The impasse between the Minister of Health and KwaZulu-Natal over the R720-million grant ($72-million) to the province to fight HIV/AIDS is far from over, despite the “final meeting” on 17 July to resolve the matter.

According to Minister Manto Tshabalala-Msimang, KwaZulu-Natal failed to follow proper procedures as it should have submitted its proposal to the Global Fund to fight AIDS, TB and Malaria (GFATM) through the SA National AIDS Council (SANAC).

The fund’€™s rules stipulate that all proposals need to be fed to it through “country co-ordinating mechanisms” ‘€“ or bodies that are representative of all major health stakeholders in the country.

As South Africa does not have such a structure, the minister announced less than a week before the deadline for submission of proposals that SANAC would act as the country co-ordinating mechanism.

However, SANAC’€™s term of office expired in February. According to a spokesperson in the deputy president’€™s office, SANAC needs to be overhauled and its membership broadened so new members will be appointed only   after a restructuring workshop has been held. No date for this workshop has been set, and the national Department of Health continues to run SANAC’€™s secretariat from its HIV/AIDS Directorate.

This means that should the minister face a legal challenge to ensure that the grant to KwaZulu-Natal is released — as threatened by the Treatment Action Campaign — she may face problems given the questionable legal status of SANAC, the very body supposed to approve such proposals.

Meanwhile, GFATM spokesperson Melanie Zipperer was admanant that the KwaZulu-Natal grant could not be re-allocated to other provinces as suggested by a press statement following Wednesday’€™s meeting on the matter.

“The money allocated to KZN cannot be spent for anything else,” said Zipperer. “It cannot be mixed up (with the $93,3-million grant given to national government) or distributed in a different way. Money cannot be taken from KwaZulu-Natal and given to another province.”

Zipperer said that should national government want the R720-million grant to be spent in any other way, it would have to submit a new proposal to the Global Fund’€™s board and negotiate this new proposal with the board.

There is no guarantee that the board would agree to release the R720-million to South Africa, should government decide on this route.

However, Zipperer said that KwaZulu-Natal was not yet in danger of losing its grant as the GFATM had not yet received any official request from national government for the grant money to be reallocated.

She also indicated that it was “not yet time for the Global Fund to intervene” in negotiations between the minister and KwaZulu-Natal.

“According to fund procedures, the principle recipient of the fund has to identify a local fund agent, which can ensure that the money goes where it is supposed to go,” said Zipperer. “This local fund agent needs to be approved by the global fund, and can be any independent organisation or institution that can be responsible for monitoring the grant.”

Only if the local fund agency ‘€“ likely to be a local firm of auditors ‘€“ complained to the fund that grant money was not being spent as it should, would the fund intervene, said Zipperer.

However, the hurdle facing KwaZulu-Natal is that the national country co-ordinating mechanism has to either recognise the provincial structure that made the KZN grant as a provincial co-ordinating mechanism, or it has to approve the provincial proposal. Only then will the grant money be released.

Meanwhile, new guidelines published by the GFATM make it possible for provinces and states that are responsible for health delivery to apply directly for money rather than going via national structures. This was apparently introduced to avoid a situation where a national government attempts to centralise all grant applications, as is happening in South Africa.