Bush Administration Demands Stalling Distribution of Grants From Global AIDS Fund
Although it has approved $1.6 billion in grants for programs in more than 40 countries, the Global Fund to Fight AIDS, Tuberculosis and Malaria has not yet distributed any money, largely because of "demands led by the Bush administration" that the fund create an aid-delivery mechanism "from scratch," the Wall Street Journal reports. The Global Fund has so far received $2.1 billion in pledges; the United States has pledged $500 million of this amount. The fund approved 58 project applications in its first round, including $165.3 million for programs in South Africa and $92.9 million for efforts in Zambia -- two countries with HIV prevalence rates of more than 20%. As the HIV/AIDS pandemic continues to grow, the fund is facing "mounting pressure" to distribute the grants. Global Fund Executive Director Richard Feachem said that he hopes to distribute money to a "handful" of projects by October, although this deadline is also "up in the air," the Journal reports. Most of the grant recipients will not receive any money until the end of the year or later.
Creating a New Distribution System
The Journal reports that several donors to the fund, including the United States and the United Kingdom -- are "dubious" about allocating aid through existing agencies, such as the United Nations and the World Bank. The Bush administration and the U.K. government say that existing agencies have not had enough of a "positive effect" and are asking that the Global Fund "shun existing aid agencies and build its own system," a request that has delayed the distribution of funding. Despite the United States' objections, the World Bank holds the fund's money and has agreed to wire grants to recipients. To create its own distribution mechanism, the fund must implement its own procurement, administrative, auditing and other services in each country for each grant. Although the fund still has only a "vague outline" of how it will distribute grant money, its current plan consists of three elements for each project: a principal recipient, a local fund agent and a third independent agent. The recipient could consist of a foreign health ministry, a local government, a private firm or a private charity that will implement the project, gauge its success and report the findings to the fund. The local fund agent could be an accounting firm, bank or charity that will audit the usage of the grant. The independent agent will periodically verify the principal recipient's assessment of the project's impact on public health. U.S. officials concede that creating this approach will mean "somewhat slower delivery of the aid," but they say that closer monitoring of aid distribution will ensure a greater benefit. "We're anxious for quick victories, (but) better that it be done right and later than early and wrong," an unidentified U.S. official said. Feachem and U.S. and British officials say that the fund is making "quick progress" in implementing its new distribution system, but "tension has emerged" between donors and the recipients who want to receive the money as soon as possible. Milly Katana, a Ugandan AIDS activist who represents private charities on the fund's board, said, "I don't see any justification for that kind of excess precaution. Personally I don't want to just light the money on fire and burn it, but at the same time lives are being lost" (Phillips, Wall Street Journal, 8/5).