Big pre-holiday hopes that WHO member states might agree on a sweeping financial reforms to put the World Health Organization’s $3 billion annual budget on a more sustainable foundation now seem to be foundering in the New Year.

A report by the member state Working Group on Sustainable Financing, published on Tuesday, has stopped short of recommending that assessed contributions by WHO member states be scaled up gradually to meet 50% of the Organization’s core budget needs by 2028-29. 

The scale-up in assessed contributions has been viewed as the lynchpin measure in a series of broader reforms to WHO finances, proposed by a number of recent external reviews of WHO’s performance – and shortcomings –  during the COVID pandemic – among those the Independent Panel review co-chaired by Helen Clark and Ellen Johnson-Sirleaf, former heads of New Zealand and Liberia respectively. 

In the wake of those scathing reviews, reforming WHO’s finance has become a flagship cause for Germany, backed by a large bloc of European, African and other member states – who see  funding reform as critical to maintaining WHO’s central role in global health decision-making, post pandemic. 

While the Working Group impasse does not mean that the financing reform initiative is dead, it means that there is not, right now, any clear pathway to a formal decision on sweeping reforms in the lead-up to the WHO Executive Board meeting, scheduled for 24-29 January – where the Working Group’s deliberations will be reviewed.  

Leading holdouts on reform include US, handful of other rich countries and Russia, Brazil 

In a series of extensive member state consultations that took place since March 2021, WHO’s entire Africa bloc, as well as most European Union and Eastern Mediterranean (Middle Eastern) member states spoke out strongly in favor of the financial reforms, the report states.  Of the 100 countries submitting written responses, some 90 supported an increase in the level of assessed contributions, which have stagnated for over a decade.  

But a handful of countries, including the United States, but also Russia and Brazil, have continued to hold back, diplomatic observers in Geneva told Health Policy Watch.  

Other holdouts include Japan, Monaco and Poland, observers say.  China, meanwhile, has remained on the fence, neither emphatically supportive or opposed.   

Their reluctance is summed up by a terse sentence in the 4 January report that states: “The Working Group did not reach consensus on the Recommendations of the report, given the limited time.”

On the face of it, that may seem odd  in the case of the United States – regularly the largest, or one of the largest, contributors to WHO overall.  However, notably most of the US contributions are  “voluntary” – meaning they can be packaged into a wide range of US offices and initiatives – from USAID and the Centers for Disease Control to the US Department of Health and Human Services.  

In contrast, getting US Congressional approval to a decision increasing the US proportion of required, assessed contributions would be a potentially difficult political move. And that is the case now  even for the WHO- sympathetic administration of US President Joe Biden, who is already facing increasingly tough opposition from his Republican opponents in Congress. 

And although the cumulative impact of the proposed 50% assessment move would only add up to about $600 million a year more in contributions from all WHO member states together, some countries may also be worried about the precedent the decision could set.   

In particular, they may fear that agreeing to  higher WHO assessments might lead to stiffer payments for the rest of the UN system – with much larger budgetary implications, sources said.  

“I think that is a key elephant in the room – what would the WHO Assessed Contribution increase mean for the entire UN system?” one observer told Health Policy Watch. “Are we opening up a Pandora’s box, so that if we are increasing the AC for WHO, wouldn’t we have to increase the AC for the UN overall, for UNDP, for everybody.”   

WHO member states are ‘minority shareholders’ in WHO’s budget  

The current system, however, leaves  WHO member states as effectively minority shareholders in their own governance of WHO, critics say.  

In contrast, philanthropies like the Bill and Melinda Gates Foundation and Gavi, The Vaccine Alliance, rank among WHO’s top five largest contributors, and wield accordingly disproportionate influence.  

Currently, the regular, assessed contributions from member states generate only about $475 million a year – which is only about 16% of WHO’s $3 billion annual budget costs.

Along chronically budget shortfalls for key tasks, the reliance upon “voluntary” donations has been decried by WHO Director General Dr Tedros Adhanom Ghebreyesus as confounding more strategic planning of resource use. 

Voluntary donations are not only unpredictable, but they also too often come with hobbling strings attached – meaning that they have to be dedicated to a specific programme activity. This limits WHO’s ability to nimbly shift funding and respond to emergencies such as the recent COVID pandemic, another WHO review body, the Independent Oversight and Advisory Committee (IOAC), stated in its report, published in May.   

Going forward, there also are building concerns that if other new global health institutions are created under the auspices of a Pandemic Convention or a UN-sponsored Global Health Threats board, these could have the unintended consequences of weakening WHO. Conversely, a robust financial base would help ensure that WHO remains the pulsebeat of global health decision-making – even if new pandemic-specific offices or agencies spring up alongide it.

Budget system is ‘Fundamentally Rotten’ – but action may still take more time 

In a mid-December appearance at Geneva’s Graduate Institute Global Health Centre, shortly before the last Working Group meeting, Germany’s Björn Kümmel, deputy head of global health in the Ministry of Health and head of the Sustainable Finance Working Group, made a spirited appeal for bold changes in WHO’s financing blueprint.

The current structure is “fundamentally rotten”, in its excessive dependence on just a handful of rich countries and a few private donors, he declared.   

“Practically, it’s not possible to come up with piecemeal reforms, but we need to change the way, substantively, how WHO is financed,” said Kümmel, currently Executive Board vice-chairman as well. 

It’s now very “disappointing” that member states have not seized upon the urgency of the  moment created by the pandemic to undertake bold reforms, says Olaf Wientzek, Director of Multilateral Dialogue at the Geneva office of Germany’s Konrad-Adenauer Foundation. 

He points out that the proposal to inch up contributions to the 50% benchmark does not even go as far as other outside reviews. The Independent Panel had, for instance, called for an increase in contributions to cover 66% of WHO’s base budget costs.  

 “I think it was quite a good compromise, because in the long-term it makes a big change, but it doesn’t do it too quickly, where you could argue that given the economic backlash the Corona crisis has created, it would be too tough for many countries,” said Wientzek. 

“And to be honest, if we talk about the massive recovery packages that countries have passed to address the pandemic, the sums involved regarding WHO are very limited. It’s not ambitious – it’s low-hanging fruit.”

Wientzek held out hope that the process of consensus-building over the reforms may simply take more time – as is often the case in laborious WHO debates where consensus is the norm. 

“The initiative may have more chances in May [at the World Health Assembly], or the following May,” he predicted.  “What I do know is that Germany remains very committed to this – and I don’t think that’s going to change with the new [German] government.”  

Image Credits: Wikimedia Commons, WHO/P. Virot & LoC/Carol Highsmith, Kaiser Family Foundation , WHO .