13 June 2016
In a review of processes to set up a new Global Fund online procurement tool called wambo.org, auditors from the Office of the Inspector General (OIG) found instances of non-competitive procurement; non-compliance with procurement rules; and weaknesses in the design and execution of contracts. However, the OIG found no evidence of deliberate wrongdoing by staff. The OIG also found that recruitment processes for a project manager were effective.
Wambo.org is a purchasing tool that brings together buyers and suppliers of health products and medicines onto an e-market platform. The platform is expected to improve the availability of products, bring down prices and reduce costs. The Global Fund Secretariat has estimated that wambo.org will make savings of US$250 million to the Global Fund by 2019. Given its expected benefits, the Global Fund Secretariat developed and completed the project within 18 months. Wambo.org went live in January 2016. As of the date of the OIG report, the Secretariat has reported that six countries are using the platform to buy health products.
Following allegations received early 2016, the OIG undertook a limited scope review of procurement processes regarding the Global Fund Secretariat’s management of the project. OIG auditors reviewed whether processes to procure services and resources under the wambo.org project were undertaken in accordance with the relevant Global Fund policies and regulations.
The auditors found that 65% of the procurement contracts to set up wambo.org that were eligible for competitive tendering (worth US$ 6.9 million) were not awarded competitively, contrary to the Global Fund’s Procurement Policy. The policy requires competitive tendering for all procurements, with at least three quotations obtained for contracts below US$30,000 and open or restrictive tendering for procurements above that level. Although ‘exceptions to competition’ are allowed for valid business reasons, the OIG found the use of non-competitive procurements to be a routine practice rather than an exception.
The auditors also identified some weaknesses in the management of contracts once they had been awarded. For example, consultants started work before contracts were finalized and signed which can affect the leverage of the Global Fund to negotiate rates, levels of effort and overall cost.
The OIG found that the processes followed in recruiting a dedicated program manager for the project were compliant with Global Fund Human Resources regulations. However, the level of experience required for this role was incongruous with similar jobs at the same grade within the Secretariat.
To correct the anomalies found by the OIG, the Global Fund Secretariat is reviewing its current procurement framework to strengthen compliance and accountability. The Human Resources Department is also reviewing the criteria contained in job descriptions linked to professional experience.
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