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Broadening its donor base and non-state actors – Does WHO really have a choice when it comes to financing?  

By on February 22, 2019

Priti is an Independent Journalist & Researcher

When global health policy wonks talk about the financing pressures of the World Health Organization, there is a certain kind of despondency. Many of the 194 of its member states do not want to cough up more money to enable WHO to do what it must. Not only that, they also want WHO to do more than it does.

As a result, it has forced the institution to explore other ways to raise funds, including by forging partnerships. The bulk of its funding is tightly circumscribed by what donors want, leaving it little room to spend resources as per its priorities. However, reaching out to other kinds of donors, and engaging other stakeholders in global health, inevitably comes with strings attached.

Director General Dr Tedros Adhanom Ghebreyesus said he wants to broaden the donor base and use  innovative financing mechanisms to shore up funds, at the recently concluded Executive Board meeting of the organization. WHO plans to organize a partner’s forum later this year to ostensibly find new contributors offering flexible financing.

Practical as this approach may sound, it is likely to run counter to the very intentions the organization’s Framework of Engagement with Non-State Actors (FENSA) has set out to do. Civil society members have cautioned against this conspicuous shift from risk aversion to risk management on these sensitive matters. Since the majority of its funding is voluntary, it leaves WHO vulnerable to undue influences, they say.

WHO’s objectives & the limitations of earmarked funding

WHO has numerous responsibilities, from quelling epidemics to prequalifying medicines, from setting norms to negotiating prices for drugs and diagnostics; from thinking up new ways of protecting health from climate change to coming up with international standards for the oversight of human genome editing. These are complex and diverse tasks attracting a variety of players for different reasons. The organization has estimated that it will need $10.1 billion over the next five years to deliver on its Triple Billion target. This ask includes $ 2.5 billion for humanitarian and emergencies, $1.6 billion for polio eradication and $ 10.0 billion for the WHO base budget. (It needs $14.1 billion, but WHO says, current projected income against the $14.1 billion is $ 4 billion, which includes income from annual dues and long-term pledges.)

In a document that explains the overall financing status in the biennium 2018–2019, WHO said the approved program budget for 2018-2019 is $4.4 billion.  The budget segment for base programmes is financed by US$ 956.9 million of assessed contributions and US$ 2443.4 million of voluntary contributions.

The Proposed Programme Budget for 2020-2021 stands at $3.9 billion. Any increase over the previous year is expected to be met through voluntary contributions. And hence there is no demand to increase assessed contributions, WHO says. Dr Tedros has refrained from asking more from countries, even as he has not shied away from pushing for unearmarked funding. (Norway has signalled some contributions as unearmarked funding during the board meeting last month.)

The organization admits that “Financing with flexible funds continues to be available for only about one third of the Programme budget.” It notes that communicable diseases is the best funded among technical categories, followed by health systems. “However, funds under these categories are usually highly earmarked and designated for specific work, often not allowing resources to be shared with related programme areas within the same categories and between categories,” it said in a document to the board. As before, noncommunicable diseases continues to be the least funded category. Even though most activities in this category are considered to be of high priority, “donor interest does not match the prioritization made by Member States,” WHO said.

So how will this tension on financing realities and organization objectives be resolved? Some believe that assessed contributions are safer than voluntary funding. A “donor chokehold” is how civil society classifies this seemingly intractable problem.

How WHO proposes to raise funds

WHO seeks to “broaden the donor base and increase flexibility in funding. This, it believes, will enable more efficient use of funds and ensure more balanced resource allocation for all its priorities.” It is also hoping to deploy innovative financing to help address this – but details on such mechanisms have not yet been forthcoming.

For now, WHO is working to transform its interaction with donors. It has asked for unearmarked and soft-earmarked funds, so that resources are more closely aligned with strategic priorities. 

In addition, a new resource mobilization framework is in the works. It hopes to implement the resource mobilization strategic framework to fully finance the proposed programme budget 2020–2021. “The framework consists of three segments, with a focus on three groups: Member State contributors, both existing and new private donors (in line with WHO’s Framework of Engagement with Non-State Actors), including foundations and Funds; and international development banks, and multilateral organizations,” according to WHO. The framework will also illustrate how innovative financing can generate revenue, increase flexibility among other goals.

Dr Tedros has been clear and consistent about working with the private sector on Sustainable Development Goals. This is in line with the wider partnership with the private sector on the SDGs.

Speaking on the institution’s Framework of engagement with non-state actors, he has now (famously) said that FENSA is not a fence and that WHO must be engaged. He has called for a need for “appropriate engagement” and has assured to take into account and manage any conflict of interest.    

WHO plans to convene a partner’s forum – in some ways taking forward WHO’s erstwhile Financing Dialogue – to work on “new mechanisms to allow a wider group of contributors to provide flexible funding, as well as newer themes, such as innovative financing by and partnership with the private sector,” among other objectives.

The link between financing & FENSA

For a lay observer, like this author, the link between financing of the institution and its engagement with non-state actors is not so obvious at first.

In its status update on FENSA to the board, WHO reiterated that “transforming partnerships, communication and financing is one of the operational shifts” of the Thirteenth General Programme of Work, 2019–2023. The “triple billion” goal (that has energized most member states), cannot be met without stronger and more systematic engagement with non-State actors, it has said. To that extent, even its external relations strategy will also be governed by the framework, according to WHO.

The framework serves as an instrument for identifying risks and balancing them against the expected benefits, while protecting and preserving WHO’s integrity, reputation and public health mandate, it says.

But WHO admits associated implementation challenges. “..For example, with respect to the requirement that non-State actors confirm that they have no engagement with the tobacco industry and that their activities do not further that industry’s interests, it has proven difficult to come up with a consistent definition of how broadly “furthering the interests” should be interpreted. Similarly, WHO wants to promote its objectives by cosponsoring major global health events. Often, however, such events are also cosponsored by private sector entities with a potential commercial interest in the event’s outcomes,” it informed the board. The Secretariat is reviewing its cosponsorship practices in order to increase engagement in a manner that is in line with the Framework, it added.

“The extent to which non-State actors can contribute to the Organization’s normative work has also been hard to define, bearing in mind the importance of obtaining certain data and information, while at the same time balancing the risk that such actors will have an undue and unacceptable influence on the work of WHO,” it cautions. And adds that financial and human resources will be required to ensure compliance with the framework.

To be sure, the framework is fairly comprehensive in that it not only categorizes various kinds of non-state actors, but also the range of possible engagements and the potential impact on WHO’s work. The framework spells out due diligence on verifying non-state actors to have a clear understanding of their profiles. It also suggests assessing the risk of specific proposed engagements with non-state actors. On risk management, the framework describes it as a process leading to a management decision whereby the Secretariat decides explicitly and justifiably on entry into engagement, continuation of engagement, engagement with measures to mitigate risks, non-engagement or disengagement from an existing or planned engagement with non-state actors.

Reviewing FENSA in light of these implementation challenges is telling. The framework says, “All institutions have multiple interests, which means that in engaging with non-State actors WHO is often faced with a combination of converging and conflicting interests.” Further, an institutional conflict of interest is described as a situation where WHO’s primary interest as reflected in its Constitution may be unduly influenced by the conflicting interest of a non-State actor in a way that affects, or may reasonably be perceived to affect, the independence and objectivity of WHO’s work.

On conflict of interest, the framework says, “The existence of conflict of interest in all its forms does not as such mean that improper action has occurred, but rather the risk of such improper action occurring. Conflicts of interest are not only financial, but can take other forms as well.” (Italics mine)

“For WHO, the potential risk of institutional conflicts of interest could be the highest in situations where the interests of non-State actors, in particular economic, commercial or financial, are in conflict with WHO’s public health policies, constitutional mandate and interests, in particular the Organization’s independence and impartiality in setting policies, norms and standards,” the Framework explains.

WHO would do well to carefully analyse its future partners irrespective of the level of engagement.

In the past, civil society organizations have cautioned that the “reliance on financial support from the private sector risks leading to the corporate capture of WHO.”   In a letter in 2016, for example, organizations advised against using FENSA as a fund-raising strategy. 

Does WHO really have a choice?

So does WHO have a choice in its strategy to diversify its financing needs? Depending on who you talk to, it appears WHO can avoid potential fault lines as it were.

Steadfast believers in the partnership model, point towards the near impossibility of getting diverse countries with varied interests and motives to agree on how to spend on priorities (global health security, emergencies or norms-setting?) The asymmetry of powers that has long plagued multilateral discussions in both health and trade spheres continues, albeit in somewhat different configurations. Hence, this alternative approach of working with interested partners. In other words, stakeholders who also stand to benefit from such partnerships.

This pressure to forge partnerships is not only obvious at WHO, and clearly it transcends even the wider UN system. Think, corporate social responsibility goals meet international public sector needs.

It may be hard to argue against partnerships and associated benefits per se – but surely erring on the side of caution by taking a clinical and calibrated approach is advisable. In its January meeting, a number of member states rightly asked WHO about how it proposes to broaden its donor base.

Finally, WHO must fight the narrative of inefficiency. Curtailing wasteful expenditure is valid, but it must also continue to focus on the big, strategic areas – as it has done in the past. As one passionate advocate pointed out, the proposed target of US$ 99 million for savings through reallocation and efficiencies (that will offset a part of the suggested budget increase for 2020–2021) is a fraction of the potential savings WHO can generate for member states – for example – by merely ensuring lower drug procurement costs for countries. This it can do by helping ensure availability and accessibility of cheaper drugs.

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