The Global Fund's new funding model for more strategic investment

Symposia Session - Trends in AIDS Financing and Effectiveness of Current Investments

Melbourne, July 2014Dr Christoph Benn

Director, External Relations Division

Global Fund

Content Overview

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Financing trends

Addressing unmet needs

Towards more strategic investments

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Update on resource mobilization 4th Replenishment: $ 12 B in pledges – 30% above 3rd Replenishment level

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• Pledges & contributions to the Global Fund have been increasing over time

• As of Q2 2014:

• Total pledges have reached US$ 12.3 billion, with donor government pledges accounting for US$ 11.6 billion or 94.7%

• US$ 3.844 billion of total pledges have been signed into contribution agreements of which US$ 1.580 billion have been paid in

2006-2007 (London) 2008-2010 (Berlin) 2011-2013 (New York) 2014-2016 (Washington) -

2,000

4,000

6,000

8,000

10,000

12,000

14,000

3,380

8,400 9,200

12,006

4,717

9,826 10,521

12,284

4,740

9,414 10,120

1,580

in USD million

Original Pledges Actual Pledges Cash Receipt

3,844

2006-2007 (London) 2008-2010 (Berlin) 2011-2013 (New York) 2014-2016 (Washington) -

2,000

4,000

6,000

8,000

10,000

12,000

14,000

3,380

8,400 9,200

12,006

4,717

9,826 10,521

12,284

4,740

9,414 10,120

1,580

in USD million

Original Pledges Actual Pledges Cash Receipt

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Disbursements to programs total $24.4 billion to date, including $13.1 billion (54%) for HIV/AIDS

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2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20140.12 B0.36 B

0.58 B 0.70 B

1.07 B1.33 B 1.29 B

1.58 B 1.46 B1.76 B

2.10 B

0.73 B

0.23 B 0.63 B 1.05 B 1.33 B 1.73 B 2.25 B 2.75 B 3.07 B 2.63 B 3.34 B 3.96 B 1.45 B

Annual disbursements in US$ Billion

HIV/AIDS Malaria Tuberculosis

Total Annual Disbursements:

Total HIVDisbursements:

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Total Funding from Global Fund is Increasing• The total funds for allocation are 20% higher than in the past:

- The total funds allocated to countries, available as of January 1, 2014 and including existing funds: $ 14.7 billion for three years or on average $ 3.7 billion per year;

• In addition:

- $ 950 million to be awarded as incentive funding to ambitious programs that deliver impact in country, which increases the average implied funding level to above US$ 3.9 billion per year;

- $ 200 million for new regional grants and $ 91 million to finish existing regional grants.

64% 10% 9% 8% 4% 4%

- Allocations by Region (billion and %) -

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Content Overview

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Financing trends

Addressing unmet needs

Towards more strategic investments

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Largest funding increases are targeted at the regions with the least recent funding relative to burden

East Asia & the

Pacific

Eastern Europe & Central

Asia

Latin America

& the Carib-bean

North Africa &

the Middle East

South Asia

East Africa

Southern Africa

West & Central Africa

0%

5%

10%

15%

20%

25%

30%

Disease Burden Recent Funding

Disease burden and recent funding share

Country allocations relative to recent funding

75% 100% 120% 170%

Allocation as a percentage of recent funding:

0% >170%

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0 m

50 m

100 m

150 m

200 m

250 m

300 m

350 m

400 m

450 m

Malaria - Prevention: Nets dis-tributed (ITNs & LLINs)

2006 2007 2008 2009 2010 2011 2012 2013 mid-20140.0 m

2.0 m

4.0 m

6.0 m

8.0 m

10.0 m

12.0 m

14.0 m

0.8 m1.5 m

2.0 m 2.4 m3.0 m 3.3 m

4.2 m

6.1 m6.6 m

HIV - People currently on ART

TB - New smear-positive TB cases detected and treated

Global Fund results - 6.6 million people on antiretroviral therapy, an 8% increase over 6.1 million in 2013

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Source: Global Fund Grant Data, mid-2014

Cur

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Cum

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Inse

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Results in HIV/AIDS at a glance:

• 6.6 million people on ART, with gains driven by higher numbers in Nigeria, Mozambique, India, and Uganda, among others.

• counselling and testing sessions for HIV increased by more than 50 million to 360 million from 306 million at year-end 2013

• number of OVCs that received basic care and support for HIV increased to 7.1 million from 6.5 million over the past 12 months.

• condoms distributed grew by 155 million to reach the total of 4.7 billion, more than a third of the increase from campaigns in Rwanda and Ghana

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Most countries are under-funded relative to need & are encouraged to be ambitious in what they plan to achieve

In most countries, the allocation amounts (regardless of whether a country is over- or under-allocated) will still be insufficient to cover the gaps vs. real need

- Most countries are under-funded relative to their needs.

- This should not limit planning and ambition – to defeat the diseases, countries need to think creatively on how to use all resources available

Stronger resource prioritization is critical to achieving impact

- Existing grants should be used as effectively as possible, ensuring programs are regularly evaluated and grants reprogrammed for maximum impact

- Any additional funding should be harmonized with existing funding; disease programs should be viewed in a holistic manner

Strategic investment for maximum impact

- Resources are focused on targeting the right populations

- Decisions on allocation of resources are based on evidence/data

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Context of the 5th Replenishment

ODA projected to increase in 2014 & then stabilize

10July 2014Melbourne

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

80.13 B

108.30 B 105.42 B

104.92 B

122.78 B

120.56 B

129.07 B134.67 B

126.95 B

2013 2014 2015 2016

138.4 B

Net official development assistance 2004-13 & projections for 2014-16 (in current US$ billions)

OECD: http://www.oecd.org/newsroom/aid-to-developing-countries-rebounds-in-2013-to-reach-an-all-time-high.htm

ODA in 2013 rebounded & reached $ 134.8 B despite economic pressure on donors but likely to stabilize after 2014 critical to ensure appropriate share for health

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Content Overview

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Financing trends & Results

Addressing unmet needs

Towards more strategic investments

• Focus more strategically on areas of greatest impact

• Support increased investments from domestic sources

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Example of investing for impact: Targeting ‘hot spots’ achieves greater impact in Kenya

Source: [i] Williams BG, Lloyd-Smith JO, Gouws E, Hankins C, Getz WM, et al. (2006) The potential impact of male circumcision on HIV in Sub-Saharan Africa. PLoS Med 3: e262. doi:10.1371/journal.pmed.0030262

…lends itself to improve efficiency of HIV prevention spending through prioritization

In Kenya, geographic variation in HIV prevalence …

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Shared responsibility through increased domestic resources

Mandatory minimum requirements of counterpart financing

• Minimum threshold contribution (LI-5%, Lower LMI-20%, Upper LMI-40%, UMI-60%)

• Increasing government contribution to disease programs and health sector

• Reliable disease and health expenditure data

‘Willingness-to-pay’ commitment to further incentivize

• Additional co-investments by government in disease programs in accordance with ability to pay

• Realization of planned government commitments

• 15% of allocation is contingent upon meeting WTP commitments

Core Global Fund principles: Sustainability, Additionality, Country Ownership

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Update on resource mobilization

GF Domestic Financing Strategy

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GF strategy for increased domestic financing for health

1. Implement NFM policies linked to domestic financing

(Counterpart financing & willingness-to-pay)

3. Advocate for political leadership & for realization of

Government commitments

2. Support domestic resource mobilization efforts (priority

countries) with help of partners

1. Implement NFM policies linked to domestic financing (CF & WTP)

• Country needs assessment/ target-setting & support the buy-in process

• Options of tools/mecha-nisms for innovative financing

• Documentation & dissemination of Best practices

• Advocacy plan with key messages by GF, Donors, partners, private sector and CSOs

• Revive co-champion-ships and identify other champions

• Leverage key national/ international events & platforms

• Support countries on CF/WTP (guidance & tools, country dialogue)

• Review country compliance with CF & monitor WTP commitments

• Track at grant & portfolio levels

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Conclusions

Health expenditures should keep pace with economic growth

There is no single blueprint for increasing domestic funding for health

Lessons learned and best practices should

THANK YOU

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