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Is the Global Fund Growing Up or Selling Out?
September 22, 2011
This week, a high level panel issued its assessment of fiduciary controls at the Global Fund to Fight Aids TB and Malaria. Despite press accounts that describe the report as “devastating” and “toughly worded,” it read more like a dull corporate system evaluation to me. Don’t get me wrong. I actually think that organizations need these kinds of studies to figure out where things are going well, or badly, and how to improve. I just don’t like trying to read all 150 pages in the middle of a business trip. The panel did an amazingly thorough job in only 6 months and, frankly, I’m pleased with the document’s low-key style, which is a more appropriate response than the relative hysteria in the press earlier this year. The Inspector General’s reports last year on misappropriated money were not evidence of major scandal. Rather they were evidence that the organization was getting its act together.
The bigger story to me is what this report might mean for an organization that was expressly created to blaze an innovative approach to international aid and is being counseled to back away from that vision. Is the Global Fund being asked to grow up or to sell out?
A large part of the impetus for creating the Global Fund was that donors didn’t want to channel large new sums of money through existing agencies such as the World Bank or the UN system that were considered bureaucratic, slow, unresponsive to countries, and more concerned with moving money than getting results. The Global Fund was supposed to be lean in staff, finance programs that had true “country ownership,” and eschew pushing external models. Most importantly, it was supposed to judge countries who received grants less on their adherence to procedures and more on their performance in reducing disease prevalence and treating the ill. Unfortunately, measuring performance was not taken seriously enough and the Global Fund relied more on measuring outputs (how many bednets were distributed?) than outcomes (has the prevalence of malaria declined?).
So ten years since it began, we have recommendations aimed at making the Global Fund look more like other aid agencies. The report calls for the Global Fund to be less “passive” and more “assertive” in its dealings with countries, asserting that their proposals for a new grant approval process, more scrutiny of the country coordinating mechanisms, greater supervision of sub-recipients, and more time spent by staff engaged with grantees are compatible with “country ownership.” (But are they?)
The Review Panel described this as a natural process of maturation – the Global Fund reaching a point where it needs to put systems and procedures in place like the other big boys and girls. They may be right. Even with the proposed changes, the Global Fund will probably remain more nimble and flexible than other international agencies. It will certainly be able to produce more reliable accounts and it continues to be more open and transparent about its findings than other agencies.
But I can imagine another approach that would have been closer to realizing the original promise of the Global Fund – an approach that would have called on the Fund to put resources into performance measurement, into independently verified reliable statistics on the prevalence of Aids, TB and malaria that could be used for assessing progress and rewarding good performers. This approach would measure the organization’s effectiveness by progress in combating disease rather than the rate of disbursement and the accurate accounting of funds.
The Global Fund faces a challenge in dealing with donors who reacted negatively to last year’s revelations of fraud. It is certainly safer under such circumstances for the Global Fund to mimic other agencies institutionally and procedurally. It is always riskier to stand out in the crowd. But it isn’t necessarily the best way to effectively assist low- and middle-income countries to fight disease.
Possibly Related Posts
- What Can We Learn from the Global Fund’s “Massive Fraud”?
- Does the Global Fund Reach the Most Marginalized and At-Risk Populations? (Postcard from Vienna)
- What’s Not Being Said about the U.S. Government’s Role in the Global Fund Replenishment
6 Responses to “Is the Global Fund Growing Up or Selling Out?”
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September 24th, 2011 at 10:21 pm
The evolution of the Global Fund demonstrates that the original impetus for creating it was based on false assumptions and wishful thinking. In terms of moving money, the GF did outperform the UN and WB, but at the expense of weak controls and simplistic approaches to counting “results”. Now there are efforts to fix these weaknesses by instituting better monitoring of outcomes and exercising more financial controls, but as a result, control is shifting to Geneva and it will inevitably become as bureaucratic as the UN and the WB. Shifting to some sort of performance based financing could improve focus on impact rather than process indicators, but greatly increase the need for close (and expensive) monitoring. Why not wind up the bureaucracy in Geneva and simply ask the WB to administer the funds for HIV, TB and malaria? Unfortunately, it is easier to create global bureaucracies than to close them.
September 25th, 2011 at 11:09 am
Jeff: I agree that the GF was built on wishful thinking. It was created as if there were no reason for all the bureaucracy and procedures at the UN and WB when, in fact, these procedures have grown from pressures by funders to “assure” that money is spent “appropriately” (that is, according to ‘the plan’).
But I don’t think the GF was based on false, shall I say, hypotheses. The core belief embedded in creating the GF was that an organization that links funding to measured results and performance (rather than controlling financial flows and monitoring activities) can be more efficient. This assumption was never tested because adequate resources and attention were never put into really measuring the outcomes of the programs. You state that moving to performance based financing would greatly increase the need for close and expensive monitoring. I don’t think this is necessarily true. For example, in our book on COD Aid we show how a relatively low-cost survey can independently verify government reports on school completion. Yet we’ve been financing education for decades with appallingly poor information about how many kids actually complete school. I believe that measuring outcomes can be less costly than controlling expenditures and inputs in many circumstances but that we rarely try it.
As for transferring the funds to the WB to administer – do you think they’re better at assuring funds are used effectively? I would like to see a good independent comparative study before assuming that transferring to WB administration would be cheaper than improving the functioning of the GF.
September 26th, 2011 at 10:53 am
Actually, the false assumption/hypothesis that I was referring to was the notion that by engineering new local structures (CCM’s) they could get local ownership and accountability. In fact, most CCM’s have been dominated by government and where host governments have issues of transparency and accountability, so have the CCM’s in those countries.
I agree that results based financing is something the GF should explore whether it is through the WB or through the Geneva bureaucracy. The WB is more of a leader in this area, however, so that is why I would opt for a transfer to them. The cost benefit calculation should also factor in the savings from closing down the Geneva bureaucracy.
My own organization’s experience with PBF suggests to me that monitoring results will be time consuming and expensive. Again, it figures to be most complicated and expensive in countries that already have issues with corruption, transparency and lack of accountability in the public sector.
September 26th, 2011 at 6:20 pm
Bill – I completely agree with you that COD aid should be piloted to see what it can do, and under which circumstances. However, I think you are mistaking the GF for an institution that already uses a COD aid approach. I think you’ll find the indicators they use are mostly the same process indicators almost everyone else uses.
See my blog here http://blogs.cgdev.org/globalh.....d-part.php
Results measures are discussed about two-thirds of the way down.
And if you see the content of GF proposals that are reviewed and “quasi-supervised” – I think you’ll see they focus very much on the “how” of what the programs will do with the money to achieve the proposed results.
The problem is that they try to do this without the technical, on-the-ground capacity to ensure the quality of the proposals. And then, well, they clearly are having even bigger problems with supervision – also due to lack of on-the-ground capacity. I think, in some ways, they are stuck between the “old model” of aid – with too little country ownership, but higher amounts of support for preparation and supervision, and a “new model” (which COD would be an application of) with much more freedom on the how, and MUCH higher scrutiny and accountability for results. But the GF as it currently operates in not an example of this.
September 27th, 2011 at 10:56 am
Jeff: I get your point about the CCMs and agree. I’m less convinced that the WB is a leader on results based financing when it comes to the big picture. They are certainly leading with respect to micro-level interventions – output-based aid or RBF that finances health service delivery. When it comes to policy lending and sector programs, though, I think they pay lip service to the idea of paying for results (outcomes) and end up paying for results (outputs or inputs). As April notes, my implicit counterfactual is a COD Aid style arrangement where the monitoring of results is not on the delivery system but on the outcomes and for that, depending on the sector, there are very cost-effective ways to get information.
April: I agree with you that GF is stuck between the old and new models of aid. I wasn’t trying to say that the GF *is* the new model and going back to the old. I was trying to say that staying true to the original ambition would require them to go significantly further down the road of outcome measurement. My concern is that this report says nice things about performance measurement but only reinforces the trend toward closer supervision of financial flows. I think GAVI was also between the old and new, and has opted to retract rather than move forward. When it’s approach to measuring coverage (relying on country reporting without verification) turned out to be flawed, they pulled back rather than introduce independent surveys to assess the accuracy of country reporting and help improve it. Their new strategy may work, but it has much more in common with traditional aid models – with extensive donor involvement in program design – than with the original innovative strategy.
September 28th, 2011 at 10:33 am
The GF was formulated on well intended wishes to speed up Aid disbursement for the critical interventions that most developing countries are grappling with. It however came to the realization that part of the “loose” processes aimed at speeding up Aid disbursement could not work.
The use of systems of other established institutions like the WB was brought into play (to help firm up processes I suppose) and usually the WB as a funds manager incorporates their systems into the whole process. Hence reverting back to the same place where the discussion of the formulation of the GF emerged.
Yes impact should come out more unlike the outputs and for some important reason (which I will not discuss here) monitoring of the procedures by fund organizations is helpful and beneficial to the recipient country BUT dwelling much on the same is detrimental and it partly turns the mandate to policing rather than facilitating interventions to deal with a particular cause.
There is some evidence regarding the use of other Organization’s systems, and truly its not always best (especially in dealing with disasters)