Global Fund halts $92 million grant for Ukraine after problems

The Global Fund to Fight AIDS, TB and Malaria has halted a $92 million five-year grant for Ukraine because of irregularities and a lack of progress in the work it was meant to finance – and the fund has since appointed another body to take on the work of treating 4,000 people in the former Soviet state.

It is the first time the Global Fund has withdrawn funding. The Fund suspended the grant after concluding the project was poorly managed and behind schedule. Some reports said that money intended to pay for medicines “was likely to be inappropriately diverted”. The Fund said it did not suspect embezzlement. The three principal recipients for Ukraine were the Ministry of Health, a charity called the Ukrainian Fund to Fight HIV infection and AIDS, and the United Nations Development Programme (UNDP). The Fund was dissatisfied with the performances of all three. Evidence of the problems was brought to light by the Fund’s staff and PricewaterhouseCoopers, the Fund’s local fund agent in Ukraine as well as two external government sources.

More than $7 million dollars was given to Ukraine and of this about $1 million has been spent. The Fund is asking for the remainder to be returned. In the meantime the Global Fund has appointed the international NGO, the International HIV/AIDS Alliance, to take on the role of Principal Recipient of its funding in the Ukraine. The Alliance was a sub-recipient of the previous agreement.

The agreement is still being finalised but it seems the Alliance will receive $15 million to take charge of the programme for one year, with future funding dependant on performance. The money is to pay to increase the number of people receiving antiretroviral treatment in the Ukraine from fewer than 60 to 4,000.