The increase in set-aside pledges

Author:

Aidspan

Article Type:

Article Number: 5

Transparency in the planned and actual use of set-asides is essential

Abstract: The Strategy Committee requested the Secretariat to provide an update on the issue of set-asides at the March Committee meeting. Under the Seventh Replenishment, pledges to date of total bilateral set-asides grew to about $700 million, which represents an increase of approximately 40% more than set-asides for Sixth Replenishment pledges. As Grant Cycle 7 gets underway, the Global Fund wants to ensure that these set-asides are aligned with the Global Fund Strategy and national strategies supported by Global Fund grants. This will require transparency and effective country-level coordination.

Context

Under the Seventh Replenishment, pledges to date of total bilateral set-asides amount to around $700 million, which represents an increase of about 40% over set-asides for the Sixth Replenishment pledges. As Grant Cycle 7 (GC7) gets underway, the Global Fund wants to ensure that these set-asides are aligned with the Global Fund Strategy and national strategies supported by Global Fund grants. This is particularly important given constraints on other resources and ongoing challenges faced by countries.

The Strategy Committee (SC) requested that the Secretariat provide an update on the set-asides at the March SC meeting. This article summarizes the Secretariat’s update and reactions from stakeholders.

The issues

As the Global Fund’s Head of Donor Relations, Dianne Stewart, explained, the donors’ objective in making the set-aside pledges is to have the financial resources available to readily provide direct technical assistance support for disease programs, thereby facilitating more efficient and effective country level implementation.  That said, the way in which set-asides are applied varies. Donor governments tend to channel the funds through their bilateral programs aimed at interventions that the donors want the Global Fund to work on. A good example is the United States Agency for International Development (USAID): a portion of the US set-aside is channelled through the US President’s Emergency Fund for AIDS Relief (PEPFAR) to support the Joint UN Programme on HIV/AIDS (UNAIDS) activities/implementation of Global Fund programs in selected countries.

The first issue is: should all of the pledged amounts that are announced (every cent) go through the Global Fund allocation process? From the Global Fund’s perspective, the choice is not about the percentage that should be given to it but rather that there is the risk that some of the set-aside amounts that will go through the bilateral programs may not be applied to support Global Fund interventions., even if that is the donor’s intention.

Another issue is that the use of set-asides alongside Global Fund supported programs makes country-level coordination all the more important; and coordination is already a challenge in many countries.

With the significant increase in the total amount of set-asides, the SC wants to ensure that the set-asides are applied in ways that are helpful to the Global Fund Strategy and the SC therefore wants to define parameters for the use of set-asides in the future.

There has always been and will continue to be a robust dialogue between the set-aside donors and the Secretariat. A roundtable is held with donors for them to present their intentions for the use of those funds. The donors discuss, advise on priorities, implementation gaps and weaknesses, and where they consider they can best provide support; and they discuss how to complement each other geographically.

If countries do not fully utilise the set-aside amounts, more than one of the donors has in the past given the remaining money to the Global Fund before the end of the allocation cycle; and it is hoped that this practice will continue.

Key to all this is: transparency in the way in which the set-aside amounts are being applied.

Status of pledges

While there was only a modest increase in allocations, there was a sharp increase in set-asides in the Seventh Replenishment, as the figures below show. Here you can see the difference in pledges under the two replenishments (Figure 1), and the comparison of the set-asides under the replenishments (Figure 2).

 Figure 1: Comparison between Sixth and Seventh Replenishments’ Pledges

 

Summary of GC7 set-aside landscape

While the details are still being finalized, there are significant differences across set-asides (Table 1).

From a geographical perspective, Figure 3 clearly shows donor set-aside preferences for funding priorities in sub-Saharan Africa and south-east Asia. Figure 3: Geographical Focus of Set-asides

Planning for use of set-aside

The Secretariat is currently working with bilateral partners on planning of GC7 set-asides (Table 2).

 

Managing these objectives and activities is labour-intensive for GF country and technical teams and for countries, but it is deemed to be very important given the magnitude of the set-aside amounts. Following the Seventh Replenishment, after 20 November 2022 the Core Group was expanded to include new donors and now includes Australia, the Bill & Melinda Gates Foundation (BMGF), France, the United Kingdom and the United States; and there is also ongoing bilateral dialogue (Table 3).

	Aligned on engagement principles	Shared priorities for GC7 support	Identified common country-level goals
What is being discussed	Country ownership Co-shaping and ongoing alignment In-country coordination Mutual transparency Emphasis on performance	Several common priority areas: RSSH Product innovation CHW/communities Gender	Enabling demand creation Minimizing repeated TA requests Expanding/strengthening local pool of expertise Improving quality and coordination of support
Next steps	Embedding principles into efficient operational planning. Determining how to evaluate set-aside outputs across principles.	More granular operational discussions across partners and relevant Secretariat teams, especially GFCTs. Explore how partners can work synergistically in common areas.	Continued problem-solving and sharing best practices. Country-level pilots of potential strategies and driving best practices.

Key factors for operationalizing GC7 set-asides and achieving impact

The Secretariat will continue to work with partners to resolve any challenges that set-asides may pose. The key factors for the speedy and appropriate operationalization of set-asides to maximise impact are listed in Table 4.

Stakeholder feedback on set-asides

Given a much larger share of set-aside funds and the 55% reduction in catalytic funding, stakeholders appreciate that efforts must continue to try to fill the gap in missing resources, especially given that communities and multi-country proposals are those that will be most affected.

Stakeholders welcome the fact that some of the set-asides give priority to human rights and gender as well as to CCMs; but note with regret that not a single Latin American country was considered a priority for the set-asides. They understand that the increase in set-aside funding is complicated and there is therefore a need for strong principles for joint accountability across the Secretariat, countries, and bilateral partners. They agree with all the principles suggested and would like to add a key element: to ensure, the inclusion of civil society and communities in any decisions made at the national level; and this needs to be explicit especially in countries that do not have good track records of inclusion.