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Demystifying the New Funding Model

GIZ Regional ConferenceAfrica, MENA and LAC6-9 May 2014, Accra

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• Bigger impact: focus on countries with the highest disease burden and lowest ability to pay, while keeping the portfolio global

• Predictable funding: process and financing levels become more predictable, with higher success rate of applications

• Ambitious vision: ability to elicit full expressions of demand and reward ambition

• Flexible timing: in line with country schedules, context, and priorities

• More streamlined: for both implementers and the Global Fund

Principles of the new

funding model

The new funding model has been designed to bring the Global Fund Strategy of ‘Investing for Impact’ to life. The new model will improve the way the Global Fund assesses, approves, disburses, and monitors grants

Principles of the new funding model

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Disease burden

Income level

External financing

Minimum required level

Grant performance

Increasing infection rate

Absorptive capacity

Risk

Impact

= Country allocation

Allocation formula Qualitative factors

15% of which accessible based onWillingness-to-Pay

Overview of how funds are allocated to countries

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Counterpart Financing

Mandatory minimum requirements of counterpart financing

• Minimum threshold contribution (LI-5%, Lower LMI-20%, Upper LMI-40%, UMI-60%)

• Increasing government contribution to disease programs and health sector

• Reliable disease and health expenditure data

‘Willingness-to-Pay’ commitment to further incentivize

• Additional co-investments by government in disease programs in accordance with ability to pay

• Realization of planned government commitments

• 15% of allocation is contingent upon meeting WTP commitments

Core Global Fund principles: Sustainability, Additionality, Country Ownership

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Country band composition

Allocation methodology2

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Disease Burden

Inco

me

Lower Higher

Low

er

Band 1

Band 3Band 4

Band 2

GNI per capita US$ 2,000

Lower-income, higher-burden

39 countries

Higher-income, higher-burden

11 countries

Lower-income, lower-burden

18 countries

Higher-income, lower-burden

55 countries

0.26 composite

score

US$ 1.1bn US$ 1.5bn

US$ 0.9 bn US$ 11.3 bn

US$ 83 million of incentive funding

available for Band 3

US$ 825 million of incentive funding

available for Band 1

US$ 42 million of incentive funding

available for Band 2

Band 4 countries have incentive

funding calculated into their allocations

Hig

her

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Total funding from Global Fund is increasing

• The total funds for allocation are 20% higher than what we have disbursed in the past.

- The total funds to be allocated to countries, available as of January 1, 2014 (including existing funds): US$ 14.8 billion

- Average implied funding level: US$ 3.7 billion per year

- This compares favorably vs. the average annual disbursement rates of US$ 3.2 billion.

• In addition, the Global Fund will allocate:

- US$ 950 million of incentive funding which will be awarded to ambitious programs that deliver impact in country

- US$ 200 million for new regional grants and US$ 91 million to finish existing regional grants

This represents US$ 16 billion for countries

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Types of funding

Country allocation

• A separate reserve of funding designed to reward high impact, well-performing programs and encourage ambitious requests

• It is made available, on a competitive basis, to applicants in Country Bands 1, 2, 3

• Awarding of incentive funding will be based on the TRP recommendation. The GAC will decide on incentive funding, which will be included in the upper-ceiling of the grant

Incentive funding*

• Any funding requested through a concept note which is considered strategically focused and technically sound by the TRP, but cannot be funded through available funding

• The demand is registered for possible funding by the Global Fund or other donors when, and if, any new resources become available

Unfunded quality demand

* Regional applicants, significantly over-allocated disease components and Band 4 countries are not eligible for incentive funding.

• Each eligible country receives an allocation to support its disease programs for the allocation period (communicated in March 2014)

• The amount is determined using an allocation methodology based on disease burden and income levels, and is adjusted for qualitative factors

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New funding model cycle

2nd

GAC

Concept Note Grant Making

Board

TRP

GAC

Ongoing Country Dialogue

National Strategic Plan/

Investment Case

Grant Implementation

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The term is used by the Global Fund to refer to the ongoing discussion that occurs at country level to prioritize how to fight the three diseases and strengthen health and community systems

Concept Note Grant-Making

Ongoing Country Dialogue

National Strategic Plandetermined by

country

Grant Implementation

3 years

Govt-led CCM-led PR-led CCM/PR-led

Country owned process

Country Dialogue

Country dialogue is a country-owned, on-going process

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Who plays a role in country dialogue?

Country dialogue

Technical partners

Civil society / key populations

Private sector

Country government

Other donors

Global Fund

These actors meet in the CCM, however, the dialogue should expand beyond the CCM

Academia

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How do we engage with communities, including key populations?

Encourage assembling of communities in advance of national meetings• Ensure they can raise their concerns on human rights, gender, access and other

issues in a safe space without repercussions• Ensure confidentiality for all participants• Convene different groups of women, youth, key populations etc. separately and

collectively as needed. Collective assembling can help create coalitions, separate meetings help in-depth discussions on specific needs and issues

Facilitate meaningful participation e.g., national / regional meetings held outside the capital and in the local language

Ensure communities understand what support they can expect from The Global Fund to address human rights, CSS, gender inequalities

Ensure concerns raised by communities get raised and addressed during the country dialogue through lead representatives

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Technical Assistance framework under the new funding model

2nd

GAC

Concept Note2-3 months

Grant Making3+months

Board

TRP

GAC

CCM strengtheningHSS strengthening

CS/KAPs strengthening and engagementOperational support (existing and new programs)

National Strategic Plan/

Investment Case

Grant Implementation

3 years

Situation analysis/epidemic assessment• Epidemiological analysis• Program gap• Financial gap• Capacity gap

Strategic plans /Investment case development, reviews and costing

Health Sector strategy

Policy advice/enabling environment

Partners mapping

Support to develop CN and all documentation

•Use of modular tool•Program design•Selection of interventions•Indicative/above indicative budget

CN review based on early feedback from TRP

Risk and capacity assessment response and implementation capacity•Financial management•M&E•PSM•PR/SR/SSR management•Governance

Start-up TA • GF systems/tools• Org development

Disease-specific/public health technical support

Addressing implementation bottlenecks

Long-term capacity development•M&E•Financial management•PSM•PR/SR/SSR management•Governance

Disease-specific /public health technical support

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What is the Technical Review Panel looking for?

Soundness of approach

Feasibility

Potential for sustainable outcomes

Value for money

Criteria for reviewing funding requests

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Resources available http://www.theglobalfund.org/en/fundingmodel/

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New funding model Resource Book

Frequently Asked Questions about the new funding model

Online learning materials on key topics (e-learning modules)

Concept note templates and guidelines

Information notes

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ResourceResource

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Useful links

Further information about the New Funding Model can be found on the Global Fund website

The following documents are available to support the countries during the application process:

Overview of the Allocation Methodology (2014-2016)

Resource Book for Applicants

New Funding Model Brochure

Frequently Asked Questions on the New Funding Model

Frequently Asked Questions – Allocation Amounts

Ten Frequently Asked Questions on the Global Fund Board Decision of a Single Concept Note Submission for Joint HIV and TB Programming

Additional Applicant Support

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- Support to development of quality NSP and Investment Cases, gap analyis, etc.

- Participation in/support to inclusive country dialogue/multistake-holder processes (including SWAP and Donor Groups)

- Support to Concept Note develop-ment based on robust national strategies;

- Integration in national systems

- Dialogue with BMZ/ PROFILE for GAC inputs (based on GAC and TRP documents and specific issues discussed at country level)

- Creation of robust implementation frameworks

- Dialogue with BMZ/ PROFILE for GAC inputs and comments on funding recommendations

- Capacity development for PRs, SRs on financial management, procurement, M&E, etc.

- Support to risk management- TC measures complementary to

GF grants- Support to local organizations in

their role as implementer (CS and public organisations)

ENTRY POINTS: NFM PROCESSES

Support to CCM Processes (to improve coordination, communication, oversight and risk management)