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Local Fund Agents (LFA)
 
The Global Fund does not have a country-level presence outside of its offices in Geneva, Switzerland. Instead, it hires Local Fund Agents to oversee, verify and report on grant performance, and make recommendations for future funding.
 
Local Fund Agents are firms or entities, usually based in countries receiving Global Fund grants, which provide a range of oversight services to the Global Fund. There are currently six active LFAs working in approximately 130 countries.
 
The Global Fund normally has one Local Fund Agent in each country where it has approved a grant. This gives the Global Fund access to local knowledge that may be relevant to grant performance. There are some cases, however, where it is not possible to have a Local Fund Agent in the country. In these cases, the Local Fund Agent is based in a nearby country and flies in from time to time to verify grant implementation.
 
LFAs are selected through a competitive bidding process. The existing LFAs were selected in a two-step process. First, entities/firms were pre-qualified as potential LFAs. This was done through a global Request for Proposals, and the selection was based on criteria including the capacity to perform the services, the quality of the proposal and cost. The second step was to select LFAs from among the pre-qualified entities, for specific countries. This was done again through a competitive process, on a country-by-country basis.
 
The Role of Local Fund Agents
 
The Global Fund follows the principles of performance-based funding in making funding decisions. The aim is to ensure that investments are made only where grant funding is managed and spent effectively on programs that achieve impact in the fight against HIV/AIDS, tuberculosis and malaria.
 
The role of LFAs is to provide independent and professional advice on grant progress, requests for funding and local circumstances. In particular, the LFA performs the following services for the Global Fund:
 
Before a grant agreement is signed with a principal recipient, the LFA assesses the capacity of the Principal Recipient to implement the grant as described in the approved grant proposal. The assessment looks at four specific areas:
 
• Financial Management and Systems 
• Institutional and Programmatic Capacity (also known as Program Management Capacity) 
• Procurement and Supply Management 
• Monitoring and Evaluation capacity
 
The LFA also reviews the Principal Recipient's work plan and budget and assists the Global Fund in negotiating the grant agreement.
 
During program implementation, the Principal Recipient submits regular progress updates and requests for the disbursement of funds. The LFA reviews these, verifies that targets have been reached and expenses incurred as reported and makes a recommendation to the Global Fund on how much to disburse to the Principal Recipient. The LFA also advises the Global Fund of any issues it becomes aware of that may affect performance of the grant.
 
The Global Fund's grants are initially approved for two years (Phase 1) and renewed for up to three additional years (Phase 2) based on the performance of grant-funded programs. Funding is disbursed incrementally every three to six months throughout the grant's lifespan, and each disbursement is based on performance. Local Fund Agents play an important role in verifying the performance of grant-funded programs each time recipients report results.
 
Towards the end of Phase 1, the Global Fund asks the Country Coordinating Mechanism (CCM) to submit a Request for Continued Funding. This is the start of the Phase 2 process. This document assesses performance on the grant so far and requests that the grant be renewed into Phase 2. The LFA plays a critical role in reviewing the CCM's Request and making recommendations as to whether the Global Fund should continue to fund the grant, and if so what funding to approve for Phase 2.
 
At the end of the grant, the LFA is involved in assisting the Global Fund with closure of the grant.
 
Local Fund Agent are contracted by and works for the Global Fund. LFAs do not work for the CCM or the Principal Recipient or sub-recipients. All of the LFA's reports are submitted to the Global Fund and are confidential unless the Global Fund makes them public.
 
UNOPS – the LFA in Azerbaijan
 
In Azerbaijan, United Nation’s Office for Project Services (UNOPS) has been contracted by the Global Fund to provide Local Fund Agent services for the HIV/AIDS and TB grants.
 
UNOPS supports the Global Fund’s stated mission to facilitate and promote national capacity and ownership to establish simplified, rapid and innovative processes to effectively combat HIV/AIDS, tuberculosis and malaria. Furthermore, UNOPS recognizes the critical relationship between the Global Fund and the LFA who is appointed to translate this mission at country-level.
 
UNOPS, in addition to performing the outlined LFA Services has the advantage of being an international development organization with significant social experience. It provides administrative and technical support necessary for the successful completion of each of these activities. This, coupled with UNOPS’ overall vast experience in procurement, (over the pasts 10 years it has procured commodities, equipment and goods valued at US$ 1,3 billion), places it in a unique and advantageous position to effectively and objectively monitor implementation and assess the capacity of the PR in the areas defined by the Global Fund.
 
The LFA Team is composed by:
 
Central Coordinator Mr Fabrizio Vivarini, UNOPS Portfolio Manager based in Geneva 
Country Coordinator Ms. Jamila Azizova, based in Baku, Azerbaijan