Health, Public Security, Labour
and Social Affairs, Planning and Investment, Finance, Information and Culture, Women’s Union and
the Youth Union.
Provincial action plans are approved through an iterative process involving the PACs and the
CPMU, with technical advice from WHO. DFID and the World Bank have opportunities to feed into
this process.
Technical assistance will be provided by WHO. Additional TA will be procured based on demand.
DFID and the World Bank jointly lead on overall management, although the World Bank handles the
financial disbursement to the Government and also leads on procurement. Both DFID and the World
Bank participate in regular supervision and monitoring. The programme will contract health specialist
inputs through a Technical Assistance Arrangement, which will include drawing in WHO expertise.
DFID plans to bring in additional technical inputs as required to support annual reviews.
Day-to-day implementation management is by the Government of Vietnam at both national and
provincial levels. During this extension phase the management costs have been reduced by
rationalization of management structures at provincial level and reduction of staff numbers at the
national level. More staff will now be paid for completely by the Government.
International partners in the HIV/AIDS sector in Vietnam work together closely, and the DFID/WB
project is not managed as a stand-alone project. It is essential for effectiveness and sustainability that
it is managed in close collaboration with the programmes funded by the Global Fund and by PEPFAR
and with the domestically funded National Targeted Programme. Donors hold monthly coordination
meetings and both DFID and the US Government are members of the Global Fund’s Country
Coordinating Mechanism, along with UNAIDS and WHO.
B. What are the risks and how these will be managed?
The overall risk rating is medium. The two key risks identified during the original project design –
sustainability of outcomes and support from public security – remain key risks, although recent political
developments have somewhat reduced the second of these.
Limited sustainability of outcomes due to shortage of public funds. This remains a key risk.
Government commitments to increase significantly the domestic budget for HIV and AIDS have only
partially materialized and in the meantime donor support has decreased much more rapidly than
previously expected. Uncertainties over ongoing Global Fund financing are particularly worrying. This
risk will be mitigated in the short term by this project extension, ensuring uninterrupted prevention
activities during the transition to the next phase of Global Fund financing. DFID and other international
partners will continue to use high level policy fora to push for increasing public funding for HIV/AIDS
and make the economic case for early funding on prevention and harm reduction. As GoV financing is
expected to grow steadily over the coming years, the situation from 2020 onwards looks manageable.
The period from 2015 to 2020 could potentially be covered by additional Global Fund financing, since
the Global Fund Board has stated that new funding applications will be processed from 2015.
International partners, including key Global Fund financiers such as DFID and the US Government,
need to advocate at the Global Fund Board and senior management level to ensure that the Global
16
Fund provides adequate resources for Middle Income Countries (especially lower MICs like Vietnam)
which are struggling to mobilize adequate domestic resources while simultaneously losing bilateral
donor funding.
Restricted community and authority acceptance of the national harm reduction approach.
Despite the growing awareness of the effectiveness of harm reduction among Government agencies
and communities in Vietnam, drug injecting is still treated as a criminal offence by many local
authorities and police forces. While this remains the case, harm reduction activities such as needle
and syringe programmes may not receive the necessary support from communities and Government
agencies, in particular the police. Furthermore, local authorities at various levels (from provincial down
to commune) in some parts of the country place restrictions on the placement of condoms in
entertainment venues and guesthouses, despite the fact that there is a national regulation encouraging
such condom placement. This severely hinders the 100% condom use programme in those locations.
To mitigate this risk, the programme will actively pursue a multi-sectoral approach to the management
and delivery of project activities. In addition to national support from the MOH, Ministry of Public
Security, Ministry of Labour Invalids and Social Affairs (MOLISA) and Ministry of Culture Sports and
Tourism, the political involvement of provincial, district and commune level party and local governments
(i.e. People’s Committees) will be prioritized.
Lack of procurement capacity was identified as an important risk in the original project design, and
this proved to have been a well-founded concern. Stock-outs of commodities occurred during the
transition from previously DFID-funded provinces to the new project using World Bank procurement
rules in 2009-2010. Provided that option 3 (continuation of the same joint DFID/WB project
management arrangements) is selected, this should not be a major risk now, as all provinces are now
up to speed on the procurement regulations.
Stigma, discrimination and criminalisation of drug users, sex workers, MSM and other
vulnerable groups was another important risk. This continues to be a risk, although the
criminalization of sex work has reduced markedly and in many provinces drug users are less
criminalized than before. MSM remain highly stigmatized almost everywhere, although there are signs
that this is beginning to change in the major cities. Furthermore, the Ministry of Justice is currently
reviewing the legal status of same-sex couples, using (somewhat surprisingly) a rights-based approach
to identity, property, inheritance and adoption of children. The project will continue to work with
government officials and community leaders to reduce criminalization, stigma and discrimination.
C. What conditions apply (for financial aid only)?
Not applicable.
D. How will progress and results be monitored, measured and evaluated?
The project currently utilizes a monitoring and evaluation (M&E) framework which forms part of the
National M&E Framework which the project has helped to develop. Outcome and output indicators
have been revised to make them up to date and relevant and to reflect the additional results to be
delivered through the extension phase.
The project has established a good monitoring and reporting system. Monitoring is carried out at
different levels by:




Ministry of Health and VAAC (ad hoc)
Provincial AIDS Centre (monthly)
Central Project Management Unit M&E team (6-monthly)
Technical, financial, social and safeguard audits (annually)
17
The CPMU provides VAAC and donors with a 6-monthly progress report with data on progress on
disbursement, on progress of implementation, on procurement and TA activities and key issues to be
addressed. These reports will be discussed at the semi-annual review missions.
The project also uses data from the Government’s Annual Sentinel Surveillance Data System and the
Integrated Blood and Behavioural Survey (IBBS) (every 2-3 years) and supplemented by programme
surveys at start and completion of the project.
The project has used analysis and evidence from various evaluations on DFID’s work on harm
reduction including the independent evaluation in 2009 on DFID’s previous project by WHO and the
independent impact evaluation in 2011 by UNAIDS and the University of New South Wales.
The project is planning another independent evaluation focusing on effectiveness and VFM. This is
currently in the process of being commissioned. The ToRs have been developed jointly by DFID
Vietnam, DFID Evaluation Department, WHO and the World Bank, in consultation with VAAC and
following UNAIDS guidance on best practice for HIV prevention evaluations. The evaluation will be
conducted in close collaboration with the independent Vietnamese team (from the Research Centre for
Rural Population and Health) that is providing inputs to the World Bank’s Implementation Completion
Report.
The project has also included a budget of £282,000 during the extension phase to strengthen the
national monitoring and evaluation systems for HIV and AIDS.
Logframe
Quest No of logframe for this intervention: 3623917
18
Annex 1
Supplement to Business Case: Funding sources, current and future
1. Funding from all sources over the last three years for which comprehensive data
is available is presented in the table below. (Figures in US dollars)
Sources
%
2008
2009
2010
Total
13,459,880
17,176,061
21,431,087
52,067,028
6,832,580
6,737,254
9,193,116
22,762,950
6.3%
6,627,300
10,438,807
12,237,971
29,304,078
Private sources
16,014,322
16,036,519
15,600,379
47,651,220
8.1%
13.1%
Profit-making institutions
Households
82,581
15,931,741
144,812
15,891,707
15,600,379
227,393
47,423,827
International sources
66,734,575
94,161,904
102,221,779
263,118,258
Bilateral organisations
Government of Australia
Government of Canada
Government of Denmark
Government of France
Government of United Kingdom
48,552,930
1,205,251
70,785,002
2,471,859
137,207
954,800
593,146
4,470,027
598,866
2,256,690
84,013,483
1,502,842
300,000
4,176,787
321,443
7,534,127
203,351,415
5,179,952
437,207
5,131,587
1,513,455
14,260,844
56.0%
1.4%
0.1%
1.4%
0.4%
3.9%
Government of United States (PEPFAR)
38,894,158
63,926,353
69,340,357
172,160,868
47.4%
596,419
304,091
581,876
953,162
158,084
398,397
385,379
448,912
117,000
502,195
159,897
754,503
819,488
1,469,450
1,561,971
0.2%
0.2%
0.4%
0.4%
3,255
58,835
62,090
0.0%
17,849,999
6,251,409
22,975,232
6,320,161
17,512,495
6,152,088
58,337,726
18,723,658
2,871,788
5,829,561
6,650,517
15,351,866
1,877,157
5,548,183
1,670,997
8,443,611
1,343,508
1,849,216
4,891,662
15,841,010
4.2%
1.3%
4.4%
1,301,462
710,902
1,517,166
3,529,530
1.0%
331,646
401,670
695,801
1,429,117
0.4%
The Bill and Melinda Gates Foundation
46,697
20,887
67,584
0.0%
Ford Foundation
Other international not-for-profit
organisations
14,880
14,880
0.0%
Public sources
Central government (including
National Targeted Program)
Provincial government
Government of Germany
Government of Ireland
Government of Netherlands
Government of Sweden
Other Goverments (Japan,
Luxembourg, Norway)
Multilateral organisations
Asian Development Bank (ADB)
Global Fund to Fight AIDS,
Tuberculosis and Malaria (GFATM)
UN agencies
World Bank
Multilateral funds or development
funds n.e.c.
International not-for-profit
organisations
Total
14.3%
0.1%
13.1%
72.5%
16.1%
5.2%
331,646
340,093
674,914
1,346,653
0.4%
96,208,776
127,374,483
139,253,245
362,836,506
100.0%
19
2. The above data is derived from the Vietnam National AIDS Spending
Assessment (UNAIDS, 2011). After excluding out-of-pocket expenditure, the
total programme expenditure covered by Government and donors in 2010 was
$123.7 million.
3. The Government estimates that the total programmatic need is still around $125
million, but from 2014 this will grow steadily to $205 million by 2020. This growth
is due to planned increased coverage, both of prevention programmes and
treatment and care programmes, as Vietnam seeks to fulfil both its international
obligations and its duty of care to the population.
4. Many of the donors listed in the above table have already stopped providing any
further funds for HIV and AIDS work in Vietnam. These include most of the
European donors, the World Bank and the ADB. The WB and ADB have decided
that any further funding for the health sector should be through health systems
strengthening, not for any specific disease control programmes.
5. Although PEPFAR is by far the largest donor, there are some important
considerations concerning PEPFAR funding that make it very different from other
donors’ and GoV funding. Hence the role of PEPFAR in the overall financial
picture is distortionary. Key factors include:
a. Almost all PEPFAR money is channelled through US-based international
NGOs and cannot be passed through Government channels and cannot
pay for Government staff or Government-managed procurement.
b. Almost half of the money goes into management, administrative and
“enabling” work that does not directly deliver HIV/AIDS services.
c. PEPFAR cannot fund some crucial prevention activities, such as needle
and syringe programmes.
d. PEPFAR’s cost norms (e.g. for staff salaries and allowances) are three
times those of the Government.
6. The Government has recently published (this week) its latest projections for the
HIV/AIDS response’s financing needs, using an all-inclusive programmatic
approach sub-divided into four categories: prevention, treatment & care,
monitoring & evaluation and capacity building. These projections are based on
the Government’s own cost norms and management costs. Whereas the
DFID/WB and Global Fund financed programmes stay quite close to Government
cost norms, as they mainly implement through Government, PEPFAR’s cost
structure is very different. Thus, to get a comparable picture of the actual value
to Vietnam of the PEPFAR programme, the PEPFAR budget has to be adjusted
downwards to fit with GoV cost norms for the activities financed. This makes a
very significant difference when looking at future financing projections and the
estimated funded gap. The following two figures illustrate this.
20
Figure 1: Showing funding sources without adjusting PEPFAR value. (US$)
7. This assumes that the Global Fund Round 9 grant Phase 2 application is granted and does not include the DFID extension. At
face value, the programme is fully funded until 2015 or 2016. However, this is not a realistic scenario, because the PEPFAR
resources cannot be used to fund all the activities considered necessary by Government (and donors) and PEPFAR-funded and
managed activities cost approximately twice as much to implement as Government-managed activities. The next figure shows
the situation after adjusting the PEPFAR resources in line with Government cost norms.
21
Figure 2: Showing PEPFAR funding adjusted to remove excess overhead costs (US$)
8. This now shows that when the PEPFAR contribution is scaled to fit the Government’s own cost projection, there is a much
larger funding gap. There is already a gap in 2013, and then a bigger gap starts to open up from 2015. However, if the Global
Fund is open to considering further funding applications from Vietnam after completion of Round 9 in 2015, the remaining gap
could potentially be filled right up to 2020. It is also likely that through efficiency savings, it may be possible for Vietnam to run
an effective HIV and AIDS programme at a cost somewhat below the current projection. However, this is crucially dependent on
22
there being no interruption in the prevention programme. Any loss of momentum on prevention will lead to greatly increased
treatment and care costs in subsequent years.
9. These projections are based on the latest estimates by donors (including an update by PEPFAR this week). The central
Government funding projection is based on the current commitment to increase funding by 20% per annum up until 2020,
reiterated publicly by the Vice Minister of Health this week. The provincial Government funding is also calculated on the basis of
20% annual growth. In actual fact, provincial financing has been increasing faster than this in recent years, and Vietnam is
following a path of increasing fiscal decentralization. So these projections may in fact be on the low side.
10. It is clear from this projection, which is the most accurate scenario based on currently available information, that although GoV
funding is increasing slowly, it is on track to provide more funding than all the donors together as early as 2015 or 2016. By
2020 it will be funding 61% of the estimated need from domestic public finances.
11. The next figure (see Figure 3, next page) adds in the proposed DFID/WB extension. This effectively fills the gap in 2013. This
may look like a small gap in financial terms, but it is critically important for two reasons: (1) the DFID money is funding crucial
prevention activities for which no other provision has been made other than the extension of the Global Fund Round 9 into its
Phase 2; (2) the Global Fund Secretariat in Geneva has already communicated that there will most likely be a gap of about 6
months from the Board decision in January 2013 to the actual availability of Phase 2 funds for the programme in Vietnam.
12. This is a manageable scenario. Adequate funding is assured to 2015; prevention programmes do not get interrupted; and
Vietnam can apply for more Global Fund financing to bridge the gap from 2015 to 2020.
23
Figure 3: Showing adjusted PEPFAR budget with DFID 1-year extension. (US$)
13. It is of course impossible to know whether the Global Fund Board will approve the Phase 2 at its meeting in January 2013. But
the approval of the DFID extension will improve the likelihood of a positive outcome. Throughout the planning process for the
Phase 2, the DFID/WB teams and the DFID-funded WHO experts have been working intensely with the Global Fund’s principal
recipient (a sister unit within the Vietnam Authority for HIV/AIDS Control) and the Vietnam CCM to ensure a well-planned,
seamless and responsible handover of key prevention activities from DFID/WB financing to Global Fund financing. Originally,
when the Global Fund Round 9 grant was approved, this transition was planned for 2012. Due to factors beyond the control of
24
the DFID/WB funded project, this could not happen. However, now that the Global Fund resources have become more
constrained and subject to more conditions, and now that the Government has recognised the extreme urgency of using all
resources in an integrated, cost-effective way, the conditions are right for a smooth transition in 2013. The Global Fund’s Fund
Portfolio Manager for Vietnam has told the Vietnamese Government that a well-planned and epidemiologically sound handover
of DFID/WB-funded prevention work to the Global Fund programme is a requirement for further grant approval. It is well
recognized by all that if the prevention work currently funded by DFID/WB stops, Vietnam’s entire HIV and AIDS programme will
suffer a major setback. The following figure shows the funding scenario without either the DFID or Global Fund extensions.
Figure 4: Showing adjusted PEPFAR budget but without DFID or GF extensions
25
14. In this scenario, a large funding gap opens up from 2013, and without the possibility of Global Fund finance, there are no other
options for filling the gap. The next applications for new Global Fund finance will not be submitted until 2015. By that time the
prevention programmes will have come to a halt, with GoV having to prioritize its limited resources into care and treatment. The
epidemic will almost certainly flare up out of control, setting Vietnam back by at least 5 years.
15. Another important consideration is that if the DFID/WB project is extended through 2013, this enables GoV to learn important
lessons from the transition process. A well-managed transition, supported by DFID-funded WHO technical assistance, will set
the standard for an even bigger transition from the Global Fund financed programme to the domestically funded National
Targeted Programme in the coming years. Abrupt DFID exit in 2012 without this well-managed transition would not provide any
opportunities of this nature.
16. The most positive scenario, which is not improbable, is that (1) the DFID extension provides the necessary transition in 2013;
the Global Fund Round 9 Phase 2 is approved, with funding filling the gap from the second half of 2013 through to the end of
2015; and (3) Vietnam secures new financing from the Global Fund from 2015 to 2010 at approximately the same level as the
current Round 9. Under this scenario, there is no funding gap until 2020, and by that time it is expected that efficiency savings
will have brought down the estimated need somewhat. See the final figure below:
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Figure 5: Showing adjusted PEPFAR budget with DFID 1-year extension and additional GF financing from 2015. (US$)
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Annex 2
Light touch economic appraisal for the HIV/AIDS Prevention Programme
extension, August 2012
Background
DFID and the World Bank in Vietnam have been supporting an HIV/AIDS Prevention
Programme since 2009, focusing on harm reduction activities, training and
advocacy, and monitoring and evaluation. This work has been effective, contributing
to Vietnam seeing the number of new HIV infections in decline for the last four years.
The programme was planned to end in December 2012. However Vietnam is now
subject to serious financing constraints given unexpected rapid loss of donor
resources (e.g the Global Fund, and the US Government’s PEPFAR programme),
and Vietnam’s own budgetary difficulties. DFID is proposing to continue its support
for an additional 12 months to provide bridging funding before additional funding
from the Global Fund and Government’s budget comes. This will help ensure the
continuation of key prevention activities and advocacy work to bring about
sustainability of the approach before we can confidently and successfully complete
the programme.
Methodology and assumptions
This light touch economic appraisal draws heavily from the substantial economic
appraisal piece of HIV/AIDS prevention programmes in Vietnam, performed by
Access Economics, the University of Melbourne in March 2009. This study looked at
the lifetime cost of illness per case of HIV/AIDS in people who inject drugs - the most
prominent high risk behaviours, and the cost-effectiveness of prevention
interventions for this group in Vietnam. It concluded that a prevention programme of
£18 million would have very strong value for money with net benefits to DFID
(avoided health care costs) ranging from £26 million to £59 million. The societal
benefits (including also avoided lost productivity, quality of life and mortality) would
range from £1.86 billion to £4.39 billion.
For this analysis of the programme continuation, we use the same various figures
calculated in the previous study for the following reasons, some of which will be
elaborated in the Benefits section below:




The Access Economics study used a standardised approach for estimating
the costs and effectiveness of prevention interventions;
Key parameters still hold such as the epidemiological, political, social, and
institutional contexts. Vietnam is still at the low-level and concentrated
epidemics stage and other contextual issues are still valid;
Costs of HIV infection could have increased given the rising health care costs
and productivity. However the same costs used mean that we adopt a
conservative approach to estimating the expected benefits (i.e. avoided costs)
Intervention cost per case prevented is assumed to be the same, and was
quickly cross-checked with newly available results of cases prevented and
corresponding estimated programme spending.
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The business case considers three options in addition to the “do nothing” option. It
concludes that the preferred option is extending the current programme, using the
existing management and implementation mechanisms, but with tailored activities for
maximum impact and sustainability. The cost and benefit analysis below presents
results for this option and the counterfactual of doing nothing.
Costs
The programme cost for DFID is £6.2 million. This amount is proposed to be
transferred to the World Bank, the implementing agency in two instalments, £4.5
million and £1.7 million in 2012/2013 and 2013/2014. For simplicity we assume that
this cost will be incurred in the calendar year of 2013. Also for simplicity we do not
take into account the staff cost involved with the extension, which is very small
proportionately to the programme cost.
The activities and their cost breakdown are as follows:
Activity
Harm reduction for people who inject drugs
Condom social marketing
Work among men who have sex with men
National monitoring and evaluation system
Training and advocacy
Programme management
DFID-managed consultancy support
Allocation (£)
1,240,000
2,052,000
437,000
282,000
1,142,000
797,000
250,000
The cost of the “do nothing” option for DFID is zero.
Benefits
We calculate only the benefits arising from infection cases averted due to harm
reduction for people who inject drugs, using the parameters identified in the Access
Economics study such as intervention cost per case prevented and cost per case of
HIV infection. Benefits from other prevention types such as condom social marketing
or work among men who have sex with men cannot be robustly identified due to very
limited evidence of cost-effectiveness in these areas. A review of value for money in
HIV prevention, by the DFID supported Human Development Resource Center,
found only one study related to condom distribution, out of over 30 studies reviewed.
On the other hand one may well argue that a mixture of interventions is required to
break the infection circle, although evidence of cost effectiveness of a
comprehensive package of activities is also limited.
The intervention cost per case prevented is the average of the costs in large urban
city, rural province, and urban township settings, where DFID work, which is £742.
This figure tally broadly with newly established data in the “Evaluation of
epidemiological impacts of HIV harm reduction programmes in Vietnam”, 2011 of
over 1500 cases being averted annually, and the corresponding spending. The cost
per case of HIV infection, or the benefits/avoided cost per case averted, consists of
health care cost, productivity loss of people with HIV/AIDS. These figures are £2,046
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and £5,507. The benefits/avoided costs to the society, apart from the above items,
include loss of wellbeing, quality of life and premature mortality. This figure is
£148,574 per case.
Balance of costs and benefits
The below table summarises the balance of costs and benefits of the proposed
project extension.
Summary of costs and benefits (£)
2013 Present Value
6,200,000
5,636,364
12,616,596.32
11,469,633.02
Costs to DFID
Benefits to DFID
(Avoided health care costs &
productivity loss)
Benefits to society
248,179,290.53
225,617,536.84
(Avoided health care costs, productivity
loss of HIV people and carers, quality of
life and premature mortality)
Net benefit to DFID
Net benefit to the society
6,416,596.32
241,979,290.53
5,833,269.38
219,981,173.20
Taking into account the avoided costs in health care and productivity loss, the net
benefit is significant at £5.8 million in present value, for this DFID investment of £6.2
million (or £5.6 million in present value). The societal net benefit is huge at £220
million in present value.
With the “do nothing” option, the benefits would be negative, i.e unrealised benefits
because of lack of support.
Value for money measures
The main cost-effectiveness measures for HIV prevention interventions are
intervention cost per infection averted or quality adjusted life-years (DALY) saved.
We will include vfm dimensions in the coming independent impact assessment. We
will verify the intervention cost per infection averted used for this analysis, which is
£742. This is currently in the range for low-level and concentrated epidemics of $374
- $45,173 identified in the Human Development Resource Center review mentioned
above. We will also explore measuring cost per DALY saved. There are other, lower
level indicators such as cost per client contact or cost per condom/syringe
distributed, which can also be looked at.
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