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Month end blues: How to make the money stretch

Month end blues: How to make the money stretch. Ernest Massiah, UNAIDS RST, PANCAP AGM, Nassau, Bahamas, 2011. Presentation Format- Key Questions Asked and Answered. What has occurred - A Snapshot of the HIV trend What has been the “spend” What has been the outcome and result of the “spend”

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Month end blues: How to make the money stretch

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  1. Month end blues: How to make the money stretch Ernest Massiah, UNAIDS RST, PANCAP AGM, Nassau, Bahamas, 2011

  2. Presentation Format-Key Questions Asked and Answered • What has occurred - A Snapshot of the HIV trend • What has been the “spend” • What has been the outcome and result of the “spend” • What is the likely impact of the Changing Global Economic Environment? • In light of this, What is the suggested way forward

  3. THE TREND

  4. YEAR HEALTH IMPACT Snapshot of the HIV trends over the period 2001-2009 21,000 18,000 new infections 12,000 deaths 2001 2009

  5. THE SPEND

  6. Over $1.6 Billion in 10 years

  7. GF Global Fundeligibility changes GF Global Fundeligibility changes Most WB projects closed Start of World Bank MAP Global Fund Haiti grant PEPFAR

  8. A Tale of ThreeCountries

  9. Trinidad 2009 • 84% Government funded programme • $ 90.3 million in 2009

  10. Trinidad/Tobago: HIV Expenditure Patterns, 2008

  11. Trinidad/Tobago: HIV Expenditure Patterns, 2008 02-06 73% Donors funded 93% Gov funded In 2009, donor funding exceeded government’s

  12. Dominican Republic 2008 • 25% Government funded programme • US$31.3 million in 2008

  13. DR: HIV Financing Sources, 2008

  14. DR: HIV Expenditure Patterns, 2008 63% donor funded 35% donor funded A Tale of TwoCountries 35% donor funded

  15. Guyana 2010 • 80% Donor funded programme • $ 28.9 million in 2010

  16. Guyana: HIV Sources of Funding, 2010 Largest supporter in 2015, with 68%, but ends in 2016 Ends in 2015 , declines from $18.7 in 2010 to $0m in 2015

  17. EVALUATION OF THE SPEND

  18. 260,000 PLHIV 2008250,000 PLHIV 2001 52% don’t get treatment

  19. MONEY What did the money buy? $1.6 Billion $91m 2009 2001

  20. MONEY HEALTH IMPACT Impact of investment in HIV prevention, care and treatment 2001-2009 21,000 $1.6 Billion 18,000 new infections 12,000 deaths $91m 2001 2009

  21. 3,592 receiving ART , 404 PLHIV on 2ndLine ARV , 40 PLHIV on 2ndLine ARV

  22. 7,503 needing ART 3,592 receiving ART

  23. 7,503 needing ART 3,592 receiving ART $4,324,640 , 404 PLHIV on 2ndLine ARV , 40 PLHIV on 2ndLine ARV $469,400

  24. There is an economic crisis

  25. The Economic Context • Before 2008 - with few exceptions, very low rates of growth and widespread fiscal and balance of payment deficits. • Post 2008 - worsened economic context with some countries experiencing negative growth rates and seeking IMF support. • Yet, the annual income of the region, including Puerto Rico and the Dominican Republic, is approximately US$60 billion with a population of 35 million people • The public sector accounts for roughly 30% of this income

  26. Economy GDP from 2.7% in 2006 to -2.7% in 2009 Debt-to-GDP 132% in 2009 Unemployment increased from 9.8% in 2007 to 11.4% in 2009 Remittances slowed Exchange rate declined Alumina revenue delined by 60%, bauxite by 25% 20% decline in Government budgets Health Sector Impact Pre crisis (2006/07) health expenditures were increasing by 19.7% in real terms In crisis, (2009-10) Health expenditures declines by 6.5% In US$ health expenditures declined from $212.5M in 06/07 to $176.4M in 09/10 - 23% Jamaica: 2006-2010: Impact of an economic crisis on the health sector Source: Rapid Assessment of the Impact of the Economic Crisis on Health Spending in Jamaica, World Bank, 2011

  27. Drug shortages: ART resistance Lack of funding for MARPs Less prevention: increased risk taking Drug shortages: increased mortality and morbidity Potential Effects of economic crises

  28. Quo vadis?

  29. What do we do? • Address the IDD • Be strategic in our choices • Put resources where the epidemic is • Be realistic about long term change • Develop a new message

  30. What do we do? • Address the IDD = Implementation Deficit Disorder • Be strategic in our choices • Put resources where the epidemic is • Be realistic about long term change Of 7 World Bank loans totalling $157m, only $114m was used. Of 7 closed grants, 5 did not use all the funds available

  31. What do we do? • Address the IDD • Be strategic in our choices No more implementation of costly schemes of uncertain effectiveness We must pay more attention to what things cost, their likely impact and reduce costs

  32. What do we do? • Address the IDD • Be strategic in our choices There must be better integration of HIV with STI, SRH services Also better alignment with country reponses to NCDs

  33. What do we do? • Address the IDD • Be strategic in our choices • Put resources where the epidemic is • Be realistic • Develop a new message

  34. DR: Modes of Transmission Study, 2010

  35. DR: Mode of Transmission Study, 2010 Approximately 1.2% of expenditure, specifically targeted Approximately 16.1% of expenditure, specifically targeted

  36. Prevention Spending Trinidad/Tobago 2002 and 2009

  37. What do we do? • Address the IMD • Be strategic in our choices • Put resources where the epidemic is • Be realistic • Develop a new message The project cycle is not a development cycle

  38. What do we do? • Address the IMD • Be strategic in our choices • Put resources where the epidemic is • Be realistic • Develop a new message Second highest prevalence in the world?

  39. Where do we go from here – A look at the Financial &Fiscal Side Karl Theodore HEU, Centre for Health Economics, UWI

  40. Update on Cost of Regional Response to HIV/AIDS • Based on initial estimates produced jointly the World Bank and the HEU in 2000 the updated estimate of the projected cost of responding to HIV/AIDS in 22 CAREC countries is approximately US$ 300m per year. • This is significantly more than the average annual expenditure ( about $165mn) on the epidemic for the past eight years.

  41. Update on Cost of Regional Response • On a positive note, in spite of the gap between actual and required expenditure the epidemic has more or less been kept in check. • If the sustainable financing requirement is set just a little higher than the recent annual average expenditure, with a new target of US$ 180million, for example, we would still be requiring just over three-tenths of one percent , or 3/1000 (0.3%) of the region’s annual income!

  42. Sustainable Financing Feasible? • On the face of it an expenditure of 0.3% of the region’s income cannot be considered an infeasible target, especially in the context of an epidemic with the potential to annihilate the region. • It is, by all appearances, a matter of the political will to take full ownership of the epidemic, the will to mobilize a miniscule fraction of income to confront a survival threat.

  43. A CHANGE OF ATTITUDE • The truth is that while the region is grateful for international support to fight the epidemic, the region has always had the financial capacity to fight this epidemic on its own. • To some this is the kind of statement that can make overseas support become even more scarce, but facing up to this is what independence and regional responsibility are about.

  44. History of domestic support • More data required but three country experiences are instructive: • Country A: US$ 50mn spent over the period 2002 to 2009. • Over the same period the cumulative income of the country was close to US$ 135 billion. • The allocation to HIV was therefore less than 0.05%, that is less than 1/20 of one percent! • Country B: in 2006 5.1% of its GDP spent on health, with 3.8% of this five percent allocated to HIV/AIDS, or 0.2% of its income. • Country C in 2008 laid out a plan to spend US$ 90mn between 2008 and 2013 – an average of $18mn per year • Since the country’s income for 2008 was US$4,046mn this means that the planned expenditure was just over 0.4% of income, slightly more than the regional target!

  45. Additional Dimension of the Context • In addition to a challenging epidemiological and economic context, the HIV/AIDS response is now faced with the prospect of reduced financial resources, mainly because of the lingering effects of the 2008/2009 global recession. • The need now is to do at least as much as before with less resources than previously available. • It is in this context that the question of the sustainability of the HIV/AIDs response rears its head.

  46. Sustainable Sourcing • Although support for HIV/AIDS programmes mainly comes directly from fiscal and international sources, in the final analysis all such support comes from the global and national levels of income. • If we assume that decline in international support will follow UK trend, where DFID has cut by 32%, it follows that sustainability will require countries to find significantly more domestic fiscal space to support national programmes.

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