Local Fund Agent: An Evolving Mechanism to Provide Accountability with Large Scale Program Financing

Learning Objectives:

This paper discusses how the Global Fund to Fight AIDS, Tuberculosis, and Malaria (GFATM) is a financial instrument and not an implementing agency. Participants will be able to identify how the GFATM and the Local Fund Agent (LFA) mechanism support the rapid disbursement and absorption of funds by Principal Recipients (PR's).

Background:

Since 2001, the Global Fund to Fight AIDS, Tuberculosis, and Malaria has provided in excess of $9 billion in grant funding to support over 150 programs worldwide in about 140 countries worldwide. To efficiently manage fund disbursement, the GFATM has established the Local Fund Agent mechanism. This mechanism has evolved since its inception to efficiently and practically serve the needs of the GFATM and grant Principal Recipients and face challenges of tracking grant implementation by hundreds of PR's and thousands of Sub Recipients (SR's).

Design and Evaluation Methods:

Emerging Markets Group (EMG) currently serves as the LFA in nine markets - Papua New Guinea, Mongolia, Malawi, Mozambique, Guyana, the Caribbean region (CARICOM, CRN+ OECS), and Guatemala. EMG performs a suite of assessments in PR institutional and programmatic capabilities, assists in negotiating a final grant agreement, performs program monitoring and evaluation, provides fiduciary accountability, and reports issues to the GFATM. This work requires continued coordination and communication between the PR, the in-country monitoring team, the Global Fund headquarters in Geneva, and the EMG home-office. In fulfilling this role EMG has adapted its functions to GFATM objectives and PR needs.

Conclusions:

The GFATM as a financial instrument relies on the LFA to monitor the progress of grants they fund. As health financing from the GFATM continues to increase (from Round 7 funding of 1.1. billion to Round 8 with 3.15 billion), the LFA mechanism will continue to evolve as necessary and support the scale up of services for HIV/AIDS, tuberculosis, and malaria by PR's.