Graft, incompetence led to theft of Global Fund cash
Sep 11, 2005
CORRUPTION, mismanagement and incompetence, went unnoticed and unreported because managers of the Global Fund (GF) monies ignored implementation plans, an audit report showed.
By Jennifer Austin
CORRUPTION, mismanagement and incompetence, went unnoticed and unreported because managers of the Global Fund (GF) monies ignored implementation plans, an audit report showed.
Disregard for guidelines outlining the purpose of the GF grants, what types of agencies could be beneficiaries, and how the money should be accounted for, allowed for a complete breakdown of accountability and the loss of millions of dollars.
A lack of comprehensive monitoring and disciplined internal regulation, allowed the losses to go unnoticed until now.
Starting with the selection of fund beneficiaries, fund managers were deviating from the protocol laid out in the GF agreement.
Initially, advertisements were run soliciting proposals from sub-recipients.
These were to be reviewed following government procurement procedures according to the eligibility criteria approved by the Country Coordinating Mechanism (CCM).
This process lasted three months ending in the selection of 27 lead agencies and 37 direct implementers.
Under pressure from the GF Secretariat and others in Uganda to speed up fund disbursement, the CCM appointed a technical team to review applicants rather than use the Government protocol in an effort to review applicants in a timelier manner. Though the criteria for sub-recipients were supposedly unchanged, proposals were approved by the new grant management team that had previously been denied under the Government procurement guidelines.
CCM criteria required that sub-recipients be registered as legal entities and have a minimum of one year’s experience in programme implementation.
Of the 77 sub-recipients approved by the grant management team, “25 did not have the requisite experience to qualify for funding.â€
It was also reported that the investigators “did not see evidence of legal status for 25% of the organisations.â€
Some registrations were expired or had not yet been filed at the time the funds were approved.
It was also noted that the second round of sub-recipient evaluations was not advertised, so the grants could only have been bid for by organisations that already knew the funds were available.
The evaluation of Civil Society Organisations (CSO) was to include a financial assessment to ensure the organisation could manage the funds.
Under the Government procurement process, the assessments were carried out but apparently disregarded as funds were still given to agencies that had been determined unable to manage them.
In the second round of evaluations, such assessments were not done at all. Programme Management Unit (PMU) management blames time pressure for the irregularities in sub-recipient approval.
The tracking of the allocated funds followed a similarly haphazard pattern and GF guidelines continued to be disregarded.
Once sub-recipients were selected, they were to submit a work plan and budget for final approval before signing a contract.
Some sub-recipients complain they did not receive a copy of the contract after its approval and signing.
“These contracts contained the amended work plans and budgets that were being funded.â€
The review also found that funds were then dispersed without instructions for their use.
Both of these led to some funds being spent on ineligible activities or activities that were not in the contract.
The report found that at almost all levels, work plans and implementation manuals were not followed.
Sub-recipients were supposed to submit monthly and quarterly reports to the PMU accounting for the use of funds.
This was to ensure the funds were being spent properly.
Evaluations of these reports were to be the main criteria for the disbursement of additional funds.
The report found that many sub-recipients did not file progress reports and that additional funds were dispersed despite the initial funds not being accounted for.
“To date, 31% of the implementers have not submitted the quarterly reports which is contrary to their obligations as per the grant agreement entered into between the implementers and the ministry of health/PMU.â€
The disbursement of funds to some larger sub-recipients was uncoordinated, resulting in the double funding of some agencies.
Some funds were given in the form of cash or cheques directly to individuals rather than to organisations.
The report reveals an overall lack of monitoring and accountability at all levels of the fund’s management.
The plans laid out for the use of funds were generally disregarded making actual progress hard to compare to the expected results and leaving room for corruption and mismanagement.
CORRUPTION, mismanagement and incompetence, went unnoticed and unreported because managers of the Global Fund (GF) monies ignored implementation plans, an audit report showed.
Disregard for guidelines outlining the purpose of the GF grants, what types of agencies could be beneficiaries, and how the money should be accounted for, allowed for a complete breakdown of accountability and the loss of millions of dollars.
A lack of comprehensive monitoring and disciplined internal regulation, allowed the losses to go unnoticed until now.
Starting with the selection of fund beneficiaries, fund managers were deviating from the protocol laid out in the GF agreement.
Initially, advertisements were run soliciting proposals from sub-recipients.
These were to be reviewed following government procurement procedures according to the eligibility criteria approved by the Country Coordinating Mechanism (CCM).
This process lasted three months ending in the selection of 27 lead agencies and 37 direct implementers.
Under pressure from the GF Secretariat and others in Uganda to speed up fund disbursement, the CCM appointed a technical team to review applicants rather than use the Government protocol in an effort to review applicants in a timelier manner. Though the criteria for sub-recipients were supposedly unchanged, proposals were approved by the new grant management team that had previously been denied under the Government procurement guidelines.
CCM criteria required that sub-recipients be registered as legal entities and have a minimum of one year’s experience in programme implementation.
Of the 77 sub-recipients approved by the grant management team, “25 did not have the requisite experience to qualify for funding.â€
It was also reported that the investigators “did not see evidence of legal status for 25% of the organisations.â€
Some registrations were expired or had not yet been filed at the time the funds were approved.
It was also noted that the second round of sub-recipient evaluations was not advertised, so the grants could only have been bid for by organisations that already knew the funds were available.
The evaluation of Civil Society Organisations (CSO) was to include a financial assessment to ensure the organisation could manage the funds.
Under the Government procurement process, the assessments were carried out but apparently disregarded as funds were still given to agencies that had been determined unable to manage them.
In the second round of evaluations, such assessments were not done at all. Programme Management Unit (PMU) management blames time pressure for the irregularities in sub-recipient approval.
The tracking of the allocated funds followed a similarly haphazard pattern and GF guidelines continued to be disregarded.
Once sub-recipients were selected, they were to submit a work plan and budget for final approval before signing a contract.
Some sub-recipients complain they did not receive a copy of the contract after its approval and signing.
“These contracts contained the amended work plans and budgets that were being funded.â€
The review also found that funds were then dispersed without instructions for their use.
Both of these led to some funds being spent on ineligible activities or activities that were not in the contract.
The report found that at almost all levels, work plans and implementation manuals were not followed.
Sub-recipients were supposed to submit monthly and quarterly reports to the PMU accounting for the use of funds.
This was to ensure the funds were being spent properly.
Evaluations of these reports were to be the main criteria for the disbursement of additional funds.
The report found that many sub-recipients did not file progress reports and that additional funds were dispersed despite the initial funds not being accounted for.
“To date, 31% of the implementers have not submitted the quarterly reports which is contrary to their obligations as per the grant agreement entered into between the implementers and the ministry of health/PMU.â€
The disbursement of funds to some larger sub-recipients was uncoordinated, resulting in the double funding of some agencies.
Some funds were given in the form of cash or cheques directly to individuals rather than to organisations.
The report reveals an overall lack of monitoring and accountability at all levels of the fund’s management.
The plans laid out for the use of funds were generally disregarded making actual progress hard to compare to the expected results and leaving room for corruption and mismanagement.