ONE’S Analysis of the President's FY2011 Budget Request

ONE is dedicated to supporting developing countries in the fight against extreme poverty and disease and is committed to working with the executive and legislative branches to achieve sustained funding increases for proven and effective foreign assistance programs. In his FY2011 budget request, President Obama continues to scale up resources for critical programs to fight poverty, particularly in agriculture and some areas of global health and in these tight economic times, such sustained commitment is critical. As this analysis shows, however, proposed increases for FY2011 fall short or delay the levels required to fulfill existing commitments on specific goals to fight poverty.

In total, President Obama requests $58.5 billion for the International Affairs Budget (the 150 Account), representing a $6.1 billion or 11.6% increase over total FY2010 enacted spending. If the FY2010 supplemental request of $4.5 billion for civilian support to "frontline" countries is added to the FY2010 enacted total, the FY2011 request would represent a 2.8% increase over the FY2010 total. Within the overall total, $39.4 billion is requested for foreign operations-a total of $5.2 billion, or 16% over the FY2010 enacted amount (including forward funding provided in FY2009 to meet FY2010 requirements). Given the recommended freeze on non-national security spending, the increased investment in development, as part of the US national security strategy, is welcome. Not only are America's investments paying dividends in saved and improved lives across the globe, they build goodwill, create stability and promote new economic markets.

As the Administration notes in its budget request, the FY2011 proposal represents another step closer to the commitment to double foreign assistance by 2015 from its FY2009 baseline of $26.1 billion. In total, foreign assistance (which is comprised of $39.4b in foreign operations and another $1.9b in food aid) reaches a total of $41.3 billion in the President's request. However, it is important to note that 60% of total increases in foreign operations over FY2010 are directed to Afghanistan, Pakistan and Iraq. While the development needs in these countries are great, the spirit of the overall commitment to scale up development efforts around the world will not be met by channeling resources to these three states; nor will the even more critical commitments be achieved to meet global health, food security, education and economic growth objectives.

Included in the increases requested as part of foreign operations for development, the Administration has asked for scaled up resources to address climate change and clean energy. In total, the FY2011 request includes $1.391 billion for these efforts.

Overall Global Health

In May 2009, the Administration pledged $63 billion over six-years for a Global Health Initiative that would coordinate and expand U.S. efforts to improve global health. The GHI program remains and was given greater detail with the release of a consultation report along with the FY2011 budget. Though the overall goal of a coordinated global health strategy and the policy prescriptions for achieving it are welcome, the relatively modest increases in most global health accounts proposed for FY2011 raises concerns about the likelihood of achieving the outcomes described.  If Congress supports the FY2011 request, the GHI will still require a significant scale-up during the next three years to complete the $63 billion goal and achieve the outcomes outlined in the consultation document.

In the FY2011 budget request, the overall total dedicated to activities for global health (across all accounts) increased from $8.855 billion to $9.572 billion. After years of relatively small increases, the majority of the global health increase in foreign operations is dedicated to maternal and child health (an increase of $351 million).  In addition, bilateral assistance for AIDS grows by $191 million and bilateral malaria receives an increase of $95 million. Neglected tropical diseases "and other public threats" received a major and welcome boost from $65 million in FY2010 to a request of $173 million. The request for the Global Fund to Fight AIDS, TB and Malaria, slated for a $50 million cut from the FY2010 total (the foreign operations total falling from $750 million to $700 million), is a disappointment and will harm efforts to mobilize funding globally to meet the Fund's portfolio of technically-sound proposals.

Global HIV/AIDS, TB and Malaria

The total investment in AIDS, TB and Malaria remains the majority of the United States' global health portfolio but this budget continues a slowing of increases to HIV/AIDS funding particularly as investments in other areas of health have increased. The percentage of total global health spending (in foreign operations) on AIDS in 2009 was 77%; the request for FY2011 brings that figure to 69%. Though investments in other areas of global health are long overdue and are welcome, the Administration also increased the treatment target for AIDS to at least 4 million people with the release of the GHI details today. It will take much more significant increases in AIDS spending to accomplish and maintain this goal. 

• Bilateral HIV/AIDS Programs-The majority of the scaled up U.S. investment in HIV/AIDS programming has been directed towards bilateral programs over the past eight years. Since 2002, bilateral spending on HIV/AIDS in foreign operations alone has increased from $435 million in 2002 to a requested total of $5.15 billion in foreign operations FY2011. The FY2011 budget request includes an increase over FY2010 of $191m. When funds from Labor-HHS are added, the total for bilateral HIV/AIDS programs reaches $5.73 billion.

• Global Fund-In 2010, the Global Fund will face a replenishment conference and a possible significant funding shortfall. This year, the Global Fund will require $5.25 billion from all sources in order to fund new proposals and renewals of existing grants to combat HIV/AIDS, TB and malaria. Commitments by the United States and other donors to universal access to malaria and AIDS prevention and treatment require that the Global Fund is fully funded. ONE believes that the U.S. should provide one-third of this estimate, at $1.75 billion ($1.45 billion of which would be funded through foreign operations). The President's request of $1 billion ($700 million from foreign operations and $300 million from Labor-HHS) falls $750 million short of this recommendation. This is the first indication by a donor country of a financing level during the next replenishment period and sets a difficult tone for the upcoming meeting in Amsterdam in March 2010.

• Bilateral TB-The Lantos-Hyde Authorization bill in 2008 authorized $4 billion in spending on tuberculosis between 2008 and 2013, a major scale up in efforts to fight TB. Tuberculosis cases are up globally, as are drug resistant cases of tuberculosis, known as MDR-TB and XDR-TB. The bilateral request adds $7.5 million to the FY2010 level for a total of $251 million. Though the recent increases are welcome, they are not keeping pace with the scale-up authorized in Lantos-Hyde and required to fight this disease.

• Bilateral Malaria-Malaria has been brought under control and even eliminated in many parts of the world, including very recent success stories across Africa. Yet, infections worldwide still number around 350 to 500 million cases a year, with nearly 900,000 deaths, mostly among children and young adults, in Africa. President Obama committed to eliminate deaths from malaria by 2015 which would require a quick scale up of resources to distribute the necessary preventative bed nets and begin scaling up access to treatment. Though a lofty goal, recent efforts put this objective within reach. The malaria bilateral program receives a $95 million increase in the FY2011 request-from a total of $585 million in foreign operations in FY2010 to $680 million in foreign operations in FY2011. This is a welcome increase in funding. If these increases are continued and coupled with a more robust contribution to the Global Fund, the goal of a world where no one dies from malaria is possible by 2015. (There is another $9 million in bilateral malaria programs and a further $116 million in research through Labor-HHS as well.)

Child and Maternal Health-Child mortality has been greatly reduced from 12.5 million in 1990 to 8.8 million in 2008. There is much more to be done and great opportunities exist to deliver results through USAID's bilateral maternal and child health programs and mechanisms like the Global Alliance for Vaccines and Immunization (GAVI) and UNICEF. Indeed, the renewed emphasis on child and maternal health is reflected in the FY2011 budget request with a total increase of $351 million. Though the request for maternal and child health is very welcome, the portion allocated for GAVI ($90 million) is far below what is needed to fund the need for vaccines for rotavirus and pneumococcal disease.

Neglected tropical diseases (NTDs)-NTDs impact over a billion people, and they have traditionally received less political attention and funding than other diseases.  The most common NTDs can be controlled globally and multiple NTDs can be eliminated across Latin America.  President Obama's FY2011 request-$155 million, more than double the $65 million in FY2010-signals that the Administration is committed to ending the neglect of these diseases and recognizes that investments in NTD control and elimination is a cost-effective way to achieve "quick wins" in global health.

Global Hunger and Food Security Initiative

Agriculture is one of the strongest drivers of economic growth in developing countries-the primary tool for generating income, growth and meeting food security needs. However, assistance to agricultural development has been grossly underfunded for decades making new and better investments critical to ending the food crisis. President Obama is leading a new effort to boost and improve investments in agriculture through the L'Aquila Food Security Initiative. At the2009  G-8 summit, the U.S. committed to scaling up resources in 21 focus countries, spending at least $3.5 billion over three years. The FY2011 request includes a total of $1.762 billion for the "Global Hunger and Food Security Initiative". The total is comprised of the following components:

ONE welcomes the overall increase of $749 million for agriculture as an essential tool in tackling poverty, but continues to call on the Administration for greater transparency in their financial and forthcoming operational plans.

Millennium Challenge Account (MCA)

The Millennium Challenge Account (MCA) is focused specifically on supporting programs that reduce poverty by encouraging sustainable economic growth through market-based investments in agriculture, infrastructure, water, education, private sector development, and capacity building.  A unique feature of the MCA is the fact that the countries themselves are responsible for identifying the greatest barriers to their own development. In FY2010, Congress approved $1.105 billion for the MCA and in his FY2011 request, the President includes $1.28 billion for the program-a $175 million increase. Several countries could be ready to sign compacts in 2011 including Zambia, Malawi, Cape Verde, and Indonesia. Nevertheless, this total may not meet the full amount needed to fully finance three or four new full compacts anticipated to be completed in 2011, while also covering incoming threshold compacts and operational costs, the increase is welcomed.

International Financial Institutions

• International Development Association (IDA) -The International Development Association (IDA) is the part of the World Bank that is one of the largest sources of assistance for the world's 80 poorest countries, 39 of which are in Africa. A full share of the negotiated annual US contribution to IDA would total $1.235 billion in FY2011. In the FY2011 request, the President includes $1.285 billion which would fully cover the negotiated share and allocate $50 million towards arrears.
• The African Development Fund (AfDF) and the African Development Bank (AfDB)-The African Development Fund, the concessional arm of the African Development Bank, supports 40 of the poorest African countries with grants and highly subsidized loans focused largely on transport, energy, and water. FY2011 marks the final payment to fulfill the current U.S. pledge to the AfDF. The President's request fully covers that pledge (with $156 million). At the request of the G20, the AfDB accelerated its lending to assist African countries cope with the current global financial crisis. It has now obligated most of its resources and will be completely run out of money sometime in 2010, according to AfDB President Kaberuka. The FY2011 budget does not include any additional resources or forward funding that could have been utilized to scale up assistance for Africa's poorest nations. In addition, the African Development Bank, which has not approved a general capital increase (GCI) in over a decade, had planned to begin discussions for a 2012 GCI.  ONE had hoped for an early negotiation for the GCI with funds to be requested in FY2011, a proposal that was not included in the budget request.

Other Development Assistance accounts:

• Education-Global education is a key investment in economic, social and political development, especially for women and girls. As a candidate, the President pledged a $2 billion global education fund. ONE does not currently have enough information to detail the FY2011 request, but will update this document when that information is made available.
• Water-The Water for the Poor Act authorizes a scaled up effort to provide clean water to fight extreme poverty. ONE does not currently have enough information to detail the FY2011 request, but will update this document when that information is made available.
• USAID Capacity Building- Building on the Bush Administration's Development Leadership Initiative (DLI) - a plan to double the number of USAID Foreign Service Officers to about 2,100, originally by FY2011 - the FY2011 request proposes to fund 200 new USAID Officers.  While significant, it slows the pace of doubling and leaves the initiative nearly 250 hires short of the overall goal to double FSOs.  USAID does plan to allocate a larger share of the DLI in FY2011 for mid-career personnel, something critical to building a more experience cadre of development professionals as more senior officials retire.

ONE supports robust increases for the following list of accounts included as "other key accounts." For all of these accounts, ONE only counts the portions that would qualify as ODA under international definitions:

[1] Although this program counts as Official Development Assistance and is a ONE Key Account, it is not included in the totals in the table above because the program is not part of the goal to double foreign assistance by FY2015.