GFO Issue 467, Article Number: 6
ABSTRACT
This article argues that the Global Fund should strengthen collaboration with national accountability systems - especially Supreme Audit Institutions -to replace parallel private audits with sustainable public mechanisms. In an era of shrinking aid budgets and growing domestic co-financing, integrating audits into national frameworks would enhance transparency, reduce costs, build local capacity, and ensure genuine long-term ownership of financial governance.
A turning point for financial accountability
Since its creation in 2002, the Global Fund to Fight AIDS, Tuberculosis and Malaria has built its reputation on an uncompromising stance against corruption and mismanagement. Its zero-tolerance policy and rigorous financial controls have earned the confidence of donors and the respect of international observers. Few global health institutions can boast such a consistent record of clean audit opinions and financial transparency.
Yet beneath this success lies a structural paradox. To maintain its impeccable record, the Fund has historically relied on parallel systems of accountability – chiefly private audit firms, fiduciary agents, and verification contractors hired and paid directly by the Secretariat. This model, while effective in protecting donor resources, has also carried an unintended message: that national public institutions cannot be trusted to manage or oversee Global Fund investments.
As global health financing enters a new era of tighter budgets, rising domestic co-financing, and shifting donor priorities, this approach is increasingly hard to sustain. The question is no longer whether the model has worked, but whether it remains viable or fair in the long run.
A gradual shift toward country systems
Encouragingly, the Fund has begun to engage more deliberately with national accountability institutions, particularly Supreme Audit Institutions (SAIs) and other public financial oversight bodies. At Aidspan, convinced that this collaboration would improve efficiency, we began working with SAIs in 2018. These entities constitutionally mandated to safeguard public funds are central to any lasting culture of transparency.
Progress is measurable. As of 2025, SAIs audit Global Fund grants in over twenty countries, up from just eight in 2019. This expansion represents not only improved trust but also a recognition that sustainability and national ownership must go hand in hand with donor oversight.
Still, challenges persist. In many contexts, the Fund continues to contract private firms whose services can absorb a notable share of grant budgets, even where national audit institutions could deliver comparable quality at a fraction of the cost and with stronger legal authority.
The cost and the trade-offs
Experience from several countries illustrates both the potential and the pitfalls of different approaches.
In Malawi, the National Audit Office now conducts the audit of Global Fund grants on a cost-recovery basis. The collaboration has proved both efficient and developmental: the state gains capacity, the Fund retains assurance, and costs are significantly lower than under the previous parallel arrangement.
By contrast, in South Africa, external private auditors still review Global Fund expenditures. Yet the Auditor-General of South Africa (AGSA) is widely regarded as one of the continent’s strongest oversight bodies responsible for auditing the entire national health budget and the government’s own HIV programs, which cover nearly three-quarters of the country’s HIV response. When domestic public spending dwarfs donor contributions, it seems only logical that the Fund’s accountability mechanisms should align with and strengthen the national systems already responsible for the bulk of the investment.
When irregularities are found, who pays?
When the Global Fund identifies misuse of funds through its internal controls, external audits, or the Office of the Inspector General (OIG), it typically requests repayment from the implementing entity.
If that implementer is a government body, such as a Ministry of Health, the reimbursement usually comes from public revenue. The outcome is paradoxical: citizens pay twice—first through reduced access to services, and again through tax-funded reimbursements—while those directly responsible for the wrongdoing often escape legal consequences.
This happens because the Global Fund lacks the authority to prosecute; it must rely on national systems to act, which they may be reluctant to do at the request of an external partner. Had domestic accountability institutions such as SAIs been engaged from the outset, both the detection and the follow-up could take place within a single, legitimate national process, enhancing deterrence, justice, and credibility.
Moving beyond the capacity argument
Skeptics frequently cite concerns about the independence, capability, or willingness of SAIs to audit Global Fund grants. Others note that legal barriers may restrict their ability to share findings directly with international partners. While these concerns have some merit, they no longer justify exclusion. After more than two decades of Global Fund operations in Africa - and billions of dollars invested - it is reasonable to expect that capacity-building should have evolved into trust-building.
True sustainability means using aid not to bypass local systems but to reinforce them. Parallel mechanisms may offer short-term comfort, but they are structurally unsustainable in a world of shrinking aid budgets and growing domestic responsibility. The abrupt disruptions in major health assistance programs in recent years, including the uncertainty around U.S. funding for PEPFAR, underscore the risks of creating accountability systems that vanish when external financing wanes.
Working with national institutions is not a shortcut; it is a strategic investment in the governance architecture that will remain long after donor projects end.
Auditing the full picture including domestic co-financing
Private auditors contracted by the Global Fund are limited to reviewing expenditures financed by the Fund itself. They do not examine domestic co-financing, even when national contributions represent the majority of spending. The result is a large blind spot in oversight.
SAIs, by contrast, can audit both donor and domestic funds, providing a comprehensive view of total health financing. Their reports submitted to parliaments or heads of state carry institutional legitimacy and strengthen fiscal transparency and stewardship. Integrating the Global Fund’s audits into this broader national framework would enhance accountability, reduce duplication, and support genuine ownership of financial governance.
Programmatic oversight: the supply-chain challenge
Many OIG reports have repeatedly identified weaknesses in health-commodity supply chains: poor recordkeeping, limited traceability, and discrepancies in stock balances. These problems are not purely financial; they are operational, systemic, and cross-sectoral.
Because private financial audits often focus narrowly on ledger accuracy, they rarely capture such weaknesses. National audit and inspection bodies, which operate across sectors and within national systems, are often better positioned to understand and address them. Their proximity to government processes allows for pragmatic, context-aware recommendations that can improve both fiduciary assurance and service delivery.
From control to collaboration
The Global Fund’s rigorous accountability framework has delivered enormous value in protecting resources and preserving trust. But today’s environment demands a recalibration from a model built on external control to one grounded in shared accountability.
Partnering with national audit institutions is not a concession to lower standards; it is an opportunity to extend accountability deeper into the systems that will sustain health responses long after external aid diminishes.
By trusting and investing in national accountability systems, the Global Fund can reinforce the very foundations of the transparency and integrity it has long championed, ensuring that every dollar spent leaves behind a stronger, more self-reliant system of public trust.
A turning point for financial accountability
Since its creation in 2002, the Global Fund to Fight AIDS, Tuberculosis and Malaria has built its reputation on an uncompromising stance against corruption and mismanagement. Its zero-tolerance policy and rigorous financial controls have earned the confidence of donors and the respect of international observers. Few global health institutions can boast such a consistent record of clean audit opinions and financial transparency.
Yet beneath this success lies a structural paradox. To maintain its impeccable record, the Fund has historically relied on parallel systems of accountability – chiefly private audit firms, fiduciary agents, and verification contractors hired and paid directly by the Secretariat. This model, while effective in protecting donor resources, has also carried an unintended message: that national public institutions cannot be trusted to manage or oversee Global Fund investments.
As global health financing enters a new era of tighter budgets, rising domestic co-financing, and shifting donor priorities, this approach is increasingly hard to sustain. The question is no longer whether the model has worked, but whether it remains viable or fair in the long run.
A gradual shift toward country systems
Encouragingly, the Fund has begun to engage more deliberately with national accountability institutions, particularly Supreme Audit Institutions (SAIs) and other public financial oversight bodies. At Aidspan, convinced that this collaboration would improve efficiency, we began working with SAIs in 2018. These entities constitutionally mandated to safeguard public funds are central to any lasting culture of transparency.
Progress is measurable. As of 2025, SAIs audit Global Fund grants in over twenty countries, up from just eight in 2019. This expansion represents not only improved trust but also a recognition that sustainability and national ownership must go hand in hand with donor oversight.
Still, challenges persist. In many contexts, the Fund continues to contract private firms whose services can absorb a notable share of grant budgets, even where national audit institutions could deliver comparable quality at a fraction of the cost and with stronger legal authority.
The cost and the trade-offs
Experience from several countries illustrates both the potential and the pitfalls of different approaches.
In Malawi, the National Audit Office now conducts the audit of Global Fund grants on a cost-recovery basis. The collaboration has proved both efficient and developmental: the state gains capacity, the Fund retains assurance, and costs are significantly lower than under the previous parallel arrangement.
By contrast, in South Africa, external private auditors still review Global Fund expenditures. Yet the Auditor-General of South Africa (AGSA) is widely regarded as one of the continent’s strongest oversight bodies responsible for auditing the entire national health budget and the government’s own HIV programs, which cover nearly three-quarters of the country’s HIV response. When domestic public spending dwarfs donor contributions, it seems only logical that the Fund’s accountability mechanisms should align with and strengthen the national systems already responsible for the bulk of the investment.
When irregularities are found, who pays?
When the Global Fund identifies misuse of funds through its internal controls, external audits, or the Office of the Inspector General (OIG), it typically requests repayment from the implementing entity.
If that implementer is a government body, such as a Ministry of Health, the reimbursement usually comes from public revenue. The outcome is paradoxical: citizens pay twice—first through reduced access to services, and again through tax-funded reimbursements—while those directly responsible for the wrongdoing often escape legal consequences.
This happens because the Global Fund lacks the authority to prosecute; it must rely on national systems to act, which they may be reluctant to do at the request of an external partner. Had domestic accountability institutions such as SAIs been engaged from the outset, both the detection and the follow-up could take place within a single, legitimate national process, enhancing deterrence, justice, and credibility.
Moving beyond the capacity argument
Skeptics frequently cite concerns about the independence, capability, or willingness of SAIs to audit Global Fund grants. Others note that legal barriers may restrict their ability to share findings directly with international partners. While these concerns have some merit, they no longer justify exclusion. After more than two decades of Global Fund operations in Africa - and billions of dollars invested - it is reasonable to expect that capacity-building should have evolved into trust-building.
True sustainability means using aid not to bypass local systems but to reinforce them. Parallel mechanisms may offer short-term comfort, but they are structurally unsustainable in a world of shrinking aid budgets and growing domestic responsibility. The abrupt disruptions in major health assistance programs in recent years, including the uncertainty around U.S. funding for PEPFAR, underscore the risks of creating accountability systems that vanish when external financing wanes.
Working with national institutions is not a shortcut; it is a strategic investment in the governance architecture that will remain long after donor projects end.
Auditing the full picture including domestic co-financing
Private auditors contracted by the Global Fund are limited to reviewing expenditures financed by the Fund itself. They do not examine domestic co-financing, even when national contributions represent the majority of spending. The result is a large blind spot in oversight.
SAIs, by contrast, can audit both donor and domestic funds, providing a comprehensive view of total health financing. Their reports submitted to parliaments or heads of state carry institutional legitimacy and strengthen fiscal transparency and stewardship. Integrating the Global Fund’s audits into this broader national framework would enhance accountability, reduce duplication, and support genuine ownership of financial governance.
Programmatic oversight: the supply-chain challenge
Many OIG reports have repeatedly identified weaknesses in health-commodity supply chains: poor recordkeeping, limited traceability, and discrepancies in stock balances. These problems are not purely financial; they are operational, systemic, and cross-sectoral.
Because private financial audits often focus narrowly on ledger accuracy, they rarely capture such weaknesses. National audit and inspection bodies, which operate across sectors and within national systems, are often better positioned to understand and address them. Their proximity to government processes allows for pragmatic, context-aware recommendations that can improve both fiduciary assurance and service delivery.
From control to collaboration
The Global Fund’s rigorous accountability framework has delivered enormous value in protecting resources and preserving trust. But today’s environment demands a recalibration from a model built on external control to one grounded in shared accountability.
Partnering with national audit institutions is not a concession to lower standards; it is an opportunity to extend accountability deeper into the systems that will sustain health responses long after external aid diminishes.
By trusting and investing in national accountability systems, the Global Fund can reinforce the very foundations of the transparency and integrity it has long championed, ensuring that every dollar spent leaves behind a stronger, more self-reliant system of public trust.
