Part IV: The Role of the RBM Partnership
6. Financing
In many malaria-endemic countries, the growth of external funding for malaria has not been matched by a growth of national resources. For the medium and long term, donor funding must be sustained and national public resources must increase. But perhaps as important, the funds that are available must be used as effectively as possible. Effective financing processes and financial management are critical to meet the 2010 and 2015 global targets.
Effective global and local financing mechanisms can ensure that existing funds, both national and external, have the greatest possible impact. The biggest financing challenges and the recommendations for meeting these challenges are summarized below and detailed in this chapter.
Key Challenges
Numerous challenges linked to financing need to be addressed to make funds available in a timely manner for malaria control and elimination activities.
Time-consuming processes. While unprecedented amounts of money pour into the fight against malaria, little time remains to achieve the 2010 global targets. One critical roadblock is the time-consuming disbursement process of some of the main international donor bodies. When these lengthy processes are followed by long procurement times, the result is an unacceptable time-delay between initial proposal acceptance and the final disbursement and distribution of interventions: approximately between 18-21 months in total. This time-consuming process will make it especially difficult for ACTs and LLINs to be disbursed in sufficiently high numbers to achieve the 2010 targets.[15]Workshop: Tackling the challenge of rapid LLIN scale-up, Washington, D.C., World Bank, April 2008.
Inadequate ability to manage large amounts of funds. Many countries are overwhelmed when large funding donations arrive. Increasingly this will be an issue as countries prepare themselves to scale-up malaria control interventions. National Malaria Control Programs repeatedly pointed out that capacity building for financial management is needed to ensure funds are properly managed.
Difficulty sustaining predictable funding flows. Sustainable and predictable financing for the sustained control and elimination stages are essential to avoid resurgence of malaria due to relaxation of control efforts. To advocate nationally and internationally for sustainable and predictable financing, countries must have the tools to manage current funds and to track how they are used. These tools will support the development of sustainable mid- to long-term financing strategies which can be based on a realistic mix of external and national, public and private, resources.
Priorities
As with most topic areas, priorities for the RBM Partnership differ according to the malaria stage.
Priorities for scaling up. The RBM Partnership recommends the following priorities be taken to meet these financing challenges in the scale-up stage.
A) Support negotiations with major donors. Coordination is needed among all donors within a particular country. For some high-burden and high-need countries, this could take the form of roundtables of negotiations between the major donors and the countries supported by the Harmonization Working Group (HWG), as is the case for Nigeria. (Support for the translation of country business plans into funding proposals is presented in Part IV - Chapter 4: In-Country Planning.)
B) Support disbursement processes. Timely disbursement of funds is important to ensure that the scale-up activities take place on time. Disbursement support will be coordinated by MAWG for approved funding proposals by building country capabilities for response to the Technical Review Panels and helping to resolve disbursement bottlenecks. This includes assisting countries in completing high-quality procurement and supply chain management (PSM) and monitoring and evaluation (M&E) plans for Global Fund proposals, under the leadership of the PSM and MERG Working Groups.
C) Use existing tools to accelerate funding flows. To meet the 2010 goals, using the flexibility of the major donors (especially the Global Fund and the World Bank) needs to be encouraged. For example, these donors permit front-loading of disbursements linked to interventions, shortening the periods between disbursement phases, and amending previous projects used in the country's advantage. In addition, options such as direct payment could further accelerate the use of funds: donors could make direct payments to procurement agents, suppliers or fiduciary agents thus shortening the path to commodity procurement. This option could avoid time-consuming, in-country procedures for disbursements to procurement agents or suppliers, as well as reduce transaction costs (bank fees, exchange rate losses).[16]The direct payment option has been used in about 14% of the malaria disbursements from the Global Fund from mid-2007 to mid-2008 in 19 countries: Afghanistan, Bangladesh, Cameroon, Ethiopia, Ghana, Guinea-Bissau, India, Kenya, Mali, Nepal, Nigeria, Papua New Guinea, Somalia, Sri Lanka, Tanzania, Uganda, Yemen, Zambia and Zimbabwe. Source: Internal analysis conducted by Vestergaard Frandsen, 2008.
D) Establish innovative financing mechanisms for ACTs and LLINs. To ensure that countries are able to achieve their targets, the RBM Partnership must establish innovative financing and procurement mechanisms for malaria interventions. For ACTs, the RBM Partnership (under the leadership of the AMFm taskforce) is developing a mechanism which would make low cost ACTs widely available through the public and private sectors (See Box IV.2). Furthermore, the RBM Partnership is considering financing and third-party procurement options to ensure that finances are rapidly available to procure LLINs within malaria-endemic countries.
Box IV.2: Affordable Medicines Facility – malaria
The AMFm is an innovative financing intervention that seeks to make affordable ACTs available to patients in the malaria endemic world who use facilities run by the public or NGO sectors or who purchase drugs themselves.
The idea behind the Affordable Medicines Facility for malaria (AMFm) emerged from a 2004 report by Institute of Medicine (IOM) “Saving Lives, Buying Time” that highlighted the risks of resistance emerging to artemisinin due to the widespread availability of artemisinin monotherapies in the private sector and the potential benefit of an ACT subsidy to promote wide-spread use of effective anti-malarial drugs. After the publication of the report, the RBM Partnership decided to examine further the ACT subsidy concept and began work with the World Bank to develop a detailed proposal for the design and operation of such a global ACT subsidy.
The core principles of the AMFm are:
- reducing consumer prices to an affordable level (approximately US$ 0.20 - 0.50 in the private sector) through price negotiations and a co-payment and
- ensuring the reduced price benefits those suffering from malaria by introducing in-country supporting interventions
The potential benefits of AMFm are considerable. This price reduction is expected to more than triple ACT usage to a projected 360 million treatment courses per year. In turn, this will reduce purchases of less effective treatments and delay the emergence of resistance to artemisinin by the malaria parasite. It is expected to save 175,000 to 300,000 lives per year, mostly children in sub-Saharan Africa.
Continued field research will be required after launch to ensure that the AMFm achieves these goals. For more information, please visit the website for the AMFm taskforce.
Priorities for sustained control and elimination. To support sustained control and elimination within countries, the RBM Partnership recommends a focus on capacity building and on medium- and long-term financial planning .
E) Continue support with funding disbursements. HWG will continue to support countries with the timely disbursement of funds. This includes advocating that international donors sustain financial commitments throughout the sustained control and elimination stages.
F) Advocate for and support medium- and long-term planning for financing. Malaria activities need to be included in national, medium-term planning efforts to increase clarity regarding future funding requirements, enable better funding predictability, and ensure that malaria is part of national priorities and receives an adequate amount of money. (See also Part IV - Chapter 4: In-Country Planning.) NMCPs require technical assistance for the development of medium-term financing plans and capacity building to reinforce their role on financial forecasting and planning.
G) Track expenditures for increased accountability. National Health Accounts (NHA) and malaria sub-accounts track spending on health care (amount and flows) including public, private, household and donor contributions. They are important to assist countries and donors in evaluating the effective expenditure of available funds and to increase transparency. Rather than being stand-alone tools, questionnaires for malaria should be integrated into existing household surveys and malaria indicator instruments, which would greatly reduce the cost of implementing sub-accounts. The RBM Resources Working Group (RWG) will assess these options and the outcomes of the ongoing malaria sub-account activities. As this will take years to institutionalize, NHA malaria sub-account preparations need to begin today to prepare the groundwork.
Organizational Implications
The key coordinating bodies for the RBM Partnership are the Resources Working Group and the Harmonization Working Group. Currently, different partners support countries with financing processes. HWG, other Working Groups, and individual partners provide support to countries with the disbursement of funds. RWG is closely involved with AMFm activities and supports recommendations regarding effective financing and tracking within countries.
Table IV.7: Summary of Financing Activities
| Reference to priority | Major actions | Completed by | Coordinator (bold) / Sub-coordinatorsa |
| C | Frontload financing from Globa Fund and WG grants for LLIN and provide voluntary 3rd party procurement service to enable global scale-up by 2010 | Q1 2009 | HWG, RWG |
| D | Establish AMFM as an innovative financing and procurement mechanism for ACTs to enable global scale-up by 2010 and reduce risk of counterfeits and resistance | Q4 2009 | AMFm taskforce |
| B | Accelerate Global Fund funding disbursements by holding workshops with mock Technical Review Panels to build country capabilities to respond to TRPs | Q3 2008 and beyond | HWG, SRNs |
| G | Work on integrating malaria sub-accounts within M&E activities to track financial flows | 2015 | RWG, MERG |
a) Main coordinating group / body in the RBM partnership indicated in bold. Closely linked contributors within the RBM partnership are also listed. RBM partners are not listed explicitly as their involvement occurs through the Working Group.
