You may have noted a series of recent media reports alleging corruption and mismanagement in projects financed by the Global Fund to Fight AIDS, Tuberculosis, & Malaria. Although these reports focused on the Global Fund, a number of newspapers, blogs, and broadcasters have made or repeated allegations about its involvement with the UN Development Programme (UNDP). These have in many instances contained serious errors of fact and omission, including a misrepresentation of the scale of UNDP’s role with the Global Fund. The Associated Press (AP) has notably issued a correction clarifying that UNDP manages roughly 10 percent of Global Fund resources, not 50 percent as the AP first reported. Erroneously, Canadian Press today cited a Canadian MP as "[pointing] out that the United Nations Development Program, which manages one-fifth of the Fund, refuses to open its books to investigators." A related dispatch today by Fox made similar assertions.

These reports have unfairly criticized UNDP for not granting the Global Fund unlimited access to its internal audits. Such access is currently permitted only to Members States, not to non-governmental organizations such as the Global Fund, under a policy adopted by the UNDP Executive Board, which includes 36 countries including the United States and Canada. As members of both the UNDP and Global Fund Executive Boards, the United States and Canada can in fact review internal UNDP Global Fund and other audits upon request, and the United States has done so. In addition, UNDP reports to the Global Fund any significant irregularities revealed in its audits, which include the work of sub-contractors; UNDP works closely with the Global Fund to address such issues if and when they arise.

UNDP is also working with UN system partners on a proposal for Board consideration that will provide the Global Fund greater access to Fund project audits. UNDP management strongly supports this effort to increase access by large-scale institutional donors  to relevant project audits. We hope as many UNDP Executive Board members as possible will support this proposal.

Please find below a summary of UNDP’s relationship with the Global Fund, which has in many instances yielded remarkable results under uniquely challenging circumstances.

UNDP’s Partnership with the Global Fund to Fight AIDS, TB, & Malaria

AIDS, tuberculosis and malaria claim more than four million lives annually and pose a serious threat to stability and growth in many countries.

Established in 2002, the Global Fund is an innovative public–private partnership with the aim of bringing additional resources to country responses to the HIV/AIDS pandemic and well as the neglected diseases of tuberculosis and malaria. It is guided by the principle of performance-based funding and has committed US$21.7 billion to 150 countries through nine competitive funding rounds. Mandated to be lean, the Global Fund relies on a wide range of partners to carry out key activities.

As part of a wider engagement with the United Nations, the Global Fund has developed a strong partnership with UNDP, formalized in 2003, to ensure that Global Fund grants are implemented and services delivered in countries facing the most exceptional development challenges and/or complex emergencies. Overall, UNDP represents around 10% of the Global Fund’s total portfolio. As of January 2011, this translates into UNDP managing 63 active grants in 27 countries as the Global Fund Principal Recipient.

UNDP’s added value to the partnership includes:

•        long-term country presence and operational capacity;

•        governance and capacity development mandate;

•        multi-country expertise in grant implementation;

•        well-established legal and administrative agreements with host governments;

•        access to the technical expertise of the UN family; and

•        competitive procurement.

UNDP has been called upon to serve as temporary Principal Recipient for a variety reasons, such as in countries

•       where the Global Fund has assessed the proposed national Principal Recipients as significantly lacking in capacity in one or more of the required management areas, and as unable to develop or mobilize the necessary technical capacities during a reasonable period within the lifetime of the grant. Examples include Chad, Niger, and Togo;

•       which are emerging from long periods of conflict with extremely weak central administrations, often accompanied by concerns about governance and implementation capacity. Examples include Angola, DRC, Iraq, Liberia, and Sudan;

•       which are recovering from a major natural disaster that has destroyed the ability of national entities to implement programs. Haiti is a recent example following the devastating earthquake in January 2010;

•       which are facing political upheaval, or longer-term, complex political situations that jeopardize the ability of Governments and national NGOs to implement Global Fund grants. One example is Kyrgyzstan, where the Global Fund and the Provisional Government recently asked UNDP to step in as temporary Principal Recipient following the revolution in April 2010. Another example is Bosnia, where the Government has requested UNDP to stay on as Principal Recipient to overcome implementation obstacles related to the political complexities in that country;

•       where corruption and weaknesses in financial management capacity have led to the suspension of grants; in these cases, UNDP has been asked to step in as temporary Principal Recipient while transparency and accountability systems are strengthened. Zambia is a recent example;

•       which have chosen to use UNDP as Principal Recipient to overcome national institutional bottlenecks and legal obstacles that obstruct effective implementation (e.g., prohibition of NGOs holding foreign currency accounts). Examples include several countries in Central Asia;

•       which are under “additional safeguards," primarily referring to donor limitations on transfer of funds to Government. Countries in this situation include Cuba, Iran, and Zimbabwe.

In the early years of the partnership, countries that fell into none of these categories, and which enjoyed strong civil society and technically competent public sectors, asked UNDP to serve as Principal Recipient for the grants primarily as a neutral, cost-effective administrative service. These included Argentina, Honduras, and Panama. These types of services have been discontinued, and UNDP is no longer Principal Recipient in such countries.

Accountability

Global Fund projects are uniquely risk-prone, given the exceptionally difficult environment in which UNDP is asked to manage such projects. Global Fund grants managed by UNDP are therefore subject to intensive audit scrutiny. UNDP’s Office of Audit & Investigations (OAI) has three Audit Specialists dedicated to and specialized in auditing Global Fund grants. Annually, OAI covers up to 15 out of the 26 Global Fund programs managed by UNDP as of December 2010. Wherever we have discovered problems, we have acted to remedy them and ensure they do not recur. Of the 19 UNDP-managed Global Fund programs audited, only two were rated “unsatisfactory,” while most were “partially satisfactory”—meaning that internal controls, governance, and risk management processes were generally established and functioning, but need improvement. OAI works closely in its investigations, as appropriate, with national law enforcement authorities, and keeps the Global Fund’s OIG informed of all of its findings and results.

Results

As of the end of 2009, as Principal Recipient, UNDP had reached 28 million people with prevention services, distributed 356 million condoms, provided 4.8 million people with HIV counseling and testing, supported 213,000 people with ongoing, life-saving antiretroviral treatment, treated 878,000 cases of sexually transmitted infections, provided prevention of mother-to-child transmission services to 36,000 women living with HIV, detected and treated 700,000 cases of tuberculosis, treated 26 million cases of malaria, and distributed 11 million bed nets. Life-saving services are reaching millions of people in countries facing exceptionally difficult development challenges. Good progress is being made in developing national capacity to take over full implementation of Global Fund grants.

UNDP Partnership Works in Three Areas

Implementation support: In exceptional circumstances, UNDP serves as interim Principal Recipient—implementing grants and delivering services—in countries that lack strong national institutions resulting from capacity constraints, complex emergencies, post-conflict environments, or donor sanctions. It does so only upon request by the Global Fund and/or the Country Coordinating Mechanism—a public-private partnership at the country level, which develops and oversees Global Fund grants—and when it has been determined that no national entity is ready to take on the Principal Recipient role at the time.

Capacity development: UNDP helps to strengthen capacity of prospective and current national Principal Recipients to manage and implement Global Fund-financed programs. Once local capacity has strengthened, UNDP then hands over the role of Principal Recipient to a national entity. Such handovers have occurred in 12 countries, and the process is under way in another nine.

Policy engagement: UNDP engages with the Global Fund on important substantive policy and programmatic issues in line with UNDP’s mandate as co-sponsor of UNAIDS. This includes promoting principles of good governance, human rights, and gender initiatives into Global Fund grants, ensuring that financing reaches key populations, helping align grants with national development plans and poverty reduction strategies, and contributing to the further enhancement of country-level governance of Global Fund programs that respect principles of national ownership and aid effectiveness.

Successes

In Liberia, UNDP successfully transferred the Principal Recipient role of the Round 6 HIV grant to the Ministry of Health in January 2010. The Principal Recipient role for the TB and malaria grants is scheduled for handover in 2011. A capacity development plan was jointly developed and implemented with the Ministry of Health to enable it to achieve efficient management, oversight, and coordination of its national response to HIV and AIDS.

In Belarus, UNDP works with nearly 100 governmental and non-governmental organizations to implement Global Fund grants, strengthening their capacity in project management, monitoring and reporting. The HIV grant focuses on highly vulnerable groups, including sex workers, men who have sex with men, injecting drug users, and prisoners. The program has led to the creation of a nationwide network of educational centers on HIV prevention for young people and 10 self-support groups for people living with HIV. For the GF TB grant, 8 out 10 progress indicators were reached or surpassed, and a treatment success rate of 76% was achieved, while 10 of 11 indicators for the HIV grant were achieved or exceeded.

In Indonesia, the Government and UNDP partnered to strengthen the capacity of national Principal Recipients to improve implementation of Global Fund programs. After a 2007 assessment found weaknesses in program management that prompted new restrictions, the Ministry of Health and UNDP developed a project to provide capacity-building support to Principal Recipients to meet performance targets. These included training for managerial and financial staff and national certifications in the areas of procurement, human resources management, and behavioral analysis. Within two years, the grants were rated as “high-performing.”

In Tajikistan, UNDP is Principal Recipient for three Global Fund grants of each disease component. In 2009, it conducted training for government and local NGOs to build their capacities in financial management, program management, procurement, and monitoring of program implementation. In the last two years, more than 1,500 health care providers have been trained in disease management, as have NGO workers.

In Chad, UNDP has worked to strengthen capacity for Chad’s national malaria program through a GF Round 7 malaria grant. An initial capacity assessment revealed low capacity development in the national program, due to the lack of a proper working environment and the absence of a central, national database and appropriate data collection tools to collect, among other factors. UNDP has strengthened the program’s capacity by improving the working environment, training national program staff in monitoring and evaluation, training health center staff in the use of regional data collection tools, implementing tools (such as solar-powered radios) to transfer data easily from local areas to national data collection centers, and supporting introduction of a national data collection database. As a result of these efforts, the national malaria program’s monitoring and evaluation and data collection by staff in the national health system have improved considerably.

In Gabon, UNDP has handed over the Principal Recipient role, while continuing to support capacity strengthening in the national malaria program. It has helped restructure and re-profile the program, improved and clarified workflows, revised job descriptions, and supported the recruitment and training of new staff. UNDP has also helped formulate a capacity development plan for the program, and strengthened its monitoring and evaluation and data collection capacity by introducing mobile phone-based technology.

Please direct any further queries or requests for additional information to:

Sarah Jackson-Han
United Nations Development Programme (UNDP)-Washington
+1 202 331 9130 tel.
+1 202 674 7442 mobile
+1 202 907 4613 mobile
sarah.jackson-han@undp.org 
http://www.us.undp.org/