Africa: The Transformation of the Global Fund – Concerns and Opportunities

Published: January 24, 2012

It has been a year of turmoil for the Global Fund. Round 11 has been officially cancelled, preceded by months of negative publicity about corruption and fraud. But the turmoil is set to continue as the Fund undergoes a process of organisational transformation. A Consolidated Transformation Plan (CTP) consisting of six "transformation areas," 31 projects and 162 deliverables is being implemented. A new Strategy for 2012-16 ("the Strategy") has also been produced, setting the direction for the Fund’s future evolution. With so much happening, it can be hard to "see the forest for the trees."

This commentary identifies seven elements of the Global Fund’s future transformation and then discusses what they might mean for the Fund’s mission.


Contraction and tighter rationing

If the first decade was the Global Fund’s era of expansion (in terms of the number of countries supported by grants and annual levels of expenditure), the next decade looks likely to be an era of contraction. As aid budgets stagnate or shrink, and as donor commitment to the Global Fund weakens, and given the reality of scarce resources and unmet need, the Global Fund has little choice but to consider tighter eligibility criteria and a more explicit system of rationing. The original demand-driven model of funding will thus be transformed into one that is more supply-driven. Funding will become less about countries "pulling in" Global Fund grants, and more about the Global Fund "pushing out" money according to stricter eligibility criteria.

A more hands-on approach

The Global Fund is adopting a more hands-on approach to all aspects of the grant cycle, from the initial applications for funding through grant management and programme implementation, and including grant renewals. This is designed to allow grant-making and grant-management to be better tailored to the specific context and needs of a given country. The CTP and Strategy also suggest a more operational role for the Fund in the procurement and supply management of pharmaceutical and other health commodities. In order to support this change, the status, capacity and authority of fund portfolio managers will be increased, as will the number of countries that will be managed under the country team approach. In addition, the time spent by Global Fund staff within recipient countries is expected to rise, and efforts will be made to strengthen the capacity and effectiveness of local fund agents. These changes mark a significant departure from the original vision of the Global Fund as a quick and nimble, global-level financing agency with a minimal in-country presence.

Shorter cycles of funding

The Fund will be moving towards shorter cycles of funding. For example, in future, new grants will cover a three-year period rather than a five-year period; and applications to the Transitional Funding Mechanism are limited to a maximum of two years. Grant performance will also be subject to more rigorous (and possibly more frequent) assessments and performance management prior to semi-annual disbursements. These changes mostly run contrary to the principles of aid effectiveness and may aggravate the difficulties associated with unpredictable and uncertain aid flows.

More emphasis on results and performance based funding

A striking feature of both the CTP and the Strategy is the even greater emphasis on results and performance measurement than before. This appears to be part of a general trend of donors and international agencies seeking to calculate their impact, especially in terms of the ultimate outcome measure: lives saved. As a result, the CTP and the Strategy include a number of plans to improve the health and management information systems of recipient countries and to improve the methodologies for measuring and attributing "results" to funders and programmes.

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