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Global Health Fund Scandal May Affect Yemen

An Associated Press report published last week put a microscope on the Global Health Fund’s recent global investigation’s findings, sending shock waves through the humanitarian world. The internal investigative report stated that the  $21.7 billion world-wide budget of the Global Fund To Fight AIDS, Tuberculosis and Malaria combat is facing significant challenges of corruption and fraud.

Although Yemen was not investigated yet, the findings may have a large impact on Yemen’s ability to address HIV/AIDS, Tuberculosis, and Malaria which has received a total of over $69 million from the Global Fund.

The extensive corruption was exposed by an internal audit of the newly reinforced inspector general’s office of the Global Fund. Even though only a small, initial portion of the funds’ financing was assessed, fraud and abuse was quickly found to be rampant, raising huge red flags for its global operations.

The audit found that much of the money in many countries was poorly accounted for by using weak book-keeping and forged documents. These practices led to heavy abuses of the funding such as phantom training events that were paid for by forged receipts for per-diem payments, lodging, and travel expense claims.  It was also found that millions of dollars worth of vital medicines were simply sold on the black market.

One striking example were the phantom events that took place in Mali which stole over $4 million dollars – half of Mali’s Global Fund’s grant money for TB and Malaria. The results of Mali’s corruption shook the country, leading not only to the arrest of 15 people, but the sudden and unexplained resignation of the health minister just two days before the audit became public.

Other equally wasteful accounts of widespread fraud were reported in Zambia, Mauritania, Haiti and Djibouti with many more countries left to be investigated.

Despite not being named, it does not necessarily mean that the Yemen branch of the Global Fund is free from corruption or the fall out of these events. Already, the seven years of Global Fund funding in Yemen  has had a contentious history at best.

The original purpose of the Global Fund was to serve only as a direct financing mechanism in order for funds to reach programs quickly. Thus creating the means to skip the slow and bureaucratic processes of the United Nations programs and directly fund programs through out the world. With a mechanism to release funds quickly and efficiently, the Global Fund quickly became the “darling of the development world” backed by famous celebrities and powerful donors such as Bill Gates .

As a result, in the first round of Global Fund funding for HIV/AIDs in Yemen, it worked directly through the Yemen National AIDS Program and the Yemen’s National Populations Council and designated them both as the PR, or primary recipient of funding.

This novel approach quickly came to an end as an assessment of first round by the UNDP recalled that “poor implementation…[and] weak management systems and cumbersome financial regulations hindered…[the] ability to successfully achieve its targets.”

As a result, the Global Fund backtracked on its original intent and designated the Yemen United Nations Development Program as its primary recipient for HIV/AIDS grant money to ensure more accountability and better distribution of funds. According to the Associated Press report, a similar switch happened in Zambia after the Global Fund decided its ministry was no longer capable of managing the grants. The Global Fund is still trying to recover over $7 million dollars in stolen money in Zambia.

Ironically, the designation of the UNDP as the primary recipient plays a role as to why Yemen was not included in the findings of the Global Fund’s initial world-wide internal audit and why it may never will.

In countries that were investigated where the UNDP serves as a primary recipient, the Global Health report stated that the UNDP offices would not release any of its internal audits on the Global Fund’s grants, citing “special privileges and immunity.” The UNDP responses has and will severely complicate the Global Fund’s investigations as the UNDP has now become the primary recipient in over 24 countries – managing $3.88 billion of the Global Fund’s grant money.

Despite the move to UNDP as a primary recipient of funds to create better accountability, the results have had mixed results in the countries that have been investigated. The Global Fund noticed descripancies with the little information it was able to obtain in UNDP managed countries.

One example was cited with the UNDP in Haiti where the Global Fund investigative team was only given “abbreviated summaries devoid of factual detail,” the Global Fund investigative report continued as its investigative team noted “there was a $519,326 difference between the balance recorded by the UNDP and those in the [sub recipient] records. As such the [investigative team] has concerns over the thoroughness of the grant closure process.”

There is increasing concern as the integrity of many U.N. agencies, including the UNDP, which has been under increasing fire recently as they have been accused of dragging its feet on addressing corruption in order to not scare its donors.  These claims come as the U.N. dismantled its Anti-Corruption Procurement Task Force two ago.

Strong questions remain as to whether the UNDP office will fully release its internal audits or cooperate with the investigative efforts of the Global Fund. The UNDP must balance a precarious situation as it cannot withhold its information on the Global Fund’s grant money indefinitely, nor may it be willing to release it if extensive accountability problems exist. The Global Fund has reiterated that it will hold the UNDP responsible for any mismanagement of funds under its watch.

UNDP spokesman Stephane Dujarric told the Associated Press last week that the UNDP is reassessing its policy that prevents it from sharing internal audit reports with the Global Fund.

Ultimately, whether or not corruption exists with the Global Fund’s grant money in Yemen, the fall out from the misconduct of other countries may still threaten Yemen’s programs. The limited funding from the global fund is already extremely competitive among participating countries and will only become more so as a result of the corruption found.

Not only is Global Fund is pulling or suspending funds in countries where corruption is found, donors are starting to suspend their donations.  Sweden and Germany, who planned to donate over $350 million to the Global Fund in 2011 suspended their payments until the corruption issues are solved.

This news comes at an unwelcome time for the AIDS, TB and Malaria initiatives in Yemen. The proposal for additional funding for HIV/AIDS programs from the Global Fund was not successful. As a result, current programs will either be terminated or for an unknown period of time. Yemen intends to reapply for funds in the future, but possibly in an even more competitive environment as more donors threaten to pull out.

A source knowledgeable on the Global Fund’s status shared told the National Yemen that despite the lack of success in applying for additional funding it will hopefully force the government to step up to continue the Global Fund’s projects. However, the source acknowledges that what the government will not be able to cover enough.

As for now, the Global Fund programs that provide assistance and life saving care to thousands of people in Yemen will remain in doubt until the dust settles from the recent corruption scandals and better accountability mechanisms are put in place.