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How a Simple Finance Mechanism is Building Country Ownership of Global Health Efforts

There’s a growing movement in foreign aid to ensure that the countries and communities that receive assistance also have increased ownership over programs. In his welcome message, U.S. Agency for International Development (USAID) Administrator Mark Green reminded us of this, saying “I believe the purpose of foreign assistance should be ending its need to exist.” We’ve all read articles debating the extent to which this is actually happening and the most effective ways to build country ownership. Over the past decade of my work in neglected tropical diseases (NTDs), I’ve seen a simple financial mechanism utilized to manage resources efficiently and empower local communities. In doing so, we can manage assistance in a way that ensures the most vulnerable people aren’t left behind.

In 2006, I joined RTI’s NTD team—lead implementers for USAID’s NTD Program dedicated to helping national NTD programs integrate and scale-up mass drug administration for seven targeted NTDs. More than a billion people around the world are at risk for these diseases. At the start of this journey, I wondered how we would be able to use the limited resources available to reach enough people and have a positive impact.

To support countries in NTD control and elimination, we knew we needed a system that was flexible, locally rooted, and would foster strong country ownership. It was determined that the most efficient and effective way for RTI to maximize resources and reach the greatest number of people was to enable governments to manage funds directly. I had experience issuing grants to local non-governmental organizations (NGOs), but not government entities. What about waste, fraud, and inefficiencies—certainly all those reports were true? I take the responsibility of being a good steward of U.S. taxpayer dollars very seriously, so this seemed like a risk. Fortunately, a team of dedicated staff established an exemplary grants management system that continues today under ENVISION—USAID’s flagship NTD project that supports national NTD programs around the globe.

The Solution? Fixed Obligation Grants

We use fixed obligation grants (FOGs) as a primary mechanism to fund country program implementation. These fixed-price instruments provide a set amount of funding for the achievement of a pre-determined number of activities or milestones. Under a FOG, the recipient must provide proof of performance before each payment is made. The instrument is appropriate to use when pricing information is readily available, costs are stable and reasonably predictable, and in which the accomplishment of the purpose or milestone in the grant is apparent.

From strategic planning, to health worker trainings, community mobilization activities, and monitoring and evaluation efforts, FOGs ensure funding is available for all activities needed to implement a national integrated NTD program.

To date, RTI and partners have administered more than 1,600 FOGs to host government entities through USAID’s ENVISION Project.

As a result, more than 1.1 billion treatments have been provided in communities at risk for NTDs, led by the governments themselves, with support from ENVISION.

What About the Risks?

I recall only one incident in nearly 12 years in which funds intended for a district mass drug administration went missing. The community swiftly dealt with the matter on its own, and funds were promptly returned to RTI.

In order to work, considerations must be made for the assistance, mentoring, and oversight that is needed, at least initially, to support partner governments at all levels (regional, district, and health post). These entities can be unfamiliar with managing U.S. government funds or implementing NTD programs and are often based in the remotest and most resource-poor locations.

There are incredible benefits, however, in assisting local governments to effectively plan activities and manage the funds necessary for implementation. A FOG (similar to the instrument now called Fixed Amount Award under 2 CFR 200.45) may be awarded to a grantee with any level of experience. As a manageable vehicle for both donor and recipient, a FOG helps build local capacity as the recipient prepares plans, develops budget, and conducts activities. It also enables countries to take increasing responsibility for their national NTD programs.

Direct support to governments is also helping strengthen country health systems. The recently released USAID Neglected Tropical Disease Program 2016 Evaluation found that FOGs have been used “very effectively to support mass drug administration implementation at the district level, particularly with local governments. This process has helped to build the capacity of local government health teams, as well as local governance.” FOGs were also noted as an important part of facilitating services to unserved districts, expediting the movement of funds to districts, and increasing local buy-in to health outcomes.

By allowing funds to flow as close to the beneficiary community as possible, we are empowering local governments. This has been a remarkable achievement that I have witnessed during my years working on NTD projects. I am proud to continue to contribute to the successes experienced by the country NTD programs.

Disclaimer: This piece was written by Amy Doherty (Operations Director) to share perspectives on a topic of interest. Expression of opinions within are those of the author or authors.