Launching A New Pandemic Preparedness Fund: A Crack in the Cycle of Panic and Neglect?
June 27, 2022
In the face of multiple challenges, incrementalism and realism have lately become the de facto watchwords of the global response to the Covid-19 pandemic. Pandemic fatigue has rapidly become entrenched in Washington and capitals around the world, and the nature of the pandemic itself has changed fundamentally in the wake of Omicron, alongside the pressing threats of global inflation, the war in Ukraine, food insecurity, and soaring energy costs. The impasse in Congress persists over a Covid-19 relief funding package, while elsewhere a contraction of overseas development assistance (ODA) by some significant donors contributes to rising uncertainty about future commitments.
Luckily, there is one very promising bright spot for near-term action: the emergence of an international coalition to increase financing for pandemic preparedness.
Well before Covid-19, global health experts had warned for years that countries, regional bodies, and global institutions had chronically underinvested in critical capacities to prevent, detect, and respond to epidemic and pandemic threats. Policymakers repeatedly ignored those warnings. In the fall of 2019, the CSIS Commission on Strengthening America’s Health Security called for the United States to lead in addressing this systemic risk by establishing a Pandemic Preparedness Challenge Fund at the World Bank. Such a fund would help mobilize additional financing from governments, multilateral development banks, philanthropy, and the private sector to close critical health security gaps in low- and middle-income countries with the weakest health systems.
Amid the Covid-19 pandemic, the fund proposal attracted strong bipartisan support in the Senate, and later in the House, and was championed by the Biden White House from day one. In 2021, the idea was elaborated on and endorsed by the Independent Panel for Pandemic Preparedness and Response and the G20 High Level Independent Panel on Financing the Global Commons. At the first Global Covid-19 Summit in September 2021, the Biden administration put establishing the fund as one of its primary targets by the end of the year.
Yet through the rest of 2021 and into early 2022, the idea continued to meet with resistance from a range of countries and global health actors amid concerns that it could take funding or power away from the World Health Organization (WHO) or the Global Fund to Fight AIDS, Tuberculosis and Malaria, instead creating just another global institution vying for scarce funds. To turn the tide, the Biden administration led a determined diplomatic offensive involving the vice president and the secretaries of state and treasury. U.S. diplomacy, aided by an external advocacy campaign, contributed significantly to winning pivotal endorsements from WHO director general Tedros Adhanom Ghebreyesus; European Union president Ursula von der Leyen; President Joko Widodo of Indonesia, which currently holds the G20 presidency; and South African president Cyril Ramaphosa. By mid-April 2022, G20 finance ministers and central bank governors had reached consensus to establish the fund. At the second Global Covid-19 Summit, in May 2022, total pledges to stand up the fund reached nearly $1 billion from the United States, the European Commission, Germany, and the Wellcome Trust. Subsequently, as of June 23, Indonesia, Singapore, and the Gates Foundation had pledged another $75 million, and other donors have signaled their intent to do so. The World Bank’s board of executive directors will meet on June 30, when it is expected to give the green light to launch the fund this fall.
What Will the Fund Do?
There has been some recent progress in defining precisely what the fund will actually do, although much more work still lies ahead to move beyond generalities. A May 17 draft white paper by the World Bank for public comment lays out the broad case and parameters for the fund. As the white paper argues, additional financing for preparedness must come from both domestic investments and external financing. While the International Health Regulations (IHRs) and Joint External Evaluations (JEEs) encourage capacity building and assess country-level readiness to prevent, detect, and rapidly respond to infectious disease threats, these instruments have not been adequately paired with structural support, sustained financing, or accountability. Given the legacy of panic and neglect of funding for pandemics and the cross-border nature of these threats, many countries repeatedly have failed to prioritize preparedness, leaving the entire world vulnerable to novel disease threats. As with the Financial Intermediary Funds (FIFs) set up to address other global priorities such as education, environment, and food security, the aim of a new pandemic fund will be to change this dynamic by using catalytic grant financing to incentivize strategic planning and increased and sustained investments by low- and middle-income countries themselves. This effort will be linked to increased support by development partners to close critical gaps in preparedness.
Three Tough Outstanding Issues Require Concerted International Resolve
Complementarity. At present, there is no consensus on the fund’s true top-line funding priorities. Delineating precisely what those will be will not be easy, given competing interests, but it is essential—and urgent.
One of the key principles for the fund is that it should complement, not compete, with the work of other international institutions and initiatives engaged in addressing ongoing health threats, such as HIV/AIDS. To do this, it should target the most acute country capacity gaps in the core domains of the IHRs and World Organization for Animal Health International Standards, such as disease surveillance, laboratory systems, emergency communication and management, and community engagement. It should also explicitly focus on essential activities that fall outside the mandates of existing multilateral organizations and connect to multisectoral, supranational, and geopolitical challenges, such as access to information, that require engagement beyond the health sector. The G20 panel set out broader categories, including globally networked surveillance and research, resilient national systems, supply of medical countermeasures and tools, and a global political leadership council that can drive action and accountability. Calls are growing to expand the list of funding priorities further to include upstream zoonotic spillover, anti-microbial resistance, and a strong and resilient frontline health workforce. While all these issues are important for combating pandemics, the wider the menu, the more challenging it will be for the fund to define its unique value-add in the global architecture.
The fund can also be complementary by working through a set of accredited implementing partners. Under the World Bank’s current FIF authorizing framework, the only entities automatically eligible as implementing partners are multilateral development banks, the International Monetary Fund, and UN agencies, including the WHO. The World Bank’s shareholders adopted this provision to safeguard against misuse of funds. The Global Fund, Gavi, the Coalition for Epidemic Preparedness Innovations (CEPI), and other organizations must undergo a review and seek a waiver from the World Bank to be approved as implementing partners. Public comments on the draft white paper reflect a strong push by advocates for this step to happen. The revised confidential paper recently circulated to the World Bank’s board for decision now makes clear the World Bank staff’s advice to do so. While this will leverage the respective strengths and expertise of those organizations and strengthen international coordination, it will also be imperative to demonstrate that the fund will truly build country capacity for preparedness and response in new and different ways and not become simply a pass-through or top-up to other organizations.
Additionality. Another core principle of the fund is to expand the global pool of funding available for pandemic preparedness and response. The G20 panel and other experts recommend a target initial capitalization for the fund of least $10 billion per year to address critical preparedness needs. To get there, donors must be willing to increase, not substitute for, their ODA budgets, so that contributions to the fund do not come at the expense of other urgent global health or development needs. Pledges to date from the United States, the European Commission, and Germany appear to have met that test, but the jury is out as to whether other governments will follow suit. This is especially fraught amid pressure to pledge to the new fund is happening in parallel with the Global Fund’s quest to raise $18 billion this fall in its three-year replenishment (a 28 percent increase), as appeals to close the global Covid-19 response gaps continue, and as several wealthy Nordic governments have diverted significant levels of foreign assistance to Ukraine refugee relief.
In a novel approach, the Biden administration put forward a fiscal year (FY) 2023 request to Congress with $88.2 billion in new mandatory funding over five years for pandemic preparedness, including $4.5 billion in U.S. contributions to the fund out of a total $6.5 billion for global health security activities. This is over and above the annual discretionary foreign assistance budget request. This rightly presents pandemics as a national security priority that should not be subject to budget caps and that requires a whole-of-government approach, but it faces a very uncertain future in Congress. There also has been little ambition globally thus far to look beyond traditional ODA budgets to test whether there are feasible innovative financing sources.
Governance. Outstanding contentious issues include who will have a seat on the fund’s governing body and how that body will be structured. How that is decided will have great consequences for the fund’s legitimacy, its political support, and the speed, quality, and effectiveness of its decisionmaking process. The proposal is to create a country or regional constituency-based model akin to that of the World Bank’s own executive board but leave open the question as to whether recipient countries will serve as voting or non-voting members, and whether there will be any representation at all from civil society or the private sector. The white paper cites governance examples from other FIFs, such as the Global Environment Facility Council. More than 120 organizations and experts have signed a statement calling for a more equitable and inclusive governance approach for the fund in which all contributing countries, regardless of income groups, as well as civil society and communities are represented with seats and votes. The trick is to translate this energy into a governing plan that will have legitimacy and work effectively.
Next Steps and Recommendations
Over the next few months, the United States and other founding contributors will work with the World Bank, the WHO, and other stakeholders to agree on the operational modalities necessary to launch the fund this year. For the Biden administration, Congress, and other G7 and G20 member states to achieve the fund’s promise to drive a long overdue step change in global financing for pandemic preparedness, they must:
- Define strategic priorities at the start. To ensure that the fund delivers a clear value-add vis-à-vis other global institutions, the United States and founding donors should agree on a limited list of initial top-line priorities for the fund, make clear that these investments advance shared global security interests, and link financing to robust country plans with clear, measurable results and country commitments. Founding partners must focus on the most acute national and regional capacity gaps that impact cross-border containment of pandemic threats and that will yield the greatest return on investment now. These include improved and globally networked outbreak surveillance, data sharing, and early warning systems and should be approached with a view to strengthening country ownership and leadership in these areas. Investing in human resources or “staff” must be a priority alongside investing in infrastructure or “stuff.” Rapidly demonstrating near-term, concrete impacts with the first billion dollars invested will be essential to build confidence and momentum and drive additional resource mobilization to a scale commensurate with the threat. Strategic choices, speed, and rapid impact will determine whether the fund graduates out of a relatively modest pilot stage.
- Ensure accountable and coherent governance and implementation. The fund needs a governance model that heeds the lessons of the past two decades in global health and that simultaneously achieves broad legitimacy while also having the capacity to drive rapid, decisive action. The governing body should include diverse, high-level representation from governments at all income levels, multilaterals, foundations, civil society, and the private sector. The Global Fund and Gavi boards offer models for how this can be done. In addition to the major global health organizations, such as the WHO, Global Fund, CEPI, and Gavi, experienced national and regional partners such as the Africa Centers for Disease Control and Prevention should be eligible to serve as implementers. Furthermore, all implementing partners should be required to demonstrate how they will strengthen country capacity building and sustainability.
- Grow the pie for everyone. The fund can benefit all countries by helping stop outbreaks at their source before they become deadly pandemics. The United States should work with its G7 and G20 partners to encourage all governments, regardless of income level, to contribute to the fund and share in the burden of financing pandemic preparedness. This should not just be another donor-driven effort: countries should consider investing more akin to the way they finance and pledge as shareholders to the World Bank’s International Development Association, its development fund for the poorest countries. Indonesia’s significant pledge of $50 million to the new pandemic fund should incentivize other middle- and high-income countries to step up. It will be essential to spell out the rules by which expanding U.S. and other wealthy country contributions, for instance, will be linked to proof of country ownership and financial commitments. All contributors must also demonstrate that their support is truly additional to other health and development spending. More work is also needed to reach beyond countries’ ODA and health budgets to tap other forms of finance, both public and private. The United States enacted an airline surcharge after 9/11 to finance anti-terrorism efforts that is still in place two decades later; similar ambition and creative thinking is urgently needed here. Philanthropy and corporations have much to gain from increased investments in preparedness and should be encouraged to contribute much more.
- Increase and sustain U.S. support and leadership. The United States is positioned to set the pace of expanded commitments to the fund, which will signal U.S. seriousness of purpose and set a bar for other donors to do more. Action by the United States should be explicitly linked to advancing U.S. national interests. The United States has already committed critical seed funding of $450 million to launch the fund this year. As a baseline, Congress should fully fund the president’s FY 2023 request to Congress for a U.S. contribution to the fund of $4.5 billion over the next five years, ideally from both international and domestic accounts, and should signal willingness to increase that amount in future years as the fund demonstrates impact, commensurate with a U.S. fair share. Maintaining at least this level of U.S. investment will be essential to enlist financial support from other countries and move the fund upward to well above the starting level of $1 billion.
A Promising Moment
The world is in a fragile yet promising moment when it comes to heeding the lessons of the Covid-19 crisis. The creation of the fund offers a near-term opportunity to mobilize significant new investments in pandemic preparedness that are unlikely to happen otherwise. A chance to begin to break the cycle of crisis and complacency and strengthen global security is finally within reach. A committed, diverse coalition has emerged in support of the fund, and the outstanding tough questions can be resolved over the coming weeks and months. Strong U.S. leadership and financial commitment, bridging the U.S. administration and Congress and resting on a durable bipartisan consensus, will be the single most important factor in moving the fund from its infancy into an instrument with the long-term vision, clear and unique purpose, additionality, burden sharing, and legitimacy to deliver rapid and sustainable results. Just as the United States led the world two decades ago to launch PEPFAR and the Global Fund to combat the global AIDS crisis, the United States should now lead and rally the world to launch this new fund and help prevent the next pandemic.
Carolyn Reynolds is a senior associate (non-resident) with the Global Health Policy Center at the Center for Strategic and International Studies (CSIS) in Washington, D.C., and cofounder of the Pandemic Action Network. J. Stephen Morrison is senior vice president and director of the CSIS Global Health Policy Center.
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