Increasing Domestic Investment in AIDS, TB & Malaria

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February 24, 2015

Agenda

• “Housekeeping” Items

• Welcome & Introductions

• Domestic Financing for AIDS, TB & Malaria

• Questions

• Wrap up

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Welcome & Introductions

Deb Derrick

President

Friends of the Global Fight

Johannes Hunger

Head of Strategic Information

The Global Fund

George Korah

Senior Specialist in Health Financing

The Global Fund

Background

• Current landscape:

• Increased funding requirements to sustain/scale-up

programs

• Plateauing donor resources globally

• Global Fund’s new funding model prioritizes leveraging

domestic resources for AIDS, TB & malaria

Increased domestic resource mobilization is key to transition from emergency response to sustainable health programs.

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Opportunity: Resources for HIV in LICs & MICs

The UN General Assembly 2011 Political Declaration on HIV and AIDS set

a target of USD 22bn–24bn by 2015

Source: UNAIDS estimates

Resources available for HIV in low- and middle-income countries, 2002–2012 and

2015 target [USD bn]

Scale Up of Domestic Resources Needed to

Sustain Programs

0

20

40

60

80

100

120

140

160

180

2011 2012 2013 2014 2015 2016 2017

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Vietnam: Available Funding and Gap for HIV/AIDS (2011-17)

Global Fund Other Donors Government Gap

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30

40

50

60

2012 2013 2014 2015 2016 2017

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Bangladesh: Available Funding and Gap for HIV/AIDS (2012-17)

Global Fund Other Donors Government Gap

Counterpart Financing

• All Global Fund supported programs must meet a minimum threshold

of domestic public investment known as counterpart financing.

• Low Income 5%

• Lower-Lower Middle Income 20%

• Upper-Lower Middle Income 40%

• Upper Middle Income 60%

• “Willingness-to-pay” incentive added in 2014

• 15% of Global Fund allocation contingent on additional government

investments:

• Beyond current level of government spending and not less than already planned

spending

• Over minimum threshold requirements

• Targeted to priority areas of national strategic plans

Country Engagement Process

Portfolio Review Update and Clarification from Country Stakeholders

Existing commitments are sufficient and reasonable

to meet WTP requirements based on country context

Assessment of Government Commitments

Commitments are not sufficient to meet

WTP requirements or not known

Country

DialogueEngagement to

formalize commitmentsEngagement to increase and

formalize commitments

CCM Submission of Commitments

Secretariat Review

Grant Making and Agreement

Grant Implementation

Communication to Country on Allocation and Requirements

Counterpart Financing:

Role of Country Team & Country Dialogue

• Country team:

• Clarifies counterpart financing issues identified by portfolio analysis

• Engages with country stakeholders on additional governmental

investments & actions

• Country dialogue ensures a clear understanding of:

• Government financing mechanisms

• Extent of funding & interventions supported

• Timing of government investments

• Tracking & reporting mechanism

• Development/implementation of financial stability plans for countries

no longer eligible for Global Fund support

Commitments for First Four Waves of Concept Note

Submission

Your responsibility to invest with the Global Fund

To overcome the three diseases, governments and the Global Fund must invest together in

solutions. To establish the basis for future sustainability of national disease programs, the Global

Fund requires governments to do more to support its own programs. See below for the

requirements that apply to Botswana.

Counterpart financing requirements

Access to new funding is contingent on compliance with the Global Fund’s counterpart financing

policy. It requires the demonstration of:

1. Minimum threshold government contribution to disease programs supported by the Global

Fund (60 percent for upper- middle income countries);

2. Increasing government contribution over time to the (a) disease programs supported by the

Global Fund, and (b) health sector; and

3. Reliable disease and health expenditure data to measure and monitor compliance with the

requirements of government spending.

Willingness-to-pay

To encourage countries to increase national funding beyond the minimum counterpart financing

requirements, 15 percent of the total allocation is contingent upon Botswana meeting

‘willingness-to-pay’ commitments. These commitments represent government’s willingness to

increase spending on health and the three diseases and will be a point of discussion with your

Fund Portfolio Manager (FPM) and Country Team. Willingness-to-pay commitments will be

discussed during country dialogue and confirmed when the CCM decides how it wants to split its

funds across diseases and HSS activities

Example of Language in Allocation Letter

Example of Commitments from Ministries of Health/Finance

HIV Program / Program Areas Actual FY 2011/2012 Actual FY 2012/2013 Budget FY 2013/2014 Budget FY 2014/2015 Budget FY 2015/2016 Budget FY 2016/2017

Antiretroviral Therapy (ARVs) 84,922,273 129,245,857 158,731,285 193,000,000 202,650,000 212,782,500

Lab Consumables and Reagents 10,061,675 18,166,221 25,897,930 29,268,910 30,640,197 31,775,238

Personnel Costs 48,918,387 60,941,924 68,177,648 76,271,067 82,505,433 86,630,705

Planning and Administration/Operating Costs 50,286,986 70,642,750 69,955,170 79,060,822 82,764,925 85,830,884

Communication 1,036,353 1,812,550 3,897,082 4,404,342 4,610,691 4,781,491

Conferences, Workshops & Trainings 540,883 416,417 721,187 815,060 853,246 884,854

Total Government HIV Expenditures 195,766,557 281,225,718 327,380,301 382,820,201 404,024,493 422,685,672

“Please find attached a document that shows funding from the Swaziland Government. It captures Government spending or expenditures for the financial years 2011/12, 2012/13 and the budget for 2013/14. Also included is the commitments for subsequent years”

38% 44% 8% 4% 6%

Strongly Agree Agree Disagree Strongly Disagree Do not know

Applicant Feedback from 2014 NFM Waves

“The Global Fund's increased focus on counterpart financing encouraged

greater government commitments in my country”

“This will help our country to take charge and not to rely on donation alone”

“My country is already meeting its counterpart financing requirements, and has

(and is) demonstrating additional willingness-to-pay. Global Fund’s increased

focus on counterpart financing and willingness-to-pay played no real role.”

QUESTIONS?

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EXAMPLES OF DOMESTIC FINANCING

PROGRESS

Appendix A

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Mozambique

0

10

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60

70

2012 2013 2014 2015 2016 2017

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Government Spending and Commitments for HIV, TB and Malaria

HIV Tuberculosis Malaria

• Additional $28 million to

Global Fund-supported

programs in 2015

• Will be maintained/

increased over time

• Commitments = additional

$118 million for 2015-17

• >130% increase from 2012-

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Papua New Guinea

0

5

10

15

20

25

30

35

40

2012 2013 2014 2015 2016 2017

US

$ M

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Earmarked Budget Spending and Allocation for HIV, TB and Malaria

HIV Malaria TB

• Additional gov’t contribution of

$48 million

• 78% increase from 2012-14

• Full financing of TB drugs &

supplies

• Support for malaria drugs &

diagnostics

• Procurement of ARVs

• Transitioning donor funded

positions to government payroll

Philippines

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0

5

10

15

20

25

30

Sh

are

of

Go

ve

rnm

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t in

To

tal

HIV

Sp

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Government HIV Spending and Commitments

Share of Government in Total HIV Spending

• 85% of “sin tax” revenue

earmarked for health

• 58% increase in Department of

Health appropriation from 2013

to 2014

• Gov’t contributes to 84% of

funding for HIV in 2015-17,

compared to 18% in 2009

• Gov’t resources will cover:

• >80 percent of treatment costs

treatment for PLHIV

• 100% of prevention among sex

workers

• 100% of treatment for sexually

transmitted infection for key

populations

Other Domestic Resource Mobilization Efforts

• Domestic Financing Strategy for Health

• Advocacy through global & regional platforms

• High level engagement, advocacy & technical support in priority countries (e.g.

Ethiopia, Kenya, Malawi, Nigeria, Senegal & Tanzania)

• Special initiative for value for money & sustainability

• Technical support for costing, priority setting, sustainability planning &

operationalization of sustainability initiatives

• Support for institutionalization of National Health Accounts

• Support for mobilizing domestic resources through OECD Senior Budget

Officials regional networks

• Debt2Health & private sector initiatives allow contributions to be

channeled towards Unfunded Quality Demand

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ADDITIONAL EXAMPLES OF COUNTERPART

FINANCING CONDITIONS & COMMITMENTS

Appendix B

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Counterpart Financing Related Grant Conditions

In accordance with the Global Fund Board Decision Point GF/B28/DP4: Evolving the Funding Model (Part

Two), the commitment and disbursement of 15% of aggregate allocation of approximately USD 184.6

million, which is equal to approximately USD 27.7 million, is subject to compliance with the Global Fund

willingness to pay requirement (the “WTP Requirement”). In order to meet the WTP Requirement, by 31

December of each calendar year, the Grantee shall ensure and deliver evidence of compliance with each

applicable program-specific requirement set forth below:

• On or before 31 December 2015, the government shall budget funding for substitution maintenance

therapy (the “SMT”) program and implement the SMT program for the duration of 2016, in

accordance with the target of the NAP 2014-18;

• On or before 31 December 2016, the government shall budget funding for the SMT program and

implement the SMT program for the duration of 2017, and provide evidence that domestic funding

for 2016 has been effectively provided in accordance with the target of the NAP 2014-18;

• On or before 31 December 2016, the government shall budget funding for the HIV and TB

prevention packages for key populations, including for the harm reduction component, TB active

case finding, adherence and implementation of activities for the duration of 2017 and 2018, in

accordance with the targets of the NAP 2014-18; and

• On or before 31 December 2016, the government shall budget funding for the ARV treatment to

transfer all HIV patients from the Grant Funds to the state program, in accordance with the target of

the NAP 2014-18, ensuring treatment continuation.

Commitments from Ministries of Health/Finance