TWN Info Service on Finance and Development (Jul15/02)
1 July 2015
Third World Network
Dear friends and colleagues,
A new Global Policy Watch brief from Global Policy Watch (an initiative of Social Watch and Global Policy Forum) highlights the key role that the Global Financing Facility (GFF) is to expected to play as a financing vehicle for Goal #3 of the Sustainable Development Goals (SDGs), that of: “Ensure healthy lives and promote well-being for all at all ages.” Similar to the Global Fund or GAVI (the Vaccine Alliance), the GFF will specifically finance reproductive, maternal, newborn, child and adolescent health.
The briefing note points out that: “Important decisions about the financial support of national health strategies are taken at the sole discretion of the GFF Investors Group. But the GFF Investors Group is a self-selected, exclusive body and not subject to intergovernmental oversight and mutual accountability mechanisms.” The GFF also consolidates the role of the World Bank Group as a dominant financing institution for SDG #3 on health, which will form a core part of the post-2015 development agenda overall. This bypasses the role of the UN, which includes the World Health Organization.
In the latest Financing for Development (FfD) text of 25 June, which is also a highly controversial text that is being contested by the Group of 77 (G77) developing countries, there is a specific paragraph that makes strong reference to the GFF. The last line in Paragraph 77 of the 25 June FfD text states: “We welcome innovative approaches to catalyze additional domestic and international private and public resources for women and children, who have been disproportionately impacted by many health issues, including the expected contribution of the Global Financing Facility in support of Every Woman Every Child.”
The same lack of intergovernmental oversight and mutual accountability mechanisms that characterizes the governance of the GFF is found in the private finance chapter of the FfD text. Public-private partnerships (PPPs) are embraced as the central mechanism by which infrastructure projects will be financed. However, the various drafts of the outcome text thus far do not ensure guidelines for private sector financial, social and environmental accountability. This not only endangers the ability of the State to regulate in the public interest and to promote sustainable development, it also introduces the risk that the private sector is endorsed with an open gateway into development and industrial policy, without any checks and balances or impact analyses.
Indeed, civil society organisations (CSOs) have been calling for an intergovernmental accountability mechanism for both PPPs as well as for multi-stakeholder partnerships between the UN and the private sector in the context of both FfD and the post-2015 development agenda.
CSOs outline that such an intergovernmental accountability mechanism could be aligned with the following key aspects:
(a) Such a mechanism must be rooted in the international human rights framework and in all three dimensions of sustainable development (economic, social, and environmental);
(b) The central objective of the mechanism would be to ensure accountability and ex ante assessment of partnerships;
(c) Clear criteria should be applied to determine whether a specific private sector actor is fit for a partnership in pursuit of the post-2015 development agenda (which includes the SDGs) and FfD;
(d) UN member states should be at the helm of formulating the framework, including the criteria, the oversight and monitoring process based on due diligence reporting, and independent third-party evaluations.
One key objective would be to eliminate potential private donors whose activities are antithetical or contradictory to the UN Charter, the Universal Declaration on Human Rights, and the SDG framework.
Below is the Global Policy Forum brief titled: The new Global Financing Facility – a model for financing the Sustainable Development Goals?
Policy Watch #6
By Jens Martens
While negotiations on Financing for Development and the means of implementation of the Sustainable Development Goals (SDGs) within the UN are deadlocked, a new Global Financing Facility (GFF) in support of Every Woman Every Child is going to be established outside of the UN. The creation of the GFF was initiated by the World Bank and the governments of Canada, Norway, and the United States, and announced at the UN General Assembly in September 2014. It will be officially launched in July 2015, at the third Financing for Development Conference in Addis Ababa, Ethiopia.
The GFF is expected to play a key role in financing for reproductive, maternal, newborn, child and adolescent health (RMNCAH) and will serve as a major vehicle for financing the proposed SDG on healthy lives. It is being positioned as the most important new funding mechanism for the SDGs and the Post-2015 Agenda, similar to the Global Fund or GAVI. According to the World Bank
“(t)he GFF acts as a pathfinder in a new era of financing for development by pioneering a model that shifts away from focusing solely on official development assistance to an approach that combines external support, domestic financing, and innovative sources for resource mobilization and delivery (including the private sector) in a synergistic way.”(1)
Closing the funding gap
The new facility aims to close the financing gap in RMNCAH spending, which is estimated to be around US$33.3 billion in 2015.(2) It aims to mobilize additional funding through the combination of grants from a new GFF Trust Fund, financing from the International Development Association (IDA) and the International Bank of Reconstruction and Development (IBRD), the crowding-in of additional domestic resources, particularly from the private sector, and by “generating efficiencies through smart financing.”(3) The architects of the GFF explicitly support the mix of public and private funding of health systems:
“To improve RMNCAH outcomes, we need an integrated health system approach that looks for the best solutions, regardless of whether they are provided by the public, private sectors or both in meaningful collaboration with each other. (...) The GFF can support scaling up efforts of mainstreaming mixed health systems approaches in RMNCAH at the country, regional and global levels.”(4)
A total of 63 low- and lower-middle-income countries are eligible to receive GFF funding. In the first phase four “frontrunner“ countries (DR Congo, Ethiopia, Kenya, Tanzania) will receive funding. In the next phase five to ten additional countries will be selected.(5) According to the GFF Business Plan, the GFF operates at country level through multi-stakeholder platforms, led by the national government but with the full involvement of the private sector, civil society, multilateral and bilateral donors and foundations.(6) The existence of such a multi-stakeholder country platform is regarded as an indispensable eligibility criterion.
Club governance outside the UN
The World Bank plays a convening role for the GFF; and the GFF Trust Fund is fully integrated in World Bank operations, with a small secretariat based at the World Bank in Washington, D.C. However, the central decision-making body of the GFF will be the GFF Investors Group, a multi-stakeholder body with 20-25 representatives from participating countries, bilateral donors, multilateral institutions and partnerships, the private sector, private foundations, and NGOs.
The concept of the GFF was developed under the guidance of the GFF Working Group, whose composition indicates what the membership of the GFF Investors Group may look like. The GFF Working Group was chaired by the Government of Norway, the United States Agency for International Development (USAID) and the World Bank, and had 28 members, including representatives of GAVI, the Global Fund, the Bill & Melinda Gates Foundation, and the UN Foundation.(7) Only three governmental representatives from the global South were involved (Ethiopia, Burundi and DR Congo).
A smaller GFF Trust Fund Committee is embedded within the GFF Investors Group with decision-making power on Trust Fund allocations. Membership in the Committee will be limited to the donors in the Investors Group and its Chair or Vice-Chair. Current plans do not envisage any role for partner countries or civil society organizations from the global South.
Under the cloak of the EWEC initiative and a multi-stakeholder structure, the governance of the GFF seems to be dominated by traditional donors and private foundations. Important decisions about the financial support of national health strategies are taken at the sole discretion of the GFF Investors Group. But the GFF Investors Group is a self-selected, exclusive body and not subject to intergovernmental oversight and mutual accountability mechanisms.
Nevertheless, the GFF will be instrumental in consolidating the role of the World Bank as a key financing institution for the Post-2015 Agenda, while leaving only a marginal role for the UN. Thus, the GFF in support of EWEC is a particularly striking example of the shift from inclusive multilateral decision-making within the UN to global club governance in exclusive “partnerships”.
Members of the GFF Working Group
Governments - South
Cf. World Bank (2015), p. i.
Bank (2015): Business Plan for the Global Financing Facility in
Support of Every Women Every Child. Washington, D.C.