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AIDS funding for community organisations

As HIV continues to spread extensively around the world, increasing amounts of money are being provided to fight the AIDS epidemic. To be effective, this money needs to filter down from larger bodies (such as governments and large funding organisations) to the most basic, fundamental ‘grassroots’ level – communities where people are affected by AIDS. But a person living with HIV cannot simply go to a big funding body to ask for antiretroviral drugs, or a grant to help them look after their family while they are sick. So how does AIDS funding actually reach the people that need it?

There are several different ways that HIV-related money can get to people ‘on the ground’. It may reach them through public services such as their local hospital or school, or through the work of large international non-governmental organisations (NGOs) that have established projects in their region. It may also reach them through the work of community organisations.

What are community organisations?

Community organisations are non-governmental bodies that are set up, based and run within local communities. Located in the hearts of villages and towns that are being devastated by AIDS, these groups are on the frontline of the global response, providing HIV prevention, testing, treatment and care services directly to the people that need them most. They range from small groups formed by friends, relatives and neighbours, to more organised projects that offer a range of HIV-related services.

Community organisations have an extremely important role to play in the global fight against AIDS. Their local knowledge and skills put them in a unique position to identify problems and to assess what needs to be done at the community level. In addition, they can often reach populations that governments and larger NGOs have no access to.

In order to operate properly, community organisations often rely on money from external donors. But how do they first start to look for funding?

Community organisations and access to AIDS funding

There is a common misperception that people who work for governments, NGOs or big funding bodies simply arrive in villages that are affected by AIDS and organise funding for the community organisations that work there. In reality, it is usually the other way round – community organisations themselves have to get in touch with grant-making bodies.

Many local organisations simply do not know how to go about getting in touch with donors, and there is little official guidance available to help them in this area. They often have to search the internet for potential funders, but since most community projects are based in resource-poor areas and do not have constant access to the internet (if indeed they have any access at all), this is not always possible. One option is to seek advice from other community organisations in the area that have received external funding. However, since organisations are often competing for the support of donors, they may not be willing to share information.

If a community organisation manages to find a funding body that can help them, they will need to write out a funding proposal – a document that outlines their activities and plans. Since donors have different targets and requirements, the exact details of what needs to be written in this report vary depending on the funding-body involved. This means that community organisations cannot simply write a single funding proposal and send it out to multiple grant-making bodies. Donors also have different deadlines for when proposals must be submitted, further complicating the situation.

The people who run community organisations are not always trained in fundraising or administration, and are usually much more concerned with operating their group on a practical level than with writing reports. As a result, they often struggle to write a funding proposal that satisfies donors. If the donor is a smaller organisation like AVERT, they may be able to give some assistance with writing funding proposals, but larger bodies that receive numerous applications are unable to do this. A project might be in desperate need of funding, and have the potential to use that funding effectively, but miss out because they are unable to adequately document their situation.

“Sometimes when we report to funders, they say it's not the right format.“ - Kedibome Sebelebele, Mapela Home-Based Care, South Africa¹

Once a community organisation has secured funding, they need to keep their donor updated on the project. ‘Monitoring and evaluation’ – the processes through which a project’s work and financial expenditure are documented – are important, because they make sure that the donor is aware of what is going on at the grassroots level, and that money is being used efficiently. However, keeping donors updated can also put a lot of strain on small organisations. A community organisation may have four or five separate donors, and need to write reports for all of them, which can take up a lot of time and effort that could otherwise be spent doing what they are there for – helping people in the local community.

The problems outlined above give an idea of how complicated and difficult it can be for community organisations to initially obtain funding, and to maintain that support. To fully appreciate the complexity of the situation, though, we need to look at where funding originally comes from, and how it gets from those sources to the grassroots level.

Who provides AIDS funding to community organisations?

A large proportion of the money that community organisations receive originates from large grant-making bodies. These bodies generally fall into two categories: ‘multilateral’ organisations, and donor governments.

• Multilateral organisations, such as The Global Fund to Fight AIDS, Tuberculosis and Malaria, pool donations from governments and other sources, before directing them to communities in need.
• Donor governments (generally representing developed countries) may give money through multilateral organisations, and may also provide funding through ‘bilateral’ aid schemes that transfer money directly to poorer countries. The most significant example of a HIV-related bilateral aid programme is probably the U.S. government’s PEPFAR initiative, which has pledged to provide $15 billion towards fighting HIV and AIDS between 2003 and 2008.

Although these larger donors are the biggest sources of funding for community groups, they are not the only ones. A community organisation may receive invaluable funding through domestic government expenditure, or other groups such as private-sector businesses, charities, and NGOs. To read more about the flow of HIV-related money, and to see a diagram showing the different sources that community organisations get money from, visit our Funding the Fight Against AIDS page.

The flow of AIDS funding from large donors

Large donors rarely provide money directly to community organisations. Instead, they generally give funding to ‘intermediary’ groups, such as government-run AIDS bodies and regional NGOs, who then pass that money on to the community level. This ‘tiered’ system is used by most large donors. The diagram below demonstrates a typical funding chain that money might flow down before it reaches the grassroots level. ²

Take, for example, money distributed by the U.S. government’s PEPFAR scheme to community organisations in Uganda. Funding might be passed from PEPFAR to Management Sciences for Health (MSH, an NGO that is one of the programmes ‘prime partners’, meaning that it receives money directly from the scheme). MSH may then give that money to the Inter-Religious Council of Uganda (a coalition of faith-based groups), who then distribute it to five different religious co-ordinating bodies, who finally pass it on to a number of community groups that are working to fight AIDS. ³

Involving several different partners in the funding process is often necessary, and may be the most effective course of action. But long funding chains also create problems. With so many groups involved, getting money down to the community level can be complicated, expensive, and very time-consuming.

How long does money take to reach community organisations?

There are often very long delays between the allocation of funding from large donors, and the time when that funding is actually spent on the provision of services. The factors that cause these delays – sometimes referred to as ‘bottlenecks’ – can include administration problems, a lack of human resources and infrastructure in the destination country, shortfalls in political leadership, and legislation that slows down the funding process (e.g. national drug licensing laws that delay importation of medicines).

When money reaches community organisations through short funding chains – for example, if the donor is a small charity – these bottlenecks may not be so significant. If you donate £20 (or $20, or €20) to the UK-based AIDS charity AVERT, the journey taken by that donation will be relatively short. The money will be paid into AVERT’s bank account, before being transferred to, for instance, a local community organisation that pays for home-based care workers in a South African village, before being given to the worker themselves as a salary or stipend.

But while it is possible for a small-scale operation like AVERT to achieve a short funding chain, smaller bodies usually only provide a small part of overall funding given to community organisations. Large grant-making bodies are the most significant source of funding, and these bodies generally need to involve more partners in the process.

Imagine that, instead of your £20 (or $20, or €20) going to AVERT, you spend it on a t-shirt made by a brand that is part of Product Red – a scheme that groups together various businesses, who have agreed to donate 10% of profits made on all ‘red’ products towards the Global Fund. As the diagram below illustrates, the journey taken by money that is donated through this route can be relatively long:

• £20 spent on a Product Red t-shirt at a Gap store
• 10% of profits
• Global Fund to Fight AIDS, TB and Malaria
• South African Government Health Department
• Regional NGO
• Community organisation
• Home-based care worker

By the time the money reaches the home-based care worker, it is likely that a number of months will have passed, and that some of the money will have been delayed at some point in its journey. It is also likely that a significant part of your original £20 will have been spent along the way.

How much money is spent before it reaches the end of the funding chain?

As money is passed between different countries, banks, groups and organisations, it is inevitable that some will be spent before it actually reaches community organisations. Each group involved in the funding process will need to take money for their services, to cover administration costs such as wages and resources. There may also be other expenses that drain the original allocation of funding ­– for example, banks charge for money to be transferred between countries.

In addition to these legitimate, necessary expenses, there is also the potential for money to be spent inappropriately as it is passed around. For instance, in 2005 the Global Fund to Fight AIDS, Tuberculosis and Malaria withdrew funding for Uganda, after it was revealed that someone within the country’s Ministry of Health had fraudulently taken $280,000 of money donated by the fund. Because the Global Fund has a strong and transparent financial reporting system in place, it was able to identify this fraud and rectify the situation, highlighting the importance of monitoring and evaluation:

"All organisations involved in development finance… face the constant risk of possible misappropriation of funds and of corruption. That's a fact of life in development finance. The key is to minimise the risk – to have in place oversight systems and to identify problems before they occur." - Sir Richard Feachem, Executive Director, Global Fund to Fight AIDS, Tuberculosis and Malaria ⁴

Although it is difficult for the sort of large-scale corruption that was seen in Uganda to occur without being noticed, the smaller-scale mismanagement of funds may be a more common problem. When mismanagement happens, it is not so much the case that something ‘corrupt’ is occurring, but rather that money is simply not being spent wisely, or used to maximum effect. For instance, a government department may spend excessive amounts on paying for experts to travel out to projects and stay in expensive accommodation, when the money could be better spent carrying out work on the ground. ⁵

In some cases, money may be spent on causes other than the donor intended, because some other need is deemed to be more important at the time. For instance, at a time of famine, a government department that receives a grant to fight AIDS may decide to spend a portion of that money fighting the food crisis.

It is difficult to judge exactly how much money is lost as it is passed along the funding chain. Comparing the sum of money originally allocated by a donor with the amount that actually reaches the grassroots level does not necessarily give an indication of how much has been ‘lost’, because a shortfall might just be caused by money being delayed or held up along the way. It is safe to say, though, that a sizable amount of money is often spent before it reaches the end of a large funding chain, mostly with just cause, but occasionally, illegitimately.

What needs to be done?

There are several steps that donors, intermediary groups, and community organisations themselves could work towards to strengthen and improve funding chains:

• Where feasible, large donors should decrease costs and speed up the flow of money by reducing the number of groups involved in large funding chains.
• Higher-level bodies ­– those at the top of funding chains ­– need to take a greater responsibility for the actual implementation of money on the ground. There is a great emphasis amongst the international community on raising money for AIDS, but once that money has been collected, little attention seems to be paid to where it goes.
• The focus on ‘looking upwards’ in the funding chain needs to be changed. Because community organisations have to report back to the intermediaries above them, who in turn must report back to the donor, it is easy for the needs and requirements of community organisations to be overlooked in the face of the donor's own needs.
  
• Donors need to reach out to community organisations that are working to fight AIDS, and provide them with information and support that can help them to access funding. Even small steps, such as providing a guidance document about how to write funding proposals on their website, would help.

As increasing numbers of towns and villages around the world are being affected by AIDS, the need for community organisations has never been greater. However, as this article has explained, connecting these groups with large donors can be difficult. The importance of overcoming these challenges cannot be overstated ­– when money is prevented or delayed from reaching community organisations, people’s lives are put at risk.

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WHERE NEXT?

AVERT.org has more about:

• The global AIDS epidemic
• Global money for fighting AIDS
• PEPFAR
• AIDS in Africa FAQ