Part II
Progress on the First 5-Year Strategy—PEPFAR



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PEPFAR Implementation: Progress and Promise Part II Progress on the First 5-Year Strategy—PEPFAR

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PEPFAR Implementation: Progress and Promise 3 PEPFAR’s Management Summary of Key Findings The Office of the U.S. Global AIDS Coordinator (OGAC) is committed to learning by doing and contributing to the evidence base for how to combat global HIV/AIDS most effectively. PEPFAR’s virtual organization, composed of OGAC, numerous other implementing agencies, and the Country Teams, has demonstrated an increasing capacity for responding to and sharing knowledge acquired over the course of the program’s implementation. PEPFAR’s accomplishments include the ongoing development, revision, and dissemination of program policies and procedures, as well as dissemination of evidence on how to provide and scale up quality services to those affected by HIV/AIDS in resource-constrained settings. Mechanisms for planning and reporting, coordination, and knowledge sharing at all levels have also been developed. Going forward, OGAC needs to increase its emphasis on operations research and develop an overall plan for the collection and management of strategic information. PEPFAR policies demonstrate a commitment to supporting host countries’ leadership and ownership of their responses to their HIV/AIDS epidemics. Country Teams have endeavored to work closely with host country governments and coordinating bodies, as well as other donors, to carry out PEPFAR activities within the framework of harmonization. PEPFAR has been increasingly successful in this regard, but concerns about the transparency of the planning process remain. Moreover, congressional budget allocations have created a substantial administrative burden, hampering harmonization and requiring that considerable local effort be expended on new planning, budgeting, and reporting mechanisms. PEPFAR’s initial decision to jump-start the program by relying heavily on central programming and using experienced nongovernmental organizations for implementation has had mixed results. Although some of the disadvantages of this approach are still evident, OGAC has shifted greater control of centrally funded grants to Country Teams to facilitate integration of these activities within the larger PEPFAR portfolios in the focus countries. PEPFAR and other donors plan to rely on national data from the focus countries to determine the program’s impact in the long term. Thus, strong support for creating, implementing, and strengthening a unified and coherent monitoring and evaluation system at the country level continues to be critical.

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PEPFAR Implementation: Progress and Promise Recommendations Discussed in This Chapter Recommendation 3-1: To support country leadership, the U.S. Global AIDS Coordinator should seek to identify and remove barriers to coordination with partner governments and other donors, with a particular focus on promoting transparency and participation throughout the annual planning process. Recommendation 3-2: The commitment of the U.S. Global AIDS Initiative to work toward reducing stigma and discrimination against people living with HIV/AIDS requires that marginalized and difficult-to-reach groups receive prevention, treatment, and care services. These groups include sex workers, prisoners, those who use injecting drugs, and men who have sex with men—groups that not only are characterized by their high-risk behavior, but also tend to be stigmatized and subject to discrimination. The U.S. Global AIDS Coordinator should document how these groups are included in the program planning, implementation, and evaluation of PEPFAR activities. Recommendation 3-3: Although they may have been helpful initially in ensuring a balance of attention to activities within the four categories of prevention, treatment, care, and orphans and vulnerable children, the Committee concludes that rigid congressional budget allocations among categories, and even more so within categories, have also limited PEPFAR’s ability to tailor its activities in each country to the local epidemic and to coordinate with the level of activities in the countries’ national plans. Congress should remove the budget allocations and replace them with more appropriate mechanisms that ensure accountability for results from Country Teams to the U.S. Global AIDS Coordinator and to Congress. These mechanisms should also ensure that spending is directly linked to and commensurate with necessary efforts to achieve both country and overall performance targets for prevention, treatment, care, and orphans and other vulnerable children.

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PEPFAR Implementation: Progress and Promise 3 PEPFAR’s Management The Office of the U.S. Global AIDS Coordinator (OGAC) has created a virtual organization that, as mandated by the Leadership Act, coordinates among many different entities both within and outside of the U.S. government and between the central and country levels. In contrast to recent reorganizations of other government entities, OGAC has deliberately been kept small, with use being made of temporary assignments and coordinating bodies rather than a large, entirely new structure being created. This chapter reviews key aspects of the management of this virtual organization: (1) coordination, (2) harmonization, (3) policy guidance, (4) planning and reporting, (5) technical working groups, (6) functioning as a learning organization, (7) budget allocations, (8) targets, and (9) resource allocation. COORDINATION This section reviews coordination among the U.S. implementing agencies under the auspices of OGAC both at the headquarters and country levels, between OGAC and other international HIV/AIDS donors, and between OGAC and the U.S. teams working in the focus countries (Country Teams). Coordination of the Country Teams with partner governments and other donors working at the country level is addressed in the next section in the discussion of the Second One of harmonization—One National HIV/AIDS Coordinating Authority.

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PEPFAR Implementation: Progress and Promise The Leadership Act called for the newly established U.S. Global AIDS Coordinator (the Coordinator) to coordinate Programs and policies of designated executive branch agencies and nongovernmental organizations. Resolution of policy, program, and funding discrepancies among these organizations. Field activities of the designated executive branch agencies. Related assistance by other countries and international organizations. The President’s Emergency Plan for AIDS Relief (PEPFAR) strategy was to identify the existing capacity of the implementing agencies and harness and expand their comparative strengths into one synergistic U.S. government response coordinated by OGAC (OGAC, 2004). Central Coordination: The Office of the U.S. Global AIDS Coordinator Unification of all U.S. international HIV/AIDS activities and coordination of PEPFAR implementation are the responsibility of OGAC, a relatively small central office staffed largely by people detailed from the implementing agencies and supplemented by positions created and staffed on an as-needed basis. OGAC officials reported that the office has also relied heavily on numerous interagency coordinating committees, task forces, and working groups to address the challenge of bringing together the many disparate implementing agencies. To ensure coordination among participating agencies at the central headquarters level, OGAC created the Deputy Principals Group, which handles program management and logistics and includes high-level representation from all of the implementing agencies (see Chapter 2). Interagency Coordination The two principal implementing agencies—the U.S. Agency for International Development (USAID) and the Centers for Disease Control and Prevention (CDC)—have different systems and structures for operating, different established budget cycles, and even different salary scales.1 For purposes of PEPFAR, all agencies are expected to collaborate in program funding that was previously managed separately by each agency. Prior to PEPFAR, USAID and CDC had limited funds available to prepare for scale-up of antiretroviral therapy (ART). USAID’s HIV/AIDS programs had 1 Some CDC employees are part of the Public Health Service Corps; this option is not available in USAID.

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PEPFAR Implementation: Progress and Promise previously been focused primarily on prevention, including prevention of mother-to-child transmission. CDC’s HIV/AIDS programs also provided support for prevention of mother-to-child transmission. CDC staff worked with ministries of health in various technical areas, such as surveillance, and on the development of national AIDS plans. OGAC and agency officials believe that previous joint monitoring and evaluation activities provided a foundation for improving collaboration between CDC and USAID. The agencies had engaged in an ongoing coordination process that included agency visits, biweekly conference calls, quarterly meetings, review of agency-specific guidance, and cosigned letters of concurrence on major issues (Rugg et al., 2004). The agencies had also jointly organized and conducted monitoring and evaluation workshops and training courses and collaborated to develop core indicators. In addition, they had been collaborating on monitoring and evaluation with global partners, such as UNAIDS, the World Health Organization (WHO), the United Nations Children’s Fund (UNICEF), the World Bank, and the Global Fund to Fight AIDS, Tuberculosis and Malaria (Global Fund). The people involved reported that this foundation for interagency collaboration on monitoring and evaluation did not develop easily and required significant ongoing effort, as well as “setting realistic expectations and seeing a balance between what is contributed and what is gained from the partnership” (Rugg et al., 2004, p. 74). All donors, large and small, are attempting to improve their coordination with one another so as to minimize the transactional burden—the difficulties governments experience in handling the demands of multiple donors, such as attendance at meetings and reporting requirements—associated with the influx of large amounts of funding in the focus countries (UNAIDS, 2005b; Shakow, 2006). Considerable evidence shows that uncoordinated donor actions can result in pressures on country systems that weaken, rather than strengthen, the partner government’s ability to manage its own programs (OECD, 2003; The Rome Declaration, 2003; UNAIDS, 2005a,b). As the largest single bilateral donor, PEPFAR can lead the way in furthering such efforts. Effective coordination will mean that both U.S. dollars and money from other donors will be spent effectively, minimizing the potential for waste arising from poorly coordinated independent funding streams. Field Coordination: The Country Teams In the focus countries, PEPFAR Country Teams are coordinated through the U.S. embassy and thus led by the U.S. ambassador. All agencies working in a country on HIV/AIDS—such as the Department of Defense, the Peace Corps, the National Institutes of Health, USAID, and CDC—are part of the

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PEPFAR Implementation: Progress and Promise Country Team, and each team has a designated leader (OGAC, 2004). The typical coordinating mechanism is a regular meeting chaired by the ambassador or his/her most senior staff member. OGAC intends this structure to ensure coordination among all agencies, and to provide a single voice speaking for the entire Country Team in interactions with partner governments and other donors. In its visits to the focus countries, the Committee observed that Country Teams were generally collaborating effectively, although a few examples of rivalry and poor communication persist. In addition, further efforts could be made to coordinate planning and contracting cycles and requirements among the implementing agencies, particularly CDC and USAID. The Committee was told that timing discrepancies between agencies had in some cases resulted in funding gaps and resource shortages; that confusion existed around the management of certain programs, resulting in a lack of clear accountability for those programs; and that coordination at the country level continued to be complicated by the presence of numerous, large, centrally-managed contractors. Coordination Among International Donors OGAC recently (January 2006) met with representatives from the Global Fund and the World Bank to discuss program implementation and ways of improving donor coordination (OGAC et al., 2006). The three partners have agreed to work together, particularly on coordinating procurement, organizing annual implementation reviews, improving communication, and supporting country strategies and action plans. The role of donors in the country planning process is addressed below in the discussion of the First One of harmonization—One HIV/AIDS Action Framework. Communications Communication is a central element of PEPFAR’s coordination strategy. OGAC has worked to develop a number of mechanisms for communicating not only across agencies, but also between Country Teams and central staff (OGAC, 2004, 2005a, 2006a). According to OGAC, weekly teleconferences are held between each Country Team and the Washington-based interagency core team, which includes a coordinator within OGAC. The core team is expected to be aware of both OGAC policy and country programs so it can support the Country Teams in a variety of ways, from program management to identification of areas in which technical assistance may be needed (Moloney-Kitts, 2005) (see the discussion of Technical Working Groups later in the chapter). To enhance communication, the PEPFAR Extranet was created in 2006.

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PEPFAR Implementation: Progress and Promise Currently limited to internal use, the Extranet offers access to archived News to the Field weekly newsletters, public affairs/public diplomacy resources, PEPFAR policies and guidance, presentations, budget figures and country data, and U.S. agency directories. Additionally, the Extranet is intended to give Country Teams the opportunity to collaborate and share information with their colleagues around the world. Available information includes lessons learned, best practices, national polices and guidelines, technical articles, presentations, and resources such as curricula and toolkits. According to OGAC, the primary reason the Extranet was created was to help manage the volume of information needed to run a program as technically complex as PEPFAR and make this information available to those overseeing the program’s implementation in the field. OGAC plans to allow implementing partners outside of the U.S. government access to the Extranet at some point in the near future; implementing partners have told the Committee that they eagerly await this change. HARMONIZATION PEPFAR, along with all other major donors, is committed to supporting the focus countries’ ownership of their response to their AIDS epidemics. Country Teams work closely with partner governments, as well as other donors, to implement harmonized HIV/AIDS plans (OGAC, 2005a, 2006a,b,c). To this end, PEPFAR has committed to implementing its program within the Three Ones framework of harmonization agreed upon at a meeting with the United Kingdom and UNAIDS in April 2004: One agreed HIV/AIDS Action Framework, One National AIDS Coordinating Authority, and One agreed country-level Monitoring and Evaluation System (see Chapter 2) (UNAIDS, 2004a; OGAC, 2005b). First One: One Action Framework All of the focus countries have a national strategic plan to fight AIDS; most also have a national operational plan. The latter plans vary widely in detail and quality, particularly with regard to the specific steps to be taken and the associated costs. Responding to a call by UNAIDS, PEPFAR and other major donors are currently working with the host countries to help develop operational plans that are costed, evidence-based, and prioritized, and thus will provide the specificity necessary for funding and program development purposes for both the country itself and all donors (UNAIDS, 2004a; OGAC, 2005b). OGAC has directed Country Teams to develop both a U.S. 5-year strategic country plan and an annual Country Operational Plan that are harmonized with the existing plans of the focus countries (OGAC, 2004,

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PEPFAR Implementation: Progress and Promise 2005d, 2006b,c,f). The U.S. plans are expected to reflect the priorities and interests of the partner government, as well as to identify strategic information, activities, and priorities for the coming year (OGAC, 2006a). During the Committee’s country visits, representatives of partner governments generally expressed their satisfaction with the level of harmonization achieved. To complement these reports, the Committee reviewed PEPFAR’s annual Country Operational Plans against the plans of the focus countries and found them to be generally congruent. In most cases, however, the Committee was able to compare only the highly specific PEPFAR Country Operational Plans for fiscal years 2005 and 2006 with the much more general national strategic plans. Because the national strategic plans typically are not prioritized, the Committee could not determine how well PEPFAR support is aligned with national priorities. In most cases, for example, it is not possible to determine how PEPFAR allocations by the categories of prevention, treatment, care, and orphans and other vulnerable children compare with proposed national spending. During its country visits, the Committee also heard reports of disharmony arising from constraints imposed by U.S. laws that prohibit or appear to prohibit or restrict the use of some of the means of prevention that are viewed by those in the field as important and potentially successful. These include restrictions on teaching young teens about the full scope of HIV prevention methods, the Leadership Act requirement for organizations to certify that they have a “policy explicitly opposing prostitution and sex trafficking” (P.L. 108-25, p. 734) in order to receive funding, and the prohibition against support for clean needles to combat the spread of HIV among people who use injection drugs. The Committee was told of examples of innovative programs that PEPFAR was unable to support, such as those that integrate messages about HIV prevention into traditional teaching at the time of sexual initiation, those organized by sex workers to conduct peer counseling, and those that provide clean needles in communities where injecting drug use is a major source of spread of HIV infection. By far the most often-cited obstacle to harmonization, however, is the requirement that U.S. funds be used only for medications that have received approval from the U.S. Food and Drug Administration. Country Teams, host country officials, and implementing partners all agreed that, although workaround arrangements had been developed to deal with this requirement, such arrangements were awkward, costly, and difficult to administer, reducing the ability of PEPFAR and the host countries to use funds in the most cost-effective manner possible. This issue and the Committee’s related recommendation are discussed in greater detail in Chapter 5 in the overall context of treatment. Coordination is also crucial to the development of a unified action framework. As noted earlier, failure of bilateral donors to coordinate with

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PEPFAR Implementation: Progress and Promise one another can lead to duplication and conflict in the delivery of needed services (OECD, 2003; The Rome Declaration, 2003; UNAIDS, 2005a,b). A number of countries have more or less formal donor groups that enable donors to speak to the government, to the extent possible, with a single voice. OGAC officials stressed that a significant amount of time is dedicated to working with other international donors, and the Country Teams confirmed this. Of particular importance is for all donors to know what the others are planning so they can ensure that their money is being spent in the most effective way, whether or not they participate in basket funding. Full transparency of U.S. plans is therefore particularly important. One complaint voiced by both donors and Country Teams during the Committee’s visits was that because the Country Operational Plans are procurement sensitive, they cannot be fully shared with other donors. The Country Teams share the Country Operational Plans with the partner governments before completion, and are required to obtain approval from the partner governments before submitting the plans to OGAC (OGAC, 2006c). Subsequent to the Committee’s visits, OGAC made nonsensitive versions of the Country Operational Plans available on the PEPFAR website, and OGAC officials reported that they have taken additional steps to encourage Country Teams to share as much information as appropriate with their counterparts from other donors working in a country. However, the Committee was unable to confirm with other donors at the country level whether the situation has improved in their view. Since the preparation of the Country Operational Plans is such a prominent part of the Country Teams’ work, the inability to disclose their content to other donors represents an impediment to harmonization; resolution of any remaining issues would therefore be an important improvement. Recommendation 3-1: To support country leadership, the U.S. Global AIDS Coordinator should seek to identify and remove barriers to coordination with partner governments and other donors, with a particular focus on promoting transparency and participation throughout the annual planning process. Second One: One National Coordination Authority The Second One essentially challenges each country to create a single coordinating authority to develop, implement, and monitor its plans for supporting its response to its HIV/AIDS epidemic, and calls for donors to participate in that authority (UNAIDS, 2004a). Unfortunately, the Global Fund’s required Country Coordinating Mechanisms were not fully congruent with the existing National HIV/AIDS Coordinating Authorities already in place in most countries (UNAIDS, 2005a). Although some countries have

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PEPFAR Implementation: Progress and Promise Finally, targets that are defined in terms of whether programs meet the full spectrum of needs of an individual person across his or her lifespan, of all members of the family or household, and of communities as a whole would create improved incentives for programming that is comprehensive, integrated, and accountable to those being served. At present, however, PEPFAR is not reporting referral or linkage indicators in its annual report, and few such indicators are required to be reported to OGAC across the four program categories. Over the course of the program, OGAC has increased its emphasis on integration in guidance provided to the focus countries (Dybul, 2005). Integration was included in the fiscal year 2005 guidance in a general manner; by fiscal year 2007, that guidance was expanded, outlining points of possible integration for all program activities, including voluntary counseling and testing, ART, diagnosis and treatment of sexually transmitted infections, and services for orphans and other vulnerable children (OGAC, 2006b,c). OGAC has also provided Country Teams with additional information on integrated services and activities required to address the needs of key populations, such as people living with HIV/AIDS (OGAC, 2006b,c). This improved guidance can have greater impact if it is enhanced by tracking of the results of integration. RESOURCE ALLOCATION Financial Management Over the course of the program, there have been a number of changes in the way funding is managed, as well as in the interactions between the Country Operational Plans and funding decisions. Country Teams originally developed Country Operational Plans under the assumption that they would have the available minimum level of funding OGAC had assigned to them. If, as happened in fiscal year 2006, more money was appropriated after the plans had been approved, new versions of the plans had to be developed that described how the additional funds would be spent. These new plans, called “plus-up plans,” were then reviewed through the usual mechanisms. OGAC was dissatisfied with the quality of the plus-up plans, and the Country Teams were unhappy about writing and reviewing planning documents twice in one year. As a result, for fiscal year 2007, the interagency Deputy Principals Group assumed the highest possible level of potential funding when developing the country planning budgets and requested that Country Teams formulate a short statement indicating how spending would be prioritized if funding were decreased by 5–10 percent. Since its inception, PEPFAR has undergone one evaluation by the Office of Management and Budget. The Office of Management and Budget developed the Program Assessment Rating Tool to assess and drive the improved

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PEPFAR Implementation: Progress and Promise performance of U.S. government programs by examining all factors that affect and reflect program performance, such as program purpose and design, performance measurement, evaluations, strategic planning, program management, and results (OMB, 2007a). Programs that are categorized as performing (versus nonperforming) receive ratings from effective (highest rating) to adequate (lowest rating). All U.S. government agencies involved in PEPFAR are rated in a single assessment, and the program received an overall rating of moderately effective when assessed in 2005. Specifically for fiscal accountability, however, the assessment found that “the implementing agencies’ mechanisms for financial accountability and control did not yet meet the standards for strong financial management practices.” In addition, audits conducted by USAID’s Inspector General in 2005 and 2006 found financial management problems in PEPFAR programs implemented by USAID in some of the focus countries (USAID, 2005, 2006c). OGAC’s response to its assessment was that it was establishing and implementing a new system to capture program expenditures by country and undertaking an internal review of budget allocations to focus countries based on performance data and pipeline capacity (OMB, 2007b). Additionally, a new financial management system has been implemented at CDC and at USAID for both headquarters and Country Team management. OGAC officials also explained to the Committee that they are funding a number of new projects aimed at improving PEPFAR’s financial management. These include the following: Development of a country-level portfolio review process. This process is intended to improve program management and evaluate funding pipelines by partner and activity type. A pipeline analysis to determine whether improvements can be made in how funds move from congressional appropriation to the end user. An addition, on the part of the Office of Management and Budget, OGAC, and the PEPFAR implementing agencies, of an annual outlays report to the current quarterly obligations and outlays reports. According to OGAC, this new approach will serve to provide greater detail and transparency. A joint effort with State Department information technology experts to develop a budget interface system that will be flexible and web-based. In related activities, OGAC is working with a contractor to improve COPRS reports.

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PEPFAR Implementation: Progress and Promise PEPFAR Focus Country Funding by Agency Account A 357 percent increase in focus country funding from the State Department Global HIV/AIDS Initiative account from fiscal year 2004 to fiscal year 2006 resulted from both an increase in new monies for HIV/AIDS and the shifting of funding from other agency accounts, such as CDC’s Global AIDS Program account and the Department of Defense’s Prevention account. The AIDS budgets of USAID and the Department of Defense were shifted in their entirety to the State Department account, as was a large proportion of the budget of the Department of Health and Human Services for the CDC Global AIDS and Prevention of Mother-to-Child Transmission programs (see Table 3-1). PEPFAR Central and Focus Country Funding PEPFAR activities are funded either centrally—through OGAC or one of the implementing agencies—or through the Country Teams. The majority of PEPFAR funds (84 percent), totaling almost $3 billion over the first 3 years of the program, has been planned and granted by the Country Teams. The proportion of country funds implemented through central programs has decreased by almost half—from 24 percent in fiscal year 2004 to 13 percent in fiscal year 2006 (see Table 3-2) (OGAC, 2005a, 2006a). PEPFAR’s initial rounds of funding were intended to capitalize TABLE 3-1 Focus Country–Implemented Funding by Agency for Fiscal Years 2004–2006 (in millions of U.S. dollars) Agency Fiscal Year 2004 Fiscal Year 2005 Fiscal Year 2006 Total Fiscal Year 2004–2006 Funding Percent Funding Percent Funding Percent Funding Percent USAID 194 34 0 0 0 0 194 6 Department of Health and Human Services (CDC) 84 15 59 6 59 4 202 7 Department of Defense 0.4 <1 0 0 0 0 0.4 <1 State Department 292 51 969 94 1,336 96 2,597 87 Total $570 100 $1,028 100 $1,395 100 $2,993 100 SOURCE: OGAC, 2005d, 2006f.

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PEPFAR Implementation: Progress and Promise TABLE 3-2 PEPFAR Focus Country–Implemented and Central-Implemented Funding for Fiscal Years 2004–2006 (in billions of U.S. dollars) Fiscal Year Focus Country Central Total Focus Country and Central Funding Percent Funding Percent Funding 2004 .57 76 .18 24 .75 2005 1.03 84 .19 16 1.22 2006 1.39 87 .21 13 1.60 Total 2004–2006* $2.99 84 $.58 16 $3.58 *Numbers may not sum to the totals shown because of rounding. SOURCE: OGAC, 2005d, 2006f. on the existing operations of both international and country-based nongovernmental organizations to allow for rapid scale-up. Contracts with international organizations—which were required to be already operating in at least four of the focus countries—were centrally managed, while contracts with country-based organizations were managed by the Country Teams. During the Committee’s country visits, Country Teams described the challenges of managing a comprehensive HIV/AIDS program when as much as a third (on average 16 percent) of the country’s PEPFAR funding was centrally managed. While OGAC has worked to facilitate linkages between the Country Teams and centrally funded grantees, issues remain. Centrally funded programs were selected at the headquarters level, and Country Teams had little or no control over the types of activities funded, the size of the contracts, or the evaluation of performance. Although the initial centrally managed contracts were seen by OGAC as a way to get the funding on the ground as quickly as possible, Country Teams regarded them as a circumvention of country planning and Country Team funding decisions. This situation raised concerns, some of which persist, regarding PEPFAR’s ability to comply with the tenets of harmonization. Moreover, the performance of centrally funded contracts appears to be quite variable, with some being singled out for praise in terms of country knowledge and integration with country policies and others being criticized for a lack of those characteristics. In addition, OGAC has taken several steps to shift control of centrally funded grants to Country Teams so they can better integrate the activities with the larger PEPFAR portfolio in the focus country. Central funding for these contracts has been held constant, and the organizations involved have been required to negotiate increases with the Country Teams. Two examples

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PEPFAR Implementation: Progress and Promise of this shift in management of central programs are the Partnership for Supply Chain Management and the New Partners Initiative. The Partnership for Supply Chain Management is a program involving a technically skilled central structure from which Country Teams are able to buy specific commodities and services that address each country’s specific needs (OGAC, 2006b,c). Since 2004, OGAC has requested approximately $36 million in central funds for the program, used for operations and management, but the bulk of the program’s funding is expected to come from focus country budgets. The Quality Assurance Program of USAID, described previously, is managed in a similar style (USAID, 2006b). The New Partners Initiative is a central grant-making mechanism focused on increasing the number of new partners. Initiated in 2005, it has received $35 million in central funding to date. There was concern that New Partners Initiative grants would be made with little input from the Country Teams. However, OGAC reported that it has been working with Country Teams to apply lessons learned about centrally managed programs to inform New Partners Initiative policies. Specifically, grantees are required to have Country Team approval to work in that country (OGAC, 2006a). Both of these programs were established after the Committee made its visits to the focus countries. Thus the Committee was unable to obtain the perspective of the Country Teams on whether the implementation of these centrally managed programs represents an improvement. PEPFAR Funding by Program Category Of the approximately $3.6 billion allocated for the focus countries during the first 3 years of funding, the treatment category has accounted for approximately $1.4 billion (40 percent), while prevention and care have each accounted for about $.81 billion (23 percent) (see Table 3-3). The remaining $.51 billion (14 percent) has gone to other costs, such as strategic information activities, policy analysis and system strengthening, and management and staffing of the Country Teams. With respect to the budget allocations, the proportion of funds allocated by OGAC for treatment has increased from 34 to 45 percent. The proportion for care has stayed constant at about 23 percent, while the proportion allocated for prevention has declined by about 9 percentage points. Since the program’s inception, about 28 percent of the funds allocated to care and 6 percent of overall funding has been allocated for the orphans and other vulnerable children category (OGAC, 2006a). As reported by OGAC to the Committee, it has a method to attribute the same “other” costs described above to their corresponding program categories for each fiscal year (OGAC, 2007). When this method is used, the totals for the full dollar amounts appropriated each year for the focus

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PEPFAR Implementation: Progress and Promise TABLE 3-3 PEPFAR Funding by Program Category for Fiscal Years 2004–2006 (in billions of U.S. dollars) Category 2004 2005 2006 Total 2004–2006 Funding Percent Funding Percent Funding Percent Funding Percent Prevention .21 28 .29 24 .31 19 .81 23 Care .16 23 .27 22 .37 23 .81 23 Treatment .25 34 .48 39 .72 45 1.45 40 Other Costs .13 17 .18 15 .20 13 .51 14 Total $.75 100 $1.22 100 $1.60 100 $3.58 100 NOTE: Numbers may not add due to rounding. SOURCE: OGAC, 2005d, 2006f. countries (including central support) and the percentages of funding for each program area change from the data in Table 3-3 (see Table 3-4). Focus Country Funding Between $53 million (Guyana) and $459 million (South Africa) has been allocated for each of the 15 focus countries since fiscal year 2004, totaling a combined $3.6 billion (see Table 3-5). PEPFAR support for the focus countries collectively has increased by 113 percent, and each of the countries has seen at least an 80 percent increase in funds since the first year of the program. Botswana, Ethiopia, Haiti, Kenya, Mozambique, Namibia, Nigeria, South Africa, and Vietnam have all seen their support increase by more than 100 percent. One of the major concerns of the Country Teams has been the relationship between their budgets and targets for prevention, treatment, and care. For many of the focus countries, the proportions of the prevention, TABLE 3-4 PEPFAR Funding by Program Category for Fiscal Years 2004–2006 (in billions of U.S. dollars) with Distribution of Other Costs by OGAC Method Category 2004 2005 2006 Total 2004–2006 Funding Percent Funding Percent Funding Percent Funding Percent Prevention .28 33 .38 27 .40 23 1.06 27 Care .24 28 .39 28 .54 31 1.17 29 Treatment .32 38 .62 44 .82 47 1.76 44 Total $.83 100 $1.40 100 $1.76 100 $3.99 100 NOTE: Data presented as received from OGAC. SOURCE: OGAC, 2007.

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PEPFAR Implementation: Progress and Promise TABLE 3-5 PEPFAR Funding by Focus Country for Fiscal Years 2004–2006 (in millions of U.S. Dollars) Country 2004 2005 2006 Percent Increase 2004–2006 Total Funding 2004–2006 Botswana 24 52 55 129 131 Côte d’Ivoire 24 44 47 96 115 Ethiopia 48 84 123 156 255 Guyana 12 19 22 83 53 Haiti 28 52 56 100 135 Kenya 92 143 208 126 444 Mozambique 37 60 94 154 192 Namibia 24 43 57 138 124 Nigeria 71 110 164 131 345 Rwanda 39 57 72 85 168 South Africa 89 147 222 149 459 Tanzania 71 109 130 83 309 Uganda 91 147 170 87 409 Vietnam 17 27 34 100 79 Zambia 82 130 149 82 361 Total $751 $1,223 $1,602 113 $3,580 NOTE: Numbers may not sum to the totals shown because of rounding. Some sources of central support for focus countries are not reflected in the table above. SOURCE: OGAC, 2005d, 2006f. treatment, and care targets they are responsible for achieving are close to the respective proportions of their funding. For 9 of the 15 focus countries, the target and funding proportions are within 3 percentage points of one another across the three program categories with targets. However, South Africa, which is responsible for approximately 25 percent of the targets in all three categories, is receiving between 11 and 14 percent of funding, depending on the program area. In contrast, Uganda is responsible for 2 to 3 percent of the targets and receives 10 to 15 percent of the funding. On the other hand, these figures do not take into account a number of factors that could impact the level of funding, such as existing infrastructure, other funding sources (e.g., the host country and other donors), human resource capacity, and the current state of the epidemic. Per capita PEPFAR funding for people living with HIV/AIDS also varies widely by focus country. For example, in 2006 Guyana, with an estimated 12,000 people living with HIV/AIDS, was receiving roughly $1,800 in PEPFAR funds per person living with HIV/AIDS. In contrast, South Africa, which has an estimated 5.5 million people living with HIV/AIDS, was receiving about $40 in PEPFAR funds per person living with HIV/AIDS. OGAC reported that the Deputy Principals Group decides on the total funding per fiscal year per country, but provided the Committee with no

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PEPFAR Implementation: Progress and Promise information on the process used in making these decisions. The per person allocations presented above do not take into account important factors, including the country’s own capacity to fund its programs, but they suggest a need for more transparent budgeting and planning so the rationale for these allocations can be better understood. CONCLUSION PEPFAR has been responsive to the Leadership Act’s challenging mandate to coordinate all U.S. international HIV/AIDS activities and has made progress in coordinating among the agencies of the U.S. government involved in the program and with other global HIV/AIDS donors at both the headquarters and country levels. The program has also made progress in harmonizing with the focus countries. The virtual organization created by OGAC, the implementing agencies, and the Country Teams exhibits many of the positive features of a learning organization and has evolved considerably during the initial years of the program. With the improvements in transparency and accountability for marginalized groups of people recommended by the Committee, and with the increased flexibility that would be afforded by removal of the congressional budget allocations, the U.S. Global AIDS Initiative should be able to make even greater progress toward achieving the goals of the Leadership Act. REFERENCES Bunnell, R., J. Ekwaru, P. Solberg, and N. Wamai. 2006. Changes in sexual behavior and risk of HIV transmission after antiretroviral therapy and prevention interventions in rural Uganda. AIDS 20:85–92. Dybul, M. 2005 (May 24). Integrated prevention, treatment and care: Network systems. Presentation at the PEPFAR Second Annual Field Meeting, Addis Ababa, Ethiopia. Dybul, M. 2006 (July 13). The President’s Emergency Plan for AIDS Relief: Looking back and looking forward. Remarks as prepared to the Center for Strategic and International Studies. Washington, DC: U.S. Office of the Global AIDS Coordinator. http://www.pepfar.gov (accessed July 13, 2006). Furguson, A., M. Pere, C. Morris, E. Ngugi, and S. Moses. 2004. Sexual patterning and condom use among a group of HIV vulnerable men in Thika, Kenya. Sexually Transmitted Infection 80:435–439. GAO (Government Accountability Office). 2006. Global health: Spending requirement presents challenges for allocating prevention funding under the President’s Emergency Plan for AIDS Relief (GAO-06-395). Washington, DC: GAO. Garvin, D. 2000. Learning in action: A guide to putting the learning organization to work. Boston, MA: Harvard Business School Press. Martinson, N. 2006. Outpatient provider costs of treating adults with ARVs in Soweto. Presentation at the PEPFAR 3rd Annual Meeting. Durban, South Africa: Martinson and University of the Witwatersrand.

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PEPFAR Implementation: Progress and Promise McKinsey and Company. 2005. Global health partnerships: Assessing country consequences. Seattle, WA: Bill and Melinda Gates Foundation. Moloney-Kitts, M. 2005 (April 19). Office of the Global AIDS Coordinator. Presentation at the Second Meeting of the Institute of Medicine Committee for the Evaluation of PEPFAR Implementation, Washington, DC. OECD (Organisation for Economic Co-operation and Development). 2003. Harmonising donor practices for effective aid delivery good practice papers: A DAC reference document. Paris, France: OECD. OGAC (Office of the U.S. Global AIDS Coordinator). 2004. The President’s Emergency Plan for AIDS Relief: U.S. five-year global HIV/AIDS strategy. Washington, DC: OGAC. OGAC. 2005a. PEPFAR first annual report to Congress. Washington, DC: OGAC. OGAC. 2005b. The President’s Emergency Plan for AIDS Relief: Defining US support for national strategies (PowerPoint Presentation). Washington, DC: OGAC. http://www.pepfar.gov (accessed July 19, 2005). OGAC. 2005c. FY2005 funded targeted evaluation studies: Status update. Washington, DC: OGAC. OGAC. 2005d. FY2005 country operational plans. Washington, DC: OGAC. OGAC. 2006a. PEPFAR second annual report to Congress. Washington, DC: OGAC. OGAC. 2006b. PEPFAR: Technical considerations for the FY2007 country operational plans. Washington, DC: OGAC. OGAC. 2006c. PEPFAR FY2007 COP resource guide. Washington, DC: OGAC. OGAC. 2006d. FY2006 funded targeted evaluation studies: Status update. Washington, DC: OGAC. OGAC. 2006e. Centrally-funded targeted evaluation studies: Status update. Washington, DC: OGAC. OGAC. 2006f. FY2006 country operational plans. Washington, DC: OGAC. OGAC. 2006g. A blueprint for public health evaluations in the President’s Emergency Plan for AIDS Relief. Washington, DC: OGAC. OGAC. 2007. Office of the Global AIDS Coordinator’s Suggested Factual Changes to the PEPFAR Implementation: Progress and Promise Report. Email communication to IOM staff on March 29, 2007. OGAC, Global Fund to Fight AIDS, Tuberculosis, and Malaria, and World Bank. 2006. Report: Joint coordination meeting on HIV/AIDS, January 10–11, 2006. Washington, DC and Geneva, Switzerland: OGAC, Global Fund to Fight AIDS, Tuberculosis and Malaria, and World Bank. OMB (Office of Management and Budget). 2007a. Program assessment rating tool (PART). http://www.whitehouse.gov/omb/part/ (accessed February 19, 2007). OMB. 2007b. Program assessment for the President’s Emergency Plan for AIDS Relief: Focus countries. http://www.whitehouse.gov/omb/expectmore/summary/10004619.2005.html (accessed February 19, 2007). Riedner, G., O. Hoffman, M. Rusizoka, D. Mmbando, L. Maboko, H. Grosskurth, J. Todd, R. Hayes, and M. Hoelscher. 2006. Decline in sexually transmitted infection prevalence and HIV incidence in female bar workers attending prevention and care services in Mbeya region, Tanzania. AIDS 20:609–615. The Rome Declaration on harmonization. 2003. High level forum on harmonization, February 24–25, 2003, Rome, Italy. http://www.aidharmonization.org (accessed November 10, 2006). Rugg, D., G. Peersman, and M. Carael. 2004. Global advances in HIV/AIDS monitoring and evaluation. Minneapolis, MN: Wiley Periodicals, Inc.

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PEPFAR Implementation: Progress and Promise Shakow, A. 2006. Global Fund–World Bank HIV/AIDS programs comparative advantage study. Washington, DC and Geneva, Switzerland: Global Fund to Fight AIDS, Tuberculosis, and Malaria, and World Bank. http://www.cgdev.org/doc/event%20docs/2.7.06%20HIV/GFWBReportFinalVersion.pdf (accessed November 3, 2006). Stanton, B., X. Li, J. Kahihuata, A. Fitzgerald, S. Neumbo, G. Kanduuombe, I. B. Ricardo, J. S. Galbraith, N. Terreri, I. Guevara, H. Shipena, J. Strijdom, R. Clemens, and R. F. Zimba. 1998. Increased protected sex and abstinence among Namibian youth following a HIV risk reduction intervention: A randomized, longitudinal study. AIDS 12:2473–2480. UNAIDS (Joint United Nations Programme on HIV/AIDS). 2004a. “Three ones” key principles. Conference paper 1, Washington consultation of April 4, 2004. Geneva, Switzerland: UNAIDS. http://www.unaids.org/NetTools/Misc/DocInfo.aspx?LANG=en&href=http://gva-doc-owl/WEBcontent/Documents/pub/UNA-docs/Three-Ones_KeyPrinciples_en.pdf (accessed September 20, 2006). UNAIDS. 2004b. Clearing the common ground for the “three ones”: Report of a consultation process. Conference paper 2, Washington consultation of April 25, 2004. Geneva, Switzerland: UNAIDS. UNAIDS. 2005a. Global task team on improving AIDS coordination among multilateral institutions and international donors: Final report. Geneva, Switzerland: UNAIDS. UNAIDS. 2005b. The “three ones” in action: Where we are and where we go from here. Geneva, Switzerland: UNAIDS. UNAIDS. 2006. Considerations for countries to set their own targets for AIDS prevention, treatment, and care. Geneva, Switzerland: UNAIDS. UNAIDS, African Union, WHO (World Health Organization). 2006. Brazzaville commitment on scaling up towards universal access to HIV and AIDS prevention, treatment, care and support in Africa by 2010. Geneva, Switzerland: UNAIDS. USAID. 2005. Office of the Inspector General: Audit of USAID’s implementation of the President’s Emergency Plan for AIDS Relief. Audit report number 9-000-05-009-P. Washington, DC: USAID. USAID (U.S. Agency for International Development). 2006a. Quality assurance and workforce development project: Year four annual report: Performance period: July 1, 2005–June 30, 2006, July 31, 2006. Washington, DC: USAID. USAID. 2006b. Quality assurance project. Washington, DC: USAID. http://www.qaproject.org (accessed November 3, 2006). USAID. 2006c. Office of the Inspector General audit of USAID’s progress in implementing the President’s Emergency Plan for AIDS Relief. Audit report number 9-000-07-004-P. Washington, DC: USAID. USAID, UNAIDS, UNICEF (United Nations Children’s Fund). 2004. Children on the brink: A joint report of new orphan estimates and a framework for action. Washington, DC: USAID.

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