REQUEST FOR PROPOSAL

RFP No. TGF-15-013

THEMATIC REVIEW OF THEALLOCATION METHODOLOGY

Issue Date:03 March 2015

RFP Closing Date: 23 March 2015

RFP Closing Time:noon (Geneva time)

The Global Fund invites potential suppliers to submit proposals to review the implementation of the Global Fund’s allocation methodology.

The purpose of this Request for Proposal (RFP) is to select a supplier offering the best value to the Global Fund in terms of both technical and cost factors.

The services to be provided are fully described in the Statement of Work in Attachment A.

The Global Fund will evaluate all proposals received in response to this RFP in accordance with the Evaluation Criteria in Attachment B.

The Global Fund wishes to stress that an objective of this process is to provide a rigorous and comprehensive review within the confines of a competitive commercial environment. Therefore, we encourage the proposals to provide their best offer and to propose innovative methods, outlining their advantages and disadvantages,to the Global Fund.

This RFP shall not be construed as a contract or a commitment of any kind. This RFP in no way obligates the Global Fund to award a contract, nor does it commit the Global Fund to pay any cost incurred in the preparation and submission of the proposal(s).

The Global Fund Standard Terms and Conditions form an integral part of this RFP and will be included in any contract resulting from this solicitation. Submitting a proposal in response to this RFP constitutes acceptance of these terms and conditions, found at this link on the Global Fund website:

To be eligible as a supplier with the Global Fund, any organization or individual must comply with the Policy on Ethics and Conflicts of Interest for Global Fund Institutions and the Supplier Code of Conduct.Both are located on the Global Fund website at the following link:

Please submit your proposal in accordance with the instructions given below, no later than the closing date and time, by email to:

  • , and
  • Orion Yeandel at: orion.yeandel@theglobalfund.org

ATTACHMENT A: STATEMENT OF WORK

I. BACKGROUND

The Global Fund to Fight AIDS, Tuberculosis and Malaria

The Global Fund to Fight AIDS, Tuberculosis and Malaria (“the Global Fund”) was established in January 2002 as a financial instrument, complementary to existing programmes addressing HIV/AIDS, tuberculosis and malaria. The purpose of the Global Fund is to attract, manage and disburse additional resources through a new public-private partnership that will make a sustainable and significant contribution to the reduction of infections, illness and death, thereby mitigating the impact caused by HIV/AIDS, tuberculosis and malaria in countries in need, and contributing to poverty reduction as part of the Millennium Development Goals.

The Global Fund bases its work on programmes that reflect national ownership and respect country partnership-led formulation and implementation processes. The Global Fund promotes partnerships among all relevant players within the country and across all sectors of society. It builds on existing coordination mechanisms, and promotes new and innovative partnerships. In addition, the Global Fund strengthens and reflects high-level, sustainable political involvement and commitment in making allocations of its resources.

The Global Fund supports existing and new innovative programmes both within and outside the health sector that promote public, private and nongovernmental efforts for scaling up the prevention, treatment, care and support to those that are directly affected.

The Global Fund is a non-profit foundation under Swiss Law and its headquarters are based in Geneva, Switzerland. The Fund is accountable to its Board, the highest decision making body, which consists of representatives of donors, recipient countries, civil society, the private sector and non-governmental organizations as well as other stakeholders from a broad range of interest groups and communities, including multi-lateral organizations.

The Global Fund's Secretariat is responsible for day-to-day operations, including mobilizing

resources from the public and private sectors, managing grants, providing financial, legal and administrative support, and reporting information on the Global Fund's activities to the Board and the public.

About 600 employees representing more than 100 nationalities work at the Secretariat's headquarters in Geneva, Switzerland.

The Global Fund’s allocation based approach towards HIV, TB and malaria

In 2014, the Global Fund implemented a funding model that allocates funding to countries prior to the development of grant proposals. At its Thirty-First Meeting in March 2014, the Global Fund Board approved the New Funding Model and the funds available for allocation. A total of US$ 14.8 billion was distributed across eligible countries using a Board-approved allocation methodology.

The purpose of the allocation methodology was to focus funding on countries that are most affected by the three diseases but have the least ability to pay. The new approach was also expected to bring further benefits such as (i) improved predictability of funding; (ii) improved approval rates through increased prioritization in programming; (iii) increased transparency of available funding by aligning the allocation period with the replenishment period; (iv) increased flexibility for countries when to apply and (v) more ambitious requests to access an additional pool of funding beyond the allocation (“incentive funding”).

Countries were informed of their allocation in March 2014 and will be able to apply for their allocated funding between 2014 and 2016. As a result of the allocation, countries’ funding levels may differ to what they have received historically. Countries that have historically been successful in applying for funds from the Global Fund and have received more than what the allocation methodology indicates they should may see a decrease in funding. These countries are considered “over-allocated” by the Global Fund, although they may likely still have gaps in funding their programs. Countries that have historically received little funds from the Global Fund relative to disease burden may experience an increase in funding. These countries are considered historically “under-allocated”. Over time, the Global Fund will work closely with countries to align the funding levels to the allocation amounts determined by disease burden and income levels.[1]

The introduction of an allocation methodology represents a significant departure from how Global Fund funding was awarded previously. It is therefore timely to evaluate the first application of an allocation-based model, starting with the development of the formula, to assessing its effect on funding levels generally and its effect on the country dialogue process in particular. Lessons learnt will be used to inform the next round of allocations as well as the development of the new strategy.[2]

II. Purpose of the THEMATIC REVIEW

The Global Fund’s Technical Evaluation Reference Group (TERG) is responsible for ensuring independent evaluation of the Global Fund business model, investments and impact. The TERG is an external advisory body to the Global Fund and reports to the Board’s Strategy, Investment and Impact Committee (SIIC).

In 2015, the TERG will commission an independent appraisal of progress towards the commitments reflected in the Global Fund Strategy (2012 – 2016), termed the Strategic Review 2015. Under the umbrella of the Strategic Review 2015, the TERG has planned to commission a number of additional thematic reviews, which are meant to examine specific topics in depth, such as the effect of allocation methodology in driving the Global Fund towards the objectives set out by the Board.

In addition, the Office of the Inspector General (OIG) of the Global Fund will conduct an audit of the allocation of funds in the first half of 2015, focusing on the robustness of the current allocation methodology. Close coordination will be needed with the OIG to ensure that the thematic review and the OIG audit are complementary and not overlapping.

III. THEMATIC REVIEW objective

The objective of this thematic review would be to draw lessons learnt on the roll-out of the allocation-based New Funding Model in 2014 against the objectives set by the Board[3], in order to inform the formula for the next allocation methodology, which will be rolled out in 2016.

To do so, this thematic review will evaluate the three main building blocks of the allocation model as well as incentive funding. Each area is briefly described below along with the associated evaluation questions.

IV. EVALUATION QUESTIONS

A - Eligibility for funding:Through its eligibility policy, the Global Fund defines which countries are eligible to receive funding from the Global Fund based on income level and disease burden (GF/B30/6).

1. To what extent did eligibility policy support the Global Fund’s ability to invest strategically? Did “application focus” requirements drive the Global Fund towards impactful investments? In particular, what were and will be the implications of recent changes to the eligibility policy on allocation outcomes?

B - Quantitative allocation model: The following three factors influence the quantitative allocation model:

  • Disease burden and ability to pay. The allocation methodology used a customized disease burden formula and GNI per capita as the basis, representing disease burden and “Ability-to-pay[4]” respectively.

2. What are the strengths and weaknesses of these factors to target funding towards

countries with the highest disease burden and highest economic needs?

3. Further, how appropriate are the factors when taking into account special

circumstances such as concentrated epidemics for HIV, increasing rates of multi-drug resistant TB, or pre-elimination / elimination settings for malaria?

4. Should the basis of allocation be measured at a country level or a sub-national level? Was the country-level allocation effective to allow countries to manage sub-national differences?

  • Minimum required level. To ensure that countries previously receiving Global Fund support did not experience a rapid drop in funding, the Global Fund defined a “Minimum Required Level (MRL[5])” for each country, which was 75% of funds disbursed over 2010 – 2013 or the size of existing funds already granted to the country.

5. How did the MRL affect the allocation of funds from under-allocated to “over-allocated” countries? How effective was the MRL at protecting existing Global Fund investments to achieve impact? To what extent did it prevent scale-up of effective interventions in under-allocated countries?

  • Country bands. “Bands” are groups of countries organized based on a combination of income (i.e. ability to pay) and disease burden (GF/B28/DP4). Eligible countries were placed in one of four country bands (i.e., Band 1: Lower income, higher burden; Band 2: Lower income, lower burden; Band 3: Higher income, higher burden; Band 4: Higher income, lower burden). This allowed the Board to approve the overall funding for each band without getting involved in detailed discussions around the allocations for each country. In addition, the Global Fund Board approved a separate allocation methodology for awarding funds for Band 4 countries based on population size.

6. What were the advantages and disadvantages of implementing bands as a way to group countries?

7. What were the advantages and disadvantages of having a separate Band 4 allocation methodology? What was the differential in the allocation for Band 4 countries due to a separate Band 4 methodology? How did it affect the allocation for countries within a regional context? How did it impact the overall goals of investing in highest disease burden, least ability to pay countries? Were any investment opportunities missed?

  • Program split.Prior to concept note submission, countries have the flexibility to revise their country allocations among eligible components with appropriate justifications. They can also allocate funds to cross-cutting health systems strengthening.

8. Were the countries’ proposed program splits in line with the Global Fund’s objective of investing strategically?How often did the countries change the program split, what were the most common reasons for making changes and were these changes significant or marginal?

9. Why was there no allocation for health-system strengthening as part of the global disease split and the program split? To what extent did the lack of an HSS allocation encourage or discourage inclusion of HSS funding in concept notes?

C – Adjustments through qualitative factors. Since no formula could fully account for the situation in over 100 countries, the Board granted the Secretariat discretion to use qualitative factors to adjust the initial figures derived from the allocation formula to account for the specific circumstances in each country the allocation formula might not capture (GF/B28/DP4). The analysis should focus on qualitative factors for increasing rates of infection, risk, performance, impact, absorptive capacity as well as other considerations that are taken into account before the allocations are announced.

10. To what extent could the qualitative factors affect the allocation within Bands? What impact did qualitative factors have on the allocations? Which qualitative factors were more important in shaping the allocation?

11. What “other considerations” were used and how large of an impact did they have on the allocation? Could they have been anticipated and incorporated into the allocation more directly?

D - Incentive funding. The Board developed an incentive funding stream, a $950 million pool of funds, to incentivize high impact, well-performing programs and the submission of robust, ambitious requests based on national strategic plans or investment cases (GF/B29/EDP10). The funds for incentive funding were removed from the overall pool of funds for up-front allocation to countries, thus reducing the total amount available.

12. Was the relative share of incentive funding (10%) versus allocation funding (90%) appropriate given the size of the replenishment? What impact did the size of the incentive funding pool have on the allocation of funds to countries?

13. How well has incentive funding contributed to strategic investment goals around disease burden and ability-to-pay?

14. Has incentive funding fulfilled its goals of incentivizing “ambitious, high-quality expressions of full demand, based on robust National Strategic Plans or investment cases” (GF/B29/EDP10)? In particular, is there evidence that it has influenced countries to submit full expression/be ambitious to develop more innovative approaches?

15. Does the impact achieved by incentive funding justify the operational effort in awarding incentive funding? Instead of an incentive funding pool, had country allocations been increased by a proportionate 10%, would it have resulted in impactful investments across the portfolio in a similar or better manner?

16. How did the ring-fencing of incentive funding by band affect the ability of incentive funding to fund the programmes with the highest impact overall? To what extent is there a difference in the quality of interventions recommended for incentive funding between bands?

V. Proposed approach

To strengthen the quality of the thematic review, it should be conducted using a variety of methods, such as document reviews, key stakeholder interviews, and analysis of existing quantitative and qualitative data. The evaluation is designed to have two parts:

1)Desk review

The first part is intended to be a (fairly quantitative) desk review of existing documents. The Secretariat will be able to guide the consultant team through the existing material as part of the induction period.

2)Case Studies

While the consultant team will be able to conduct an initial assessment based on the desk review, three to four case studies should be conducted to contextualize findings and to add the countries’ perspective.

The case studies are thought to mainly consist of interviews, both at the Secretariat-level as well as in countries. In order to cover a broad range of issues, the consultant team may want to cover a variety of country types, such as under-allocated countries, “over-allocated” countries or low absorptive capacity countries to analyze how the allocation affected the disease programs for the country.The consultants should propose a small set of countries (3 to 4) to augment the desk review.

Following are a few examples of countries that could be considered for the case studies:

  1. Under-allocated countries: Mozambique*, Tanzania*, Uganda*, Pakistan*
  2. “Over-allocated” countries: Ukraine, Namibia, Rwanda, Ethiopia
  3. Disease Burden
  4. Concentrated HIV Epidemic: Iran, Philippines*, Russia, Moldova, Costa Rica
  5. MDR – TB: Pakistan*, Bangladesh*
  6. Malaria elimination/ pre-elimination: Sri Lanka, Swaziland*
  7. Poor absorptive capacity: Niger*, Pakistan*, Francophone African countries or SEA
  8. Countries with Malaria Elimination priority: Sri Lanka, Swaziland
  9. Band 4 countries: Moldova, Sri Lanka, Costa Rica

*Denotes countries eligible for incentive funding

Interested bidders should consult annex 1 for an overview of which evaluation questions will primarily be answered through desk reviews, and which will primarily be answered through case studies.

VI. TIMEFRAME& DELIVERABLES

Timeframe

The consultant team is expected to commence their work no later than 13 April 2015. The consultancy should not exceed 140 working days and will be finalized with the official approval of the report at the 27th TERG meeting in September 1-3, 2015.

High-level work plan / Start date / End date
1. Develop & submit inception report / 13/04/15 / 24/04/15
2. Conduct desk review of existing information & report on preliminary findings / 27/04/15 / 22/05/15
3. Conduct country visits to collect additional information & submit first draft report / 25/05/15 / 01/07/15
5. Develop & submit final draft report / 06/07/15 / 31/07/15

Deliverables

All deliverables will be submitted to the TERG.The Secretariat’s TERG Support team together with the Access to Funding department will be the day-to-day focal point for the potential consultant(s).

The expected deliverables are as follows:

  1. Inception report Due24 April 2015

The consultant team shall deliver an inception report, which clearly outlines the review’s purpose and scope, the preliminary hypotheses, the planned methods together with a design matrix, proposed case studies as well as a schedule for the review and questions for further clarification.