GLOBAL FUND OBSERVER (GFO), Issue 108: 27 October 2009.

[Guest guest]

GLOBAL FUND OBSERVER (GFO), an

independent newsletter about the Global Fund provided by Aidspan to over 8,000

subscribers in 170 countries.

Issue 108: 27 October 2009.

(For formatted web, Word and PDF versions of this and other issues, see www.aidspan.org/gfo)

+ + + + + + + + + + + + + + + + + + +

CONTENTS

+ + + + + + + + + + + + + + + + + + +

1.

NEWS: Inspector General Finds Significant Deficiencies in Grants to Tanzania

An audit conducted by the Global

Fund’s Inspector General on five Global Fund grants in Tanzania has identified serious

problems, particularly regarding supply chain management and financial and

programmatic reporting.

2.

COMMENTARY: Round 9: Straight Talk Needed

" Senior

Global Fund officials seem to be scared to speak in clear simple terms about

things that need to be said. Next month, the Fund will have a board meeting at

which it must make difficult decisions about how to fund Round 9. Whatever

decisions it makes, it should communicate those decisions rapidly and clearly

to all applicants. "

3.

NEWS: Indian CCM Modifies its Composition and Establishes Selection Processes

The

Indian CCM has made important decisions to change its size and composition and

to establish selection processes for each sector.

4. COMMENTARY:

Time for Action on Technical Assistance

" Many implementers of Global Fund

grants are still not getting the technical assistance that they need – often

because they are not requesting the TA in the first place. Accordingly, the

Global Fund ought to require that each prospective principal recipient prepares

a TA Plan prior to signing a Grant Agreement. "

5. NEWS:

Report Says Funding for Key Populations in Latin America and Caribbean Is

Scarce

Only a small proportion of funds for

sub-recipients of Global Fund grants in Latin America and the Caribbean

are reaching organisations representing the key population groups where the HIV

epidemic is largely concentrated, according to a report prepared by the

International HIV/AIDS Alliance.

+ + + + + + + + + + + + +

+ + + + + +

1. NEWS: Inspector General

Significant Deficiencies in Grants to Tanzania

+ + + + + + + + + + + + + + + + + + +

An audit conducted by the Global Fund’s Office

of the Inspector General (OIG) on five Global Fund grants in Tanzania has identified serious

problems, particularly in the area of supply chain management and financial and

programmatic reporting. The audit was conducted in early 2009 as part of the

OIG’s regular workplan rather than as the result of any whistle-blower

input.

In the area of supply chain management, the OIG found

that the inventory management systems being used for Global Fund grants could

not be relied upon to provide accurate information. The OIG also found

that stock management at service delivery locations was deficient. For example,

the audit found that there were missing quantities of artemisinin combination

therapies (ACTs) in 2007 representing $819,000; and that stock-outs of ACTs and

antiretrovirals (ARVs) occurred at some health facilities.

The OIG said that unless corrective actions are taken

at Tanzania’s

Medical Stores Department (MSD) and at other key levels of the supply chain,

grant resources will be " at risk. " (MSD handles all procurement for

public sector grant recipients.) The OIG recommended that future disbursements

to public sector Global Fund grant recipients be conditional on Tanzania

addressing the serious issues in supply chain management.

Also in the procurement area, the OIG found excessive

delays in procurement due to capacity shortcomings, lack of coordination in

procurement planning and the complex approval process required in government

departments. The OIG said that current procedures have resulted in oversupply

of ACT in the country, which has led to expired ACTs at all levels of the

supply chain. The OIG estimated

that the expired ACTs were worth $130,000.

The OIG attributed some of the problems to serious

deficiencies in the computerised inventory control and stock management system

used by MSD.

With respect to financial and programmatic reporting,

the OIG found that a lack of coordination and information sharing, as well as

complex disbursement processes, led to delays in sending grant funds to

implementing organisations which, in turn, resulted in delayed implementation

of programme activities. Financial

reports (mainly, progress updates and disbursement requests) were not prepared

and submitted in a timely manner by principal recipients (PRs) to the Global

Fund; and it was difficult to verify the accuracy and completeness of, and

establish the audit trail for, these reports. The OIG added that there were serious

problems in the reporting of performance indicator data for three of the five

audited grants.

The OIG found many internal control weaknesses in its

review of grant receipts and expenditures at all grant implementing entities.

The OIG said that these weaknesses could be attributed to " inadequate

supervision of accounting staff, workload issues, high staff turnover and lack

of relevant qualified and experienced finance/accounting staff to undertake

routine financial control duties. "

In its report, the OIG said that it " cannot give

assurance " concerning the accuracy of the financial and programmatic

reports prepared by one of the lead implementers, TACAIDS. The OIG found that

there were no financial and programmatic reports available from implementing organisations

to confirm the figures reported. The OIG recommended that disbursements to

TACAIDS for Round 8 grants be conditional on addressing the capacity gaps at

TACAIDS.

With respect to grant oversight, the OIG said that

" there are multiple players involved in grant oversight in Tanzania

with over-lapping responsibilities and inadequately defined roles and

responsibilities that invariably leave gaps in ownership and fulfilment of

grant oversight responsibilities. "

In conclusion, the OIG noted that the large influx of

funds from donor-funded health program initiatives " has overwhelmed the

complex bureaucratic processes and procedures of public health sector

implementing organizations " such as the Ministry of Health and Social

Welfare. " This has resulted in delays in procurement of goods and services

for grant implementation that led to Tanzania forfeiting USD 7.6 million

of unspent funds at the end of phase 1 for two grants, namely HIV/TB Round 3

and HIV/AIDS Round 4. "

The OIG report contained numerous recommendations for

addressing the shortcomings.

In its response, the Government of Tanzania

accepted most of the audit findings and stated that it would take appropriate

corrective measures. For its part, the Global Fund Secretariat acknowledged

that as a result of the massive scale up of health programmes covering the

three diseases over the last five years, the health systems in Tanzania

have been greatly stretched, resulting in numerous challenges that need to be closely

monitored.

A spokesman for the Global Fund Secretariat said in a

press interview that contrary to media reports, the Global Fund had not

threatened to withdraw funding from Tanzania as a result of the audit's

findings. He said that on the whole, Tanzania’s Global Fund grants

have been successful. The spokesman added, however, that the Global Fund has

asked the Tanzanian office of the international audit firm

Pricewaterhouses to investigate the findings. The Global Fund has

committed $820 million to support programmes to fight HIV/AIDS, TB and

malaria in Tanzania;

by the end of February, $384 million of this had been disbursed.

The OIG’s report, entitled " Audit Report on

Global Fund Grants to Tanzania "

(June 2009) is available at www.theglobalfund.org/documents/oig/Tanzania_Country_Audit_Final_Report.pdf.

+ + + + + + + + + + + + +

+ + + + + +

2. COMMENTARY: Round 9: Straight Talk

Needed

by Bernard Rivers

+ + + + + + +

+ + + + + + + + + + + +

At the time that Round 8

proposals were approved by the Global Fund Board in early November last year,

the Fund expected to have enough money to provisionally approve proposals

costing $2.75 billion. Before proposals were submitted, it had been assumed by

almost everybody that this would be more than enough, given that no previous

round had cost more than $1.1 billion.

But, in fact, the total cost of

Round 8 proposals recommended for approval by the TRP came to

$3.06 billion – almost three times the cost of any previous round,

and $306 million more than was available.

After intense discussion, the

Board resolved this problem by approving all the proposals, but saying that the

Fund would spend no more than $2.75 million on them, 90 percent of the

requested amount.

This raised immediate and

obvious questions in all the countries whose proposals had been approved. How

should the savings be arrived at? Did each country have to make a ten percent

reduction in its budget, or would some be permitted to reduce their budgets by

less than others?

The Fund took far too long to resolve

this uncertainty. It was not until December 19, six weeks after the original

Board decision, that the Fund finally provided reasonably clear answers to

these questions. (See GFO Issue 101, at www.aidspan.org/gfo, for a

summary of what the Fund said.)

The steps by which the Fund

arrived at this point were hesitant and somewhat inconsistent.

It all started on November 8, when

the Board resolved that the approved Round 8 proposals " shall collectively

be subject to a 10% adjustment for efficiency. "

For a month, the Fund issued no

explanation as to what this meant.

Then, on December 8, Michel

Kazatchkine, Executive Director of the Fund, wrote to CCMs saying that the

Board had approved, in principle, all of the TRP-recommended proposals, and

that this would involve funding commitments of up to $2.75 billion. He

made no mention that this was less than the total amount that the approved

proposals had actually requested. He simply said that that all countries should

look, to an unspecified extent, for " potential efficiencies " in their

Phase 1 budgets.

He went on to say that the

Secretariat believed that the " efficiency saving " could be achieved

through " a careful review of unit costs, ... efficient procurement, ...

and by responding to TRP comments on budgets. " There was no suggestion

that reductions in actual performance targets would be required.

A week later, on December 16,

Bill Paton, the Fund’s Director of Country Programs, wrote to CCMs and

PRs suggesting, for the first time, that a " ten percent adjustment "

would need to be made " in each recipient’s budget, " rather than

across all budgets collectively. And he acknowledged that there would be times

" where target adjustment is unavoidable. "

This was important news.

However, the letter provided no proposed sequence of steps for achieving the

desired budget reductions. Those steps were finally provided on December 19 in

an FAQ document at the Fund’s website.

This whole sequence leads me to

fantasize a conversation among senior Secretariat officials that went something

like this: " OK everybody, let’s say as little as possible, and be as

vague and confusing as possible. Let’s be silent for a month. Then,

let’s ask people to seek " potential efficiencies " but not ask

them to make " budget cuts. " Let’s delay as long as possible

mentioning that anyone might need to reduce performance targets. And when we

finally have to make things clear, let’s do it at the end of the day on a

Friday when lots of people are about to go on a two-week vacation, and

let’s post it at a part of the website where nobody will find it unless

someone tells them where to look. "

Of course, that conversation

didn’t take place. The people involved are bright, committed and

hard-working. But, like so many of their opposite numbers in the UN agencies,

they seem to be scared to speak in clear simple terms about things that need to

be said. (This UN-like avoidance starts at the most basic level – for

example, why does the Fund talk about " resource mobilization " rather

than " getting money " , or at least " fundraising " ?)

Next month, the Global Fund

will have a board meeting at which it must make difficult decisions about how

to fund Round 9. Whatever decisions it makes, it should communicate those

decisions rapidly and clearly to all applicants.

Bernard Rivers (rivers@...)

is Executive Director of Aidspan and Editor of its GFO.

+ + + + + + + + + + + + +

+ + + + + +

3. NEWS: Indian CCM Modifies its

Composition and Establishes Selection Processes

+ + + + + + + + + + + + + + + + + + +

Editor’s Note: This is an

account of the decisions recently taken by the Indian CCM to change its

composition and to establish selection processes for each sector. While it is

not possible for GFO to report on all changes in composition on all CCMs, we

prepared this article on the Indian CCM because the changes were significant,

because the process was well documented, and because we believe this will be of

interest to readers. This description is based on information provided by the

CCM Secretariat and information available on the CCM’s election website.

Earlier this year, the CCM in India made important changes to its

composition. The terms of office of the members of the old CCM were set to

expire in March 2009. At the time, there were 33 seats on the CCM, broken down

as follows: central government (8), governments of states and union territories

(5), academic and research institutions (5), civil society (5), private sector

(2), people living with the diseases (1), and multi- and bi-laterals (7).

The CCM decided to expand its size to 40. At a meeting

in January 2009, decisions were taken on seat allocation and selection

processes for the reconstituted CCM. New members were to serve from April 2009

to March 2011. The CCM created seven constituencies, as follows:

Constituency No. 1: Central

Government (eight seats). Of the eight

seats, five were reserved for the Ministry of Health and Family Welfare

(MoHFW), and three for other ministries. The Secretary of Health was mandated

to select the five MoHFW representatives. For the other three seats: one was to

be filled by the Ministry of Labour; one by either the Ministry of Tribal

Affairs or the Ministry of Development of North-East Region; and one by either

the Ministry of Railways or the Ministry of Panchayati Raj. Letters of

invitation were to be sent to these ministries. (The ministries of Finance and

Defence were to be allowed to send non-voting observers.)

Constituency No. 2: Governments of

States and Union Territories (five seats). One seat was allotted for each region, to be filled by

representatives of the following states: Assam

(North-East Region), Orissa (Eastern Region), Uttar Pradesh (Northern Region), Maharashtra (Western Region) and Karnataka (Southern

Region). (These are the states with the highest burden of the three diseases.)

The seats were to be filled by Mission Directors of National Rural Health

Missions.

Constituency No. 3: Academic and

Research Institutions (five seats). Of the five

seats, one each was reserved for a research or academic institute working in

HIV, malaria and TB; one for a research or academic institute working in health

systems strengthening; and one for a research or academic institute working on

gender issues. Requests for expressions of interest were to be sent to various

agencies, with the CCM making the final selection.

Constituency No. 4: Civil Society

Organisations (eight seats). The CCM formed

an Election Committee to oversee the selection process, and hired an outside

agency to conduct the elections. (Editor’s

Note: GFO is working on a separate article on the elections process for this

constituency.)

Constituency No. 5: Private Sector

(five seats). Of the five seats, three were

allotted to corporations, one to a private sector foundation, and one to

associations of clinical practitioners. For

the corporations, the three national business associations were to be requested

to conduct an open elections process to select one corporation each from

amongst their member companies. For the foundations, 11 Indian and four

international foundations were to be invited to send expressions of interest,

with the CCM making the final selection. For the associations of clinical

practitioners, a call for nominations was to be issued, with the CCM making the

final selection.

Constituency No. 6: Persons Living

with the Diseases (three seats). One seat

was allotted to each disease. For the HIV seat, the India Network for People

Living with HIV/AIDS (INP+) was to be asked to undertake an elections process

internally at the district and state levels to find a suitable candidate, to

include some smaller networks of persons living with HIV/AIDS in this process,

and to run the process by the CCM. The TB and Malaria Program Divisions of the

MoHFW were to be asked to develop a selections process to identify people from

the TB and malaria communities, and to submit the process to the CCM

Secretariat.

Constituency No. 7: Multilaterals and

Bilaterals (six seats). Three seats were allotted

to bilaterals and three to multilaterals. Recommendations were to be sought

from these sectors, with the CCM making the final decision.

The process was completed and the seats were all

filled by May 2009. For more details, including the names of the new CCM

members, see the " Reconstitution Report

of the India

CCM-2009-11 " at www.india-ccm.org.

+ + + + + + + + + + + + +

+ + + + + +

4. COMMENTARY: Time for Action on

Technical Assistance

by Garmaise

+ + + + + + + + + + + + + + + + + + +

Many implementers of Global Fund grants are still not

getting the technical assistance (TA) that they need – often because they

are not requesting the TA in the first place. Accordingly, the Global Fund

ought to require that each prospective principal recipient (PR) prepares a TA

Plan prior to signing a Grant Agreement.

As things stand currently, a PR will only obtain

adequate and appropriate TA if it goes through several steps, including listing

all the tasks that grant implementation will involve; recognising which of

these tasks the PR doesn’t have the experience or skills or capacity to

perform adequately; determining how TA can address those gaps; identifying

potential providers of the TA; choosing the most qualified; and, after the work

is done, evaluating whether the TA was in fact of any value. Only rarely are

all these steps carried out. Being required to prepare a TA Plan will make this

comprehensive approach much more likely.

Part of the problem is that there is a natural

reluctance on the part of PRs, particularly when they are from government, to

admit to any form of weakness. If they were asked " Do you need TA? " ,

the chances are that they would reply " No " . But if they were asked

" If you were going to receive some TA, in what context would it be most

useful?, " they might be more candid.

The Global Fund already requires that prior to signing

a grant agreement, PRs must prepare a Procurement and Supply Management (PSM)

Plan and a Monitoring and Evaluation (M & E) Plan. Given the importance of

having a solid TA strategy for each grant, why not also require that PRs

prepare a TA Plan?

The fact that a TA Plan is required might make it

easier for implementers to turn to Global Fund partner organisations (UN

agencies etc.) for assistance in developing the plan, and then in implementing

it. The partners would also be helped because they would easily know what TA is

needed, what parts have been provided, and what parts still need to be

provided.

The proposal form used for Round 9 already asks CCMs

to provide information on what TA is planned; what process was used to identify

needs; how the assistance will be obtained; and what process will be used to

evaluate the effectiveness of the TA. This is a good start. But our analysis of

completed proposals shows that many CCMs do not provide everything the Fund

asks for on the proposal form, or they only provide sketchy information.

Furthermore, at the time that the CCM writes the proposal, it may not have much

knowledge about the strengths and weaknesses of the proposed PR(s).

Accordingly, the information that PRs put in the TA Plan can and should be much

more detailed than what the CCMs put in the original proposal.

Specifically, the TA Plan should include evidence, for

each part of the workplan, that the PR has adequate capacity. When this is not

the case, the Plan should specify who will provide the TA and when. This

information ought to be provided for the first two years of the grant (Phase

1). Where it is not possible to provide the information for the full two years,

the PR could be required to file a TA Plan for the first year, and then to file

an updated TA Plan part way through Phase 1 covering both the first and second

year. The TA Plan should also be updated prior to the beginning of Phase 2.

The Global Fund may be reluctant to impose more

requirements on implementers. But there are times when imposing a requirement

makes sense. This is one of those times.

Garmaise (garmaise@...)

is a Senior Analyst at Aidspan. In March 2008, Aidspan published a White Paper

on TA entitled " Providing Improved

Technical Support to Enhance the Effectiveness of Global Fund Grants, " available at www.aidspan.org/publications

(click on " Other Aidspan publications " ).

+ + + + + + + + + + + + +

+ + + + + +

5. NEWS: Report Says Funding for Key

Populations in Latin America and Caribbean Is

Scarce

+ + + + + + + + + + + + + + + + + + +

Only a small proportion of funds for sub-recipients

(SRs) of Global Fund grants in Latin America and the Caribbean (LAC) are

reaching organisations representing the key population groups where the HIV

epidemic is largely concentrated – i.e., men who have sex with men, sex

workers, transgenders, and, in some countries, drug users. This is the main conclusion

of a report prepared by the International HIV/AIDS Alliance in April 2009.

The report is based on an analysis of 15 Global Fund

grants in Bolivia, Columbia, Ecuador,

El Salvador, Paraguay, Peru,

Haiti and the

English-speaking Caribbean. The report said that

of the $170 million that was given to SRs for these 15 grants, only 4.6 percent

went to key population organisations. It also said that no organisations

representing transgenders were selected as SRs for any of the grants, even

though prevalence studies in some parts of LAC suggest rates of up to 45

percent among this population.

(Although more that 75 percent of the funds for SRs

went to civil society organisations, most of them are not organisations led by

key populations.)

In addition to the 4.6 percent of funds that went to

key population organisations as SRs, a further 2.5 percent went to key

population organisations serving as sub-sub-recipients (SSRs).

Of the funds that went to key population organisations

as SRs, organisations of people living with HIV received just over 50 percent,

and organisations representing men who have sex with men, women living with HIV

and sex workers received about 28 percent, 16 percent and six percent

respectively.

The report found that where key populations have a

strong presence on CCMs, key population organisations are more likely to be

selected as SRs; and that key population organisations are more likely to be

selected as SRs in grants that have a civil society PR.

The report

identified four main barriers to key population organisations receiving funds

as SRs:

lack of

capacity among key population organisations

difficulties

accessing and understanding Global Fund-related information

" owned " by PRs and CCMs

under-representation

of key populations on CCMs

lack of

relevant and up-to-date epidemiological data, particularly among

transgenders and sex workers

The report recommends, among other things, that staff

in key population organisation be trained in proposal development and in how to

participate strategically in country-level decisions related to the Global

Fund; that CCMs be more transparent in their decision-making; and that the

Global Fund Secretariat play a stronger role in promoting the participation of

key population organisations in the Global Fund process.

The report, entitled " Report

on Access to Global Fund Resources by HIV/AIDS Key Populations in Latin America

and the Caribbean, " is

available in English and Spanish at www.aidsalliance.org/custom_asp/publications/view.asp?publication_id=350 & language=en.

" Reproduced

from the Global Fund Observer Newsletter (www.aidspan.org/gfo), a service of

Aidspan. "

Forwarded by:

---------------------------

Yours in Global Concern,

A.SANKAR

Executive Director- EMPOWER

107J / 133E, puram

TUTICORIN-628 008, TN, INDIA

Telefax: 91 461 2310151;

Mobile: 91 94431 48599: www.empowerindia.org

·

You are invited to join an e FORUM AIDS-TN. To join this

free e Forum kindly send an e mail to AIDS-TN-subscribe

·

You

are invited to join an e FORUM CIN - Confederation of Indian NGO’s. To

join this free e Forum kindly send an e mail to ConfederationofIndianNGOs-CIN-subscribe@...

·

This e Forums are

moderated by EMPOWER, a Non-profit, Non-Political, Voluntary and

Professional Civil Society Organisation.