Grant Renewals Process, TRP Involvement in the Renewals Process

1. Grant Renewals Process, TRP Involvement in the Renewals Process TBTEAM Briefing 20th June 2012

2. Grant Renewals • Up to 3-year “checkpoints” of achievements against the objectives and goals of the Proposal in terms of “programmatic progress and public health impact”. • Opportunity to ensure effectiveness of our investments in a disease program, review implementation arrangements and/or reprogram • Periodic Reviews – and whenever possible all renewals - look at the entirety of GF funding in a component program (all PRs). • The assessment conducted at the time of grant renewals focuses on: • progress towards proposal goals and disease impact; • PR performance; and • identified grant or program-level risks, if any. Note: The GF will not seek to directly attribute disease impact to a specific PR. • The additional financial commitment recommendation to the Board per PR will include: i. Performance rating; ii. Recommendation category (with corresponding conditions, if any); and iii. Recommended additional financial commitment amount.

3. Decision making: PBF Methodology • Implementation of performance-based funding requires: (1)evaluating grant and program performance;(2)linking performance to an investment decision. This process has the following seven steps: PERFORMANCE RATING 1- Programmatic Achievements 6- Financial Efficiency 7- Budget Reasonableness 2-Data Quality 3-Grant Management 4- Progress towards Proposal Goals 5- Conditions and Management Actions RECOMMENDATION CATEGORY ADDITIONAL FINANCIAL COMMITMENT Grant Performance Evaluation InvestmentDecision

4. Grant Renewals Timeline

5. RECOMMENDATION CATEGORY 1 2 Major risks * If major program or PR-level risks are identified, PRs should receive a “Conditional Go”. If that risk is critical, that could result in a “No GO”. 3 ** A six-month extension could be granted to strong performing PRs for them to revise the implementation strategy with the CCM, reprogram activities and re-submit a request for continued funding. *** Condition Precedent related to improved performance within a defined timeframe

6. Grant Renewals: Improvements Improvements completed • Introduction of counterpart financing and focus of proposals requirements • Roll-out of pre-assessmentto align interventions with changing epidemiology and country context, new technological advances, change in donor funding and performance to date • Roll out of iterative process to engage CCMs and partners on strategic choices • Interim arrangements with TRP on involvement ($100m & UMICs) in decision making process • Revised operational guidance on renewals and streamlined Grant Score Card. Integration of risk methodology. • New panel composition to bring expertise and partner perspective into Renewals Panel discussions

7. Modified Grant Renewals ProcessSummary of Major Changes – Renewals Process Based on Periodic Review, implements enhanced pre-assessment to all renewals, coordinated by Regional Teams and includes CCM and partners briefing Includes grant performance profile highlighting impact ratings and key issues on past performance, as well as relevant strategic information provided by technical partners Country Team Pre-Assessment & Country Briefing 1 Allows clarifications after CCM receives invitation and before submission of Request for Renewal and begins Country Team engagement preparing the CCM Request for Renewal Clarifications to CCM on Pre-assessment 2 At pre-assessment stage, the TRP reviewed the pre-assessment TRP reviews the request and gives their input TRP review of Renewal Request 3 2nd SIIC Meeting Geneva, 27-28 March 2012

8. Modified Grant Renewals ProcessOperational Risk Assessment: Renewals Operational Risks Risk Types 1. Programmatic & Performance Risks 2. Financial & Fiduciary Risks 3. Health Services & Health Products Quality Risks 4. Governance, Oversight & Management Risks Risks 1.1 Limited Program Relevance 2.1 Low Absorptive Capacity or Over-commitment 3.1 Treatment Disruptions 4.1 Inadequate CCM Governance & Oversight 1.2 Inadequate M&E & Poor Data Quality 2.2 Poor Financial Efficiency 3.2 Substandard Quality of Health Products 4.2 P Inadequate PR Governance & Oversight 1.3 Not Achieving Grant Output Targets 2.3 Fraud, Corruption, or Theft of Global Fund Funds 3.3 Poor Quality of Health Services & Use of Health Products 4.3 Inadequate PR Reporting & Compliance 3.4 Inadequate Access and Promotion of Equity & Human Rights 4.4 Inadequate Secretariat and LFA Management & Oversight 1.4 Not Achieving Grant Outcome & Impact Targets 2.4 Theft or Diversion of Non-financial Assets 1.5 Poor Aid Effectiveness & Sustainability 2.5 Financial Non-compliance 2.6 Market and Macro-economic Losses 2.7 Poor Financial Reporting

9. Progress Update on Grant Renewals ProcessInvesting for Impact - Reprogramming Improvements in progress: • Defining ‘highest-impact interventions’ with technical partners • Developing tools and methodology for reprogramming (guided by global partnership plans and investment frameworks) • Reviewing the portfolio at global & country levels; with a basis in evaluation • Engaging the CCM and partners to make tough strategic choices on the shape of the portfolio • Align interventions with MDG progress, changing epidemiology and country context; new technological advances, change in donor funding, risk management and performance to date. 26th Board Meeting Geneva, 9 – 11 May 2012

10. Progress Update on Grant Renewals ProcessInvesting for Impact – at Grant Renewals Panel Panel Composition: • New Panel Composition • From April, representatives of technical / bilateral partners invited to participate in the Grant Renewals Panel. Pre- Panel: • Ongoing improvement of documentation and earlier technical inputs by Panel members • Coordination with OIG – to ensure robust response to recommendations At Grant Renewals Panel: • Panel reviews strategic investment options proposed by Country Teams to contribute to Strategy and MDG goals • Performance and impact assessment and rating to better inform investments • Enhance impeccable grant management and oversight on risk 26th Board Meeting Geneva, 9 – 11 May 2012

11. Grant Renewals Composition

12. Secretariat Attendance at Panel Meetings

13. Technical Partners to the Grant Renewals Panel Purpose: contribute to the Grant Renewals Panel discussions by providing high-level technical advice on the grants’ programmatic content Partners and Donors as Technical Advisors and Non-Voting Members i) Partners with technical expertise / normative mandate (regular attendance) ii)Donorswith significant in-country funding – by Wave and by Disease 4 • HIV: WHO and UNAIDS for technical expertise and normative guidance • TB: WHO and Stop TB Partnership for technical expertise, normative and Global Partnership Strategy (goals and monitoring progress) • Malaria: WHO and RBM for technical expertise, normative guidance and Global Partnership Strategy (goals and monitoring progress) • Bilateral and Multilateral Donors: Invitations coordinated by Wave; Criteria based on significant in-country investments by disease, and across the Wave

14. Progress Update on Grant Renewals ProcessTechnical Partners – Scope of Engagement • Technical partners are expected to contribute to the Grant Renewals Panel discussions by providing high-level technical advice on the grants’ programmatic content. • Detailed coordination of investments with our partners against the three diseases, with a special emphasis on procurement and drug supply • Acceleration of efforts to better target and improve allocation of grant funding towards high impact interventions, with the goal of rapidly expanding new and promising approaches and technologies • Sharing of detailed information on grants in-country, with a special emphasis on oversight of risk, overcoming political and technical bottlenecks • Tracking of progress and identifying potential areas of re-programming as early as possible 14

15. Lessons Learned – Technical Partners Examples of High-level Questions for Panel Discussion: • Are resources focused on highest impact interventions? • Are we investing strategically to maximize health impact (taking into account the donor landscape in-country)? • Is the latest normative guidance adequately reflected in the program design? • Is this program appropriate to the country’s disease epidemiology and health system’s context? • If not appropriate, what needs to change? Are there any areas we have missed / critical gaps? • Are reprogramming suggestions made by the country team adequate? • What contributions could the in country technical partners make to address the key conditions and critical issues? • Using necessary data and in-depth knowledge of country context – assessment of progress on the ground with an appropriate high-level strategic view, including resolving grant bottlenecks and mobilizing technical assistance; 26th Board Meeting Geneva, 9 – 11 May 2012

16. Progress Update on Grant Renewals ProcessRenewals – PBF Indicative Investment Ranges • The principle of PBF makes additional funding available to grant recipients based on results achieved in a defined timeframe. • The INDICATIVE INCREMENTAL AMOUNT RANGES are intended to ensure a clear relationship between results achieved and funds disbursed. • (Incremental = Initial Ph2 amount – (undisbursed) – (cash balance)) *Board-mandates efficiencies (10%) apply These ranges are only indicative andserve as a “starting point”

17. Progress Update on Grant Renewals ProcessInvesting for Impact – accelerate to reach MDGs * Recommendation to utilize savings of US$25 million to procure and distribute additional LLINs to contribute to addressing critical national LLIN gap. This would help to close gap and bring it up to 75% LLIN coverage! 26th Board Meeting Geneva, 9 – 11 May 2012

18. Renewals approved in 2012: Investment decisions • 26 grants approved so far in 2012 (Wave 12/2011 and Wave 1-3/2012) • Total Approved Inc. Amount: $619m total (compared to cumulative committed pre-renewal amount of $547m for these grants). • Over 95% invested in LIC countries • 75% invested in high impact countries • 66% in HIV/AIDS, 28% in Malaria, 5% in TB

19. Renewals approved in 2012: Investment decisions • Average efficiencies/reductions of 21% across renewals approved in 2012 • High impact subject to smaller reductions (17% reduction high impact countries) • Low income countries receiving higher investments (18% reductions for LIC) • PBF respected – larger reductions for B2/C grants (33% reduction for B2/C) Distribution of efficiencies: from 1% to 100% - graphs above show all 24 programs (26 grants) approved by the Board in 2012

20. 2012 Grant Renewals Pipeline • 180 grants (wave 4-12) to be reviewed and approved for a Total Original Phase 2 (adjusted to include Board mandated reductions) of $4,641 m • Only 45% expected from LIC countries • 65% expected from high impact countries • 60% expected for HIV/AIDS, 23% for Malaria, 16% for TB 2nd SIIC Meeting Geneva, 27-28 March 2012

21. Top 15 investments at renewals, by country, Waves 4-12(Board approval expected in May 2012 – January 2013)

22. TRP Involvement in Grant RenewalsProcessGuidingPrinciples GF/B25/DP16 requires that “the TRP support the renewals process by providing independent technical expertise to the Secretariat panel making recommendations on grant renewals.” * TRP operating principles: • TRP independence and open/transparent review process • Team/panel review and decision-making, not individual • Anonymityof individual proposal reviewers Approach for TRP involvement: • Consistent application of agreed criteria/triggers to identify cases that would require TRP involvement • Application of a graduated/differentiated approach – focused TRP involvement so the value added is maximized and no unnecessary delays • TRP review based on standardized information package • Based on learning and discussions, TRP involvement to be set as appropriate * This is in addition to the TRP review of Revised Go requests (material reprogramming)

23. BACK UP SLIDES

24. Global Fund Strategy Framework 2012-2016: “Investing for impact” Vision A world free of the burden of HIV/AIDS, tuberculosis and malaria with better health for all Mission To attract, manage and disburse additional resources to make a sustainable and significant contribution in the fight against AIDS, tuberculosis and malaria in countries in need, and contributing to poverty reduction as part of the MDGs Guiding principles • Being a financing instrument • Additionality • Sustainability • Country ownership • Multi-sectoral engagement • Partnership • Integrated, balanced approach • Promoting human right to health • Performance-based funding • Good value for money • Effectiveness and efficiency • Transparency and accountability Goals • 10 million lives saved1 over 2012-2016 • 140-180 million new infections prevented over 2012-2016 Global plan Global Fund leading targets for 2016 Indicators for other selected services HIV /AIDS UNAIDS 2011-2015 Strategy, 2011 Investment Framework, and UNGASS June 2011 Declaration 7.3 million people alive on ARTs • PMTCT: ARV prophylaxis and/or treatment • HIV testing and counseling • Prevention services for MARPs • Male circumcision Targets2 (2016) Global Plan to Stop TB 2011-2015 4.6 million DOTS treatments (annual) 21 million DOTS treatments over 2012-2016 • HIV co-infected TB patients enrolled on ARTs • MDR-TB treatments TB Malaria RBM Global Malaria Action Plan 2008 and May 2011 updated goals and targets 90 million LLINs distributed (annual) 390 million LLINs distributed over 2012-2016 • Houses sprayed with IRS • Diagnoses with RDTs • Courses of ACT administered to confirmed malaria cases 1. Based on impact of provision of ART, DOTS and LLINs using methodology agreed with partners. 2. Targets refer to service levels to be achieved in low- and middle-income countries. Note: Goals and targets are based on results from Global Fund-supported programs which may also be funded by other sources; targets are dependent on resource levels

25. GF Strategy Framework 2012-2016: “Investing for impact” Strategic Objectives 1. Invest more strategically 2. Evolve thefunding model 3. Actively support grant implementation success • 1.1 Focus on the highest-impact countries, interventions and populations while keeping the Global Fund global • 1.2 Fund based on quality national strategies and through national systems • 1.3 Maximize the impact of Global Fund investments on strengthening health systems • 1.4 Maximize the impact of Global Fund investments on improving the health of mothers and children • 2.1 Replace therounds system with a more flexible and effective model • Iterative, dialogue-based application • Early preparation of implementation • More flexible, predictable funding opportunities • 2.2 Facilitate the strategic refocusing of existing investments 3.1  Actively manage grants based on impact, value for money and risk 3.2 Enhance thequality and efficiency of grant implementation 3.3 Make partnerships work to improvegrant implementation StrategicActions 4. Promote and protect human rights 5. Sustain the gains, mobilize resources • 5.1 Increase thesustainabilityof Global Fund-supported programs • 5.2 Attract additional funding from current and new sources • 4.1 Ensure that the Global Fund does not support programs that infringe human rights • 4.2 Increase investments in programs that address human rights-related barriers to access • 4.3 Integrate human rights considerations throughout the grant cycle Strategic Enablers Enhance partnerships to deliver results Transform to improve Global Fund governance, operations and fiduciary controls

26. Modified Grant Renewals ProcessReprogramming – Example Zimbabwe HIV / TB • The November 2011 Phase 2 Panel requested the Country Team to work with the CCM to resubmit request addressing critical gaps (TB/HIV and PMTCT) and refocus investments to high impactinterventions • In addition, seek information on the country’s plans to address the anticipated treatment gap in 2015 when the R8 Global Fund grant ends. • The Country Team met (Jan 2012) with in-country technical partners, donors, high-level government officials and national program staff for HIV and TB to discuss CCM allocation of funding to high impact interventions: key outcomes • Reduction in funding of mass media, BCC • Savings from these components reallocated to PMTCT interventions • Increased funding for TB/HIV activities • US$ 2.2 million were reprogrammed for improved TB diagnosis for case detection, with a significant reduction in communication activities. 2nd SIIC Meeting Geneva, 27-28 March 2012

27. Modified Grant Renewals ProcessReprogramming – Example Afghanistan Malaria Global Fund is the single most important donor; the program distributed over 4.3m LLINs in Phase 1, complemented by a community systems component. National Strategy • The country has a strategy for achieving universal coverage of LLINs. The national program will improve targeting of vector control by decreasing the geographic unit to focus on identified high burden districts. Reprogramming at Phase 2 • The National Malaria program will have a 1.5m gap of LLINs during Phase 2, which must be addressed for continued impact. • At the Phase 2 Panel, the Country Team presented and the Panel approved the option of reprograming funds to achieve savings and fill the gap to universal coverage of LLINs. 2nd SIIC Meeting Geneva, 27-28 March 2012

28. Modified Grant Renewals Process Step 1 1 Step 2 Secretariat Pre-Assessment CCM Invitation & Country Briefing LFA Review Part 1 TRP Input to as appropriate 2 Clarifications to CCM (on pre assessment guidance) & Partner debrief Sign grant CCM Request for Renewal LFA Review Part 2 Renewals Panel Review 3 TRP Review Phase 2 11 weeks 6 weeks 12 weeks Periodic Review 6 weeks 16 weeks 16 weeks End 27