Global Fund given boost by The Netherlands. 13/7/11

The Netherlands Wednesday threw its support soundly behind Geneva-based Global Fund, agreeing to invest €163.5 million

Geneva, Switzerland – The Netherlands Wednesday threw its support soundly behind Geneva-based Global Fund, agreeing to invest €163.5 million to fight Aids, tuberculosis and malaria. Perhaps more critically, the Dutch government made the announcement with a firm message of support for the organization’s financial credibility.

The Global Fund suffered a sharp if possibly temporary reduction in funding this year following a widely distributed US news agency report in January that mistakenly accused the fund of not managing money properly.

The report focused on alleged fraud cases and implied mismanagement, but used information the Global Fund itself had published, following internal investigations, as part of its policy of transparency. Several governments withdrew their funding pledges as a result, saying they needed time to review the situation, putting the Global Fund’s operations into a precarious situation.

Dutch Minister for European and International Affairs Ben Knapen underscored Dutch support in the wake of the Geneva group’s funding crisis, in announcing the agreement through the Dutch Foreign Ministry:

“Recently, much attention has been given to financial improprieties at the Fund. The abuses were brought to light by an internal investigation and made public by the body itself. The Fund has a zero-tolerance policy on corruption, and following these incidents it has tightened control procedures, doubled the budget for internal audits and sought to recoup the missing money.

“While concerned about such irregularities, Mr Knapen is satisfied about the measures taken by the Fund and its openness in communicating about the misappropriations. He therefore sees no reasons to reduce the Dutch contribution. ‘The Netherlands does not wish to either reward secrecy or punish transparency,’ said the minister.”

The Global Fund responded publicly to the cutbacks linked to the AP article, noting that it has so far disbursed US$13.4 billion, of which US$3 billion was disbursed in 2010, to more than 1,000 grants in 145 countries. “When irregularities are identified, The Global Fund takes swift and firm action to stop misuse, recover losses and restart supported programs with new and solid structures and management so that we can continue the effort to save lives worldwide.”

Its web page on “protecting the grant money” has added more information on the subject in recent weeks and provides links to key international media articles on its credibility.

The Global Fund also became a member of the International Aid Transparency Initiative in May. The group was created in 2008 to provide clearer information about aid funding; it has some 20 donor organizations as members and is supported by nearly the same number of countries.