President's Emergency Plan For AIDS Relief:
Partner Selection and Oversight Follow Accepted Practices but Would Benefit from Enhanced Planning and Accountability
GAO-09-666, Jul 15, 2009
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The President's Emergency Plan for AIDS Relief (PEPFAR), first authorized in 2003 at $15 billion for 5 years, was reauthorized in 2008 at $48 billion through 2013. PEPFAR supports HIV/AIDS prevention, treatment, and care services, primarily in Africa as well as in Asia and the Caribbean. The Office of the U.S. Global AIDS Coordinator (OGAC) leads implementation of PEPFAR. The Department of Health and Human Services' Centers for Disease Control and Prevention (CDC) and the U.S. Agency for International Development (USAID) are among PEPFAR's primary implementing agencies. In this report, responding to a legislative directive, GAO examined practices used in (1) selecting organizations to implement PEPFAR activities and (2) overseeing these organizations' PEPFAR activities. GAO interviewed agency and implementing organization officials; reviewed key agency guidance; analyzed PEPFAR awards for fiscal years 2007 and 2008; and observed PEPFAR activities in Namibia, South Africa, and Zambia.
The selection of PEPFAR partner organizations to implement HIV/AIDS prevention, treatment, and care services generally follows accepted practices. GAO's review of PEPFAR guidance on annual interagency planning for program activities, including selection of implementing partners, found that the guidance calls for strategic assessments of overall program needs. GAO also found that the interagency plans for PEPFAR activities in Namibia, South Africa, and Zambia for fiscal year 2008 included such assessments, and CDC officials reported using these annual plans in planning their selection of PEPFAR implementing partners. However, the PEPFAR guidance that GAO reviewed does not call for the involvement of agency assistance and acquisition officials--officials with primary responsibility for making awards to implementing partners--although these officials possess expertise necessary to ensure that the selection process contributes to meeting program needs. Moreover, these officials were not involved in preparing the interagency PEPFAR plans for fiscal years 2008 and 2009. Further, although PEPFAR guidance on preparing the interagency plans is OGAC's key tool for coordinating the implementing agencies' partner selection processes, this guidance has not been integrated with the agencies' guidance. In making awards, CDC and USAID generally engaged in competitive selection processes, such as issuing solicitations and convening review panels, to select candidate organization proposals with the best approach for meeting program needs. In addition, CDC and USAID evaluated candidate organizations' technical, management, and financial capacities to ensure that candidates had the systems and resources needed to meet program needs. CDC and USAID have established a number of practices to oversee the activities of their PEPFAR implementing partners. For the awards that GAO reviewed, CDC and USAID required programmatic and financial reporting, reviewed implementing partners' expenditure data against their work plans, and documented site visits with checklists and reports. In addition, CDC and USAID provided technical assistance to improve implementing partners' capacities. However, several weaknesses have limited CDC's and USAID's ability to oversee partners' and subpartners' PEPFAR activities and thus ensure accountability for PEPFAR funds. First, according to OGAC data, about 29 percent of CDC and 7 percent of USAID direct-hire positions--including those with oversight responsibility--remained unfilled early in fiscal year 2009. Second, PEPFAR and agency award reporting time frames are not synchronized, exacerbating agencies' reporting burden and reducing time for oversight, including time for site visits. Third, GAO's assessments of 15 implementing partners' internal controls showed that one implementing partner and six subpartners were constrained in their ability to account for the use of PEPFAR funds, because they did not consistently carry out established policies and procedures. Fourth, CDC procedures for collecting audits and ensuring resolution of audit findings are unclear, limiting CDC's ability to help strengthen identified implementing partner weaknesses.
Status Legend:
- Review Pending
- Open
- Closed - implemented
- Closed - not implemented
Recommendations for Executive Action
Recommendation: To strengthen CDC's and USAID's ability to accomplish PEPFAR goals and ensure accountability for PEPFAR funds, the Secretary of State should direct OGAC to improve the process of partner selection by ensuring that the annual guidance on preparing the country operation plan (COPs) addresses the need to involve assistance and acquisition officials.
Agency Affected: Department of State
Status: Closed - Implemented
Comments: In a May 2010 letter to Congressional committees about its actions related to the report, State agreed that assistance and acquisition officials need to be included in the preparation of country operation plans (COP). In its FY 2010 COP guidance, issued June 29, 2009 (shortly before the report was published), the Office of the Global Aids Coordinator (OGAC) cited the GAO report and stated the need to consult with all relevant agencies when preparing country plans. The FY 2010 COP guidance contained language specifying that acquisition and assistance officials who are part of country teams are to participate in planning and drafting of annual COPs and a section for acquisition and assistance officials emphasizing the importance of their participation throughout the funding year, for example, for the purposes of both changing existing contracts or awards in addition to planning new procurements for the following fiscal year. Similar language was contained in the FY 2011 COP guidance. We consider these actions to be responsive to the recommendation.
Recommendation: To strengthen CDC's and USAID's ability to accomplish PEPFAR goals and ensure accountability for PEPFAR funds, the Secretary of State should direct OGAC to improve the process of partner selection by working with Department of Health and Human Services (HHS) and USAID to clarify the relation between PEPFAR guidance on COP preparation and the agencies' guidance on assistance and acquisition awards.
Agency Affected: Department of State
Status: Open
Comments: The Departments of State and Health and Human Services and the U.S. Agency for International Development provided joint comments on this report. They welcomed the report's identification of areas in which PEPFAR partner selection and oversight could be strengthened. They said that PEPFAR is committed to continue working through the Procurement and Assistance Working Group and agency leadership to ensure alignment between the PEPFAR guidance and implementing agency guidance and regulations. GAO continues to monitor agency efforts to implement the recommendation.
Recommendation: To strengthen CDC's and USAID's ability to accomplish PEPFAR goals and ensure accountability for PEPFAR funds, the Secretary of State should direct OGAC to strengthen oversight of PEPFAR implementing partners by working with CDC and USAID to develop a strategy to address staffing shortages identified by OGAC, CDC, and USAID.
Agency Affected: Department of State
Status: Open
Comments: The Departments of State and Health and Human Services and the U.S. Agency for International Development provided joint comments on this report. They welcomed the report's identification of areas in which PEPFAR partner selection and oversight could be strengthened. They said the FY 2010 country operation plans (COP) guidance asks country teams to develop an action-oriented staffing plan that identifies all existing vacant positions and outlines a specific plan for filing them in a timely manner. GAO continues to monitor agencies' efforts to develop the plan.
Recommendation: To strengthen CDC's and USAID's ability to accomplish PEPFAR goals and ensure accountability for PEPFAR funds, the Secretary of State should direct OGAC to strengthen oversight of PEPFAR implementing partners by working with implementing agencies to develop a plan to reduce PEPFAR country teams' reporting burden through better alignment of OGAC and agency reporting time frames.
Agency Affected: Department of State
Status: Open
Comments: The Departments of State and Health and Human Services and the U.S. Agency for International Development provided joint comments on this report. They welcomed the report's identification of areas in which PEPFAR partner selection and oversight could be strengthened. However, they offered no specific comments on this recommendation. GAO continues to monitor the agencies' efforts to implement the recommendation.
Recommendation: To strengthen CDC's and USAID's ability to accomplish PEPFAR goals and ensure accountability for PEPFAR funds, the Secretary of State should direct OGAC to strengthen oversight of PEPFAR implementing partners by assessing and addressing the degree to which weaknesses in PEPFAR partners' and subpartners' implementation of financial controls negatively affect CDC's and USAID's ability to ensure that program funds are used for their intended purposes.
Agency Affected: Department of State
Status: Open
Comments: The Departments of State and Health and Human Services (HHS) and the U.S. Agency for International Development (USAID) provided joint comments on this report. They welcomed the report's identification of areas in which PEPFAR partner selection and oversight could be strengthened. They said HHS is taking a number of steps to strengthen PEPFAR partners' implementation of financial controls by exploring options to provide additional training to field staff as well as implementing partners on proper project and financial oversight. The HHS Office of Inspector General also agreed to process audits of foreign recipients, which the agencies said would strengthen their auditing capacity. Finally, they said USAID intended to direct country teams to consider hiring a contractor to oversee and monitor internal control rules and regulations. GAO continues to monitor agency efforts to implement the recommendation.
Recommendation: To strengthen CDC's and USAID's ability to accomplish PEPFAR goals and ensure accountability for PEPFAR funds, the Secretary of State should direct OGAC to strengthen oversight of PEPFAR implementing partners by working with CDC to establish procedures for collecting PEPFAR implementing partners' audit information and addressing audit findings.
Agency Affected: Department of State
Status: Open
Comments: The Departments of State and Health and Human Services (HHS) and the U.S. Agency for International Development (USAID) provided joint comments on this report. They welcomed the report's identification of areas in which PEPFAR partner selection and oversight could be strengthened. They said the HHS Office of Inspector General agreed to process audits of foreign recipients, which the agencies said would strengthen their auditing capacity. The HHS OIG has a system for tracking the receipt of audits and the resolution of audit findings by CDC and a process for following up on delinquent audits. DCD plans to use these procedures for international audits. GAO continues to monitor agency efforts to implement the recommendation.