Donor Governments Pledge Record – But Insufficient – Amounts to the Fund

Author:

Bernard Rivers

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Article Number: 1

ABSTRACT Global Fund donors are expected to give the Fund about $11.7 billion over the three years 2011-2013, according to statements they made at a pledging session earlier this week in New York. This is 20% more than the $9.7 billion that was pledged three years ago for the 2008-2010 period; but it is significantly less than the Global Fund says that it needs.

Donors are expected to give the Global Fund about $11.7 billion over the three years 2011-2013. This is 20% more than the $9.7 billion that was pledged three years ago for the 2008-2010 period; but it is significantly less than the Global Fund says that it needs.

More than 40 countries, together with the European Commission, faith-based organizations, private foundations and corporations attended a pledging session in New York on Tuesday chaired by UN Secretary-General Ban Ki-Moon. Firm pledges for 2011-2013 were made totalling $9.2 billion. Some of the donors were not yet ready to make commitments. With the Global Fund projecting that these donors will end up giving some $2.5 billion, this leads to a total projected revenue of $11.7 billion.

The Fund says that its total needs over the three years 2011-13 will be $13-20 billion. Over the past few months, donor government studied the Fund’s needs and effectiveness and deliberated over how much each would commit to for the three years in question. They then came to New York this week to announce their decisions.

Pledge highlights

The amounts pledged were as shown in Table 1. Some highlights of the pledges were as follows:

• The four countries that pledged (or are projected to pledge) the most for 2011-13 are the USA ($4,000 m., 40% up on its pledge for the previous three years), France ($1,480 m., 20% up), Germany ($822 m., no change) and Japan ($800 m., 28% up).
• The three countries that pledged the largest percentage of their Gross National Income (GNI) are Norway and France (0.018% each) and Canada (0.013%).
• The four major donors whose pledges grew the most in percentage terms since their pledges for the previous three years were Finland (increased 100%), Australia (increased 56%), the USA (increased 40%) and Japan (increased 28%).
• Previous major donors who have as yet made no pledge for 2011-2013 are Spain (which pledged $600 m. for the previous three years), Italy (which pledged $541 m. for the previous three years), Sweden ($269 m.), Ireland ($98 m.), and Belgium ($56 m.) Given that these countries pledged a total of $1,563 m. for the previous three years, and that the Global Fund is only projecting to receive $1,100 m. for 2011-2013 from these plus a number of other countries, it is clear that the Fund expects some former major donors to significantly reduce or even end their contributions. One possible such country is Italy, which still has paid nothing from the $177 m. it pledged to pay in 2009 and the $177 m. it pledged to pay in 2010.
• The $4,000 m. pledge by the USA is the largest pledge ever made to the Global Fund. It is the first multi-year pledge that the USA has given to the Fund. The pledge is conditional on the Fund developing and implementing ‘a comprehensive set of reforms to maximise the impact of Global Fund grants.’
• The pledges by Russia ($60 million) and China ($14 million) were far less than the Fund had hoped.

Table 1: Donor Pledges to the Global Fund for 2011-2013

Data source: Global Fund press release at www.theglobalfund.org/en/pressreleases/?pr=pr_101005c

* Some of these amounts have been converted from other currencies.

** For pledges not made in USD, percentages shown are those that apply to the original currencies

¹Amount pledged by Japan will be given over ‘the coming years’.

²Netherlands pledge will be announced later. This is a conservative estimate by the Global Fund.

³UK pledge to be finalised/revised in the next few months.

Needs

In early 2010, the Global Fund provided donors with three possible resource needs scenarios for the period 2011-2013:

• Resource Needs Scenario 1 , which would cost $13 billion, would allow for the continuation of funding for existing programmes. New programmes could only be funded at a significantly lower level than in recent years.
• Resource Needs Scenario 2 , which would cost $17 billion, would allow for the continuation of funding for existing programmes, and funding for new programmes at a level that comes close to that of recent years.
• Resource Needs Scenario 3 , which would cost $20 billion, would allow for the continuation of funding for existing programmes, and for well-performing programmes to be scaled up significantly, allowing in turn for more rapid progress towards achieving the health-related Millennium Development Goals.

The Fund said that the differences between the human benefits of Scenarios 1 and 3 would be as follows:

Table 2: Human Benefits from Different Global Fund Scenarios

Data source: ‘Resource Scenarios 2011-2013′, available at www.theglobalfund.org/en/replenishment/hague/documents

 

Consequences

 

The Global Fund said some time ago that however much money was raised, it would need $8.8 billion over 2011-2013 for “continuations within existing grants,” plus paying for Round 9 grants that have not yet been signed, plus operating costs. On top of that, it would need a further $4.2 billion (Scenario 1) if it was to fund Rounds 10, 11 and 12 at a significantly lower level than earlier rounds, or it would need $8.2 billion (Scenario 2) if it was to fund Rounds 10, 11 and 12 at a similar level to earlier rounds.

 

In fact, though, this week’s pledges provide only $2.9 billion for Rounds 10, 11 and 12. The current estimate of the cost of Phase 1 of Round 10 is $2.0 billion. So the prospects for adequately funding Rounds 11 and 12, and Phase 2 of Round 10, are currently bleak, unless funds significantly in excess of this week’s pledges end up being raised.

 

 

Reactions

 

Ban Ki-Moon, UN Secretary-General, said upon opening the pledging session “We are within sight of ending deaths from malaria by 2015. That would be a great victory, on the order of eliminating smallpox, or polio. But we must defeat all these three diseases, completely. If we lose the ground we have gained, we will be back to square one – all that effort and investment, lost. The decisions you make here today will determine the outcome.”

 

The Treatment Access Campaign (TAC) in South Africa said, “Just as countries are beginning to build the infrastructure and systems to deliver services, the funding appears to be drying up.” Shaun Mellors, a member of the Communities delegation to the Global Fund Board, added, “To turn around now would be disastrous for all that we have achieved in the last 25 years. We applaud some donors who have stepped up to the plate by pledging what was expected, and call on others to prioritise the lives of people.”

 

 

Michel Kazatchkine, Executive Director of the Global Fund, said “This amount is not enough to meet expected demand. It will lead to difficult decisions in the next three years that could slow down the effort to beat the three diseases. I will continue a relentless effort to seek the additional resources the Global Fund needs to fully contribute towards achieving the MDGs.”