Document of The World Bank FOR OFFICIAL USE ONLY Report No: 54060-BR PROJECT APPRAISAL DOCUMENT ON A PROPOSED LOAN IN THE AMOUNT OF US$67 MILLION TO THE FEDERATIVE REPUBLIC OF BRAZIL FOR THE AIDS-SUS PROJECT (NATIONAL AIDS PROGRAM - NATIONAL HEALTH SERVICE) April 16, 2010 Human Development Sector Brazil Country Management Unit Latin America and the Caribbean Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS Exchange Rate effective July 1, 2009 (Appraisal date) Currency Unit = Real (R$) R$ 1.00 = US$0.5122 US$1.00 = R$ 1.9525 Source: The World Bank FISCAL YEAR January 1 ­ December 31 ABBREVIATIONS AND ACRONYMS AIDS Acquired Immunodeficiency Syndrome API Active Pharmaceutical Ingredients ART Antiretroviral Treatment AZT Azidothymidine BSS Behavioral Surveillance Surveys CAPS-AD Center of Psychosocial Support for Alcohol and Other Drugs CD4 Cluster of Differentiation 4 CIT Tripartite Inter-managerial Commission CTA Centers of Testing and Counseling CNS National Health Council CONASEMS National Council of Municipal Health Secretaries CONASS National Council of State Health Secretaries CPLP Community of Portuguese Language Countries CPS Country Partnership Strategy CSO Civil Society Organizations DLI Disbursement-Linked Indicator DLOG Department of Logistics DSEI Indigenous Health Districts DST/AIDS Department of Surveillance, Prevention and Control of STD and AIDS, and Viral Hepatitis DU Drug User EEP Eligible Expenditure Program FIOCRUZ Oswaldo Cruz Foundation FNS National Health Fund FRL Fiscal Responsibility Law HIV Human Immunodeficiency Virus HTLV Human T-lymphotropic virus ICTC International Center for Technical Cooperation IDU Injecting Drug Users IE Impact Evaluation IFRs Project Interim Financial Reports IPPF Indigenous Peoples Planning Framework LA Loan Agreement ii LGBT Lesbian, gays, bisexuals, and transvestites M&E Monitoring and Evaluation MDGs Millennium Development Goals MERCOSUR Regional Trade Agreement among Argentine, Brazil, Paraguay and Uruguay MIC Middle-Income Country MOH Ministry of Health MONITOR-AIDS Monitoring and Evaluation MOP Project Operational Manual MSM Men Who Have Sex With Men MTCT Mother-to-Child Transmission NCD Non-communicable diseases NTCP National Tuberculosis Control Program OI Opportunist Infections PAM Results-Based Action Plans PDI Project Development Indicators PDO Project Development Objectives PLHA People Living with HIV/AIDS PMTCT Prevention of Mother-to-Child Transmission PNHV National Program of Viral Hepatitis POM Project Operational Manual PRODOC UN Project Document QUALISUS Health System Quality Improvement Project R&D Research and Development RBM Results-Based Management RDS Respondent-driven sampling SAS Secretariat of Health Care SCTIE Secretariat of Science, Technology and Strategic Supplies SE Executive Secretariat SES State Secretariat of Health SFC Secretariat of Federal Control SGEP Secretariat of Strategic and Participatory Management SGTES Secretariat of Management of Labor and Heatlh Education SIAFI Federal Government Financial Management Information System SIAIDS PAM Information System SICLOM Drug Logistics Management System SIDOR Integrated Budget System SIL Specific Investment Loan SIM Mortality Information System SIMOP Information System for Decentralized Transfers SINAN Disease Notification Information System SISCEL Lab tests information system SIS-Incentivo Incentive Policy Information System SMS Municipal Secretariat of Health SOE Statement of Expenditures STD Sexually Transmitted Diseases iii SUS Unified Health System SVS Secretariat of Health Surveillance SW Sex Workers SWAp Sector Wide Approach TCU Supreme Auditing Court UNAIDS Joint United Nations Programme on HIV/AIDS UNDCP United Nations International Drug Control Program UNESCO United Nations Educational, Scientific and Cultural Organization UN-TG United Nations Theme Group VCT Voluntary Counselling and Testing VIGISUS Disease Surveillance and Control Project WHO World Health Organization Vice President: Pamela Cox Country Director: Makhtar Diop Sector Manager: Keith Hansen Task Team Leader: Joana Godinho iv BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service CONTENTS Page I. STRATEGIC CONTEXT AND RATIONALE ................................................................. 1 A. Country and sector issues.................................................................................................... 1 B. Rationale for Bank involvement ......................................................................................... 6 C. Higher level objectives to which the project contributes .................................................... 8 II. PROJECT DESCRIPTION (Annex 4) ............................................................................... 8 A. Lending instrument ............................................................................................................. 8 B. Project development objectives and key indicators ............................................................ 8 C. Project components ............................................................................................................. 9 D. Lessons learned and reflected in the project design.......................................................... 14 E. Alternatives considered and reasons for rejection ............................................................ 15 III. IMPLEMENTATION .................................................................................................... 16 A. Partnership arrangements (Annex 2) ................................................................................ 16 B. Institutional and implementation arrangements (Annex 6) .............................................. 16 C. Monitoring and evaluation of outcomes/results (Annex 3) .............................................. 17 D. Sustainability..................................................................................................................... 18 E. Critical risks and possible controversial aspects ............................................................... 18 F. Loan/credit conditions and covenants ............................................................................... 21 IV. APPRAISAL SUMMARY ............................................................................................. 23 A. Economic and financial analyses (Annex 9) ..................................................................... 23 B. Technical ........................................................................................................................... 23 C. Fiduciary (Annex 7 and 8) ................................................................................................ 24 D. Social (Annex 1, 9 and 10) ............................................................................................... 25 E. Environment (Annex 9) .................................................................................................... 26 F. Policy Exceptions and Readiness...................................................................................... 26 v Annex 1: Country and Sector or Program Background ......................................................... 27 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies ................. 46 Annex 3: Results Framework and Monitoring ........................................................................ 52 Annex 4: Detailed Project Description ...................................................................................... 68 Annex 5: Project Costs ............................................................................................................... 76 Annex 6: Implementation Arrangements ................................................................................. 78 Annex 7: Financial Management and Disbursement Arrangements ..................................... 83 Annex 8: Procurement Arrangements ...................................................................................... 96 Annex 9: Economic and Financial Analysis ........................................................................... 104 Annex 10: Safeguard Policy Issues .......................................................................................... 111 Annex 11: Project Preparation and Supervision ................................................................... 124 Annex 12: Documents in the Project File ............................................................................... 125 Annex 13: Statement of Loans and Credits ............................................................................ 130 Annex 14: Country at a Glance ............................................................................................... 134 Annex 15: Map IBRD 37818 .................................................................................................... 136 vi BRAZIL AIDS-SUS PROJECT NATIONAL AIDS PROGRAM - NATIONAL HEALTH SERVICE PROJECT APPRAISAL DOCUMENT LATIN AMERICA AND CARIBBEAN LCSHH Date: April 16, 2010 Team Leader: Joana Godinho Country Director: Makhtar Diop Sectors: Health (100%) Sector Manager/Director: Keith E. Hansen Themes: HIV/AIDS (P); Health system performance (P); Managing for development results (P); Decentralization (S) Project ID: P113540 Environmental screening category: C Lending Instrument: Specific Investment Loan Project Financing Data [X] Loan [ ] Credit [ ] Grant [ ] Guarantee [ ] Other: For Loans/Credits/Others: Total Bank financing (US$m.): 67.00 Proposed terms: IBRD Flexible Loan (IFL) with variable spread option. Repayment schedule linked to commitments and all the conversion options. Payable in 30 years, including a 5-year grace period with a level repayment schedule with repayments on each May 15th and November 15th respectively. Financing Plan (US$m) Source Local Foreign Total Borrower 104.50 28.50 133.00 International Bank for Reconstruction and 66.00 1.00 67.00 Development Total: 170.50 29.50 200.00 Borrower: The Federative Republic of Brazil Responsible Agency: Ministry of Health - Department of Surveillance, Prevention and Control of STD and AIDS, and Viral Hepatitis SAF Sul Trecho 02, Bloco F, Torre 1, Térreo, Sala 12, 70070-600 ­ Brasília/DF Phone: (61) 3306-7138 vii Estimated disbursements (Bank FY/US$m) FY 2011 2012 2013 2014 2015 Annual 5.93 16.75 20.45 16.75 7.12 Cumulative 5.93 22.68 43.13 59.88 67.00 Project implementation period: September 1, 2010 to December 31, 2014 Expected effectiveness date: September 1, 2010 Expected closing date: December 31, 2014 Does the project depart from the CAS in content or other significant respects? Ref. PAD I.C. [ ]Yes [X] No Does the project require any exceptions from Bank policies? Ref. PAD IV.G. [ ]Yes [X] No Have these been approved by Bank management? [ ]Yes [ ] No Is approval for any policy exception sought from the Board? [ ]Yes [X] No Does the project include any critical risks rated substantial or high? Ref. PAD III.E. [ X]Yes [] No Does the project meet the Regional criteria for readiness for implementation? Ref. PAD IV.G. [X]Yes [ ] No Project development objective Ref. PAD II.C., Technical Annex 3 (i) Increase access and utilization of HIV/AIDS and STD prevention, care and treatment services by Groups Most at Risk; and (ii) Improve the performance of the National HIV/AIDS and STD Program through decentralized implementation, improved governance and results-based management. Project description [one-sentence summary of each component] Ref. PAD II.D., Technical Annex 4 Component 1: Improve surveillance, prevention and control of HIV/AIDS and STD. Component 2: Build decentralized governance and innovation capacity. Which safeguard policies are triggered, if any? Indigenous Peoples (OP 4.10) Ref. PAD IV.F., Technical Annex 10 Significant, non-standard conditions, if any: None As a condition of effectiveness, the Loan must be registered with the Central Bank of Brazil. The full list of covenants applicable to the project implementation is included in PAD III.F viii I. STRATEGIC CONTEXT AND RATIONALE A. Country and sector issues Key development issues 1. Since the emergence of the epidemic, Brazil has been a global leader in the response to HIV/AIDS. The country has achieved notable success in controlling the spread of the disease and preventing new infections. However, Brazil is now challenged to revisit its HIV/AIDS strategy in order to address a changing epidemic. Brazil, as a large country that is socially, economically and culturally complex, is witnessing changes in the epidemic`s profile that may be similar to changes that are happening on a narrower scale in other locations. As such, the country has the opportunity to remain at the forefront of the response to HIV/AIDS, as it embarks on designing innovative responses to the epidemic that can be applied to a variety of countries. The Government of Brazil has requested Bank collaboration on a unique program that further addresses the current evolution of the epidemic. 2. Although about one third of all people living with HIV in Latin America reside in 1 Brazil , the country has defied early dire predictions. In the early 1990s, the epidemic was increasing in Brazil at the same rate as in Africa. However, due to the efforts of civil society and Government, Brazil has been able to contain the epidemic at 0.6% of the adult population and has halved the number of AIDS-related deaths. While early Bank estimates indicated that Brazil would have 1.2 million people living with HIV/AIDS in 2000, the country has now an estimated 630,000 people infected; about 507,000 cases were notified since 1980, of which about 488,000 are presently followed by the Program; and over 190,000 people are on anti-retroviral treatment (ART), ensuring a median survival of 108 months, which is comparable to the survival rate in developed countries. Consequently, AIDS mortality has decreased from 6.3 to 5.1 per 100,000 between 2003 and 2007. Among children, the probability of survival after 60 months with AIDS increased 3.5 times. In the period 1997-2007, mortality decreased 50%, morbidity 77% and hospitalizations decreased from 81% of AIDS patients who had at least one hospitalization per year in 1997, to 19% in 2007, which saved up to R$ 1,1 billion. 3. The Brazilian epidemic is still concentrated in groups most at risk, with HIV prevalence above 5% among men who have sex with men (MSM), sex workers (SW), injecting drug users (IDU) and prisoners. Unprotected sex between men is estimated to account for about half of all HIV infections that are sexually transmitted in Brazil. In 2005, a study found a prevalence of HIV of 7.2% among MSM2. The incidence of AIDS in this group is 250 per 100,000, while among heterosexual men it is 27 per 100,000. A 2007 study found a prevalence of HIV of 5.7% among prisoners3. Injecting drug users (IDU) and sex workers (SW) are also at significantly increased risk of infection as compared with the population in general. However, HIV prevalence among IDU in Brazil has declined in some 1 UNAIDS 2007. 2 Mello MB et al 2008. 3 Coelho HC 2004. 1 cities as a result of harm-reduction programs, a shift from injecting to inhaling drugs, and mortality among drug users4. The Department of Surveillance, Prevention and Control of STD and AIDS (DST/AIDS)5 is finalizing studies among MSM, SW and IDU that will provide additional information on HIV-related knowledge, attitudes, and practices, and sero- prevalence of HIV and STD among these groups. Preliminary evidence shows a high prevalence of HIV and other STD among sex workers. The results of the ongoing studies will form the basis for increased activity involving these groups, which continue to be considered key for successful prevention and control of the epidemic in Brazil. In addition, the DST/AIDS works with other key groups, including prisoners and people living with HIV (PLHA). 4. Brazil is facing an evolving epidemic, with different epidemiological profiles emerging that may require distinct responses involving specific groups most at risk and regions of the country. In recent years, the epidemic has been spreading to females, poorer groups, and towards the interior of the country. In 1985, for every 15 cases of HIV infection among men in Brazil, one was reported among women. Since then, the epidemic has spread more rapidly in women, and the male-female ratio decreased from 15:1 in 1986 to 1.5:1 in 2007. While the risk of infection for a man 13-39 years decreased, the risk for women, especially at younger ages, increased significantly. In the age group 13-19, the gender ratio was 0.6:1 in 2006. Heterosexual transmission is now more important for both genders. It is estimated that a large proportion of infections among women can be attributed to the behavior of their male sexual partners6. Although most cases are still located in the South and Southeast, the number of notified cases decreased in these regions, while it significantly increased in the North and Northeast. The epidemic is expected to continue to grow in the North, Northeast and Center-West regions, where sexual activity starts at younger ages, use of condoms and testing is lower, and health services and socio-economic conditions are more precarious. The risk of dying one year after an AIDS diagnosis in the least developed regions (North and Northeast) is three times higher than in the most developed region of the country (Southeast), which indicates very late diagnosis. 5. The Government has invested heavily in the prevention and treatment of HIV/AIDS and other sexually transmitted diseases (STD), providing condoms to groups most at risk, and antiretroviral treatment to all identified patients who qualify for it, free of charge. The Government has put in place a solid institutional framework, which has been strongly supported by partnerships with state and local Governments and a wide range of Civil Society Organizations (CSO). Bank-financed projects contributed to increase accessibility to condoms, double the number of testing and counseling sites and increase the number of HIV tests performed; and to strengthen the services and laboratory network to provide care for PLHA, enabling the implementation of the policy on universal access to ART. The program decentralized and initiated integration into primary health care; it has developed technologies that allow for more efficient and decentralized action against the 4 Hacker, Leite, Friedman, Carrijo and Bastos 2009; UNAIDS and WHO 2006. 5 The Department has been recently established through the Decree #6860, and replaces the former National Program which was established by Portaria in 1985. 6 Silva, Barone 2006 2 epidemic; and established MONITOR-AIDS to monitor, evaluate, and report on program and project results.7 Brazil AIDS: an Evolving Epidemic Groups most at risk HIV prevalence rate o Population: 0.6%8: o Men: 0.8%: o Women: 0.4% o MSM: 0.6%-32%, with most studies reporting prevalence 4%-24%9. o SW: 0%-9%, with a national study showing an aggregate of 6.1% prevalence in this group 10. o IDU: 36-82% national studies with samples of more than 200 subjects conducted 1998-200111. Higher rates of HIV incidence and prevalence among MSM involved in sex work. AIDS incidence: 33,000 new cases/year Relative risk of AIDS among MSM 15 times higher than among heterosexual men. 12 AIDS incidence in IDU males 110 times higher than in heterosexual men in 1995, 15 times higher in 2004. 13 Regional vulnerability AIDS mortality rate: since 2006, about 6/100,000 with an effective reduction in the Southeast, stabilization in the South, and growth in the North, Northeast and Midwest. AIDS incidence rate: since 2002, stabilizing at high levels in the South, slight reduction in the Southeast and increasing trend in the North, Northeast and Midwest. Syphilis prevalence rate among conscripts 17-20 years: 43% higher in the North, Northeast and the Midwest than in the South/Southeast. HIV prevalence rate among conscripts 17-20 years: in 2007, 76% higher in the North, Northeast and the Midwest than in South and Southeast. STD symptoms among people 17-20 years: highest percentages in the North and Northeast. STD symptoms among conscripts: highest percentages in the North and Northeast. HIV Testing rates: in 2008, 41% of people 15-64 years in the Southeast, 39% in the South, 32% North and 27% in the Northeast.14 HIV Testing in pregnant women: in 2006, 85.8% in the South, 46% in the North and 40.6% in the Northeast. Syphilis testing in pregnant women: 86.8% in the South and 64.2% in the Northeast. Proportion of HIV patients with an initial CD4 less than 200 cells per mm3 without treatment: 28% in the South, 31.5% in the Southeast, 38% in the Midwest, 36.5% in the Northeast and 40.5% in the North, which suggests late diagnosis in these last three regions. 15 Percentage of individuals with correct knowledge about HIV/AIDS: 58.7% in South and Southeast, 52.7% in the North and 54% in the Northeast. 16 In the North, a larger proportion of sexually active people (93.6%) with initiation before the age of 15 (31%), lower age at first sexual intercourse (15.8 years), with more than one partner in life (70.9%) and over 10 partners in life (27.6%). Access to and use of condoms 30% population has access to free condoms. In 1986, 9% population reported use of condom in the first sexual intercourse; in 2008, about 61%. However, use of condom declined in the period 2004-2008, while causal sex increased. 7 http://sistemas.aids.gov.br/monitoraids2 8 Szwarcwald et al 2008, Pascom et al 2009. 9 Malta et al. 10 Idem. 11 Idem. 12 Barbosa Jr et al 2008. 13 Idem. 14 Brazil 2008. 15 Souza Jr et al 2007. 16 Brazil 2008. 3 6. Despite the program numerous achievements, significant challenges persist, relating, among others, to poor coverage of groups most at risk (MSM, SW, IDU), the evolving epidemic with different profiles throughout the country, increased expenditures and other needs posed by PLHA survival, developing M&E capacity at all levels, and weak fiduciary capacity at decentralized levels. In addition, like all sectors, health is affected by general issues of governance failures, notably the lack of incentives and accountability. The program is moving towards a renewed focus on traditional groups most at risk (MSM, SW, IDU, prisoners), while identifying and reaching new groups most at risk (young homosexual men who do not participate in traditional networks, young women), in underserved regions (either poorer areas in the South and Southeast or the North and Northeast); further developing surveillance, R&D and M&E, in a way that can serve as a model for other programs; and integrating the national response to HIV/AIDS into the overall health system.17 7. As HIV/AIDS has become a chronic condition, the DST/AIDS has begun moving towards a more horizontal organization, coordinating and integrating its services into the national health system (Sistema Único de Saúde ­ SUS). Important synergies have been achieved through collaboration with other health and social programs, such as the Brazilian surveillance and primary health care programs. The Family Health Program began to raise awareness about prevention of HIV and other STD at the primary care level, while the National Anti-Drug Secretariat included HIV prevention and control in its national policy. However, this work needs to be further developed. 8. The Brazilian health system is complex and multi-layered. The states have responsibility for coordination and oversight, and municipalities are responsible for the organization and provision of surveillance, prevention and mostly primary health care. Brazil`s health sector encompasses two main systems: the publicly-financed and managed Sistema Único de Saúde (SUS), a national health service, which was established by the Constitutional Reform of 1988; and a system consisting mainly of private insurers and prepayment plans. SUS is a complex system of shared but often ambiguous responsibilities among federal, state, and municipal Governments. Health policies are implemented through negotiated agreements with state and local authorities and through co-financing arrangements among the three levels of Government. The federal Government, through the Ministry of Health (MOH), is responsible for designing and regulating national health policies. SUS includes a subsystem for Indigenous Health. 9. The DST/AIDS has decentralized activities to states and municipalities, including training and capacity building. Supporting enhanced capacity in states and municipalities has not only helped to ensure sustainability of program activities, but also supported the Government`s policy of social service decentralization. Results-based Action Plans (Planos 17 First generation AIDS programs primarily supported awareness and prevention among groups most at risk and the general population, as well as treatment and care in the most affected countries (World Bank 2005). Second generation programs aimed at dramatically increasing access to prevention, care and treatment, with an emphasis on groups most at risk. A key feature of second generation programs is direct support to community organizations, CSO, and the private sector for HIV/AIDS activities. As HIV/AIDS has become a chronic disease, third generation AIDS programs aim at ensuring universal access to prevention and treatment services in the context of a strengthened health system. 4 de Ações e Metas ­ PAM) were the primary vehicle for the decentralization process. The PAM were developed by the Federal District, the 26 States and until now 481 municipalities (out of 5,560), which cover over 90% of reported AIDS cases. In 2007, 75% of the states and municipalities achieved at least 75% of PAM targets. The decentralization process included financing about 1,500 CSO subprojects. Difficulties in the implementation of PAM relate to some state and municipal administrations not considering STD and HIV/AIDS a top priority, and administrative difficulties such as carrying out program procurement, and lack of capacity at decentralized level. 10. The DST/AIDS is committed to improving the program's governance throughout the three levels of implementation (federal, state and municipal), aiming at increasing its effectiveness. This will involve paying more attention and allocating more resources to further establish an evidence-based culture, increase transparency and accountability, and build incentives such as performance-based financing of the agreements with states, municipalities and CSO. As new epidemiological data is now becoming available, and as there are many stakeholders to be coordinated in the HIV response, an evidence-based, multi- sectoral AIDS strategy is of utmost importance to guide the program at federal and decentralized levels. 11. Establishing an evidence-based culture requires strong monitoring and evaluation, anchored on surveillance, research and other M&E activities. Brazil has invested heavily in a wide range of HIV activities, involving a highly decentralized array of actors. This is believed to have contributed to the country's success in keeping a low prevalence rate of HIV. Important building blocks` are already in place to monitor the epidemic and program activities, which can be drawn on and consolidated into a systematic approach. However, the program`s impact has not been evaluated, among other reasons because it is hard to disaggregate the impact of individual programs or interventions. The project will include an impact evaluation of program activities to assist establishing a stronger evaluation culture in the DST/AIDS. In addition, this is a timely opportunity for Brazil to contribute to the currently ongoing work at the global level linked to the UNAIDS M&E Reference Group, serving as a model for M&E implementation in other countries. 12. As Brazil faces this next generation of challenges in addressing the HIV epidemic, the Government seeks continued Bank support. The Government approved and sent to the Bank a proposal (Carta-Consulta) for a new $200 million project co-financed by a Bank loan of $67 million. To tackle the outstanding challenges, the Program defined the following priority areas for action under the project: · Groups most at risk and vulnerable contexts, focusing on the North, North-East, and Center-West of the country; · Evidence-based management and program quality aiming at increasing efficiency and effectiveness; · Development of HIV/AIDS and other STD networks to improve transparency, accountability and social control; · Performance-based financing of the project, PAM and CSO agreements; 5 · R&D and technology innovation to ensure sustainability in the area of second generation information systems and information technology, national production of inputs, and vaccine; and · International cooperation, especially South-South Cooperation with MERCOSUR and Lusophone countries. B. Rationale for Bank involvement 13. The Government attaches a high level of importance to this project, in the context of a continued partnership to prevent and control HIV/AIDS, and to strengthen the health system. The changing global health financing architecture has made significant grant funds available for HIV/AIDS globally. However, the Bank is the only significant external source of financing for HIV/AIDS in Brazil. In addition, the Government has explicitly sought Bank support by virtue of the continued collaboration and "embedded knowledge" about HIV/AIDS in Brazil and elsewhere. Bank involvement is key on two fronts: further strengthening of an evidence-based health system and public sector reform. The Bank participation facilitates work with groups most at risk, and it brings to the fore the Bank`s substantial know-how on health system strengthening, program governance and public sector management, and on M&E. 14. The project will complement previous Bank assistance to the prevention and control of HIV/AIDS and STD in Brazil. The Bank has provided substantial technical and financial support to the Program since 1988, with total lending for AIDS-related projects of US$ 432 million, having contributed to the many achievements of the program and innovation. The proposed AIDS-SUS project will improve the program performance by (i) putting in place a robust surveillance and M&E system, which can serve as a model for other programs and health systems; (ii) coordinating and integrating provision of prevention and care with primary health care programs (Atenção Básica and Saúde da Família) to respond to the changing epidemic; and (iii) implementing a performance-based financing mechanism to transfer funds to states, municipalities and CSO. 15. The proposed project will also complement activities undertaken by other Bank- financed health projects - VIGISUS, Family Health and QUALISUS ­ to strengthen the health system as a whole. The Bank has extensive experience in assisting countries in Latin America and other regions to strengthen health care systems, including through the establishment of primary health care and modernization and rationalization of the hospital sector. In Brazil, the Bank`s experience in health system development will allow it to assist the AIDS Program to continue decentralization in order to guarantee increased access for groups most at risk, including the poorest and most remote populations. 16. The new project aligns closely with the current public sector reform processes underway in Brazil. A reform movement has been sweeping Brazil`s public sector, aimed at making decentralized Government more responsive to demands for services and more accountable to citizens. The so-called Choque de Gestão (Management Shock) model, first launched by the Government of Minas Gerais, involves securing a healthy macroeconomic and fiscal situation, improving efficiency and service quality in key sectors 6 that account for a significant part of state expenditures, and committing the state Government to measurable results, among other managerial innovations. The Ministry of Health has been engaged in the development of results-based management in the context of decentralization to states and municipalities for several years. States that are successful should be rewarded and efforts should be redoubled for those that are lagging behind. The project will support the DST/AIDS to further develop results-based financing to states, municipalities and CSO. In addition, Bank support is sought to assist Brazil in addressing the persistent issue of capacity within national, state and municipal institutions. The problems with M&E and procurement in the prior projects revealed some systemic areas of weakness and reinforce the urgency of capacity-building in these areas. 17. Successfully navigating these challenges will keep Brazil in the forefront among developing countries as it transitions from a single-disease focus to a more systemic approach. Much has been done and learnt in Brazil that has been used in other countries. Bank`s engagement will continue facilitating learning from the Brazil AIDS Program. The DST/AIDS has been cooperating with other countries, especially in the context of MERCOSUR and Lusophone countries (CPLP). By further developing the work with groups most at risk, based on evidence and results-based management, the Brazilian program will serve as a model to other programs dealing with the same issues in the context of South- South cooperation. 18. The proposed project is in alignment with the World Bank Group's Country Partnership Strategy 2008-2011 (Report # 42677-BR) discussed by the Executive Directors on May 1, 2008, and the Progress Report (Report #53356-BR) discussed by the Executive Directors on April 20, 2010. The CPS envisages less Bank involvement in single-disease projects and potentially more activity in strengthening the health system as a whole, greater engagement at the sub-national level and improving accountability and expenditures. Among the key health programs in Brazil, the national STD and AIDS Program is arguably the most advanced in establishing an evidence- and results-based culture. Although the project is disease-focused, it will contribute to the ongoing public sector management reform in the Ministry of Health, and to strengthen the health system in Brazil. 19. The proposed project follows Bank/IEG recommendations for Bank investment in middle-income countries (MICs), as follows: Focusing on (i) reducing inequalities, especially in the social sectors; (ii) and combating corruption, through improving procurement and financial management programs. Supporting and strengthening MIC own programs. This project is built on the client`s own reform agenda, programs and indicators. Demonstrating and sharing best practices, and transferring knowledge. The project design benefits from inputs from other results-based SWAPs in Brazil, and lessons learned from this project may be useful to other Bank clients in Brazil and elsewhere. Being more agile. The Project`s sector-wide approach follows the Government`s agenda and systems, which allows for more efficient preparation and implementation, while reinforcing the Government`s agenda of strengthening the results orientation of its sectoral programs. 7 As it happens with subnational SWAP projects, the proposed federal project will contribute to the ongoing public sector management reform in Brazil, and it will similarly follow a SWAP approach18, contributing to further development of this innovative instrument. C. Higher level objectives to which the project contributes 20. The Government and the Bank have established a strong partnership for prevention and control of HIV/AIDS and STDs in Brazil. Previous successful projects have contributed to the establishment of key components of the program. This project will contribute to (i) decreasing the risk of HIV and STDs in a context of diverse epidemics throughout the country; (ii) strengthening the health system; and (iii) improving the effectiveness and efficiency of the public sector in Brazil. The proposed project will also contribute to advance Brazil`s progress on the Millennium Development Goals (MDGs). Similarly to other federal and subnational projects in Brazil, this project will also contribute to the ongoing shift towards country systems. II. PROJECT DESCRIPTION (Annex 4) A. Lending instrument 21. The project will co-finance the Brazil STD and AIDS Program with a Specific Investment Loan (SIL) of US $67 million to be disbursed in four years (2011-2014). The project will follow a Sector Wide Approach (SWAp), with the loan co-financing a percentage of Government Eligible Expenditure Programs (EEP), results-based grants and training and technical assistance. Disbursements will be triggered by the execution of the agreed programs and achievement of specific results targets. The project will use Government systems and procedures, both to foster ownership and to strengthen MOH, state and municipal institutional capacity. B. Project development objectives and key indicators 22. The proposed project development objectives (PDOs) are the following: (i) Increase access and utilization of HIV/AIDS and STD prevention, care and treatment services by Groups Most at Risk; and (ii) Improve the performance of the National HIV/AIDS and STD Program through decentralized implementation, improved governance and results-based management. 23. The project will track 1 Global Indicator and 11 Project Development Indicators (PDIs) to measure progress towards achievement of the PDOs and to trigger disbursements - Disbursement-Linked Indicators or DLIs. Another 9 indicators will also be linked to disbursements. The remaining indicators (17), while not linked to 18 In this project, the use of the term SWAp refers to (i) co-financing of a significant public sector program through budgeted programs (Eligible Expenditure Programs); (ii) results-based financing from the Bank to the federal Government, and from the federal Government to states, municipalities and CSO; and (iii) increased use of countrysystems. 8 disbursements, will measure implementation progress and contribute to substantive dialogue between the Government and Bank during project implementation. All indicators and respective protocols are included in the Project Operational Manual and in Annex 3. Progress toward meeting all indicators will be tracked and reported systematically under the project. BRAZIL AIDS-SUS PROJECT Project Indicators Baseline 2008 Global Indicator At least 70% execution of project Eligible Expenditure Programs (EEPs). NA Project Development Indicators Increase access and use of prevention, care and treatment services by groups most at risk 1 15% increase of MSM reporting the use of a condom the last time they had sex in the last TBD year 2 10% increase of sex workers reporting the use of a condom with their most recent client. 90.1% 3 15% increase of DU who report the use of a condom at last sexual intercourse. TBD 4 49% PLHA accessing condoms. 35% 2007 5 70% prisoners accessing condoms. 58% 2008 Improve Program Performance through decentralization, improved governance and RBM 6 85% SES (27) reaching at least 70% of PAM targets. 50% 2008 7 66% SMS Capital city (26) reaching at least 70% of PAM targets. 39% 2008 8 20% increase in SES with institutional site information on STD and HIV/AIDS TBD (epidemiological and financial). 9 20% increase in SMS capital city with institutional site information on STD and TBD HIV/AIDS (epidemiological and financial). 10 85% CSO with results-based contracts. 2.5% 2009 11 National HIV/AIDS Strategic Plan 2014-2019 based on project-generated evidence NA available on the web. C. Project components 24. The Project consists of the following Components: Component 1. Improving surveillance, prevention and control of HIV/AIDS and STD (a) Support the implementation of the Eligible Expenditure Programs, including activities to: (i) improve surveillance, prevention, diagnosis, and treatment of STD and HIV/AIDS for Groups Most at Risk; and (ii) carrying out strategic planning, monitoring and evaluation, and results-based management; (b) Support the carrying out of Result-based Grants. 9 Component 2. Building decentralized governance and innovation capacity (a) The expansion of the prevention and care services for Groups Most at Risk and the strengthening of the institutional capabilities of DST/AIDS to further develop its governance and innovation capacity in dealing with HIV/AIDS and STD, through the provision of technical assistance and training which shall aim at carrying out, inter alia, the following activities: (i) the mapping, by region, of epidemic and prevention interventions with Groups Most at Risk; (ii) the production and testing of epidemiological data (triangulation); (iii) the development of monitoring and evaluation and results-based activities, including, the carrying out of at least three impact evaluations; (iv) the carrying out of training programs for staff of the Borrower (DST/AIDS), States, Eligible Municipalities and Eligible CSOs, to strengthen their technical and institutional capacity in, inter alia: strategic planning, results-based management and monitoring and evaluation, and fiduciary management; (v) the improvement of the contents and implementation of the Incentive Policy; (vi) the elaboration and implementation of a plan to assist DST/AIDS in the communication, to the public-at-large, of a variety of areas supported by the Project, inter alia : (A) the expansion of social participation, transparency and accountability in the formulation of policies regarding HIV/AIDS and STD; and (B) the development of mechanisms for the proper disposal of non-biodegradable condoms; and (vii) the provision of consultants` services to carry out technical audits under the Project. (b) The carrying out of a series of activities, through the provision of technical assistance and training, aimed at strengthening the capabilities of the Borrower (through DST/AIDS), the States, the Eligible Municipalities, the DSEI, and the Borrower`s entity responsible of Indigenous Peoples health, to adequately respond to the health needs of the Indigenous Peoples and control the expansion of HIV/AIDS and STD among said peoples (as set forth in the Indigenous Peoples` Planning Framework and the Indigenous Peoples` Plan, if applicable), including, inter alia, the following: (i) the provision of technical assistance to State and Eligible Municipality Health Secretariats to support DSEI in improving HIV/AIDS and other STD prevention, diagnosis and treatment activities in respect of indigenous populations; (ii) the carrying out of monitoring of the implementation of the DSEI plans on HIV/AIDS and other STD, including the creation of specific monitoring indicators; and (iii) the carrying out of a review and dissemination of the findings of the 2009 evaluation of DST/AIDS activities and repeating such evaluation in the second year of Project implementation. (c) Provision of support for Project coordination, through the provision of technical assistance, financing of incremental operating costs, and provision of the necessary goods and equipment required for such coordination. 10 BRAZIL AIDS-SUS Project Components Component 1(a). Improve Surveillance, Prevention and Control of HIV/AIDS and STD for Groups Most at Risk Areas ­ Support the implementation of the EEPs Policy Formulation Develop policies, guidelines and technical regulations for the health care network to better and Regulation reach groups most at risk; improve the logistical system that provides condoms and drugs. Surveillance Improve behavioral and seroprevalence surveillance of HIV/AIDS and other STD, prioritizing groups most at risk and PLHA. Information Further develop program M&E; coordinate epidemiological surveillance, R&D and M&E; Management monitor and evaluate R&D; and develop tools and processes to make the information available to key stakeholders. Research & Promote R&D in innovative, priority areas to better reach vulnerable populations, and to Technology develop vaccines and other prevention products; develop cooperation between research Innovation institutes, private sector and development agencies; and assess technology. Decentralized RBM Establish results-based financing of STD and HIV/AIDS programs in states, municipalities and CSO, on surveillance, M&E, prevention, treatment and care. Network Further organize a network of care integrating primary, secondary and tertiary care to Organization expand the provision and improve the quality of services in the areas of prevention, diagnosis and treatment of STD and HIV/AIDS, focusing on groups most at risk. Transparency, Strengthen social participation in the formulation and control of policies for HIV/AIDS and Accountability, other STD, and increase transparency and visibility of program inputs, processes, activities Social Control and results. National & Develop national and international networks to improve the national response focusing on International groups most at risk; integrate the efforts of the relevant health subsectors, especially those Cooperation linked to surveillance, primary health care, and reproductive health, as well as public and private sectors and civil society; and increase South-South cooperation, especially in the context of MERCOSUR and CPLP. Component 1(b). Support the carrying out of Result-based Grants Governance & Results-based grants for State and Municipal Secretariats (SES and SMS, respectively) and management CSO, and individual providers, namely to focus on groups most at risk. Component 2. Build Decentralized Governance and Innovation Capacity Surveillance Mapping the epidemic and prevention activities. M&E Annual Independent Verification Agency Impact evaluation of Interventions to decrease risk among groups most at risk Results-Based Financing Fiscal impact of the program, focusing on ART Governance & Capacity-building in strategic planning, project management and M&E for DST/AIDS, management SES, SMS and CSO. Development of an output-based cost-accounting system for PAM Transparency & Communication, Accountability and Participation Plan Accountability Indigenous Technical assistance to SES and SMS to support DSEI improving STD and HIV/AIDS Populations prevention, diagnosis and treatment interventions. Environment Communication strategy for proper disposal of non biodegradable condoms (mainly feminine condoms); system of payment for environmental services to protect the forest and its biodiversity. FM Implementation of FM Action Plan. Procurement Implementation of Procurement Action Plan; Modernization of procurement processes. 11 25. The DST/AIDS will reach out to groups most at risk in their networks and communities, and improve governance at all levels. The project will contribute to the development of relevant policies, guidelines and technical regulations for the health care network; and provide incentives to the health system at federal, state and municipal level, and to CSO, to better serve the needs of groups most at risk. Transparency, accountability and social control will be improved by promoting performance-based management, and organization of services involving relevant networks. The surveillance gaps to be covered by the project are: estimates of HIV incidence; systematic estimates of the size of populations most at risk; systematic behavioral and seroprevalence surveys of groups most at risk; mapping of HIV/AIDS and STD, groups most at risk and interventions to prevent and control the epidemic; and systematic surveillance of STD. Monitoring and evaluation of HIV/AIDS and STD will continue to be promoted throughout the program to induce the establishment at all levels of an evidence and results-based culture. Results-Based Financing 26. The project will follow a results-based financing approach, with loan funding of about 33.5% of total project costs contributing to the implementation of agreed policies and programs, and to the achievement of specific results, which will trigger disbursements. Project indicators have been discussed during project preparation to ensure that Disbursement-Linked Indicators (DLIs) present a challenge, but are not so ambitious as to represent a high risk of failure in terms of project implementation and achievement of PDOs. An evaluation of performance-based financing under the project - from the Bank to the federal Government, and from the federal Government to states, municipalities and CSO - will be carried out during project implementation. 27. Under Component 1 (a), disbursements will be triggered by progress on key project development indicators and will be made against Eligible Expenditure Programs (EEPs in Annex 5). Eligible Expenditure Programs will be annually budgeted and formally approved by the Government, appearing with a budget code. It was agreed that budget code numbers may change under budget law provided that there is no change in the activities and objectives of the corresponding EEPs. DST/AIDS financial systems will track and report EEP budget estimates and actual expenditures, which will enable the use of program systems for purposes of financial management. Reimbursement of actual expenditures under Component 1 (a) for the previous semester will be made every semester, in June and December of each year. The first disbursement will take place 10 months after Project effectiveness. Amounts to be disbursed every semester under Component 1 (a) are indicated on Annex 7. 28. Compliance with disbursement and monitoring indicators will be measured every semester, as follows: Once a year, determine whether the project meets the 70% expenditure rule on the respective EEPs. If execution of EEPs is lower than 70%, disbursements will be pro-rated according to the level of execution of those EEPs (e.g. 66% execution of an EEP will lead to 66% of planned disbursement for that EEP). Every semester, determine whether the DLI targets have been met. If a specific DLI target is not reached, US$ 1 million will be deducted from the disbursement for the 12 semester. For each DLI target not timely achieved, the DST/AIDS and Bank will agree on a time-bound Action Plan. Disbursement will take place when either the DLI target is achieved; a time-bound Action Plan agreed between the DST/AIDS and Bank is satisfactorily implemented, or both. In case of achieving the 70% rule for both EEPs for the yearent, and DLI targets are fully achieved for the semester and subsequent, the Bank may disburse 100% of both semesters. In the event that the DST/AIDS accelerates project implementation by increasing execution to more than 100% of 2 EEPs for a certain semester and achieving all DLI targets plus 1 DLI target earlier than expected, then the Bank may increase the planned disbursement for the semester by US$1 million. If the 70% of the EEPs are not met and no DLI target is achieved, no disbursement will take place for the semester. The corresponding disbursement will be postponed until the target is achieved in a manner satisfactory to the Bank. BRAZIL AIDS-SUS: Awards and Penalties for Indicators not met Indicators Measurement Remedy EEPs included in the Annual Disbursement for the year will be pro-rated according to project execute at least level of execution of each EEP. 70% every year. DLIs Every Semester If EEP execution is over 100% for a certain semester and all DLI targets are achieved and 1 DLI target is achieved earlier than expected, then the Bank may increase the planned disbursement for the semester by US$1 million. DLIs Every Semester If a target is not achieved, US$ 1 million will be deducted from the disbursement for the semester. Disbursement will take place when either the DLI target is achieved; a time-bound Action Plan agreed between the DST/AIDS and Bank is satisfactorily implemented, or both. 29. Additional incentives will be established under the project for the DF, States, Municipalities and CSO, which will be financed under Component 1 (b). The MOH transfers funds to states and municipalities for health surveillance, prevention and treatment, under the Incentive Policy.19 Transfers are based on demographic, epidemiological and local priorities criteria. Funds are allocated to the results-based Agreements (PAM) between the DST/AIDS, states and municipalities. Preliminary criteria were agreed for annual awards and penalties to SES, SMS and CSO according to performance (Annex 4). 30. In addition to DST/AIDS reporting, annual financial audits and procurement post reviews, and Bank implementation support including supervision missions every semester, independent technical reviews will be carried out annually to certify achievement of agreed results. The DST/AIDS will send Project Progress Reports and disbursement requests (supported by the most recent Interim Financial Reports) to the Bank every calendar semester after the effectiveness date, in June and December of each year. Bank supervision missions will review budget allocations and execution, and project results 19 The Incentive Policy was created through Portaria 2313, dated December 19, 2002. Details of such Policy can be found at: http://www.aids.gov.br, Política de Incentivo. 13 prior to disbursements. In addition, the project will contract an independent organization (university, private sector, and/or UN agency) to undertake technical reviews of agreed results once a year prior to disbursement. D. Lessons learned and reflected in the project design 31. Confronting the sensitive issues that surround HIV/AIDS is critical for program success. Although a predominantly religious country where traditional mores still prevail in many regions, Brazil confronted the sensitive issues surrounding HIV/AIDS without flinching. Effective prevention activities require that communication strategies directly discuss delicate subjects that had previously been absent from public discourse. Issues such as having multiple sex partners, homosexuality and drug use were brought out into the open by Government activities that directly involved groups most at risk like MSM, SW and IDU. By 2005, the DST/AIDS was distributing 20 million free condoms a month, a number that doubled during Carnival. In 2007, the DST/AIDS purchased one billion condoms for free distribution. 32. Strong, sustained political will is a necessary (but not sufficient) requirement for a successful HIV/AIDS program. In Brazil, the Government recognized the threat inherent in the HIV/AIDS epidemic at an early stage, and established the DST/AIDS to manage the crisis. Leadership on confronting and handling the issue came from the highest levels of the Government and strategy, urgency and money flowed down from the top. The mandate for action from the top levels of Government meant that participation could be demanded from line ministries and other Government actors. 33. Treatment saves lives and money, but should not be promoted at the cost of prevention, which should remain the program`s highest goal. While Brazil`s treatment program clearly has saved lives, it has also saved money. The cost of ARV treatment is lower than estimated hospital costs for patients if they had not received treatment. However, its other effects must be managed carefully. Treatment does carry the risk of drug resistance, so treatment regimens must be closely managed and monitored. 34. HIV/AIDS is a complex epidemic which demands a robust response that will rely heavily on existing institutions. An effective response program will utilize talent and capacity from the national health system, so a country with a more developed health network will be able to more easily establish and expand an HIV/AIDS response program. Other systems needed by an HIV/AIDS program include high-functioning logistics, sophisticated testing facilities, reliable and robust information systems, communications and media that reach the entire country, effective M&E and experienced data analysis. Less developed countries may not be able to replicate the success of Brazil`s program until such peripheral programs or inputs are developed and/or expanded. 35. Weak institutional capacity can affect project outcomes. Even though Brazil is a sophisticated country and is recognized as a global leader on HIV/AIDS, progress can be hampered by weak institutional capacity. The limited capacity in procurement within the MOH, SES and SMS, affected more than procurement of project inputs such as condoms. Critical information such as surveys and research projects were also delayed, in many cases 14 to the point of the DST/AIDS being unable to provide data on key indicators at project`s end. Weak capacity at decentralized levels is also critical and can affect project outcomes. 36. Integration of HIV/AIDS activities with those of other health actors and institutions increases impact and sustainability. The integration of HIV prevention and treatment services into the package of services commonly available at primary health care centers was a particularly effective strategy and led to significant increases in demand, access and utilization of HIV/AIDS and other STD services among beneficiary populations. Brazil`s challenge going forward will be to integrate HIV and AIDS activities even more fully within the overall health system. Appropriate starting points are the Surveillance, Family Health and Basic Care Programs, which focus on issues such as the information basis available for decision making in the health sector, women`s health, STD treatment and control of tuberculosis. 37. CSO play a critical role in AIDS programs. Brazil has been a leader in collaboration between the Government and civil society organizations (CSO). By the end of 2007, more than 1,500 CSO had implemented program activities. For national HIV/AIDS programs, including such organizations can be not only a smart financial move (CSO often have a better record of effective spending than Governments), but it can also ensure that regional trends and issues are included in strategies and objectives set at the national level. Finally, CSO often hold regional and central Governments accountable for their actions and their spending decisions, helping to ensure transparency and effectiveness. 38. A multi-sector approach can increase the reach and effectiveness of program activities. In Brazil, the DST/AIDS approach involves key ministries that are critical to the program`s ability to reach certain populations and geographic locations. The national response includes such essential players as the Ministry of Education, Transport and the Defense Ministry. The latter has played a particularly significant role in some remote areas of Brazil, where the national army is the only Government institution in that location, and is thus the only actor that can carry out education and prevention activities among remote populations, including indigenous groups. 39. Decentralization often progresses unevenly, depending on variable capacity among state or municipal-level actors. The DST/AIDS has increased monitoring and supervision, training and technical assistance to weaker states and municipalities. The turnover of staff within the Program, both at the national and municipal levels hindered past project performance. Wide scale staff turnover could put the sustainability of any intervention at stake, especially when large numbers of civil servants change jobs after national elections. This is an issue that affects the Brazilian public system as a whole, but the MOH is starting to take steps to correct this issue. E. Alternatives considered and reasons for rejection 40. A "no-project" alternative was considered but, as previously mentioned, the Government attaches a high level of importance to this project, in the context of a continued partnership to prevent and control HIV/AIDS, and to strengthen the health 15 system. The Bank participation facilitates work with groups most at risk, and it brings to the fore the Bank`s substantial know-how on health system strengthening, program governance and public sector management, including on M&E. 41. The possibility of a follow on project, with traditional expense-related disbursement, was considered. However, the proposed project represents a significant departure from the design of previous projects. Given the flexibility that a SWAp-style SIL brings, as well as the accountability of results-based financing, it was considered that this type of lending instrument was more appropriate than a traditional SIL. 42. The possibility of increasing the scope of the project was also considered. SWAp projects usually cover an entire sector or even several sectors. The Ministry of Health and the Bank considered enlarging the scope of this project to cover surveillance, prevention and control of other communicable and non-communicable diseases. However, this would require the approval of a new Carta-Consulta, which would take months, and significantly delay action on STD and HIV/AIDS. Instead, the project will focus exclusively on supporting the DST/AIDS towards the full development of a third generation HIV/AIDS and STD Program. III. IMPLEMENTATION A. Partnership arrangements (Annex 2) 43. The DST/AIDS leads the STD and HIV/AIDS national response in Brazil and it has established national and international partnerships, the latter in the context of MERCOSUR and of Portuguese-Speaking Countries (CPLP). The Department participates in the UN-Theme group (UN-TG), which, under UNAIDS coordination, provides a forum for all stakeholders (Government, civil society, bilateral and multilateral agencies, including the Bank) to regularly exchange information and views, and carry out internal and external activities. B. Institutional and implementation arrangements (Annex 6) 44. The proposed project will be implemented over a four-year period. The Project`s planned effectiveness date is September 1, 2010, and the expected closing date is December 31, 2014. The total project costs are US$200 million, with a loan of US$67 million. 45. The Project will be implemented by the Ministry of Health (MOH) through the Department of Surveillance, Prevention and Control of STD and AIDS (DST/AIDS), and State and Municipal Health Secretariats (SES and SMS, respectively), as well as CSO. The project will be implemented nation-wide, and it will reach out to the 27 federal units, with the North, Northeast, and Center-East regions as priorities. About 500 municipalities currently included in the MOH`s Incentive Policy were prioritized for the development of the AIDS and STD prevention and control policies. To develop its role, the DST/AIDS will be supported by UN agencies, playing a procurement agent role, on a declining basis. 16 46. The program has good institutional capacity at central level, and in most SES and SMS of capital cities. The DST/AIDS has dedicated staff, many of them with a background in public health and connected to the health system reform movement. However, most of the 219 staff have precarious contracts. At the central level, the preparation and implementation of a human resources plan is the main challenge. At decentralized level, smaller SMS and CSO have low fiduciary capacity. C. Monitoring and evaluation of outcomes/results (Annex 3) 47. The DST/AIDS developed MONITORAIDS, a system tracking about 100 indicators. This system was designed to provide relevant information to track the Brazilian response to HIV, AIDS and other STD, and for better results-based management, and allowed for improvements in the orientation of program activities. In addition, the DST/AIDS developed a subsystem to monitor the results-based Action Plans (PAM) implemented by states and municipalities20. The PAM monitoring system tracks state and municipal technical and financial performance against the agreed plans and targets. As previously mentioned, the project will track 11 PDIs to measure progress towards achievement of the PDOs, which will trigger disbursements (DLIs). Another 9 indicators will also be linked to disbursements. The remainder indicators (17) will measure implementation progress (Annex 3). 48. Despite significant progress, M&E activities under previous projects were considered only moderately satisfactory for several reasons. Some baseline data were from regional or state-level studies, especially from the State of São Paulo, and some baseline studies experienced long delays. Project activities directed at trends emerging in other regions were designed based on data from São Paulo, where the epidemic had some different characteristics. Hard-to-reach groups presented a particular challenge in terms of outreach and sampling. However, the M&E unit tested two sampling methods through 10 studies of these populations, and studies were initiated during the last year of implementation, with results becoming available in 2009 and 2010. 49. In general, M&E implementation highlighted three main issues that should be addressed by this project: 1) weak understanding and ownership of a results-based management approach, especially at decentralized level; 2) need for further decentralization and training on M&E, and 3) lack of a strong link between activity and financial monitoring. A recent Bank in-depth review of the status of M&E found opportunities for improvement in four key areas: (i) human resources and partnerships; (ii) evidence-based program planning and M&E planning; (iii) collecting, verifying and analyzing data; and (iv) data dissemination and using data for decision-making. The project will focus on strengthening M&E activities in these four areas. 20 www.aids.gov.br/incentivo 17 D. Sustainability 50. The economic and financial analysis found no significant fiscal impact in Brazil as a result of the implementation of the project. The fiscal impact was estimated based on a model developed to evaluate the expected fiscal expenditures and revenues that are projected as a result of the project. The model showed a trend toward reduction of Brazil`s fiscal surplus through the life of the project, but this trend was not affected by loan repayment. 51. An analysis of the fiscal impact of the national program will be carried out under the project. The Government policy to provide anti-retroviral treatment free of charge to all who qualify, which costs about US $316.5 million a year, determines in great measure the sustainability of the national response. The Government finances 18 ARV, of which 10 are produced in Brazil and 8 are imported, and is a tough negotiator for lower prices. Recently, the Government issued a compulsory license for Efavirenz, which is used by about half of all PLHA on ART. In the decade from 1997 to 2007, savings in morbidity and hospitalizations due to treatment were estimated to account for R$1.1 billion. Evidence indicates that resistance to first-line drugs is low in Brazil21, which is an indicator of treatment compliance and quality of the program. The global crisis may have an impact on prices of Active Pharmaceutical Ingredients (API), which coupled with an increase in the virus virulence and/or resistance, may have an impact on the sustainability of this policy. Although the project does not include financing for ARV, it will contribute to improve access to these drugs and quality of treatment, especially for groups most at risk, as well as to the overall program`s governance. E. Critical risks and possible controversial aspects 52. The overall project risk is low. Several technical and operational challenges were identified as presenting a moderate risk. Over the last decade, Brazil has made great strides on nearly all measures of economic growth and social equity. Since 2004, the Brazilian Government has coupled stable macroeconomic management with well-directed social policies. This double focus had visible good results. The Government consolidated the country`s commitment to fiscal responsibility, and Brazil obtained an investment grade rating from Standard & Poors, opening the way for further acceleration of investment. Implementation of the Fiscal Responsibility Law (FRL), in conjunction with a prudent fiscal stance on the part of states and municipalities has resulted in a significant decline in sub- national indebtedness. 53. Before the financial crisis, the economy was growing steadily; inflation and debt were lower; employment was higher; poverty had been reduced and income inequality had been decreasing. However, the global financial crisis had a negative impact on Brazil`s economic growth, which decelerated in 2009. While financial and external sector indicators stabilized in 2009, industrial production and employment decreased. To face the current economic scenario, the Government has strengthened its macroeconomic policies. 21 Petersen ML et al 2006. Assessing HIV resistance in developing countries: Brazil as a case study. 18 BRAZIL AIDS-SUS PROJECT Project Risks Risk factors Description of risk Rating of Mitigation measures Residual risk risk I. Country- and Sector-Level Risks Macroeconomic The global financial crisis S The Government has strengthened M framework had a negative impact on macroeconomic policies. Brazil`s economic growth. Country ownership Change of Government or M Brazil is politically stable and all L (incl. political MOH leadership major parties regard HIV/AIDS as aspects) a top priority. Continued Bank engagement strengthens the Government`s perception of the importance of the Program as a best practice model. Systemic corruption is M Implementing a strong L moderate. procurement system with regular Corruption Perceptions training carried out by the Bank at Index by Transparency the three levels of Government International: 3.5 in 2008 and CSO. (80 out of 180 countries). II. Operation-specific Risks Technical/design Ambitious targets M Targets were reviewed during L difficult to achieve in four preparation to ensure that those years included in the project were achievable during implementation. Indicators ambiguous M The DST/AIDS benchmarked L indicators to confirm their feasibility and protocols were developed to calculate each one. Weak M&E at the 3 M Ongoing dissemination of robust L levels of Government and M&E programs and management in CSO. practices will be further supported by the project. Evaluating the impact of program activities will contribute to establish an evaluation culture. The Bank team includes an UNAIDS M&E specialist; two peer reviewers are M&E specialists. Ineffective outreach of M Project financing will be linked to L prevention activities to increasing activity with groups groups most at risk at the most at risk. decentralized level. Implementation Lack of coordination M The DST/AIDS has clear L capacity and between different sectors leardership, and organizes regular sustainability and partners meetings of sectors and partner organizations involved. 19 BRAZIL AIDS-SUS PROJECT Project Risks Risk factors Description of risk Rating of Mitigation measures Residual risk risk Implementation Institutional reforms M A participatory approach is used L capacity and leading to attainment of for strategic planning and decision sustainability targets require time to be making on institutional and institutionalized. organizational changes. Lack of participation from A communication strategy will be key stakeholders developed and implemented. (beneficiaries, SES, SMS, CSO, research institutes) Relatively weak M Continued guidance from the L systematic planning, federal level and the Bank team. information, monitoring Further development of M&E and and evaluation systems at management information system; the state and municipal training in RBM will be provided levels, and in CSO. for staff at the three levels of Government, and CSO. Few public services and M Training in outreach activities for L CSO working with SWs staff at the three levels of and IDUs Government and CSO. Delays in the M Some of the activities are already L implementation of the ongoing and most TOR will be subprograms ready before effectiveness. Staff turnover M This issue plagues not only the L Subprograms not health system, but the entire Brazil adequately staffed public sector. The MOH is proceeding with contracting of permanent staff, for the first time in many years, which should contribute to alleviate this problem. The MOH established the DST/AIDS, which enables the Program to strengthen its capacity. Fiduciary Slow disbursements due M Targets are from the DST/AIDS L to low achievement of development agenda and have agreed results Government buy-in. The Bank will provide continued support to the implementation of the program. Low FM Capacity M FM Capacity Assessment was L carried out, and a FM Action Plan was agreed. Low Procurement S Procurement Capacity Assessment M Capacity, particularly at was carried out. A Procurement decentralized levels Action Plan was agreed. III. Overall Risk L 20 F. Loan/credit conditions and covenants 54. The Legal Agreement includes the following covenants: Institutional Arrangements The Borrower shall furnish to the Bank on or about ten months, sixteen months, twenty two months, twenty eight months, thirty four months, forty months, forty six months and fifty two months after the Effective Date, regular reports (the Project Reports including the most recent Interim Unaudited Financial Reports) prepared in accordance with the provisions of the Project Operational Manual and the additional instructions referred to in Section IV.A.1 of the Schedule 2 to the Loan Agreement (LA). Incentive Policy - For the purposes of carrying out of Part 1 of the Project: The Borrower, through MOH (DST/AIDS), shall cause each State or Eligible Municipality Health Council, as the case may be, to approve the PAM submitted by each State or Eligible Municipality under terms and conditions satisfactory to the Bank, in accordance with the terms and conditions set forth in the Incentive Policy Legislation and the Project Operational Manual. The Borrower, through MOH (DST/AIDS), shall, and shall cause each State or Eligible Municipality, as the case may be, to comply with, inter alia: (i) the structure, process and results indicators related to the implementation of the corresponding PAM, as specified in the Project Operational Manual; and (ii) the provisions applicable to each State or Eligible Municipality (compatible with the Borrower`s regulations on the subject) , to be rewarded for achieving the indicators referred to in (i) above, or penalized with a reduction of financing in cases of poor performance. The Borrower, through MOH (DST/AIDS), shall cause each State or Eligible Municipality to comply with, inter alia, the following obligations: (A) procure the goods and services for its respective activities under Part 1 of the Project, in accordance with the provisions of Section III of Schedule 2 to the LA and with the contracting procedures and schedule set forth in the Procurement Plan; (B) utilize the State Transfer or Eligible Municipality Transfer, as the case may be, in accordance with: (i) the procedures set forth in the Project Operational Manual, and (ii) only for the purposes of the respective activities under Part 1 of the Project; (C) carry out its respective activities under Part 1 of the Project in accordance with technical, financial, environmental, and social procedures and plans, including the IPPF, as set forth in the Project Operational Manual; (D) assign, under the respective PAM, sufficient funds to be transferred to Eligible CSOs selected to conduct prevention and other support services to Groups Most at Risk in their respective communities, through a CSO Agreement , and in accordance with terms and conditions set forth in the Project Operational Manual; (E) keep records and accounts in regard to the respective activities under Part 1 of the Project and provide timely information to the Borrower (through DST/AIDS) on the use of the State Transfers or Eligible Municipality Transfers, as the case may be; and (F) comply with the terms of the Anti-Corruption Guidelines. The Borrower, through MOH (DST/AIDS) and following the regulations contained in the Borrower`s Portaria 2313/02 and Portaria 3252/09, shall disburse (through MOH`s Fund) to each State Fund or Municipal Fund, as the case may be, a specific amount (the 21 State Transfer in case of States, and the Eligible Municipality Transfer in case of Eligible Municipalities). but only after the State or Eligible Municipality, as the case may be, has: (i) submitted and obtained approval of its PAM, all in accordance with the provisions of this Agreement and the terms and conditions of the Project Operational Manual; (ii) provided satisfactory evidence that a financial management system is in place; and (iii) agreed to carry out a fiduciary action plan in those cases in which the Bank considers it necessary. The Borrower, through MOH (DST/AIDS), shall exercise its rights and carry out its obligations under the Incentive Policy, including the PAM in such a manner as to protect the interests of the Borrower and the Bank and to accomplish the purposes of the Project, including through the application of any legal remedies provided under the Anti- Corruption Guidelines, the suspension of disbursements, or cancellation of the amounts to be disbursed, as the case may be, in the event of non-compliance by any of the States or Eligible Municipalities with the obligations set forth in the PAM and the Borrower`s relevant legislation. The Borrower, through MOH (DST/AIDS), shall inform the Bank of any change in the Incentive Policy or any of its provisions, in connection with the Project. Implementation Arrangements The Borrower and the Bank may jointly review, once every year, the amounts assigned per budget code to the EEP detailed in Schedule 4 to the LA, and adjust as necessary, in a manner satisfactory to the Bank. The budget code numbers indicated in Schedule 4 to the LA shall conform to the Borrower`s budget law. The Borrower and the Bank agree that such budget code numbers may change under the Borrower`s budget law provided, however, that there is no change in the corresponding Programs described in Schedule 4 to the LA and in the underlying activities to be financed by the Bank under such Programs. Withdrawal Conditions Notwithstanding the provisions of Part A of this Section, no withdrawal shall be made: for payments made under Category (1) unless: (i) the relevant Project Reports, as referred to in Section. I.A.(c) of Schedule 2 to the LA, have been submitted to, and found satisfactory by, the Bank, in accordance with the provisions of the Project Operational Manual and the additional instructions referred to in Section IV.A.1 of Schedule 2 to the LA; and (ii) all other conditions referred to in the Project Operational Manual and in the additional instructions referred to in Section IV.A.1 of Schedule 2 to the LA (including, when applicable, compliance with the Disbursement-Linked Indicators (for the respective semester) as referred to in Schedule 5 to the LA and compliance with the 70% Rule Indicator) have been met by the Borrower in form and substance satisfactory to the Bank. If the Bank has: not received evidence of full compliance with the 70% Rule Indicator with respect to the second, fourth, sixth and eighth disbursement under Category (1) (as referred to in the Project Operational Manual and additional instructions referred to in Section IV.A.1 of Schedule 2 to the LA), then the maximum amount of the corresponding withdrawal shall 22 be proportional to the degree of execution of the Borrower`s EEP, as further detailed in the additional instructions referred to in Section IV.A.1 of Schedule 2 to the LA; not received evidence of full compliance with the DLIs referred to in Schedule 5 to the LA in respect to the first to the seventh disbursements under Category (1) (as referred to in the Project Operational Manual and the additional instructions referred to in Section IV.A.1 of Schedule 2 to the LA), the Bank shall: (i) allocate a base value of $1 million to each DLI and deduct said base value from the otherwise disbursable amount, all as set forth in said additional instructions; (ii) request the Borrower to prepare a time-bound action plan to achieve such DLI or DLIs in a manner satisfactory to the Bank; and (iii) when satisfied that the DLI or DLIs have been complied with and/or such action plan has been implemented, authorize that the unwithdrawn amount by which the corresponding disbursement had been reduced be carried forward to the immediately subsequent withdrawal, all as set forth in said additional instructions; and received evidence satisfactory to the Bank that the Borrower has accelerated Project implementation by increasing EEP execution and achieving the DLIs earlier than expected, then the Bank may accelerate disbursements, by an additional $1 million for each DLI achieved earlier than expected, as further detailed in the additional instructions referred to in Section IV.A.1 of Schedule 2 to the LA. In the event that the Bank has not approved a full withdrawal by the Borrower of the Loan proceeds under Category (1) (as referred to in the Project Operational Manual and the additional instructions referred to in Section IV.A.1 of Schedule 2 to the LA), the Bank may, by notice to the Borrower, cancel the corresponding amount of the loan at the time of the eighth disbursement (as referred to in the Project Operational Manual and the additional instructions referred to in Section IV.A.1 of Schedule 2 to the LA). IV. APPRAISAL SUMMARY A. Economic and financial analyses (Annex 9) 55. In addition to indisputable social benefits, the project's Internal Rate of Return (IRR) over a 10-year period is estimated to be 49%, with a Net Present Value (NPV) of more than US$682 million (assuming a 10% discount rate). Even with the most severe assumptions (50% fewer expected benefits than projected), the project still has a positive NPV (about US$170 million) and an IRR of 16%. Direct economic benefits will accrue from the reduced burden on the health care system resulting from a reduction in morbidity. Indirect social and economic benefits include the cost savings associated with reduced morbidity and mortality and the impact on quality of life, as well as the positive economic benefits associated with the reduced economic costs of illness and death of adults of working age. The indirect benefits estimated for the proposed project include the cost of production lost to the Brazilian economy implied by each AIDS case. B. Technical 56. The main technical issues that were addressed during preparation were the following: Surveillance and M&E. Surveillance is a national activity, which focus on the epidemic, while M&E is an activity focusing on program effectiveness and efficiency. However, 23 routine national health information systems usually do not capture information about groups most at risk. In the project, surveillance, R&D and M&E were lumped together as there is a need to strengthen leadership and coordinate the activities in these three areas, as they feed into each other. The PAD includes a description of the surveillance activities to be undertaken under the project to cover identified gaps (Annexes 1 and 4). Impact Evaluation. It is important to ascertain whether the project makes a contribution to specific program objectives, but not necessarily to distinguish the relative weight of the project`s and program`s contribution. Several areas have been considered as potential areas for IE: impact of interventions with groups most at risk on decreasing risk and changing behavior; impact of HIV VCT on increasing utilization and changing behavior; impact of condom use on incidence; and impact of treatment on reducing mortality, improving quality of life and productivity. The return on investment and fiscal impact of the epidemic will also be measured during project implementation. It has been agreed that the project will include at least three impact evaluations to be designed during project preparation: (i) interventions to decrease risk among groups most at risk; (ii) decentralized results-based financing; and (iii) fiscal impact of the national HIV/AIDS and STD program. Project incentives. Under the project, a system of incentives and penalties is being further developed for the DST/AIDS, SES, SMS and CSO. The DST/AIDS has been piloting beneficiary incentives (e.g., fee for participation in BSS studies, grants for HIV+ young people who engage on peer education, etc). However, these do not always work; and establishing beneficiary incentives through conditional cash transfers, a la Bolsa Familia, would put a heavy administrative burden on the DST/AIDS (Annex 4). CSO. In a decentralized context, CSO may lack the necessary support to undertake activities with groups most at risk. The DST/AIDS will finance under the project CSO networks which will in turn provide technical and financial assistance to smaller CSO. The Operations Manual includes a detailed description of the mechanism to finance CSO under the program and under the project. C. Fiduciary (Annex 7 and 8) 57. Financial management is considered adequate at the federal level. The challenge is posed at the sub-national level, where most services are delivered and there are less control mechanisms. Overall, accounting, FM reporting, and the management information system and internal controls are adequate and reliable, providing sufficient financial information to manage and monitor program implementation. The DST/AIDS used two separate systems to track financial data under the previous project. In addition to these two systems, the MOH uses yet another system to monitor budget and financial execution. The program is working to improve the availability and coherence of financial information. The DST/AIDS has made a significant effort to build fiduciary capacity at decentralized level, and this will continue to be supported by the project ­ including through incentives. 58. In terms of procurement, this operation is seen as an opportunity to analyze the supply chain, and improve capacity at the federal and sub-national levels. The DST/AIDS will use both the MOH`s structure ­ Department of Logistics (DLOG) -, and UN agencies to conduct procurement for centralized activities under the AIDS-SUS Project. Despite initial challenges, the DST/AIDS managed to successfully address its procurement 24 shortcomings over time, and build significant and sustainable capacity at central level. However, decentralized procurement capacity is still weak. The Project includes an indicator to measure the increase, during project implementation, in the number of contracts to be procured by DLOG instead of UN agencies. Technical assistance will be provided under the project to address procurement deficiencies and mitigate fiduciary-associated risks. D. Social (Annex 1, 9 and 10) 59. The social assessment identified strengths, weaknesses and opportunities presented by each vulnerable group. In general, some AIDS Coordination teams lack the necessary concern for priority prevention activities and treatment of vulnerable populations such as gays, MSM, transvestites, SW, IDUs and prisoners. According to the survey of the 2006 Goals and Action Plan conducted by the DST/AIDS, only an average 2% of the total resources for prevention activities at the state and local levels were invested in interventions directed towards gays and other MSM. Despite the Incentive Policy, there are still states that face difficulties in conducting selective project evaluations and distributing resources among CSO. With decentralization, there has been a reduction at the federal level in dialogue with specific populations which has not been matched by corresponding increases in engagement at the state and local levels. The involvement of CSO that care for groups most at risk is determined by the possibilities of each organization and by who is able and willing to participate, study, collaborate and influence policy decisions. To improve the situation, federal programs have recently been introduced to support national networks dedicated to the most vulnerable populations. In addition, the project will link financing to states and municipalities increasing interventions with group most at risk, as well as provide training and technical assistance. 60. The success of the project will depend on the way that crucial stakeholders communicate with each other -- for example CSO, and SES and SMS --as well as the synergy of the project with other components of the Brazilian program. Improving channels of communication and putting in place mechanisms to guarantee not just the execution of the activities, but also the quality of the activities being implemented (including M&E) will support the efforts of the program to improve accountability, transparency, social control, and governance. The project will implement a communication, accountability and participation plan; and funding will be linked to the establishment of mechanisms to improve transparency, such as the establishment of websites by states and municipalities providing epidemiological and financial information. 61. OP 4.10 is triggered, as the project will focus in regions where indigenous groups live. The DST/AIDS and FUNASA published the project's Indigenous People Planning Framework (IPPF summary in Annex 10), which indicates that activities will be carried out under the project to improve surveillance, prevention and treatment of STD and HIV/AIDS among indigenous populations living in urban areas and villages. The IPPF was disclosed at the InfoShop and in the country on July 15, 2009. The DST/AIDS develops protocols, and provide condoms, rapid HIV tests and ART to indigenous populations; the agency 25 responsible for Indigenous Health22, delivers services to indigenous populations. The Indigenous Health Program includes training of indigenous groups, CSO working with indigenous groups, and health staff working in Indigenous Health Districts (Distritos Sanitários Especiais Indígenas - DSEI) on HIV/AIDS and other STD. E. Environment (Annex 9) 62. OP 4.01 is not triggered. The project will not present any potential impacts that would be of environmental concern, and will not involve any resettlement. Given that this is a follow on project, with no new construction envisaged, no new environmental assessment will be required. Project activities will not result in increased waste, and the project will monitor the proper disposal of health care waste by health care providers. Under the project, the DST/AIDS will develop (i) a communication strategy for proper disposal of non biodegradable condoms (mainly feminine condoms); and (ii) a system of payment for environmental services to protect the forest and its biodiversity with the objective of attaining reduced emissions through international financial mechanisms and national funds such as the recently created Amazon Fund. This will provide an added stimulus to rubber tappers and their families to increase latex production, thereby contributing to the financial and environmental sustainability of the extraction of non-timber forest products. Safeguard Policies Triggered by the Project Yes No Environmental Assessment (OP/BP 4.01) [ ] [X] Natural Habitats (OP/BP 4.04) [ ] [X] Pest Management (OP 4.09) [ ] [X] Physical Cultural Resources (OP/BP 4.11) [ ] [X] Involuntary Resettlement (OP/BP 4.12) [ ] [X] Indigenous Peoples (OP/BP 4.10) [X] [ ] Forests (OP/BP 4.36) [ ] [X] Safety of Dams (OP/BP 4.37) [ ] [X] Projects in Disputed Areas (OP/BP 7.60) [ ] [X] Projects on International Waterways (OP/BP 7.50) [ ] [X] F. Policy Exceptions and Readiness. 63. No policy exceptions are requested. 64. The project has been appraised. The implementation agencies will be the same as in the previous successful project; all key staff is in place; drafts of the Project Operations Manual have been reviewed by the Bank, and a revised draft was sent to the Bank before Negotiations, and considered satisfactory; and terms of reference for technical assistance under the project are under preparation. 22 The management of Indigenous Health is being transferred from FUNASA to the Special Secretariat of Indigenous Health (SESAI) at the Ministry of Health. 26 Annex 1: Country and Sector or Program Background BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service 1. Brazil is one of the biggest countries in the world, with the fifth largest population. The Brazilian population is estimated to be approximately 190 million23. Brazil is divided into five Regions, 26 States and the Federal District, and 5,561 municipalities. Over the last decade, Brazil has made great strides on nearly all measures of economic growth and social equity. The economy was growing steadily; inflation and debt were lower; employment was higher; poverty has been reduced and income inequality has been decreasing. However, the global financial crisis had a negative impact on economic growth, which decelerated in 2009. While financial and external sector indicators stabilized in 2009, industrial production and employment decreased. To face the current economic scenario, the Government has strengthened its macroeconomic policies. 2. Over the past generation, there was good progress on health, especially against childhood and communicable diseases and in building health surveillance. In the last 20 years, the organization of the health sector into a National Health Service (SUS), the consolidation of health financing, and an increased emphasis on surveillance and primary care have been critical for these improvements. However, like all sectors, health is also affected by general issues of governance failures, notably the lack of incentives and accountability that ensure that services reach the most vulnerable and are of acceptable quality. 3. Demographic and epidemiological transitions will significantly impact health status and the health system. During the last 20 years, Brazil has experienced a demographic transition, with its population growth rate decreasing from nearly 2.3% to 1.4%. Together with a concurrent epidemiological transition, the burden of disease has shifted from infectious to chronic, non-communicable diseases (NCDs). The rapid pace of these twin transitions will increase pressure on demand for health care and financial resources. The incidence of chronic diseases is likely to deepen as the Brazilian population ages, and the health system thus faces a dual challenge: it must continue to address the burden of communicable diseases and maternal and child health, while restructuring health care and directing resources to meet the growing challenge of chronic diseases. The HIV/AIDS Epidemic 4. As HIV/AIDS becomes a chronic disease, a third of people affected in Latin America live in Brazil. In the beginning of the 1990s, the HIV/AIDS epidemic appeared to be progressing in Brazil at comparable rates with some countries in Africa. However, due to civil society and Government efforts, Brazil has been able to contain the epidemic at 0.6% of adult population, and has nearly halved the number of AIDS-related deaths. Between 1980 and June 2008, the cumulative number of AIDS cases reported was 506,499, and of AIDS deaths was 205,409. The country has now an estimated 630,000 people infected, with about 66% of reported cases among men24;and about 80% are in the Southeast and South. 23 www.ibge.gov.br 24 Brazil 2008. Epidemiological Bulletin. 27 5. The AIDS epidemic is still considered concentrated in Brazil as prevalence exceeds 5% among groups most at risk, but it is lower than 1% among pregnant women. However, the country is facing an evolving epidemic, with different epidemiological profiles emerging that may require distinct responses targeted to specific groups and regions of the country. In the early 80's, the epidemic struck, fairly intense, MSM, IDUs and recipients of blood transfusions. In recent years, the epidemic has been spreading to females, poorer groups, and towards the interior of the country. Brazil`s situation is now so complex that one researcher considered "It is probably more appropriate to refer to it not as a single epidemic, but rather as a mosaic of regional epidemics, reflecting the extension and socio-geographic diversity of the country, and its regional heterogeneity."25 6. While incidence and mortality rates have been slowing in general, this trend is clear only among the most affected populations. Other groups are in fact showing increased impact, affected by variables such as the epidemic`s complex dissemination and the difference among groups in access and adherence to prevention and treatment. In the early 1980s, the vast majority of HIV-infected individuals were well-educated men, aged between 20 and 44, with male homosexual sex and needle sharing between intravenous drug users (IDUs) as the main routes of transmission.26 Since the early 1990s, marked changes have occurred in the epidemic in Brazil, progressively affecting heterosexual men, females, individuals of lower income and with fewer years of formal education, and reaching smaller cities throughout the country27. 7. Heterosexual transmission is now more important for both genders. Women are showing increasing rates in nearly all age groups, raising as well the risk of vertical transmission. In 1985, for every 15 cases of HIV infection among men in Brazil, one was reported among women. Since then, the epidemic has spread more rapidly in women, and the male-female ratio decreased from 15:1 in 1986 to 1.5:1 in 2007. While the risk of infection for a man 13-39 years decreased, the risk for women, especially at younger ages, increased significantly. In 2006, in the age group 13-19, the gender ratio was 0.6:1. Older women are also showing increased incidence, especially the 40-49 age group. Since the mid-1990`s, homosexual/bisexual transmission has been responsible for approximately 1/3 of reported AIDS cases 28. It is estimated that a large proportion of infections among women can be attributed to the behavior of their male sexual partners29. Increased transmission via unprotected heterosexual relations has resulted in larger numbers of vertical transmission from mother to child. This is especially true in poorer parts of the country, where prenatal care and HIV testing and counseling for pregnant women is scarce. 8. Geographic patterns are changing too. As a result of the regional dynamics of the epidemic, the incidence rate of AIDS in the country remains stable, even at high levels. Although most cases are still located in the South and Southeast, the number of notified cases decreased in these regions, while it significantly increased in the North and Northeast. The AIDS 25 Fonseca, Bastos 2007. 26 Galvão, Teixeira, Vitória, Schechter 2008. 27 Brazil 2002; Portela, Lotrowska 2006. 28 Fonseca, Bastos 2007. 29 Silva, Barone 2006. 28 incidence rate in the Northern region increased from 4.1 per 100,000 inhabitants in 1996 to 14 in 2006 - more than 3.5 times; and in the Northeast, from 4.8 to 10.6 in the same decade. The epidemic is expected to continue to grow in the North, Northeast and Center-West regions, where sexual activity starts at younger ages, use of condoms and testing is lower, and health services and socio-economic conditions are more precarious. Epidemiological analyses pointed out that, even in terms of decrease of mortality after the introduction of antiretroviral treatment, the underserved North and Northeast regions did not experience a similar decrease, but rather an increase.30 The risk of dying one year after an AIDS diagnosis in the least developed regions (North and Northeast) is three times higher than in the most developed region of the country (Southeast), which indicates very late diagnosis or poor quality of care. 9. While the epidemic is still primarily based in Brazil's large urban centers, growth rates are high in municipalities with populations between 50,000 and 200,000. The Accelerated Growth Program (Programa de Aceleração do Crescimento, or PAC) has the potential to further influence the epidemic geographic reach. Some PAC projects are multi- national, especially those involving highway infrastructure, and some of these projects will be in the North. One anticipated consequence would be, for example, that sex workers will follow this route in temporary worker migrations to the Northern region. The Brazilian Health System 10. Given its level of national income and spending, Brazil still exhibits comparatively low health status indicators. Infant and child mortality decreased significantly in the last 20 years. However, child mortality is still three times higher in the poorest quintile than in the richest. Maternal mortality has remained largely stagnant, and higher than in any other LAC countries except Bolivia and Peru. Despite advances in health status and progress on health reform, the health system still faces structural and organizational challenges that may compromise its ability to achieve further gains. 11. The Brazilian health system is complex and multi-layered. The federal Government, through the Ministry of Health (MOH), is responsible for designing and regulating national health policies. The states have responsibility for coordination and oversight, and municipalities are responsible for the organization and provision of surveillance, prevention and mostly primary health care. Brazil`s health sector encompasses two main systems: the publicly-financed and managed Sistema Único de Saúde (SUS), a national health service, which was established by the Constitutional Reform of 1988; and a system consisting mainly of private insurers and prepayment plans. SUS is a complex system of shared but often ambiguous responsibilities among federal, state, and municipal Governments. Health policies are implemented through negotiated agreements with state and local authorities and through co-financing arrangements among the three levels of Government. SUS includes a subsystem for Indigenous Health. 12. Two decades of ambitious and sweeping reform programs have reshaped the health sector, decentralizing most responsibilities for providing and managing care to municipal Governments. The first wave of reform (1984-89) focused on institutional restructuring, decentralization, and establishing mechanisms for social participation. The second wave (1990- 30 Bastos, Cáceres, Galvão, Veras, Castilho 2008. 29 95) emphasized consolidation of the SUS, implementation of financial mechanisms for allocating federal funds, and municipalization of service delivery. The third wave, beginning in 1996, reoriented the health care model for primary health care and conceptualized health networks. In addition, the third wave defined institutional roles, implemented legal and regulatory changes, and developed resource allocation mechanisms to support primary health care. 13. Brazil has implemented innovative health agreements between the federal and subnational Governments known as Pactos pela Saúde (Health Covenants). These agreements, initiated in 2006, represent the first step in an important shift in federal/subnational relations in the health sector. Unlike previous regulations which dictated a uniform delivery structure, the Pactos focus on performance and outcomes, leaving subnational entities the flexibility to tailor delivery systems to the local context. They specify performance targets for each level of Government and lay the foundation for a results-based management and budgeting system. 14. The country's ability to achieve continued progress in health now largely depends on improving issues such as sector organization, financing and management. Quality, efficiency and accountability indicators are low. While the coverage of services is now fairly high, most facilities, especially hospitals (which consume nearly 70% of all public health financing), operate at low levels of productivity and efficiency. Overlapping responsibilities lead to low levels of accountability between providers and public payers, municipal managers and federal financiers, and managers/providers and the populations they serve. Recent analyses have identified significant obstacles to continued progress such as weak system coordination and distorted supply; weak governance with deficient management and accountability; diluted funding mechanisms with distorted incentives; lack of systematic quality assurance; and weak information for decision making31. The National STD and HIV/AIDS Program 15. Significant progress has been made in the effectiveness and efficiency of the national response on HIV/AIDS and other STD. In the 1990s, Brazil and South Africa had roughly the same estimated HIV prevalence rate, but while Brazil is estimated to have now approximately 600,000-890,000 people living with HIV/AIDS, South Africa is estimated to have 5.7-6.6 million PLHA32. HIV prevalence among IDU in Brazil has declined in some cities partly as a result of harm-reduction programs. The rapid increase of HIV infection among women in general was halted, and the prevalence rate among pregnant women was reduced (0.26% in 2006). Vertical transmission (mother to child), decreased from 16% in 1998 to 6.8% in 2004; and AIDS incidence among children under the age of five, decreased from 6.5/100,000 in 2002 to 3.1 in 2006. Notification of congenital syphilis increased 20%, and syphilis prevalence among women 15-49 years decreased from 1.7% to 1.1%; there was a 40% reduction of syphilis prevalence among young men (conscripts) in the period 2003-2008, including a 20% reduction among those who self-identify as MSM. Brazil AIDS Program Main Achievements by 2008 31 La Forgia G, Couttolenc B, Matsuda Y 2007. 32 Rohter 2005; WHO, UNAIDS, UNICEF, 2008a, b. 30 Outcomes AIDS mortality decreased from 6.3 per 100,000 in 2003 to 5.1 in 2007. · Morbidity decreased 77% in the decade 1997-2007. · Hospitalizations of AIDS patients who had at least one hospitalization per year, decreased from 80.8% in 1997 to 18.6% in 2007. · Estimated prevalence kept at 0.6% adult population (15-49 years). · Prevalence of HIV among pregnant women has remained below 0.3% since 2004. · Mother-to-child transmission decreased from 16% in 1998 to 6.8% in 2004. Prevention · 97% of the population knows that HIV can be transmitted through sexual relations. · About 97% of secondary schools conduct HIV/AIDS-related activities. · 38,4% of adult population tested for HIV at least once. · 58,8% people aged 15+ report use of condom in the last sexual encounter with a casual partner. · 70% sex workers report using a condom with last client. · Free provision of 1 billion condoms. · 67% of pregnant women were tested, over 75% in the South, Southeast and Center-West regions. · Over 51% of estimated infected pregnant women, and over 81% of those identified as infected, were provided with AZT for PMTCT. Treatment and Care · Survival of PLHA on ART almost doubled from 58 to 108 months in the period 1996-2007. · Over 180,000 patients (100% of those identified that qualify) are treated with ARV according to a national treatment protocol. · Initial average CD4 in patients not on ART increased from 387 to 432 in 2002-2006. · ART and treatment of OIs is provided by the National Health Service free of charge. · Savings due to ART estimated at R$ 1.1 billion in a decade (1997-2007). Surveillance and M&E · MONITORAIDS is well established as a DST/AIDS management tool. · Notification of congenital syphilis increased 20%. · Complex seroprevalence surveys that will provide crucial information about HIV infection rates among groups most at risk (MSM, SW, IDU) and general population are being finalized. Results-Based Decentralization · The DF, 26 states and 445 municipalities covered about 90% of notified AIDS cases in the country, and 62% of the entire population. · 75% of the states achieved at least 75% of their HIV/AIDS targets in 2007. · About R$ 510 million (US$305 million) transferred to states and municipalities under results-based Agreements in 5 years. · Close coordination with national health surveillance, and Family Health and Primary Health Care Programs allows for extension of coverage to new risk groups: women, poorer people in the interior. · All states have launched public competitions to finance subprojects carried out by CSO. · About 1,500 CSO and CSO have worked with the DST/AIDS. · Research and Development · Carried out 141 R&D subprojects out of 489 submitted in the last 5 years. · Diagnostic kits for HIV 1 and 2 produced and distributed. · HIV Vaccine Strategic Plan and Strategic Plan for Technological development of pharmaceutical drugs approved. · HIV/AIDS and STD R&D Information System developed. · Network for technological development of vaccines and microbicides established. International HIV/AIDS and STD Network for Technological Cooperation established. 31 16. The current success of the Brazilian response to the AIDS epidemic can be traced directly back to the 1980s, when public pressure, combined with progressive politicians and bureaucrats, led to the creation of a national health policy based on the principles of universal access and comprehensiveness. In Brazil, as in other countries, the initial Government response to AIDS as a health problem was denial. The Brazilian response to the HIV/AIDS epidemic, which arose from initiatives by both civil society and the Government, followed the process of democratization of the country. The first Government AIDS Program in Brazil was established in São Paulo in 1983, and at the national level, in Brasília, in 1985. 17. After more than two decades of implementation of the Brazilian response, its efficacy has been nationally and internationally recognized and the country is frequently quoted as a success in terms of the national response to the epidemic 33. This performance is the result of a comprehensive response based on partnerships between the Government, CSO, private sector and international and bilateral agencies, building together a multisectoral response and mobilization. This comprehensive approach has as principal components a synergy between prevention and treatment with a strong emphasis on human rights in all strategies and actions. 18. The DST/AIDS is the national authority in charge of the development of the country strategy to fight the HIV/AIDS epidemic. The DST/AIDS reports to the Health Surveillance Secretary and is integrated into the Brazil health system (SUS). The National Health Surveillance System was established in the 70s, and focus on epidemiological and environmental health surveillance. The DST/AIDS works closely with other Heath Surveillance Departments to ensure monitoring of the epidemic among groups most at risk, and general population through pregnant women and conscripts; with the Health Care Secretariat to ensure testing and counseling services into the Primary Care and Family Health Programs, which allow for coverage of new groups at risk, such as women and poorer people in the interior, and PLHA access to health care (testing, diagnosis, PMCT, ART, OI, STD); with the sexual and reproductive health services at all levels to monitor prevalence among pregnant women, provide PMCT and other services to VGs; and with the National Tuberculosis Control Program (NTCP) to cover PLHA with TB. Surveillance 19. A strong, coherent surveillance system is critically important if Brazil is to move from simply claiming success for its HIV prevention programs to demonstrating that success. Surveillance approaches differ according to epidemic stages:34 In a low-level epidemic (where HIV infections are confined to individuals with higher risk behaviors, however HIV prevalence has not consistently exceeded 5% in any defined population group), surveillance systems focus on high risk behaviors, looking for changes in behavior which may lead to spread of HIV infection. In a concentrated epidemic (where HIV has spread rapidly in a defined sub-population, but is not well-established in the general population, with HIV prevalence consistently over 5% in at least one defined sub-population), surveillance systems focus on monitoring infection in the sup-populations and concentrate on behavioral links between members of 33 Rosenberg 2001; WHO, UNAIDS 2006. 34 UNAIDS, WHO 32 these groups and the general population. Surveillance systems also monitor the general population and high-risk behaviors among its members. In a generalized epidemic (where HIV is established in the general population, with HIV prevalence consistently over 1% in the general population and pregnant women), surveillance systems concentrate on monitoring HIV infection and risk behavior in the general population. 20. Systematic national surveillance systems are a sine qua non of strong, evidence- based HIV programming. A well developed surveillance system should include the following: Routine mapping, counting and population size estimation, at the local level, of groups most at risk. Data are needed at the state level or lower, once every 3-4 years. Routine sentinel and community-based integrated bio-behavioral surveillance (IBBS) of groups most at risk. a. Repeated HIV and STD sero-surveys in groups most at risk, including MSM, SW (female, male and transgender sex workers) and IDU. These surveys should be undertaken every 2-3 years, in a substantial number of geographically-dispersed sites. b. Repeated surveys of HIV-related practices in groups most at risk, including MSM, SW and IDU, as well as clients of female sex workers. These surveys should be undertaken every 2-3 years, in a substantial number of geographically- dispersed sites. Reported HIV testing (including denominators) in other populations who should be tested for HIV for clinical/prevention programming reasons - TB patients and pregnant women. If routine testing is not in place, repeat sentinel surveillance in these populations as well as in prisoners. These surveys are relatively easy and inexpensive, and can be conducted annually, particularly in areas of highest prevalence. Analysis of bio-behavioral studies of behavioral patterns, linking groups most at risk to bridge populations and hence the wider society. Modeling of the epidemic based on analysis of AIDS case reporting, risk practice reporting in the IBBS, HIV prevalence, size estimations and behavioral data. Based on the above analysis of priority risk groups, transmission dynamics and geographic foci, prioritization of activities and resources. 21. In Brazil, the DST/AIDS has been investing on the establishment of an evidence- based culture ­ a virtuous circle of surveillance, planning, R&D, implementation and M&E - for the last several years with significant results. Several behavior and seroprevalence surveys and routine systems are used for surveillance of HIV/AIDS and other STD in Brazil. 22. Studies of seroprevalence and behavior provide information about HIV/AIDS and other STD among groups most at risk, pregnant women and conscripts as a proxy for the general population, and the Brazilian adult population, and are carried out as follows: Sentinel studies in pregnant women and conscripts allow for estimates of the HIV prevalence in the country, quadrennial. Prevalence of syphilis, HIV and Human T-lymphotropic virus (HTLV) and behavioral factors in conscripts, quadrennial. 33 Prevalence of HIV, syphilis and hepatitis B and C in pregnant women, quadrennial. A study on the prevalence of STD was carried out in 2004 in six capital cities in the five Brazilian regions, and found a high prevalence of HPV and gonococcal infection and chlamydia among young people; higher rates of syphilis were found among older people. Attitudes, Behaviors and Practices surveys of the Brazilian population 15-64 years, bianually. Nationally representative behavior and seroprevalence surveys among groups most at risk (MSM, SW and IDU) every three years, starting in 2007. Previously, a series of regional studies were carried out which provided information about groups most at risk in the most affected regions (São Paulo, Rio, Minas Gerais, etc). Studies Period Last 2009 2010 2011 2012 2013 2014 2015 Seroprevalence survey in Quadrennial 2006 X X pregnant women Seroprevalence survey in Quadrennial 2007 X X conscripts Seroprevalence and behavioral Triennial 2008 X X surveillance of MSM - 2009 Seroprevalence and behavioral Triennial 2008 X X surveillance of SW - 2009 Seroprevalence and behavioral Triennial 2008 X X surveillance of IDU - 2009 PCAP survey (knowledge, Triennial 2008 X X practices and attitudes survey) School Census Annual 2008 X X X X X X X School Study Triennial - X Vertical Transmission of HIV Annual - X Vertical transmission of syphilis Quadrennial - X X Triennial 2008 X X Resistance to ARV Quadrennial 2002 X X Primary resistance of HIV-1 Biannual 2007 X X X X Survival in children Quadrennial 2008 X Survival in adults Quadrennial 2008 NE, BR N, CO Qualiaids Annual 2008 Stock of prevention inputs, ARV 2009 X and OI drugs Synovate study Annual 2007 SenGono study Annual X X X X X X 23. Routine information systems provide data on mortality and morbidity, testing and counseling, lab test results, and supply of antiretroviral drugs to PLHA throughout the country, as follows: 34 SINAN: Disease Notification Information System. SINAN provides information on all diseases of mandatory notification in Brazil. In the case of AIDS, SINAN includes information on reported confirmed cases according to the country`s case definition since 1986. The country also reports HIV cases in pregnant women because of the benefits of prevention of mother-to-child transmission. SINAN`s data have allowed for characterization of the dynamics of the epidemic, and for preparing other surveillance, prevention and control activities. SIM: MOH Mortality Information System. Provides information on cause, date, place and municipality of occurrence of death, as well as demographic and other information on the deceased. SI-CTA: Testing and Counseling Centers Information System. SI-CTA provides information about individuals who attend Counseling and Testing Centers (ATC). This system provides information on population subgroups vulnerable to sexually transmitted infections. SISCEL: Lab tests information system. This system provides information on lab test results (CD4/CD8 T-lymphocyte counts and quantification of HIV viral load), to assess need for treatment and monitor antiretroviral treatment (ART). The system provides useful information on initial counts of CD4 T lymphocytes, and average annual number of tests per patient on ART, among others. SICLOM: Drug Logistics Management System. This system allows for management of the distribution and provision of ARV. Research & Development 24. The robust research agenda (epidemiological, clinical and operational) has been contributing to the effectiveness of the national response. In addition, innovative testing kits and supplies for HIV/AIDS and STD have been developed. Over 600 R&D projects were financed in the period 1999-2007 at a cost of R$36 million, with a significant growth in R&D in the since 2004. With Bank assistance, the DST/AIDS (i) established an R&D information system; (ii) established a national network for technological development of vaccines and microbicides; (iii) developed the National Strategic Plans for Vaccines, and for Technological Development of Pharmaceutical Drugs; (iv) launched 8 calls for R&D proposals; (vi) financed development of pharmaceutical technology for production of ARV by the Instituto de Tecnologia em Farmacos Far-Manguinhos - FIOCRUZ; and (vii) financed the project for production and distribution of kits for diagnosis of HIV 1 and 2 by the Instituto de Tecnologia em Imunobiologicos Bio-Manguinhos/FIOCRUZ. Prevention 25. Prevention activities focus on groups most at risk ­ men who have sex with men, sex workers, injecting drug users and prisoners, as well people living with HIV/AIDS. In addition to epidemiological risk, the DST/AIDS also considers social vulnerability. Some groups are at a disadvantage in what concerns cultural and social contexts that affect human rights, the adoption of safe sex practices, and access to health services, pharmaceutical drugs and supplies for diagnosis and prevention. Some groups suffer from multiple vulnerabilities, such as poverty, 35 living in rural areas, suffering discrimination, using drugs, and/or being a sex worker. The program focuses on the groups with high epidemiological risk and high social vulnerability. High epidemiological risk High epidemiological risk High social vulnerability Low social vulnerability Low epidemiological risk Low epidemiological risk High social vulnerability Low social vulnerability 26. Prevention activities cover many groups most at risk, and have achieved important results. Prevention activities include: development of technical guidelines and parameters, implementation of plans for MSM and women (including SW); finalization and implementation of plans for IDUs, prisoners and PLHA; implementation of the school program to reach youth at risk, since 90% of young people attend school; and PAM focusing on prevention among groups most at risk. Specifically, the following activities have been carried out: MSM. Behavioral interventions for adoption of safe sex practices in meeting places such as nightclubs, saunas, bars, and relationship websites. Transvestites. This is a high vulnerability population. In addition to behavioral interventions for adoption of safe sex practices, interventions focus on mobilization for human rights and combating violence. DST/AIDS will also establish reference standards for STD prevention services. Sex workers. Behavioral interventions for adoption of safe sex practices, community mobilization and human rights interventions, as well as strengthening community income generation opportunities. IDU. Behavioral interventions for adoption of safe sex practices, harm reduction approaches and care services for injecting drug users occur in areas of highest prevalence. Activities for treatment of drug users are carried under the SUS and involve the Centers of Psychosocial Support for Alcohol and Other Drugs (CAPS-AD) and the Centers of Testing and Counseling (CTA). The use of methadone to treat heroin users is not common in the country, as the drug of choice is cocaine. PLHA. Behavioral interventions for adoption of safe sex practices combined with treatment and negotiation in case of sero-discordant relationships. Strategies for income generation and community involvement are being considered. Special attention is being given to training of young people living with HIV. Youth. The main strategy is strengthening activities in schools through actions aimed at the adoption of safe sex practices, and cooperation into sexual and reproductive health interventions. More than 96% of secondary schools conduct HIV prevention activities. 27. About 97% of the population indicate spontaneously that sexual intercourse is a source of HIV transmission, and that use of condoms is a way of preventing the transmission of HIV and other STD. In 2005, 79% people reported use of condom with a casual partner, and 70% sex workers reported use of a condom with last client. In 2007, the DST/AIDS distributed 122 million male condoms, 1.6 million female condoms and 1.9 million units of gel. In 2007-2008, the DST/AIDS purchased 1 billion male condoms, which have been 36 distributed to states and municipalities; and carried out procurement of 8 million female condoms and 15 million units of gel. Over 40% of the population 14+ years was tested at least once. Rapid tests (which eliminate waiting periods for results) were implemenokted at primary health care institutions, increasing both efficiency and effectiveness. The national production of rapid tests increased from 150,000 in 2004 to 1.6 million in 2008. Program Interventions with Groups most at risk Vulnerable Leadership Community Behavioral Condoms Syringes Testing STD group building intervention intervention & needles MSM X X X X X Transvestites X X X X X SW X X X X X X IDU X X X PLHA X X X X X Youth X X X X X X 28. Important gains were made in awareness and prevention involving marginalized social groups specifically vulnerable to the epidemic, as well the promotion of legal initiatives for lesbian, gays, bisexuals and transvestites (LGBT) and PLHA. The DST/AIDS disseminates information on its website on issues related to human rights, such as the most recent national AIDS-related legislation, legal support services are available for victims of stigma and discrimination, and rights violation cases are reported nationally. In March 2008, the Ministry of Health allocated R$1 million to the implementation of human rights initiatives and prevention activities targeting the LGBT community. The DST/AIDS coordinates with the Secretary of Human Rights the implementation of the program Brazil Without Homophobia. Treatment 29. Since 1996, the treatment of all HIV positive Brazilians by SUS, free of charge, has been guaranteed by law. Over 500,000 HIV/AIDS cases were notified since 1980, of which over 488,000 are presently being followed up by the DST/AIDS; about 190,000 people are on treatment with antiretroviral drugs (100% of patients qualifying), according to a national treatment protocol. In 2008, 86% of patients reported taking 95% of their medications. CD4 in people not on ART increased from 387 in 2002 to 432 in 2007. Consequently, survival increased from 58 months in 1996 to 108 months in 2007, comparable to survival in developed countries. Among children, the probability of survival after 60 months with AIDS increased 3.5 times. In 37 the period 1997-2007, morbidity decreased 77% and hospitalizations decreased from 80.8% of AIDS patients, who had at least one hospitalization per year in 1997, to 18.6% in 2007, which saved up to R$ 1,1 billion. Decentralization 30. In a context of decentralization 2007, 75% states and municipalities met at of responsibilities, actions for HIV/AIDS least 75% of the agreed targets. and other STD are guaranteed by the federal level, states, municipalities, CSO Southeast 77,873.120 population and private sector. The DST/AIDS States Municipalities allocates resources; states and municipalities Espírito Santo 12 Minas Gerais 54 implement results-based agreements; and the Rio de Janeiro 35 three levels participate in program M&E. São Paulo 145 There are (i) grant transfers from the federal Total 246 level to SES and SMS, and CSO, to finance South 26,733.595 population the implementation of public policies that Paraná 29 strengthen the national response on Rio Grande do Sul 39 surveillance, prevention and control of Santa Catarina 33 HIV/AIDS and other STD; (ii) procurement Total 101 of key inputs for prevention, diagnosis, Northeast 51,534.406 population treatment by the MOH and distribution to Alagoas 2 Bahia 26 SES, SMS and CSO; and (iii) payment of Ceará 14 certain procedures in the SUS and private Maranhão 14 sector. The universal, free and national Paraíba 5 reach of the Sistema Único de Saúde (SUS) Pernambuco 17 was a key factor in the successful Piauí 4 implementation of the program. In recent Rio Grande do Norte 2 years, the challenge has been the Sergipe 1 decentralization of prevention activities to Total 85 SES and SMS, especially those carried by Center-West 13,222.854 population CSO. Distrito Federal Goiás 10 Mato Grosso 12 31. Under the Incentive Policy, the Mato Grosso do Sul 9 Federal District, 26 states and 481 Total 31 municipalities (out of 5,560) cover about North 14,623.316 population 90% of notified AIDS cases in the Acre 2 country. About R$ 130 million (US$ 60 Amapá 1 million) are transferred annually to states Amazonas 2 and municipalities for HIV/AIDS prevention Pará 8 and control, under results-based agreements Rondônia 1 Roraima 1 (Planos de Accoes e Metas - PAM). PAM Tocantins 3 agreed between the DST/AIDS and states Total 18 and municipalities determine resource Total States and DF 27 allocation, implementation and M&E. In Total Municipalities 481 Source: IBGE 2007; DST/AIDS 2009 38 32. These Plans are a well established program management tool. Decentralized financing is based on demographic, epidemiological and local priorities criteria. Since 2002, the Incentive Policy allocates funds to states and municipalities according to: (i) HIV/AIDS prevalence (ii) epidemic growth rate; (iii) population coverage; and (iv) priorities defined by the Tripartite Inter-managerial Commission (CIT). SES and SMS participate in workshops promoted by the DST/AIDS to develop the annual results-based agreements. Resources are transferred from the National Health Fund to state and municipal health funds monthly, provided implementation takes place as agreed. 33. The decentralization of HIV/AIDS activities has been analyzed,35 and a study about the Incentive Policy is being finalized36. With decentralization, there has been a reduction in federal dialogue with specific groups most at risk that has not been matched by corresponding increases in engagement at the state and local levels. The situation varies greatly among state and municipal AIDS/STD Coordination Teams. Efforts focused on prevention of vertical transmission are functional and have received the appropriate attention. However, SES and SMS have had difficulties in implementing the National Plan to Combat the HIV/AIDS and STD Epidemic among Gays, MSM and Transvestites. According to a 2006 DST/AIDS survey, only about 2% of the total decentralized resources for prevention were invested in interventions directed towards MSM. Civil Society Organizations 34. CSO, including organizations of PLHA, are a central element in the Brazilian response to the AIDS epidemic. About 1,500 CSO have participated in the national response since the beginning of the program. In the last decade, about US$ 140 million were invested in prevention and other activities carried out by CSO. There are two forms of financing CSO under the Brazilian program: federally for projects that are considered of national or regional interest; and as part of the PAM. CSO provide services to groups most at risk and other populations, identify innovative solutions tailored to the needs of communities, develop alternative interventions and contribute to the social reintegration of people living with HIV/AIDS, which often do not seek or find support for their needs from public services. 35. The first actions to fight the HIV/AIDS epidemic in Brazil started in the early 1980s involving the pioneering work of gay groups distributing leaflets with the information then available on the disease and on how to prevent it37. The first Brazilian CSO to work with AIDS was founded in 1985 in São Paulo. During the early phases of the epidemic, CSO were mainly in confrontation with the public sector, whose responses were deemed inadequate. In the late 1980s and early 1990s, the involvement of CSO in the national response increased and diversified. The period was one of new initiatives against the epidemic, including a broadening of the societal response to AIDS, with the participation of organized sex workers, the transvestites` movement, the women`s movement, and the private sector. Also during the 1990`s, legal challenges to the Government, arising from CSO and based on the newly established rights 35 Duarte 2008; Fonseca 2007; Pires 2006; Sampaio, Araújo 2006; Silva 2006; Taglietta 2006. 36 Granjeiro A (ongoing). 37 Galvão, Teixeira, Vitória, Schechter 2008. 39 to health care enshrined in the 1988 Constitution, helped forge a path to the current national policy guaranteeing universal access to ART free of charge.38 36. With these conquests, CSO and Government began to work more in partnership in the elaboration of a fuller national response. Starting in the mid-90s, the establishment of forums and networks allowed CSO to have greater influence and facilitated coordination and sharing of experiences. One of the main results of Bank-financed projects was the expansion of the partnership between the DST/AIDS and CSO, with scaling up of prevention activities. Starting in 2002, the support to CSO moved from the central level to states and municipalities to focus on local realities and priorities. All states have contracted CSO to engage on advocacy and anti-discrimination activities, and provide prevention and care services. As a requirement, CSO are involved in the elaboration of the state PAM, but often they are not part of the implementation. States have not been willing to focus on groups most at risk as much as necessary, and have faced multiple difficulties to transfer funds to CSO. These difficulties are more pronounced in SES from the North, Norteast and Center-West, and affect not only HIV/AIDS and STD actions but most decentralized MOH programs. 37. Federal programs are being developed to support national networks of CSO dedicated to working with groups most at risk. Some of the most expressive examples of projects for groups most at risk implemented nationwide are Somos, for gays and MSM; Tulipa, for transvestites and transgender; and Maria Sem Vergonha, for female SW39. The federal level has not faced the same constraints as the state level to transfer funds to CSO. However, one of the difficulties is the weak management and fiduciary capacity of CSO. The involvement of CSO that care for groups most at risk is determined by the possibilities of each organization and by which are able and willing to participate, study, collaborate and influence policy decisions. 38. The effectiveness and efficiency of the national response was also improved by an innovative home-based program (Casas de Apoio) carried out by CSO with support from states and municipalities. These are in-patient homes that care for low-income PLHA. There are 103 homes in 19 states, with a total of 2,224 beds. These homes are divided into two types: (i) permanent establishments where patients who are severely ill receive care; and (ii) temporary establishments where patients stay for a shorter period of time, e.g. during routine hospital visits, which may be located far from home. The establishment of these homes has clearly contributed to improved quality of life for PLHA. National and International Cooperation 39. The Brazilian multisector approach on HIV/AIDS is closely related to groups most at risk (eg, Tourism for SWs, Interior for prisoners, Army for conscripts, Transport for truck drivers, etc). National cooperation refers to inter-municipal and interstate cooperation, as requested by those beneficiaries; and DST/AIDS cooperation with civil society, academia, private sector and partner organizations. International cooperation refers to exchange of knowledge and technological know-how with other countries, especially in the context of 38 Scheffer Salazar, Grou 2005. 39 Pedrosa 2007; Rossi 2007; Câmara 2008. 40 MERCOSUL and CPLP. The DST/AIDS cooperates with the private sector in Brazil, and supports a public-private partnership for latex and condom production in Acre. 40. Since 1997, the DST/AIDS has worked in partnership with UN and bilateral agencies in Brazil. The UN works through its Expanded Theme Group on HIV/AIDS (UNAIDS/TG) and organizes its work through successive two-year Implementation Plans that follow the Government priorities. Current membership in the UNAIDS/TG includes 27 Brazilian, bilateral and international agencies and CSO. The UNAIDS/TG`s two-year plan covering 2008 and 2009 is focused in the Brazilian states of Bahia and Amazonas, where $1 million is being invested in interventions that are responsive to the specific needs of each of these states. 41. The Government has launched the Southern Ties Network Initiative (Laços Sul-Sul) to promote South-South Cooperation on HIV/AIDS. The Initiative has eight countries as members, and focuses on youth and MTCT, among other issues. In 2008, the Brazilian Government, together with UN Agencies, hosted the Community of Portuguese-speaking Countries (CPLP) in a conference focusing on women and HIV. Eight countries participated in the meeting, the first of its kind, sharing experiences and forging a framework for horizontal cooperation. As a conference result, the Declaration of Rio de Janeiro strongly affirms the need to combat the impact of the HIV epidemic on adult and teenage women and girls, and also to further expand the participation of PLHA in designing the programs that respond to the epidemic. 42. Brazil's International Center for Technical Cooperation (ICTC) was inaugurated in 2005, with the objective of sharing lessons learned from the Brazilian experience and strengthening and scaling up national HIV/AIDS programs in developing countries. ICTC was designed as a partnership between the Brazilian Government and UNAIDS, but also receives support from bilateral agencies. To date, the ICTC has focused primarily on building capacity in Latin American and Portuguese-speaking countries in the areas of clinical management of HIV infections, logistics, laboratory techniques, human rights and CSO. Further potential exists for the ICTC to support and expand cooperation between developing countries. 41 BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service PLHA and Groups Most at Risk Group Strengths Weakness Opportunities PLHA Network at national level Few initiatives and programs for Universal ART Program Collaboration with the positive prevention Identified PLHA integrated in DST/AIDS the public health system High level of HIV and AIDS knowledge and attitudes, concerning prevention and care Good levels of adherence to treatment MSM In big cities, high level of Probability to develop AIDS 11 Increasingly positive social mobilization/organization times higher than among visibility Collaboration with DST/AIDS heterosexual men Gay parades annually Network at national level Low level of mobilization in throughout the country Advocacy with members of small cities National Plan to Confront Parliament and Government Violence, stigma, discrimination HIV/AIDS among LGBT sectors Homophobia in the health system Population at the central level Dependency on financial support from Government Some SES and SMS do not include actions involving them. Low level of collaboration with other movements Transvestites Organized in networks and High levels of HIV/ Hepatitis Committed community CSO throughout the country infection leadership Good levels of awareness on Bad and uncontrolled use of National Plan to Confront HIV/AIDS and STD hormones and silicone for body HIV/AIDS among LGBT transformation In June 2009, it was Police violence established in São Paulo the Social exclusion first health post to provide Homophobia in the health system health services for transvestite No opportunities for education and transgender and employment Sex Workers In big cities, high level of Low level of mobilization in Committed community mobilization/ organization small cities leadership Collaboration with DST/AIDS Violence, stigma, and Increasing positive social Network at national level discrimination visibility Dependency on financial support Well established organization from Government in some cities in the North. Some SES and SMS do not include them into the PAM Low level of collaboration with other movements IDU Priority of interventions at Low level of organization Harm reduction programs can central level Low priority at local level also be effective for Recent mobilization for Repressive and inadequate prevention messages and decriminalization of light legislation on drugs education, and can impact drug use (marijuana) and Criminalization of drug use countries in South America consequent public debate Police violence and corruption 42 PLHA and Groups Most at Risk Prisoners Needs better coordination among Confinement may facilitate the prison and health authorities, interventions including HIV authorities Expansion of partnership with Prisons in sub-human conditions other Government institutions No respect for human rights Expansion of partnership with High levels of violence, UN agencies, such as corruption, drug abuse, other UNODC diseases (TB) Insufficient programs of HIV/STD prevention and care Interventions with PLHA and Groups Most at Risk Groups Estimated Prevalence Behavioral Condoms Needles Rapid Vertical Population intervention and testing Prevention size syringes Positive National Harm PLHA 630,000 100% Prevention distribution reduction NA N/A Program based on in implemented Needs Plan 19 services in the 26 33 million in 5 states and 2009 regions. DF 7,2% Coverage National Pilot project n=602 based on distribution in 2 MSM 1.6 million CI 4,1% - National based on metropolitan 11,5% Plan Needs Plan NA regions: NA BSS 122 million Recife and Campinas 2007 Rio de 2005 45 milllion Janeiro 2009 6,2% Coverage on National n=2712 capital cities coverage on SW 634,000 Research on and capital cities NA NA NA prevention metropolitan and effectiveness regions; and metropolitan DST/AIDS mining areas regions. 2002 in the North 82 million 2009 Coverage on National Harm IDU 521,000 Available capital cities, coverage on reduction December metropolitan capital cities with NA NA 2009 regions, and and distribution frontiers. metropolitan of needles/ regions. syringes in 13 million states with 2009 high prevalence of HIV due to IDU: South - Southeast 43 Groups Estimated Prevalence Behavioral Condoms Needles Rapid Vertical Population intervention and testing Prevention size syringes 5.7% Coverage National National National National Prisoners 460,000 n=333 based on distribution Health health health Plan males National based on Plan for Plan for for prison Ribeirão Health Plan Needs Plan prison prison system Preto for prison 27 million system system includes 2007 system: 463 2009 includes includes Care for prisons harm diagnosis pregnant reduction women 0.9% 129 National Truck 823,000 n=1,589 operational distribution Drivers São Paulo units with based on NA NA NA 2003 health Needs Plan 0.3% services 1,9 million N=1,795 providing 2009 Foz do condoms but Iguaçu e which do not Uruguaiana offer testing 2007 0.12% National Routine Conscripts Sample n=35,460 Peer distribution NA testing in NA 40,000 CI 0,08 ­ education based on the 0,16 Needs Plan context of DST/AIDS health 2007 exam Pregnant 3 million 0.04% National Plan National NA Routine National Plan women N=20,000 to Fight distribution testing in of Reduction Brazil 2006 Feminization based on the of Vertical of the Needs Plan context of Transmission epidemic prenatal of HIV and care Syphilis Pilot project National Street NA NA in three distribution NA NA NA Children regions: based on Recife, Rio Needs Plan de Janeiro 331,000 and São 2009 Paulo Program National Testing School 198,507 in NA Health and distribution awareness Children basic Prevention in based on NA kit: Do I education Schools Needs Plan need to be 2007 62,000 47 million tested? schools 2008 300,000 (50%) kits reported having developed SPE activities in 2007 44 BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Examples of Available Evidence on Cost-Effectiveness of HIV/AIDS Interventions Strong Evidence Good Evidence Weak Evidence Intervention\ Other groups Group MSM SW IDUs Prisoners most at risk* CE in HIV Condoms infections averted Decrease in number of new cases of HIV NA CE if resources allocated to Clean IDU are needles/syringes concentrated in one area CE in HIV infections averted HIV infections Circumcision HIV infections averted (young averted NA men) Decrease in Decrease in Higher number of sex Decrease in CE in HIV injection-and knowledge of encounters unprotected anal infections non-injection STD and with friend/ intercourse averted drug use HIV/AIDS prostitute Positive Education, Decrease in Number of Increase in intention to behavioral number of sexual HIV infections drug treatment reduce risky Increase in interventions, partners averted entry behavior condom use VCT Increase in CE in infection condom use averted among during anal Increase in Increase in mentally ill intercourse condom use condom use women Number of HIV Decrease in infections trading sex for averted drugs Mass media CE in behavioral campaign change CE in HIV infections Reduced risky Community averted behavior outreach Decreased in shared use of needle/syringe References in Annex 10; *Migrants, truckers 45 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Bank-Financed Projects Project Project Amount OED/IP/DO Sector issue Status name number (mil. Ratings USD) VIGISUS II P083013 100.0 IP-MS Health, Nutrition and Population Closed DO-MS Family P095626 83.45 IP-S Health, Nutrition and Population Active Health II DO-S QUALISUS- P088716 235 IP-MU Health, Nutrition and Population Active REDE DO-S Bahia Health P054119 30.0 IP-S Child health, Health system Closed System DO-S Performance, Rural services and Reform infrastructure Bolsa P087713 572.2 IP-S Social Protection Closed Familia 1 DO-S HD P082523 8.0 IP-MS Multisectoral Education, health and Closed Technical DO-S social protection Assistance Amazonas P083997 24.25 IP-S Sustainable Development; Water Active Regional DO-S and Sanitation; Health Development PROACRE P107146 120.0 IP-S Education, Sanitation, Health; Active DO-S subnational Gov. Administration; Agriculture, Fishing and Forestry Ceará P106765 240.0 IP-S Public Sector Reform; Private Active Inclusive DO-S Sector Reform; Water and Growth Sanitation; Education and Health GDF P107843 130.0 IP-MU Health; Education; Public Active Multisector DO-MS Administration; Transportation Public Management MG P101324 976.0 IP-S Sub-national gov. Administration; Active Development DO-S Roads and highways; Health; Partnership Education; Industry and trade Projects Financed by other Agencies Project Name Amount Financier Sector/issue Status (mil) UN Partnership 1.0 UN Integrated Plan 2008-2009 Ongoing promotes actions aimed at minimizing regional inequities. Two States were identified as a priority: Amazonas and Bahia. Technical Cooperation 0.15/year ANRS Strengthening of Human Resources Ongoing Brazil and France ­ research and information technology for STD and HIV/AIDS 46 Projects Financed by other Agencies Project Name Amount Financier Sector/issue Status (mil) PEPFAR 0.45 CDC Support to the Brazilian Program to Ongoing strengthen M&E International Center for 1,45 DFID Public Policy and Human Rights Ongoing since 2007 Technical Cooperation 1,45 GTZ Promotion, Prevention and Ongoing since 2007 (ICTC) 1,4 Germany Protection Ongoing since 2007 Government Diagnosis, Care and Treatment Institutional Development and 2.0 UNAIDS Ongoing since 2005 Management Systems for Epidemiology Harmonization and Multisector approach Monitoring and Evaluation 1. The Bank has provided technical and financial support to the Ministry of Health ­ National STD and AIDS Program - since 1988, with total lending for AIDS-related projects amounting to US$ 432 million, as follows: Endemic Disease Control Project. In 1988, a US$ 109 million loan financed US$ 6.6 million to contain the emerging epidemic of HIV/AIDS. AIDS I Project. As the epidemic spread in the 1990s, the Bank approved a US$ 160 million loan in 1993, to prepare and strengthen public and private institutions working on prevention and care. The project left in place a solid institutional framework that was supported by partnerships with state and local Governments and a wide range of CSO. AIDS II Project. Building on previous success, the Bank approved another US$ 165 million loan in 1998 to expand coverage of prevention activities. The project increased accessibility to condoms (male and female), doubled the number of testing and counseling sites and increased the number of HIV tests performed; and it strengthened services and the laboratory network to provide care for PLHA, enabling the implementation of the policy on universal access to antiretroviral treatment (ART). Facilities providing treatment and care doubled. AIDS III Project. The Bank approved a loan of US$100 million in 2003 to support further program decentralization by providing incentives to states and municipalities to focus on prevention and treatment. The project focused on the following activities: o Consolidated program decentralization and integration into primary health care. o Developed technologies that allow for more efficient and decentralized action against the epidemic. o Established MONITORAIDS to monitor, evaluate, and report on program and project results. 2. The AIDS-SUS project will complement activities undertaken by other Bank- financed health projects - VIGISUS, Family Health and QUALISUS ­ to strengthen the health system as a whole. A comparison of mechanisms for transfer of funds from the federal level to states and municipalities under Bank-financed health projects is included below. 47 BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Federal Transfer Mechanisms in Health Programs AIDS/ STD CONTROL III VIGISUS II FAMILY HEALTH I FAMILY HEALTH II QUALISUS I June 2003* April 2004 February 2002 March 2008 December 2008 PROJECT FOCUS HIV incidence, quality of Health surveillance and Primary Health Care. Primary Health Care. Efficiency, quality, life for PLHA. indigenous health. governance of health care. PROJECT DEVELOPMENT OBJECTIVES Reduce incidence of STD & Reduce mortality / morbidity Increase access to Family Increase access to Family Improve quality, efficiency, HIV by strengthening from communicable and non- Primary Health care in large, Primary Health care in large, effectiveness of SUS- national response & ensuring communicable dieases and urban municipalities. urban municipalities. financed delivery system via its sustainability. exposure to risk factors integrated regional associated with ill health. healthcare networks. Improve the quality of life of Improve health outcomes of Raise the technical quality Contribute to improving people living with groups most at risk including of, and patient satisfaction continuity of care by HIV/AIDS by strengthening indigenous populations and with, primary health care. strengthening the prevention, national response & ensuring Quilombo (descendents of detection, and treatment of its sustainability. slaves) communities. diseases and conditions with the greatest impact on the country`s disease burden. Improve the efficiency and Improve overall effectiveness of Family effectiveness of the delivery Health service providers as system to prevent, detect, well as the broader delivery treat priority chronic and system. non-communicable conditions. Improve the quality and efficiency of services w/ emphasis on secondary-level hospitals, specialty, diagnostic, and emergency centers, logistical systems. * Date of PAD publication 48 AIDS/ STD CONTROL III VIGISUS II FAMILY HEALTH I FAMILY HEALTH II QUALISUS I June 2003* April 2004 February 2002 March 2008 December 2008 BENEFICIAIRIES 438 200 187 municipalities 187 Municipalities 15 Regional health networks 27 states + DF 27 states + DF 411 municipalities 25 state capital cities 144 satellite cities TRANSFER MECHANISM Fund to fund transfer - Fund to fund transfer - Two pilot bonus systems that Management Contracts Subproject Plans resources flow from National resources flow from National were announced in 2005 and between first technically qualified by Health Fund (FNS) to State Health Fund (FNS) to State implemented in 2006. MOH and states; independent panel and Municipal funds. and Municipal funds. MOH and municipalities. MOH selects up to 15 plans. PAM: Results-based Action PLANVIGI: Surveillance Plans for states and development plan prepared municipalities. by state / municipality and MOH confirms management approved by MOH. capacity. DISBURSEMENT V. INDICATORS Each state / municipality States have 14 indicators A lump-sum bonus was given Performance level at mid- Implementation divided into agrees on a set of indicators / Capital cities 12 indicators to municipalities that met 3 term will determine financing two phases. Level of funding targets Municipalities 10 indicators performance indicators. levels for the subsequent 18 for 2nd phase depends on months of execution. performance in 1st phase. Agreements were evaluated Outputs & intermediate Additionally, a performance Municipalities agree to meet Compliance with subset of 17 in month 10 of outcomes benchmarked for prize bonus was established targets for 12 mandatory mandatory indicators. implementation and revised each phase. based on coverage and indicators. or continued for the fiduciary objectives. following year Weighted grading system Municipalities select elective Elective indicators eligible determines level of indicators to be eligible for for bonus financing. performance bonus financing. PLANVIGI divided into two Variable targets set according Variable targets set according phases. Level of funding for to specific municipality plans to specific subproject plans 2nd phase depends on and baseline data. and baseline data. performance in 1st phase MONITORING AND EVALUATION 6 months (targets) and 12 2 years One-time assessment at end 18 months by MOH. 6 months (data entry) and 2 months (PAM) SVS certifies compliance of project by MOH. years (in-depth assessment) Municipalities assessed by with indicators. by state M&E staff; and states SFC carries out MOH. 49 AIDS/ STD CONTROL III VIGISUS II FAMILY HEALTH I FAMILY HEALTH II QUALISUS I June 2003* April 2004 February 2002 March 2008 December 2008 by federal M&E staff administrative and financial Inception of federal, state and audits. municipal M&E units. Subset of participating states serve as pilot M&E sites. CATEGORIES OF PERFORMANCE RATING Technical & financial Technical & financial One: requirements for bonus Nine: matrix plots coverage Excellent execution execution were met. goals against technical Satisfactory Above 75% = Good Above 75% performance & financial Unsatisfactory Between 50-75% = Between 50-75% execution. Satisfactory Below 50% Below 50% = Unsatisfactory HIGH PERFORMANCE Score of 75% or above on Score of 75% or above on Not defined. Not defined. Not defined. weighted grading system. weighted grading system. LOW PERFORMANCE Score of 50 or below on Score of 50 or below on Not defined. Low execution. No financial execution 6 weighted grading system. weighted grading system. months after receiving MOH allocation. REWARDS Not defined. 10% increase in funding to be For performance bonus, 50% Up to 2.5 times original 10% increase in funding to be used during second phase of of original grant was financing for meeting agreed used during second phase of implementation to fund transferred as a lump sum targets on mandatory implementation. predefined bonus plan. payment. For performance indicators; additional 15% of prize, 12 municipalities split financing available as a bonus R $6 million. if elective indicators are met. PENALTIES Possible cessation of funding. 10% decrease in funding; Funding reduced or delayed. Not defined. Funding reduced or delayed. implement predefined emergency plan during second phase . REMEDIES Municipalities must present Increased monitoring, Targeted TA. Not defined. Low performers receive corrective action plans to supervision, training and TA. additional TA. Municipal Health Council; remedies for States not 50 AIDS/ STD CONTROL III VIGISUS II FAMILY HEALTH I FAMILY HEALTH II QUALISUS I June 2003* April 2004 February 2002 March 2008 December 2008 defined. TA includes capacity building for states/ municipalities to qualify for transfers. EXIT STRATEGY Cessation of funding can be Transfers may be blocked. Not defined. Exclusion from project Persistent low performance recommended by supervising financing. results in exclusion from inter-managerial committees. further financing. IMPACT In 2007, 75% of In 2008, 75% of The modest results-based Project not yet effective. Project not yet effective. municipalities reached at municipalities reached at financing scheme represented least 75% of targets and least 75% of targets and the first time MOH had used financial execution. financial execution. such mechanisms. Despite initial resistance, the response was so positive that MOH introduced a modified version into its Pactos de Saude policy in 2006. 51 Annex 3: Results Framework and Monitoring BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service PDO Project Outcome Indicators Use of Project Outcome Information 15% increase in MSM reporting the use of a condom Monitor progress in Increase access and the last time they had sex in the last year. meeting targets of utilization of HIV/AIDS the Brazil National STDs and and STD prevention, 10% increase of sex workers reporting the use of a AIDS Program and care and treatment condom with their most recent client. PDOs. services by Groups Most at Risk. 15% increase of DU who report the use of a condom Review strategy and at last sexual intercourse. policies based on evidence. 49% PLHA accessing condoms. Report to beneficiaries, 70% prisoners accessing condoms. Government, UNGASS and Bank. 70% execution of EEPs. Prepare National Strategic 85% SES (27) reaching at least 70% of PAM targets. Plan 2014-2018. Improve the 66% SMS Capital City (26) reaching at least 70% of performance of the PAM targets. National HIV/AIDS and STD Program through 20% increase in SES with institutional site decentralized information on STD and HIV/AIDS (epidemiological implementation, and financial). improved governance and results-based 20% increase in SMS capital city with institutional management. site information on STDs and HIV/AIDS (epidemiological and financial). 85% CSO with results-based contracts. National HIV/AIDS Strategic Plan 2014-2018 based on project-generated evidence available on the web. Intermediate Outcomes Intermediate Outcome Indicators Use of Intermediate Outcome Monitoring Increase access to 15% increase in MSM, SW, DU reporting access to Assess progress on project prevention and testing free condoms in the last 12 months. implementation for groups most at risk 15% increase in MSM, SW, DU reporting having Assess effectiveness of, and been tested for HIV in the last 12 months. improve interventions, involving groups most at risk. 49% MSM accessing services which provide condoms. Review programs and activities based on 48% SAE providing condoms in routine visits. evidence. Increase supply and 72% pregnant women tested for HIV during prenatal Assess progress on project demand for STDs and visits. implementation HIV testing at PHC level 25% pregnant women tested twice during prenatal Assess decentralized program visits and once during delivery for syphilis. performance. 52 44% sexually active population who report having Review programs and been tested at least once for HIV. activities based on evidence. Improve transparency, 70% SES PAM with specific targets for groups most Assess progress on project accountability, at risk. implementation capacity, and decentralized 83% SES executing at least 70% of Incentive Assess decentralized program performance resources transferred each year. governance and performance. 76% SMS Capital City executing at least 70% of Review programs and Incentive resources transferred each year. activities based on evidence. 50% increase in SES that carried out training in management and governance. 50% increase in SES qualified for performance bonus. Increase in permanent DST/AIDS staff from 19 to 40. Increase in proportion of contracts carried out by DLOG from 10% to 75%. Intermediate Outcomes Intermediate Outcome Indicators Use of Intermediate Outcome Monitoring Improve surveillance, 20% AIDS cases in PLHA over 13 years of age with Assess progress on project M&E and R&D a notification delay. implementation 63% SES providing PAM monitoring information. Assess program governance and performance. 34% SMS Capital City providing PAM monitoring information. Review programs and activities based on evidence. All SES and SMS Capital City trained by the DST/AIDS on epidemiological surveillance. 3 impact evaluations carried out. 17 research projects focused on groups most at risk. 8 international cooperation projects focused on M&E. Safeguards 100% DSEI (34) with Plan STD and HIV/AIDS Assess safeguards implemented compliance 53 BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Arrangements for results monitoring Target Values Data Collection and Reporting DLI Global Indicator Baseline 2010 2011 2012 2013 2014 Frequency and Data Collection Responsibility Reports Instruments for Data Collection 70% execution EEPs. NA 70% 70% 70% 70% NA Every year SIS DST/AIDS Project Development Baseline 2010 2011 2012 2013 2014 Frequency and Data Collection Responsibility Indicators Reports Instruments for Data Collection 1 MSM reporting use of TBD Baseline NA NA +15% NA Every three BSS DST/AIDS condoms the last time years they had sex in the last year. 2 Sex workers reporting 90.1% Baseline NA NA +10% NA Every three BSS DST/AIDS the use of a condom with years their most recent client 3 DU reporting use of TBD Baseline NA NA +15% NA Every three BSS DST/AIDS condoms at last sexual years intercourse 4 PLHA accessing 35% NA 39% 42% 49% 49% Annual Needs Plan DST/AIDS condoms 5 Prisoners accessing 58% NA 61% 64% 70% 70% Annual BSS DST/AIDS condoms 6 SES reaching at least 50% 65% 70% 80% 85% 85% Annual SIS DST/AIDS 70% of PAM targets 2008 7 SMS Capital City 39% 51% 55% 62% 66% 66% Annual SIS DST/AIDS reaching at least 70% of 2008 PAM targets 8 SES with institutional TBD NA >5% >10% >20% >20% Annual Institutional sites DST/AIDS site information on STD and HIV/AIDS 9 SMS Capital City with TBD NA >5% >10% >20% >20% Annual Institutional sites DST/AIDS institutional site information on STD and HIV/AIDS 54 DLI Target Values Data Collection and Reporting Project Monitoring Baseline 2010 2011 2012 2013 2014 Frequency and Data Collection Responsibility Indicators Reports Instruments for Data Collection 10 CSO with results-based 2.5% 25% 50% 75% 85% 85% Annual SIMOP DST/AIDS contracts 5/200 2008 11 National HIV/AIDS NA Outline 1st draft 2nd Available Availabl Annual DST/AIDS DST/AIDS Strategic Plan 2014-2019 draft on the e on the Report based on project- web web generated evidence. 12 MSM reporting access to TBD Baseline e NA NA +15% Every three BSS DST/AIDS free condoms in the last years 12 months. 13 SW reporting access to 77.2% Baseline NA NA NA +15% Every three BSS DST/AIDS free condoms in the last years 12 months. 14 DU reporting access to TBD Baseline NA NA NA +15% Every three BSS DST/AIDS free condoms in the last years 12 months. 15 MSM reporting having TBD Baseline NA NA NA +15% Every three BSS DST/AIDS been tested for HIV in years the last 12 months 16 SW reporting having 30.4% Baseline NA NA NA +15% Every three BSS DST/AIDS been tested for HIV in years the last 12 months 17 DU reporting having TBD Baseline NA NA NA +15% Every three BSS DST/AIDS been tested for HIV in years the last 12 months 18 Sexually active 38% NA NA NA NA 44% Every three BSS DST/AIDS population reporting 2008 years having been tested at least once for HIV 19 MSM accessing services 35% NA 42% 45.5% 49% Annual Plan of needs of DST/AIDS which provide condoms 2008 38.5% prevention inputs 20 SUS services (SAE) 32% NA 40% NA 48% NA Biannual QUALIAIDS DST/AIDS providing condoms in 2007 the routine pre- consultation 55 Target Values Data Collection and Reporting DLI Project Monitoring Baseline 2010 2011 2012 2013 2014 Frequency and Data Collection Responsibility Indicators Reports Instruments for Data Collection 21 Pregnant women tested 62.3% NA NA NA NA 72% Every four years Sentinel study DST/AIDS for HIV during prenatal 2006 visits 22 Pregnant women tested 16.9% NA NA NA NA 25% Every four years Sentinel study DST/AIDS for syphilis during 2006 prenatal visits 23 Proportion of AIDS 40% NA 35% 30% 25% 20% Annual SIS DST/AIDS cases in PLHA over 13 2007 years of age with a notification delay 24 SES executing at least 59% NA 68% 71% 77% 83% Annual SIS DST/AIDS 70% of Incentive Policy 2008 resources transferred each year 25 SMS Capital city 54% NA 62% 65% 70% 76% Annual SIS DST/AIDS executing at least 70% of 2008 Incentive Policy resources transferred each year 26 SES PAM with specific 30% NA 40% 50% 60% 70% Annual SIS DST/AIDS targets for groups most 2008 at risk 27 SES that carried out 0% NA 20% 30% 40% 50% Annual SIS DST/AIDS training in management and governance 28 SES qualified for 0% NA 20% 30% 40% 50% performance award 29 SES providing PAM 35% NA 53% 56% 60% 63% Annual SIS DST/AIDS monitoring information 2008 30 SMS Capital city 19% NA 29% 30% 32% 34% Annual SIS DST/AIDS providing PAM 2008 monitoring information 31 All SES and SMS 0 NA 20 31 42 53 Annual SIS DST/AIDS Capital City trained by 2008 100% DST/AIDS on epidemiological 56 surveillance Target Values Data Collection and Reporting DLI Project Monitoring Baseline 2010 2011 2012 2013 2014 Frequency and Data Collection Responsibility Indicators Reports Instruments for Data Collection 32 R&D subprojects 13 NA 15 NA 17 NA Biannual R&D Report DST/AIDS focused on groups most 2008 at risk 33 Impact evaluation 3 NA Baseline Ongoin Ongoing 3 carried Annual M&E Report DST/AIDS carried out Designe data g out d 34 International cooperation 4 NA 5 6 7 8 Annual CC Report DST/AIDS subprojects focused on 2009 M&E 35 Increase # permanent 19 NA 25 30 35 40 Annual SIS DST/AIDS staff 2009 36 Increase # contracts bid 10% NA 25% 50% 65% 75% Annual SIS DST/AIDS by DLOG 37 Increase in DSEI with 26 NA 28 30 32 34 Annual SIASI DST/AIDS Plan STD and HIV/AIDS implemented 57 BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Project Indicator Protocols # DLI INDICATORS PROTOCOL GLOBAL INDICATOR X 70% execution EEPs. Numerator: Total of executed eligible expenditures in the period. Denominator: Total of planned eligible expenditures in the period. PROJECT OUTCOME INDICATORS 1 X MSM reporting use of condoms the last time they had Numerator: Total number of MSM who reported having used condoms in their last sexual sex in the last year intercourse within the last 12 months. Denominator: Total number of MSM. 2 X Sex workers reporting the use of a condom with their Numerator: Total number of SW who reported having used condoms in their last sexual most recent client intercourse within the last 12 months. Denominator: Total number of SW. 3 X DU reporting use of condoms at last sexual intercourse Numerator: Total number of DU who reported having used condoms in their last sexual intercourse within the last 12 months. Denominator: Total number of DU. 4 X PLHA accessing condoms Numerator: Total number of PLHA who reported having used condoms in their sexual intercourse within the last 12 months. Denominator: Total number of PLHA. 5 X Prisoners accessing condoms Numerator: Total number of incarcerated people who have access to condoms. Denominator: Total number of people incarcerated. 6 X SES reaching at least 70% of PAM targets Numerator: Total number of SES with at least 70% PAM targets achieved. Denominator: Total number of SES under the Incentive Policy. 7 X SMS Capital City reaching at least 70% of PAM targets Numerator: Total number of SMS with at least 70% PAM targets achieved. Denominator: Total number of SES under the Incentive Policy. 8 X SES with institutional site information on STD and Numerator: Total number of SES with information on HIV/AIDS and STD on institutional HIV/AIDS sites. Denominator: Total number of SES under the Incentive Policy. 9 X SMS capital city with institutional site information on Numerator: Total number of SMS with information on HIV/AIDS and STD on institutional STD and HIV/AIDS sites. Denominator: Total number of SMS under the Incentive Policy. 10 X CSO subprojects financed by results Numerator: Total number of CSO projects funded by the DST/AIDS with disbursements linked to the achievement of results. Denominator: Total number of CSO projects funded by the DST/AIDS. 58 # DLI INDICATORS PROTOCOL 11 X National HIV/AIDS Strategic Plan based on project- st nd st rd 1 year: outline; 2 year: 1 draft; 3 year: 2nd draft; 3rd year: available on the web. generated evidence. PROJECT INTERMEDIATE INDICATORS 12 MSM reporting access to free condoms in the last 12 Numerator: Total number of MSM who reported having received free male condoms. X months. Denominator: Total number of MSM. 13 X SW reporting access to free condoms in the last 12 Numerator: Total number of SW who reported having received free condoms. months. Denominator: Total number of SW. 14 X DU reporting access to free condoms in the last 12 Numerator: Total number of IDUs who reported having received free condoms. months. Denominator: Total number of IDU. 15 X MSM reporting having been tested for HIV in the last 12 Numerator: Total number of MSM who reported having been tested for HIV some time in months their life. Denominator: Total number of MSM. 16 X SW reporting having been tested for HIV in the last 12 Numerator: Total number of SW reports that have been tested for HIV some time in their life. months Denominator: Total number of SW. 17 X DU reporting having been tested for HIV in the last 12 Numerator: Total number of DU who reported having been tested for HIV some time in their months life. Denominator: Total number of DU. 18 Sexually active population reporting having been tested at Numerator: Total number of sexually active individuals 15-64 years who reported having least once for HIV been tested for HIV some time in their life. Denominator: Total number of individuals sexually active 15-64 years. 19 X MSM accessing services which provide condoms Numerator: Total number of MSM who reported having access to services which provide free male condoms. Denominator: Total number of MSM. 20 SUS services (SAE) providing condoms in the routine Numerator: Total number of SAE providing condoms in the first medical appointment. pre-consultation Denominator: Total number of SAE who joined QUALIAIDS. 21 Pregnant women tested for HIV during prenatal visits Numerator: Total number of pregnant women who reported being tested for HIV in prenatal care. Denominator: Total number of pregnant women. 22 Pregnant women tested for syphilis during prenatal visits Numerator: Total number of pregnant women who being tested for syphilis in prenatal care. Denominator: Total number of pregnant women 23 Proportion of AIDS cases in PLHA over 13 years of age Numerator: Total number AIDS cases in individuals 13 years and over, with date of with a notification delay notification exceeding one year from the date of diagnosis. Denominator: Total number of AIDS cases in individuals 13 years of age and over. 24 X SES executing at least 70% Incentive resources Numerator: Total of executed eligible expenditures by SES under PAM in the period. transferred each year Denominator: Total of planned eligible expenditures by SES under PAM in the period. 59 # DLI INDICATORS PROTOCOL 25 X SMS Capital city executing at least 70% Incentive Numerator: Total of executed eligible expenditures by SMS Capital City under PAM in the resources transferred each year period. Denominator: Total of planned eligible expenditures by SMS Capital City under PAM in the period. 26 SES PAM with specific targets for groups most at risk Numerator: Total number of SES including in the PAM targets for groups most at risk. Denominator: Total number of SES under the Incentive Policy. 27 SES that carried out training in management and Numerator: Total number of SES that conducted training in management and governance. governance Denominator: Total number of SES under the Incentive Policy. 28 SES qualified for performance award Numerator: Number of SES which qualified for performance awards. Denominator: Total number of SES under the Incentive Policy. 29 SES providing PAM monitoring information Numerator: Total number of SES with a functional Monitoring System. Denominator: Total number of SES under the Incentive Policy. 30 SMS Capital City providing PAM monitoring Numerator: Total number of SMS Capital City with a functional Monitoring System. information Denominator: Total number of SMS Capital City under the Incentive Policy. 31 All SES and SMS Capital City trained by the DST/AIDS Numerator: Total number of SES and SMS Capital City trained by the DST/AIDS in the on epidemiological surveillance technique of database relationship. Denominator: 27 SES and 26 SMS Capital Cities. 32 R&D subprojects focused on groups most at risk Numerator: Total number of R&D projects focusing on groups most at risk. Denominator: Total number of R&D projects funded by the DST/AIDS. 33 Impact evaluations carried out At least 3 impact evaluations on: (i) interventions to decrease risk among groups most at risk; (ii) results-based financing; and (iii) fiscal impact of the program. 34 International cooperation Numerator: Total number of international cooperation projects focused on M&E. projects focused on M&E Denominator: Total number of international cooperation projects. 35 Increase # permanent staff Numerator: Total number of permanent staff. Denominator: Total number of permanent and temporary staff (including consultants). 36 Increase # contracts bid by DLOG Numerator: Total number of contracts carried out by DLOG for DST/AIDS. Denominator: Total number of contracts carried out by DST/AIDS. 37 DSEI with Plan STD and HIV/AIDS implemented Numerator: Total number of DSEI with Plan for STD and HIV/AIDS implemented: (i) distribution of male condoms; (ii) implementation of STD syndromic approach; (iii) availability of HIV and syphilis testing; and (iv) availability of PMCT. Denominator: 34 DSEI. 60 BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Monitoring and Evaluation 1. A review of the national M&E system of the Brazilian National AIDS and STD Program (DST/AIDS) was conducted during project preparation, focusing on data availability, data quality and data use. Important accomplishments in M&E include40: · Key data collection efforts include: behavioral surveillance surveys in the general population (2004, 2007), and 17-21 year old male army conscripts (1996, 1997, 1998, 1999, 2000, 2002, 2007). HIV prevalence in army conscripts and pregnant women (1996, 1997, 1998, 1999, 2000, 2002, 2004, 2006). AIDS case reporting has been mandatory since 1986 and the DST/AIDS also routinely reports on identified STD. Several AIDS-related research/evaluation studies have been published in peer-reviewed journals and/or national reports. · A national M&E Unit was established in 2003 with the responsibility for prioritizing M&E data collection efforts; coordination of M&E activities at the federal level; supporting decentralization of M&E responsibilities to the states and municipalities; dissemination of HIV and AIDS-related information; and, coordination of M&E capacity-building activities. · MONITOR-AIDS, a web-based system containing data for standardized indicators tracking HIV/AIDS and STD-related information at national, regional and state levels. It comprises 90 indicators (22 contextual indicators, 52 program indicators, 16 impact indicators). · The development and implementation of standardized M&E trainings including short training courses as well as specialized longer-term courses (i.e., M&E post-graduate course and master course). In 2007, 249 short trainings were conducted and 4,842 professionals from municipalities and CSO were trained. By the end of 2007, 61 people concluded the post- graduate course and 23 gained a Master`s degree in M&E. · The establishment of five Centers of Excellence for M&E, one in each of the five geographic regions of the country (i.e., two states: Pernambuco, Sao Paulo; three municipalities: Campo Grande, Curitiba, Manaus) to support decentralization of M&E activities. · M&E technical support to countries in Africa, the Caribbean and Latin America. Human resources and partnerships for M&E 2. Three units in the DST/AIDS have responsibility for M&E data: (1) the M&E unit; (2) the Surveillance Unit; and (3) the Research and Development (R&D) unit. The 40 Monitoring refers to the routine tracking and reporting of priority information about a program/project, its inputs and intended outputs, outcomes and impacts. · Evaluation refers to the rigorous, scientifically-based collection of information about program/intervention activities, characteristics, and outcomes that determine the merit or worth of the program/intervention. Evaluation studies provide credible information for use in improving programs/interventions, identifying lessons learned, and informing decisions about future resource allocation. · The national M&E system refers to M&E at the national, sub-national and service delivery levels and includes the following key data collection efforts: surveillance and surveys, routine program monitoring, and evaluation / research. 61 DST/AIDS planning unit has specific responsibility for strategic/work planning both at federal and sub-national levels. All units have full-time professional staff. However, staff needs and required competencies for the units are not clearly defined. In addition, contract conditions are not favorable for recruitment and retention of qualified staff. There is considerable staff turn- over across the DST/AIDS, including the units responsible for M&E data; this impacts continuity of the program and requires continued M&E capacity-building. 3. In addition to the three units dedicated to M&E, some DST/AIDS programmatic departments are assigned a focal point responsible for supporting M&E for program management and program improvement. These focal points were formally trained in M&E through the Fiocruz Master`s Course in M&E. However, as most focal points do not have dedicated time for M&E and as there are many competing demands, they are often unable to fulfill their envisaged role in M&E. 4. The authority of the M&E unit vis-à-vis other DST/AIDS departments is unclear. The M&E unit is often seen as an ad hoc information provider and less as a leader in, and coordinator of, M&E activities across DST/AIDS departments. The M&E unit takes responsibility for substantial data analysis and producing M&E reports; there seems insufficient staff time for providing leadership in M&E and supporting M&E activities at federal and decentralized levels. The national M&E technical working group can help in coordinating M&E activities and providing oversight of implementation of the national M&E plan. However, its membership is currently not fully reflective of all relevant M&E stakeholder groups (e.g., it lacks representation from CSO). 5. Several M&E capacity-building activities are incorporated in the M&E unit work plan. However, they are mainly focused on formal training activities. There is insufficient attention to opportunities for on-the-job capacity-building such as through supportive supervision, mentoring, coaching at the federal as well as the decentralized levels. 6. Five Centers of Excellence for M&E received formal M&E training through the Fiocruz Masters Course in M&E in order to allow them to take responsibility for their own M&E and for supporting M&E in their respective regions. One full-time staff member per Center was funded by the federal level for an initial period of 3 years and subsequently to be funded by the state/municipal level. However, states/municipalities did not provide continued funding. Due to the mandated decentralization process in the health sector, the centers` supporting role for M&E in the wider region did not happen to the intended extent; however, they remain important for regionalized data collection. 7. New CSO and/or new staff getting involved in AIDS programs are in need of obtaining in-depth knowledge of the history of the AIDS epidemic and the programmatic response. Overall, the M&E capacity of CSO is low; M&E is often an afterthought rather than an essential component planned for at the beginning of a project. There is no regular sharing of experiences with project implementation and collecting and using M&E data for program management and improvement. The federal level is now moving towards making M&E a condition for approval of CSO project funding and requiring M&E certification of CSO staff through the implementation of a distance learning course on M&E. 62 8. A network of M&E professionals (i.e. those conducting M&E of HIV programs at different levels) was established with the aim to support experience-sharing on M&E and to encourage discussion around pragmatic M&E issues. The network is operational but has limited capacity for providing tailored advice; it is not intended nor can it be a substitute for specific M&E problem-solving, supportive supervision and feed-back. Evidence-based program planning and M&E planning 9. The national strategic plan for AIDS is now out-dated. As new epidemiologic data are now available/becoming available and as there are many stakeholders to be coordinated in the HIV response, an evidence-based, multi-sectoral AIDS strategy is of utmost importance to guide the program at federal and decentralized levels. 10. Work planning at the federal level occurs on an annual basis and is led by the planning unit which also oversees implementation progress. There is a multitude of program objectives which are not always clearly defined and the use of available M&E data to select and prioritize interventions is not explicit. Work plans from DST/AIDS programmatic departments do not always include specific M&E objectives. 11. Whereas program planning is multi-sectoral at federal level, this is not always the case at decentralized levels. Annual work plans (PAM) from the decentralized levels are submitted to the federal level for approval and implementation monitoring; a web-based information system facilitates this process. Though the information provided is extensive, (i) the plans do not include all HIV-related activities at state/municipality level but only those funded by fund-to-fund money; and, (ii) the evidence base for selecting specific interventions is not explicit and interventions with proven effectiveness are not routinely included in intervention packages. As such, the plans do not provide an easily accessible overview of who is doing what where (know your response) and how this addresses the local epidemiological context (know your epidemic). 12. A systematic and sustained effort is in place to provide and monitor diagnostic and treatment services; the DST/AIDS has also initiated auditing of the quality of treatment and care for PLHA and STD patients. The same level of effort now needs to be expanded on the planning and implementation of effective prevention programs and on evaluation efforts to continue to improve the effectiveness and efficiency of prevention programs. Considerable program experience has been gained in HIV prevention, but experience has not been consolidated into learning that can be applied to program improvement in different local contexts. Prevention programs seem disconnected from treatment efforts and few programs specifically focus on PLHA. Studies to estimate the population size of vulnerable populations are ongoing and will provide results in early 2009; coverage and quality of prevention efforts for these vulnerable populations is currently largely unknown. 13. The national multi-year, multi-sectoral M&E plan is now outdated. As M&E activities at different levels support the national M&E system and ultimately serve to improve the national program, one comprehensive M&E plan with clear roles and responsibilities for the technical units at federal level (i.e., M&E unit, surveillance unit, R&D unit) and relevant 63 stakeholders at decentralized levels is important to ensure: (a) all M&E needs are addressed; (b) there is no duplication of effort; and (c) there is an agreed basis for coordination of M&E activities and assessing progress made in M&E implementation. Though the M&E plan includes a program logic model and an evaluation logic model, it is not sufficiently explicit in how these drive M&E data needs (i.e., what questions need to be answered at different levels of the HIV response) and systematic M&E data collection efforts, and how the data will be used for program improvement, resource allocation and policy-making. Operational questions do not seem to drive demand for M&E (i.e., data demand); M&E data collection seem to be driven mostly by the technical units (i.e., data supply). 14. It is unclear how priorities for M&E in the annual work planning cycle are decided and how they are explicitly linked to the national M&E plan. There seems to be insufficient joint M&E planning with the three units responsible for M&E data, though the M&E unit and surveillance unit seem to work closely together, while the R&D unit seems to work more independently. The planning unit monitors progress in the implementation of work plans for all DST/AIDS departments/units, but there is no official individual/body responsible for ensuring that the work of the three units responsible for M&E data is coordinated and complementary. 15. Budgeting for M&E should be at least 7-10% of the overall program budget to cover routine program monitoring and surveillance/surveys; additional funding is needed for evaluation/research studies. As M&E is a crucial component throughout the life of the DST/AIDS, the proportion of funding from the Government dedicated to M&E should outweigh the funding from external donors to ensure a sustainable national M&E system. M&E expenditures should be closely tracked. Information on M&E budgeting and expenditures is currently not readily available. 16. There is no systematic identification of evaluation/research needs in support of national response improvement. The R&D unit does not have a major focus on studies providing actionable results to improve program effectiveness and efficiency. 17. An important question to be addressed urgently is the issue of which surveillance approaches would best serve the needs of the country and its diverse regions. HIV, AIDS and STD surveillance efforts have been substantial and several important behavioral surveillance surveys have been conducted. However, there are still relatively few data available on vulnerable populations (IDU, MSM, SW) with special attention to regional data and the coverage and quality of services provided to them. Important studies (Respondent Driven Sampling, HIV incidence testing) are now underway. As is well known, all methods for sampling and collecting data from hard-to-reach populations have strengths and weaknesses. These need to be explicitly addressed in the interpretation of the data collection results for program planning and improvement purposes. 18. MONITOR-AIDS is fully implemented and provides data for national monitoring indicators on-line; it links federal, state and municipal levels allowing for feed-back. There are 90 national indicators, but for some data is scarce, lack data over time and/or are of poor 64 quality. In addition to MONITOR-AIDS, there are several other databases41 accessible on-line ­ some for public use, some for DST/AIDS internal use, but it is hard to obtain an integrated view and with that, a clear understanding of what it is known/not known about the epidemic and the HIV response and what the implications of the currently available data are for program planning and improvement. 19. The Brazil UNGASS report reflects an explicit commitment to addressing HIV/AIDS as a priority public health issue. However, data are not available for about a third of the UNGASS indicators deemed to be relevant to the Brazilian context. Data quality and data validation procedures at the point of data collection are unclear. There is a lag in understanding and ownership of a results-based management approach including a lack of a strong link between monitoring of activities and financial monitoring. Data dissemination and using data for decision-making 20. The web portal of the DST/AIDS is an important resource for accessing information (in several languages) related to the HIV/AIDS and STD epidemic in Brazil and the program response. It provides a direct link to MONITOR-AIDS including the set of standardized national indicators. Key data products (such as the epidemiological bulletin, survey reports) are disseminated through this portal. Though an important resource, the information is not presented in a way that facilitates easy use for approval of work plans and for program management and improvement, especially for those individuals/organizations with limited capacity. 21. Findings from evaluation/research studies are not easily accessible. There is no mechanism for systematic dissemination within the DST/AIDS or for sharing with the public. It is hard to get an overview of findings across studies and the lessons learned for application for program improvement, and the remaining data gaps. Recommendations Human Resources and Partnerships · Consolidating the three units responsible for M&E data into one department led by a senior manager with an M&E background and supervised by the DST/AIDS director. · Developing and implementing a systematic and knowledge, skills and competency (KSC)- based approach to human resource recruitment and professional development for M&E. · Contracting out major data analysis under the supervision of the national M&E unit to free up staff time for M&E leadership and coordination of M&E activities. Revisit the membership and terms of reference for the national M&E technical working group to ensure all relevant stakeholders are included and to facilitate coordination of M&E activities under the leadership of the national M&E unit. 41 Including SIM ­ Mortality Information System; SINAN ­ Notifiable Diseases Information System; SI-CTA ­ Voluntary Counselling and Testing (VCT) Information System; SISCEL ­ Control System for Laboratory Tests; SICLOM ­ Medicines Logistics Control System; and SIMOP ­ Project Monitoring System. 65 · Allotting dedicated M&E time in the personal work plans for focal points in DST/AIDS programmatic departments, fully endorsed and supported by the heads of department. · Requiring dedicated M&E funding for the Centers of Excellence from decentralized budgets to ensure M&E requirements for the AIDS program at sub-national levels can be met. · Supporting additional staff at the federal level and/or the Centers of Excellence to assist with M&E capacity-building in the regions and with providing mentorship, coaching and tailored problem-solving for M&E. · Increasing participation of civil society representatives in national M&E system planning and the national M&E technical working group. · Focusing on improving the capacity of decentralized levels, including CSO, for results-based program management. Evidence-based program planning and M&E planning · Developing a new national multi-year, multi-sectoral strategic plan based on the best available data on the HIV epidemic and the current response (i.e. including explicit references to data used in the planning). This could be proceeded by expert meetings/workshops involving program and M&E experts from all levels to (i) analyze existing data sources, their strengths and weaknesses, and their joint programmatic implications (i.e., conducting a national data triangulation analysis); and (ii) to identify key operational questions for the DST/AIDS at all levels and related M&E data needs and data collection requirements. The next round of strategic planning needs to draw on the results from this/these expert meeting(s)/workshop(s). · Revising the guidance for and content of current work plans in order to maximize their use as a management tool and to link more explicitly to improved program results at all levels. For the decentralized level, the work plans ideally include all (not just fund-to-fund supported) program activities for addressing HIV and AIDS within the local context; explicit references to local epidemiological and program data used in the planning process need to be included. Clear guidance on effective interventions to include in a comprehensive intervention package tailored to the specific local context needs to be provided and used in the approval process for decentralized work plans. · Institutionalizing a regular expert forum involving program and M&E experts for sharing and documenting experiences with HIV prevention interventions for different populations/settings focused on effectiveness and efficiency of programs. The evidence-base for HIV prevention globally and within countries is currently less well-developed than for AIDS treatment. This needs to be redressed urgently; Brazil can make an important contribution in this area in order to improve local HIV prevention programs as well as contribute lessons learned for sharing with other countries. · Revising the on-line system for storing and accessing work plans to facilitate the approval process and to maximize their use as a management tool. This may involve developing automated outputs that focus on key financing and programmatic issues (e.g., the proportion of federal and local budget used to support local AIDS programs; the relative focus on programs for different populations in line with the local epidemiological context). · Integrating regular M&E system assessments in the M&E planning cycle to take stock of strengths and weaknesses in the M&E system (i.e., all levels) to document accomplishments and to guide priority-setting in M&E system strengthening. This can be done every 2-3 years 66 with the involvement of all relevant stakeholders and yearly on the basis of the work plans submitted by federal as well as decentralized levels. · Developing costing tools for M&E activities at all levels and a mechanism for tracking budgeting for and expenditures on M&E. Appropriate M&E budgeting and expense tracking is a weak area globally, and thus there is an opportunity for Brazil to share tools and experiences with other countries. Collecting, verifying and analyzing M&E data · Institutionalizing a national data triangulation process to ensure that available data is used to its full extent and that important data gaps are identified. There is adequate in-country expertise to conduct such an analysis on a regular basis but appropriate management/facilitation and funding for the process need to be put in place. · Organizing an expert meeting on HIV/AIDS and STD surveillance methods. The DST/AIDS acknowledges (as do previous surveillance assessment reports) that surveillance needs to be strengthened within the context of the specific epidemiological profiles for the different regions in the country. Important new data collection efforts (BSS, HIV incidence testing) are ongoing and the experiences with their implementation and the strengths / weaknesses of the results and how the data can be used need to be carefully considered in determining the most appropriate approach to surveillance in Brazil. · Revising the national indicator set based on global standards (a tool developed by the M&E Reference Group is available) and local context including ensuring relevance of indicators to answer key questions about the HIV epidemic and the response and increasing indicator performance to ensure timely and quality data for trend analysis. · Adding to the existing web portal: (i) a section that focuses on programmatic implications of key M&E data (a product from the data triangulation and other expert analyses); (ii) an inventory of research/evaluation studies including key findings across studies and how they can be used for program planning and improvement. · Mapping of HIV interventions (with a specific focus on HIV prevention and care, as AIDS treatment is already much better documented). This will not only facilitate planning and coordination of activities, but also provide an opportunity to analyze program results (outcome, impact) in conjunction with program coverage for different populations/settings in order to generate lessons learned for improving the HIV response in Brazil. · Developing and implementing procedures and tools for assessing and improving data quality. Low data quality may mis-lead decision-making so, confidence in the validity and reliability of the data collected in crucial. Data dissemination and use for decision-making · A specific and increased focus on capacity-building of data use for program improvement at all levels. The ultimate purpose for collecting M&E data is program improvement, hence data use is the central focus of M&E system strengthening. Several of the above specific recommendations aim to improve data use. 67 Annex 4: Detailed Project Description BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service 1. The project will co-finance the Brazil STD and AIDS Program with a Specific Investment Loan (SIL) of US $67 million to be disbursed in four years (2010-2013). The project will follow a Sector Wide Approach (SWAp), with the loan co-financing a percentage of Government Eligible Expenditure Programs (EEP), as well as training and technical assistance. Disbursements will be triggered by the execution of the agreed programs and achievement of specific results targets. The project will use Government systems and procedures, both to foster ownership and to strengthen MOH, state and municipal institutional capacity. 2. The proposed project development objectives (PDOs) are the following: 1. Increase access and utilization of HIV/AIDS and STD prevention, care and treatment services by Groups Most at Risk; and 2. Improve the performance of the National HIV/AIDS and STD Program through decentralized implementation, improved governance and results-based management. 3. The project will track 1 Global Indicator and 11 Project Development Indicators (PDIs) to measure progress towards achievement of the PDOs and to trigger disbursements - Disbursement-Linked Indicators or DLIs. Another 9 indicators will also be linked to disbursements. The remaining indicators (17), while not linked to disbursements, will measure implementation progress and contribute to substantive dialogue between the Government and Bank during project implementation. All indicators and respective protocols are included in the Project Operational Manual and in Annex 3. Progress toward meeting all indicators will be tracked and reported systematically under the project. 4. The Project consists of the following Components: Component 1. Improving surveillance, prevention and control of HIV/AIDS and STD (a) Support the implementation of the Eligible Expenditure Programs, including activities to: (i) improve surveillance, prevention, diagnosis, and treatment of STD and HIV/AIDS for Groups Most at Risk; and (ii) carrying out strategic planning, monitoring and evaluation, and results-based management; (b) Support the carrying out of Result-based Grants. Component 2. Building decentralized governance and innovation capacity (a) The expansion of the prevention and care services for Groups Most at Risk and the strengthening of the institutional capabilities of DST/AIDS to further develop its governance and innovation capacity in dealing with HIV/AIDS and STD, through the provision of technical assistance and training which shall aim at carrying out, inter alia, the following activities: (i) the mapping, by region, of epidemic and prevention interventions with Groups Most at Risk; (ii) the production and testing of epidemiological data (triangulation); (iii) the development of monitoring and evaluation 68 and results-based activities, including, the carrying out of at least three impact evaluations; (iv) the carrying out of training programs for staff of the Borrower (DST/AIDS), States, Eligible Municipalities and Eligible CSOs, to strengthen their technical and institutional capacity in, inter alia: strategic planning, results-based management and monitoring and evaluation, and fiduciary management; (v) the improvement of the contents and implementation of the Incentive Policy; (vi) the elaboration and implementation of a plan to assist DST/AIDS in the communication, to the public-at-large, of a variety of areas supported by the Project, inter alia : (A) the expansion of social participation, transparency and accountability in the formulation of policies regarding HIV/AIDS and STD; and (B) the development of mechanisms for the proper disposal of non-biodegradable condoms; and (vii) the provision of consultants` services to carry out technical audits under the Project. (b) The carrying out of a series of activities, through the provision of technical assistance and training, aimed at strengthening the capabilities of the Borrower (through DST/AIDS), , the States, the Eligible Municipalities, the DSEI, and the Borrower`s entity responsible of Indigenous Peoples health, to adequately respond to the health needs of the Indigenous Peoples and control the expansion of HIV/AIDS and STD among said peoples (as set forth in the Indigenous Peoples` Planning Framework and the Indigenous Peoples` Plan, if applicable), including, inter alia, the following: (i) the provision of technical assistance to State and Eligible Municipality Health Secretariats to support DSEI in improving HIV/AIDS and other STD prevention, diagnosis and treatment activities in respect of indigenous populations; (ii) the carrying out of monitoring of the implementation of the DSEI plans on HIV/AIDS and other STD, including the creation of specific monitoring indicators; and (iii) the carrying out of a review and dissemination of the findings of the 2009 evaluation of DST/AIDS activities and repeating such evaluation in the second year of Project implementation. (c) Provision of support for Project coordination, through the provision of technical assistance, financing of incremental operating costs, and provision of the necessary goods and equipment required for such coordination. 5. The DST/AIDS will reach out to groups most at risk in their networks and communities, and improve governance at all levels. The project will contribute to the development of relevant policies, guidelines and technical regulations for the health care network; and provide incentives to the health system at federal, state and municipal level, and to CSO, to better serve the needs of groups most at risk. Transparency, accountability and social control will be improved by promoting performance-based management, and organization of services involving relevant networks. The surveillance gaps to be covered by the project are: estimates of HIV incidence; systematic estimates of the size of populations most at risk; systematic behavioral and seroprevalence surveys of groups most at risk; mapping of HIV/AIDS and STD, groups most at risk and interventions to prevent and control the epidemic; and systematic surveillance of STD. Monitoring and evaluation of HIV/AIDS and STD will continue to be promoted throughout the program to induce the establishment at all levels of an evidence and results-based culture. 69 BRAZIL AIDS-SUS Project Components Component 1(a). Improve Surveillance, Prevention and Control of HIV/AIDS and STD for Groups Most at Risk Areas - Support the implementation of the EEPs Policy Formulation Develop policies, guidelines and technical regulations for the health care network to better and Regulation reach groups most at risk; improve the logistical system that provides condoms and drugs. Surveillance Improve behavioral and seroprevalence surveillance of HIV/AIDS and other STD, prioritizing groups most at risk and PLHA. Information Further develop program M&E; coordinate epidemiological surveillance, R&D and M&E; Management monitor and evaluate R&D; and develop tools and processes to make the information available to key stakeholders. Research & Promote R&D in innovative, priority areas to better reach vulnerable populations, and to Technology develop vaccines and other prevention products; develop cooperation between research Innovation institutes, private sector and development agencies; and assess technology. Decentralized RBM Establish results-based financing of STD and HIV/AIDS programs in states, municipalities and CSO, on surveillance, M&E, prevention, treatment and care. Network Further organize a network of care integrating primary, secondary and tertiary care to Organization expand the provision and improve the quality of services in the areas of prevention, diagnosis and treatment of STD and HIV/AIDS, focusing on groups most at risk. Transparency, Strengthen social participation in the formulation and control of policies for HIV/AIDS and Accountability, other STD, and increase transparency and visibility of program inputs, processes, activities Social Control and results. National & Develop national and international networks to improve the national response focusing on International groups most at risk; integrate the efforts of the relevant health subsectors, especially those Cooperation linked to surveillance, primary health care, and reproductive health, as well as public and private sectors and civil society; and increase South-South cooperation, especially in the context of MERCOSUR and CPLP. Component 1(b). Support the carrying out of Result-based Grants Governance & Results-based grants for State and Municipal Secretariats (SES and SMS, respectively) and management CSO, and individual providers, namely to focus on groups most at risk. Component 2. Build Decentralized Governance and Innovation Capacity Surveillance Mapping the epidemic and prevention activities. M&E Annual Independent Verification Agency Impact evaluation of Interventions to decrease risk among groups most at risk Results-Based Financing Fiscal impact of the program, focusing on ART Governance & Capacity-building in strategic planning, project management and M&E for DST/AIDS, management SES, SMS and CSO. Development of an output-based cost-accounting system for PAM Transparency & Communication, Accountability and Participation Plan Accountability Indigenous Technical assistance to SES and SMS to support DSEI improving STD and HIV/AIDS Populations prevention, diagnosis and treatment interventions. Environment Communication strategy for proper disposal of non biodegradable condoms (mainly feminine condoms); system of payment for environmental services to protect the forest and its biodiversity. FM Implementation of FM Action Plan. Procurement Implementation of Procurement Action Plan; Modernization of procurement processes. 70 6. Component 1. Improve surveillance, prevention and control of STD and HIV/AIDS (US$192 million total cost; US$ 59 million Bank financing). Component 1 (a) will contribute to improving STD and HIV/AIDS surveillance, prevention diagnosis and treatment among groups most at risk, by supporting critical policies, surveillance, M&E, R&D, decentralized results-based management, network organization, governance at the three levels of Government and in CSO, and national and international cooperation. 7. The project will focus on groups with high epidemiological risk ­ men who have sex with men, sex workers, drug users and prisoners - as well as people living with HIV/AIDS and with high social vulnerability. The DST/AIDS will reach out to groups most at risk in their networks and communities, and improve governance at all levels. The project will contribute to the development of relevant policies, guidelines and technical regulations for the health care network; and provide incentives to the health system at federal, state and municipal level, and to CSO, to better serve the needs of groups most at risk. Transparency, accountability and social control will be improved by promoting performance-based management, and organization of services involving relevant networks. The project will include the following activities: Policy Formulation and Regulation, including the development of policies, guidelines and technical regulations for the health care network to better reach groups most at risk; and preparation and publication of the National Strategic Plan for 2014-2019. Surveillance. Although surveillance is well developed, significant challenges persist. The project aims to improve the monitoring of behavior and seroprevalence of HIV/AIDS and other STD, focusing on groups most at risk. To better understand the epidemic evolution, with new HIV infections evolving from defined vulnerable groups in the South to women without clear risk factors in the North, the project will carry out an epidemiological analysis at the outset. Such an analysis will include a review of surveillance, risk factor studies, modeling of HIV incidence and sources of new HIV infections and a detailed spatial analysis of HIV and AIDS cases and risk practices. Specifically, the project includes among other activities: (i) estimates of the incidence of HIV, (ii) estimates of the size of groups most at risk and behavior surveys and HIV seroprevalence among these groups, (iii) spatial analysis to identify epidemiological clusters of risk and HIV, groups most at risk, and activities involving these groups, (iv) systematic surveillance of STD, and (v) epidemiological analysis based on triangulation of data from various sources. Some of these activities have already started (e.g., estimates of the incidence of HIV), others will start in 2009 (mapping), and others will initiate after project effectiveness. M&E. Monitoring and evaluation of HIV/AIDS and STD will continue to be promoted throughout the program to induce the establishment of an evidence and results-based culture at all levels of governance. The project will focus on strengthening M&E in the four areas indicated before: (i) human resources and partnerships; (ii) evidence-based program planning and M&E planning; (iii) collecting, verifying and analyzing data; and (iv) data dissemination and using data for decision-making. Surveillance of HIV/AIDS and other STD, R&D and M&E will be coordinated; R&D will be monitored and 71 evaluated; and the project will develop tools and processes to provide information to key stakeholders. Impact Evaluations. At least three impact evaluations will be carried out under the project: (i) impact of interventions to decrease risk of STD and HIV/AIDS in groups most at risk; (ii) impact of results-based mechanisms over state, municipal and CSO performance and results; and (iii) fiscal impact of the national program, focusing on treatment of PLHA with ART. Research and Development aiming at promoting R&D in innovative, priority areas to better reach vulnerable populations, and to develop vaccines and other prevention products; develop cooperation between research institutes, private sector and development agencies; and assess technology. Project support will increase the likelihood that this work continues, and is coordinated with other global efforts. Network Organization. The project will contribute to further organize a network of care integrating primary, secondary and tertiary care to expand the provision and improve the quality of services in the areas of prevention, diagnosis and treatment of STD and HIV/AIDS, focusing on groups most at risk. As more people are under treatment, and HIV/AIDS becomes a chronic disease, it is important to integrate prevention and treatment into the national health system, especially at the primary health care level. This will include: o Prevention focusing on groups most at risk: development of technical guidelines and parameters; specific programs for groups most at risk, including implementation of plans for MSM and women (including SW), finalization and implementation of plans for DU, prisoners and PLHA, and implementation of the school program to reach youth at risk, since 90% of young people attend school; and focusing PAM activities in prevention among groups most at risk. o Care, Treatment and Social Support including development of technical parameters and logistic of drugs and other goods, and multi-sector social support to PLHA. Governance and quality of spending. This work will focus on further building decentralized program performance, results-based management and improving fiduciary processes. This will include: o Decentralized results-based financing, including linking financing to performance and achievement of results, at federal, state, and local level and CSO in the areas of surveillance, prevention, treatment and care of HIV/AIDS and other STD, focusing on groups most at risk;. o Incentive Policy. The MOH transfers funds to states and municipalities for health surveillance, prevention and treatment, under the Incentive Policy, through results-based Agreements (PAM) to increase the performance of agreed programs. The transfer is based on (i) the number of AIDS cases, (ii) increase in HIV incidence, (iii) availability of services (less structured receive more), (iv) 72 participation in previous projects, (v) local priorities. The DST/AIDS is classifying SES, SMS of capital cities and other SMS according to results and financial performance. Under the project, the Incentive Policy will be improved by: (i) simplifying the PAM, by reducing the number of targets for which states and municipalities are responsible; (ii) aligning planning, budgeting, M&E and performance; and (iii) providing technical assistance, training, monitoring and supervision to the states, municipalities and CSO with worse performance. o CSO. The DST/AIDS finances CSO to develop programs and activities in the areas of human rights, network development, social control, technical assistance and innovative approaches to work with vulnerable populations. The DST/AIDS is carrying out pilot projects in all regions to link the funding CSO to specific products. At least 10% of the funds transferred through the PAM are allocated to fund programs and activities implemented by CSO. States and municipalities finance direct actions at the local level with priority populations. Transparency, accountability and social control will be improved by promoting performance-based management, and organization of services involving relevant networks. The project will strengthen social participation in the formulation and control of policies for HIV/AIDS and other STD, and increase transparency and visibility of program inputs, processes, activities and results. There is a Committee for Communication with Civil Society and Human Rights, but there is no group dedicated to relations with the State and Municipal AIDS Coordinators. It is fundamental that they are engaged and empowered, especially those from small municipalities. Improving channels of communication and putting in places mechanisms to guarantee not just the execution of the activities, but also the quality of the activities being implemented will support the efforts of the program to improve accountability, transparency, social control, and governance. National and International Cooperation. The project will develop national and international networks to improve the national response focusing on groups most at risk; integrate the efforts of the relevant health subsectors, especially those linked to surveillance, primary health care, and reproductive health, as well as public and private sectors and civil society; and increase South-South cooperation, especially in the context of MERCOSUR and CPLP. 8. Component 1(b) will provide Results-based Grants for SES and SMS and CSO, and individual providers, as defined in the Operational Manual, to better serve the needs of groups most at risk, as indicated in the table below. Possible use of incentives to service providers (for example, pay providers for results achieved or that act in areas of difficult access) and beneficiaries (eg, payment of transport) to increase the use of services by groups most at risk are also being considered. Under the project, the system of incentives for CSO will be developed to reward innovative approaches and actions and improve performance and results. 73 BRAZIL AIDS-SUS Project Results-Based Grants Additional incentives were established under the project for the DF, States, Municipalities and CSO. Preliminary criteria were agreed for annual bonus to SES, SMS and CSO with good performance, as follows: The 27 SES may receive bonus up to US$ 100,000 if they fulfill the following requirements: Execute more than 70% of the annual transfer. Reach 100% of the targets regarding groups most at risk (MSM, SW, IDU). Reach 100% of the targets regarding PMTC of HIV and syphilis. Execute own budget for pharmaceutical drugs for opportunistic infections. Transfer funds to CSO selected by competitive bidding. The 26 SMS Capital City may receive bonus up to US$ 50,000 provided that they meet the following requirements: Execute more than 70% of the annual transfer. Reach 100% of the targets regarding groups most at risk (MSM, SW, IDU). Reach 100% of the targets regarding PMTC of HIV and syphilis. Execute own budget for pharmaceutical drugs for STD. Transfer funds to CSO selected by competitive bidding. CSO with funding of DST/AIDS may receive bonus up to 10% of initial allocation if they fulfill the following requirements: Achieve 100% of targets, execution of resources and reporting. Implement actions in 10 or more cities in five regions. CSO with funding from SES and SMS may receive bonus up to 10% of initial allocation if they fulfill the following requirements: Achieve 100% of targets, execution of resources and reporting. Develop actions to promote testing of HIV. Develop actions to promote use of prevention inputs (condoms, clean syringes and needles, etc). A National Innovation Award for prevention and control of STD and HIV/AIDS of US$ 100,000 will be awarded every 2 years as an incentive to innovative experiences developed by SES, SMS and OSC in these areas: (i) health promotion for PLHA; (ii) prevention of STD and HIV/ AIDS. Transfers to SES, SMS and CSO with none or low performance will be blocked according to existing regulations, and the DST/AIDS will provide additional technical assistance, training, monitoring and supervision, giving priority to the 27 SES and 26 SMS of capital city until the project`s mid-term review, and focusing on other SMS (about 475) after the mid-term review. Fellowship grants will be awarded to key project stakeholders in the public sector and CSO. These funds will be granted to Government staff, CSO leaders and young people living with HIV/AIDS for training in leadership, management, vocational training, etc. 9. Component 2. Build decentralized governance and innovation capacity (US$7.8 million total cost; US$7.8 million Bank financing). This component will finance specific support and training for expanding prevention and care for groups most at risk, and improve the DST/AIDS governance and innovation capacity. Among other activities, the Component assigns resources to the following: (i) Mapping the epidemic and interventions with groups most at risk by region; (ii) Assisting triangulation of data; (iii) Fostering M&E and results-based activities, including conducting at least three impact evaluations; (iv) Training in strategic planning, results-based program and project management; and program M&E at the three levels of Government, and CSO; (v) Carrying out technical and fiduciary capacity building of DST/AIDS and at decentralized level, including SES, SMS and CSO; (vi) Implementing a Communication Plan on: 74 Transparency, Responsibility and Social Control; Proper disposal of non-biodegradable condoms (mostly female condoms; System of payment for environmental services to protect the forest and its biodiversity in the production of condoms in Xapuri; (vii) Supporting DSEI, SES, SMS and CSOs to improve prevention, diagnosis, treatment and other assistance to the indigenous population. Specifically, DST/AIDS will (i) provide technical assistance to State and Municipal Health Secretariats to support DSEI improving HIV/AIDS and other STD prevention, diagnosis and treatment activities in indigenous populations; (ii) monitor the implementation of the DSEI Plans on HIV/AIDS and other STD through a project monitoring indicator; and (iii) carry out a review and dissemination of the findings of the 2009 evaluation and carry out a second evaluation of the program implementation in 2012; (viii) Hiring an Independent Verification Agency. 75 Annex 5: Project Costs BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Local Foreign Total Project Cost By Component US$ US$ US$ Component 1 ­ Improve surveillance, 163,500,000 28,500,000 192,000,000 prevention and control of STD and HIV/AIDS Component 1 (a) ­ Eligible Expenditure 161,500,000 28,500,000 190,000,000 Programs Component 1(b) ­ Result-based Grants 2,000,000 0 2,000,000 Component 2 ­ Build decentralized 7,000,000 832,500 7,832,500 governance capacity and innovation Total Project Costs 170,500,000 29,332,500 199,832,500 Front-end Fee 167,500 167,500 Total Financing Required 170,500,000 29,500,000 200,000,000 Government IBRD Total Project Cost By Component US$ US$ US$ Component 1 ­ Improve surveillance, 133,000,000 59,000,000 192,000,000 prevention and control of STD and HIV/AIDS Component 1 (a) ­ Eligible Expenditure 133,000,000 57,000,000 190,000,000 Programs Component 1(b) ­ Result-based Grants 0 2,000,000 2,000,000 Component 2 ­ Build decentralized 0 7,832,500 7,832,500 governance capacity and innovation Total Project Costs 133,000,000 66,832,500 199,832,500 Front-end Fee 167,500 167,500 Total Financing Required 133,000,000 67,000,000 200,000,000 76 BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Eligible Expenditures Programs (EEPs) Budget Code EEP First period Second period Third Fourth Total (Calendar year (Calendar year period** period** 2010)* 2011)* (Calendar year (Calendar year 2012)* 2013)* Program 1444 ­ Surveillance, Prevention and Control of Diseases Surveillance, Prevention and Control 10.305.1444.8670.0001 of HIV/AIDS and other STD 292.186.000.00 332.628.000.00 365.641.000.00 401.931.000.00 1.392.386.00 Financial Incentive to States, Federal District and Municipalities for 10.302.1444.20AC Activities of Prevention and Care on 149.648.000.00 151.976.000.00 167.060.000.00 183.640.000.00 652.324.00 HIV/AIDS and other STD TOTAL 441.834.000.00 484.604.000.00 532.701.000.00 585.571.00 2.044.710.00 * PPA 2008-2011** Estimated values based on average annual growth estimated in the PPA 2008-2011 The Government and the Bank may jointly review, once every year, the amounts assigned per budget code to the EEP and adjust as necessary, in a manner satisfactory to the Bank. The budget code numbers shall conform to the Government`s budget law. Budget code numbers may change under the Government`s budget law provided, however, that there is no change in the corresponding Programs and in the underlying activities to be financed by the loan under such Programs. 77 Annex 6: Implementation Arrangements BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service 1. The AIDS-SUS Project will be implemented over a four-year period. The Project`s expected Effective Date is September 1, 2010, and the expected Closing Date is December 31, 2014. The total Project costs are US$200 million, with a loan amount of US$67 million. 2. The Project comprises two components (i) Component 1 - Improve surveillance, prevention and control of STD and HIV/AIDS; and (ii) Component 2 - Build decentralized governance capacity and innovation. Component 1 (a) will follow a SWAp approach, in the sense that it will support the existing Brazilian AIDS Program through two Eligible Expenditure Programs - EEPs42, and is expected to strongly focus on results, strengthen local implementation capacity, and disseminate benefits to the whole Program. Component 1(b) will provide results-based grant to states, municipalities and CSO to better serve the needs of groups at risk. Component 2 involves acquisition of goods and non consultant`s services, hiring of consultants, and technical assistance to support implementation of Component 1 and to strengthen the Ministry of Health`s (MOH), as well as states` and municipalities` capacity to conduct their roles. The implementation arrangements at the central and decentralized levels are described below. The Implementation Arrangements at the Central Level 3. The MOH plays the central strategic role in the national effort to fight HIV/AIDS and other STD. Under the Brazilian law, the MOH is responsible for formulating and implementing national health policy, as well as for system planning, assessment and control. The MOH has six Secretariats: the Executive Secretariat (SE), the Secretariat of Health Surveillance (SVS), the Secretariat of Health Care (SAS), the Secretariat of Strategic and Participatory Management (SGEP), the Secretariat of Science, Technology and Strategic Supplies (SCTIE), and the Secretariat of Labor Management and Health Education (SGTES). 4. SVS is the MOH's Secretariat in charge of policy formulation and the carrying out of strategic epidemiologic surveillance activities, including for communicable and non-communicable diseases, and injuries. The Department of Surveillance, Prevention and Control of STD and AIDS (DST/AIDS) was created, under SVS, on May 27, 2009 through Decree #6860. It includes the National Program of Viral Hepatitis (PNHV) since October 2009. 42 The two identified EEPs are: (i) Surveillance, Prevention, and Control of HIV/AIDS and STD; and (ii) Federal Financial Transfers to States, Municipalities and the Federal District to Prevention and Care of HIV/AIDS and STD. 78 5. Such Department incorporates roles and functions of the former National AIDS and STD Program Coordination Unit (Programa Nacional ­PN)43, and will be responsible for coordinating and implementing part of the AIDS-SUS Project; and assisting states, municipalities and CSO with their part of the implementation. Responsibilities will include: (i) promoting the Project at the federal, state, and municipal levels to ensure timely and proper implementation; (ii) maintaining the political and technical dialogue with Government agencies (both within MOH and between MOH and other agencies), CSO, decision-making bodies in the health sector44, and the Bank; (iii) providing technical and fiduciary assistance to executors; (iv) monitoring project indicators and results and promoting the integration of such evidence into policymaking; (v) overseeing Project implementation and legal obligations; and (vi) serve as Bank`s counterpart during Project implementation. In addition, the DST/AIDS will be responsible for implementing a range of activities aimed at strengthening monitoring and evaluation capacity; strengthening governance; promoting a culture of performance-based financing; and carrying out strategic studies and research. 6. To develop its role, the DST/AIDS will count on 219 professionals, distributed in 15 units, as indicated below.45 Only 19 are MOH`s civil servants (including 3 temporaries), 12 are SES or SMS seconded staff, and 3 are UNODC seconded staff. Most of the remaining 185 are consultants hired through UNESCO or UNODC. Since personnel challenges have been a persistent issue since 1985, when the former PN was established, it has been agreed that the Project will include an indicator to demonstrate progress in this area by increasing the number of DST/AIDS staff from 4 to 40 during Project implementation, as indicated in Annex 3. The project will finance about 40 consultants along the four years of Project implementation. To avoid significant turnover of personnel during project implementation, consultants will be hired for the whole project implementation period, following the same procedures (or similar ones) used in VIGISUS II for hiring long-term consultants. The Bank will review and approve the Terms of Reference of and the proposed candidates for the key positions. DST/AIDS Staff # MOH Staff (including temporaries) 19* SES and SMS Seconded Staff 12 UNODC Seconded Staff 3 Consultants 185 Total 219 *To increase to 40 under the project 43 The National AIDS and STD Program Coordination Unit (PN) was established through portaria in 1985. Until this year, the PN was in charge of overseeing all HIV/AIDS and STD-related activities. The establishment of the Department incorporates the PN and formalizes this role within the structure of the MOH. 44 National Health Council (CNS), Tripartite Inter-managerial Commission (CIT), National Council of State Health Secretaries (CONASS), and National Council of Municipal Health Secretaries (CONASEMS). 45 This chart refers to former PN. Given the recent creation of the DST/AIDS, SVS is still discussing its final structure and chart. Despite any changes in structure, the main mission and related-activities of the Program will be kept. 79 DST/AIDS Organizational Chart AIDS National Commission (CNAIDS) UNAIDS Expanded DST/AIDS Program Technical Thematic Group Advisor Committee (COGE) (GT-UNAIDS) National Private Council for Prevention Center for International and Technical Advisory Committee Technical for Social Participation (CAMS) Cooperation nternacional (CICT) Communications Unit (ASCOM) Planning Unit (ASPLAN) Department of International DST/AIDS and Cooperation Unit (ACI) Viral Hepatitis Monitoring and Evaluation Unit (ASMAV) Information Technology Unit (ASIP) Logistics Unit Legal Unit (ASLOG) (ASJUR) Sexual Prevention Treatment Transmitted Laboratory Information Unit and Primary Disease Unit Network Unit and (PREV) Care Unit (UDST) (ULAB) Surveillance (UAT) Unit (UIV) Research and Finance and Human Human Rights and Technology Administration Resources and Civil Society Development Unit Institutional Articulation Unit Unit (UAD) Development Unit (SCDH) (UPDT) (UDHI) 80 7. The DST/AIDS will use both the MOH structure ­ Department of Logistics (DLOG), and the UN agencies to conduct procurement for centralized activities under the AIDS-SUS Project. It has been agreed that the Project will include an indicator to increase, during Project implementation, the percentage of contracts to be procured by DLOG instead of UN agencies, from 10% to 75%, as indicated in Annex 3. The use of UN agencies, as procurement agents, is expected for hiring of consultants, carrying out research studies, acquiring information technology equipment and logistics, and paying travel-related expenses for training and events. Information about the procurement processes, and whether they will be procured through DLOG or the UN agencies, were included in the Procurement Plan. The relationship between the DST/AIDS and the UN agencies will be formalized through Project Documents (PRODOC), which will include an annex stating that the Bank`s procurement rules and procedures shall be followed. Any fees charged by the UN agencies will be the Borrower`s responsibility and, as such, not financed by loan proceeds. Implementation Arrangement at Decentralized Level 8. The states and municipalities will play a key role within the Project, as will CSO. It is expected that the 26 states, the Federal District and around 500 46 municipalities participate in the project through the Incentive Policy (Política de Incentivo)47. To this end, results-based agreements (Plano de Ação e Metas - PAM)48 are agreed annually between the DST/AIDS and states or municipalities. Funds are transferred using the Fund to Fund transfer mechanism, also used in the third AIDS and STD Control Project49. Financing is based on demographic, epidemiological and local priorities criteria. Since 2002, the Incentive Policy allocates funds to states and municipalities according to: (i) HIV/AIDS prevalence (ii) epidemic growth rate; (iii) population coverage; and (iv) priorities defined by the Tripartite Inter-managerial Commission. Arrangements for granting bonuses for good performance have been agreed under the proposed Project. 46 Eligible states and municipalities are defined in the Portaria 2313 (December 19, 2002). The classification of municipalities is provided by the MOH. Currently, 481 municipalities benefit from the Incentive Policy. It is expected that this number increases during Project implementation. 47 The Incentive Policy is ruled by Portaria 2313 (December 19, 2002) that establishes all procedures and parties' obligations. The Incentive Policy was approved by the SUS, the National Health Council and Tripartite Inter-managerial Commission. Legal documents can be found on http://www.aids.gov.br/incentivo/referencia.htm. 48 The PAM - Plans of Actions and Targets are the agreements between the Federal Government and states and municipalities, which have a standardized format, are published on the web and are financed under the Incentive Policy. PAM do not generate any signed document. PAMs are prepared by states and municipalities annually, covering the calendar period January ­ December, and submitted to the State or Municipal Health Councils for approval. The MOH confirms such approval. 49 The National Health Fund is the Ministry of Health agency responsible for financing and transferring health funds to states and municipalities. Funds are transferred from the Fundo Nacional de Saúde (FNS) to Fundo Estadual de Saúde (State) or Fundo Municipal de Saúde (Municipalities). For PAMs estimated to cost R$200,000 or more funds are transferred monthly; for PAMs estimated to cost less than 200,000 Reais, funds are transferred three times a year. Law 8080 states all rules and procedures for such mechanism, including applicable documentation. A complete description of the Fund can be found on the web: Fundo Nacional de Saúde - Ministério da Saúde - Governo Federal 81 9. CSO may participate in two ways: (i) hired by the DST/AIDS as consultants, following procedures described in Annex 8; and (ii) hired by states or municipalities under the Incentive Policy. When hired directly by the DST/AIDS, CSO may receive bonuses for performance based on arrangements included in the Editais de Seleção. Under the Incentive Policy, states shall earmark at least 10% of incentive funds to CSO. All requirements to CSO`s participation in the Project will be detailed in the Project`s Operational Manual (POM). The Project Operational Manual 10. The Project Operational Manual (POM) describes the rules and procedures for Project implementation and monitoring, especially regarding innovations related to the SWAp approach and decentralized activities. The POM is divided into specific sections covering relevant technical and fiduciary aspects. It describes disbursement arrangements, which are quite different from traditional SILs. A POM was presented as a condition for Negotiations, and was found satisfactory. The Project Team 11. Project implementation will be coordinated by the same team that prepared the project (Annex 11). The team includes a Coordinator, and Operational and Planning Staff. Procurement and Financial Management will be the responsibility of the DST/AIDS Financial and Administration Unit (UAD), which has six functional areas: Procurement, Financial Management, Financial Reports, Events, Travel and General Services. 82 Annex 7: Financial Management and Disbursement Arrangements BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service 1. The project's financial management arrangements are based on the Financial Management Assessment (FMA) undertaken at the DST/AIDS in March 2009. Based on the Bank`s Financial Management (FM) guidelines50, the main purpose of the assessment was to: (i) confirm and review the adequacy of the agreed FM arrangements in the context of the project, and (ii) agree on next steps to be followed by DST/AIDS, including: (a) institutional arrangements and staffing; (b) Financial Management System; (c) interim, un-audited financial management reports (IFRs); (d) Internal Control mechanism; (e) flow of funds and main aspects of SWAp disbursements; and (e) external auditing arrangements. This annex reflects the agreed Financial Management arrangements and Action Plan, as well as measures to mitigate any unforeseen financial management risks associated with the SWAp approach. Financial Management Arrangements at Federal Level Borrower GOB ­ Ministry of Health. Accounting DST/AIDS follows federal accounting law (4320/64). FM system SIAFI and specific monitoring and evaluation system for AIDS sector SIMOP, SIS incentivo, SIDOR, SIAIDS, Assets Management System and SOE (specific module that produces SOEs and IFRs). IFR To be used for monitoring and disbursement purposes. Regular IFRs would be complemented by specifically designed IFR reflecting agreed disbursement indicators and eligible percentage and confirmed by an independent verification agency. Staffing Professional staff with experience with Bank procedures. Attended fiduciary training provided by the Bank in April 2008. Flow of funds Treasury would advance funds and request reimbursements for Part 1(a) of the Project and use Advance to the Designated Account for Part 1(b) and 2 of the Project Internal Auditing Not applicable for Federal Projects. Internal Control Through segregation of functions (i) Reconciliation with different systems, (ii) follow up of Operational Manual procedures and independent verification agency. External By SFC ­ GOB external auditing secretariat. Specific TOR to be sent to the Bank Auditing by Negotiations. Disbursements Disbursements would be report based using a tailored IFR showing achievement of agreed indicators, which are subject to the independent verification agency to support the identification of eligible expenditures. Disbursements methods will be reimbursements for Part 1(a) and advances to the Designated Account for Parts 1(b) and Part 2. 2. The DST/AIDS demonstrated ability to adapt the current FM arrangements for a SWAp design.The project at the federal level meets the Bank`s minimum requirements to provide, with reasonable assurance and accuracy, timely information on the status of the FM aspects. Although the DST/AIDS has most of the FM requirements in place, including institutional arrangements, internal control mechanisms and financial 50 Financial Management Practices in World Bank Financed Investments Operations as of November 3, 2005; Implementing Output- Based Disbursement mechanisms for investment operations of April 2, 2007. 83 management systems, there are still some important FM arrangements to be put in place at decentralized level, including strengthening decentralized staff capacity, and external audit TOR. 3. The overall risk rating is considered moderate. The major risk identified is mixed FM capacity ­ although adequate at federal level, it is weak at sub national and CSO level. This should be mitigated by a clear understanding of disbursing through SWAp arrangements, including clear dissemination and training at decentralized level, discussions and formal agreement with the decentralized executing agencies on accounting and eligible disbursements procedures, in order to minimize associated risks, regular FM site supervision missions to review proposed FM arrangements to ensure adherence to loan design and fiduciary compliance. Risk Rating Risk51 Risk Rating Risk Issues/Measures Inherent Risk Country Level Entity/project Moderate Although the legal and institutional arrangements are specific adequate, FM administrative and financial systems need to be updated. Control Risk Budget Preparation Low Budget would be clearly defined, reflected in annual Plano de Ações e Metas (PAM) and approved by the Bank. Funds Flow Substantial All funds would flow to a commercial Bank. The Project includes three main flow of funds arrangements: a) direct execution at federal level, b) decentralized execution by the states, municipalities and CSO, c) decentralized execution through international organizations (IO). Counterpart Funds Moderate Due to current financial crises, project might face under spending budgetary constraints (contingenciamento). Staffing Substantial FM staff capacity is adequate at federal level but not at decentralized level. Although mitigating measures might include on-going training arrangements throughout project life, staffing arrangements is an associated sector risk and residual project risk due to decentralized project execution, specially at state, municipal and CSO levels. Accounting Low Accounting procedures are adequate for the eligible procedures expenditures to be financed through loan proceeds. External audits Moderate Although SFC would undertake the auditing, the scope might not cover enough decentralized execution. 4. During the first year of implementation, Bank FM supervision will be carried out at least twice. Supervisions should include FM site visits, semi-annual missions to review the performance and adequacy of FM arrangements at sub national level, strengthening monitoring of expenditure documentation procedures; reviewing DST/AIDS actions agreed to in signed aide memoires, monitoring progress in the implementation of the FM Action Plan and other controls and transactions, as appropriate. This will be complemented by desk reviews of the semi-annual IFRs and annual audit report. The 51 According to the indicative criteria included in the FM guidelines. 84 frequency of Bank FM supervision will be reviewed annually. Year-one supervision will focus on DST/AIDS preparation of IFRs, including the calculation of the EEP, 70% budget execution threshold, and disbursement-linked indicators for the semester, and implementation of the FM Action Plan. Items in the FM Action Plan are not expected to require effectiveness conditions. Project Financial Management Action Plan Activity Responsible Target Date Status External Audit Satisfactory Audit TORs DST/AIDS During the first quarter of loan effectiveness Follow-up of the implementation of audit SFC/CGU Annually recommendations will be performed by the CGU / SFC and reviewed by the Bank. Internal Controls Assessment of the Ex-ante control by the Independent IVA Annually Verification Agency (IVA); WB Ex-post control by the Bank SPN mission Every Semester Technical Assistance Strengthening of SES and SMS M&E capacity DST/AIDS Ongoing Overall Financial Management Arrangements 5. Staffing and institutional arrangements. Decentralized execution includes staffing arrangements at federal, sub-national, CSO and international agencies level. The DST/AIDS would hold the main fiduciary responsibilities of the project, with activities to be undertaken by the Department`s personnel, by incorporating project activities within its daily tasks and routines. The Department will implement project-related centralized activities and monitor decentralized activities. Project implementation arrangements, DST/AIDS structures, staff duties, and technical and financial arrangements charts are being detailed in the POM. Some DST/AIDS responsibilities include, but are not limited to: (i) preparing, updating and ensuring that all project executors follow the POM; (ii) coordinating and supervising project implementation; (iii) reviewing planning and monitoring decentralized activities; (iv) evaluating program components and respective observance of disbursement-agreed indicators, which would be subject to independent verification; (v) updating SIAFI and any other monitoring system to be used to prepare the IFRs for disbursements; (vi) reviewing project expenditure documentation, observing eligibility criteria and category percentages to be used as a basis of SWAp disbursement mechanisms; (vii) preparing and submitting to the Bank office in Brasilia semi-annually IFRs; (viii) reconciling and monitoring data and identifying discrepancies and taking timely corrective action; and (ix) preparing and providing all financial documentation and project reports requested by external auditors and Bank staff. 6. Internal Control. At federal level there is no specific internal control unit. Control is undertaken through segregation of functions within the MOH and DST/AIDS, international organizations (IO) and other decentralized executors, assuring different 85 levels to approve and execute the budget following the Procurement Plan and DST/AIDS PAM. All budgetary transactions are controlled by SIAFI and other FM monitoring systems including loan expenditures. The POM should be a tool for internal control as it will contain the detailed FM arrangements by component, procedures and guidelines for all levels of executors. 7. Accounting. The DST/AIDS follows the Brazilian Accounting Rules (NBC), Law 4320/64, in line with international accounting standards. The budget cycle includes planning and implementation of all Government activities, which are reflected in the Plano Pluri-Annual, Lei de Diretrizes Orçamentárias and Lei Orçamentária Anual.52 All accounting ledgers are kept by the National Treasury Secretariat, which is subject to auditing by the Supreme Auditing Court (TCU). All records are maintained electronically and reconciled with budget report figures on a monthly basis. The loan reporting process would use the cash accounting system. 8. Financial Management System. The Operational Manual includes a detailed description of the FMS, including steps for flow of information and funds. The financial systems to be used for project accounting and monitoring purposes are the following: SIAFI, the integrated administrative and financial system used by the Federal Government to execute its budget, fulfills the Bank`s fiduciary financial management requirements. In order to better monitor project implementation, other health sector systems would allow the DST/AIDS to handle budget commitments, payments and FM reporting, among other functions. All FM information would be consolidated by the DST/AIDS through the Administrative Department, which would be responsible for submitting to the Bank the IFRs for both monitoring and disbursements purposes. For financial management monitoring reasons, the DST/AIDS would prepare consolidated every semester IFRs (1-A - source and use of funds by category and 1-B ­ investment by components, in the currency of the borrower) on a cash accounting basis and submit them to the Bank, no later than sixty days after the end of each semester. The IFRs would state the expenditure figures by semester, accumulated for the year and accumulated for the loan. SIAIDS registers the PAM for project planning and budgeting purposes, both by the centralized and decentralized executors. After the PAM is approved, it is registered in SIAIDs and can be reprogrammed if necessary. The technical and financial execution module registers all expenditures made through transfers. Technical execution can be tracked by unit costs, including the variation between planned and executed. The system may run individual expenditure based report if such expenditures have been previously planned in the PAM. It can also retrieve information from other systems to run the semi-annual IFRS. SIS-Incentivo includes the subnational PAMs financed under the federal Incentive Policy. It can control and monitor the flow of information related to the technical eligibility legal document, including different level of approvals. After the PAM is 52 The Plano Pluri-Anual, the Lei de Diretrizes Orçamentárias and the Lei Orçamentária Anual include the Governmental goals and programs, and are approved by Congress every 5 years, 18 months and 12 months, respectively. 86 approved, the legal document is signed by the DST/AIDS, which approves that FNS processes the respective eligible sub national transfers, which are then updated in SIAIDS. SIMOP is the system that monitor transfers for those activities implemented at decentralized level, and controls the transfers (and respective documentation) made by the IO to CSO. Asset Management System controls all goods. All the fixed assets to be acquired at centralized level should be registered by DST/AIDS in this system. The fixed asset management procedures will be based on national norms. At decentralized level, each SES and/or SMS will be responsible to maintain satisfactory records of fixed assets, and stocks should be kept up to date and reconciled with control accounts and periodic physical inventories. 9. Financial Reporting. All FM information would be consolidated by the DST/AIDS through the Administrative Department, which would be responsible for submitting to the Bank the IFRs, by component, budget line and activity, for both monitoring and disbursements purposes. The formats of the IFRs follow the format of the existing Government reporting to the extent possible. For financial management monitoring reasons, the DST/AIDS would prepare consolidated IFRs (1-A - source and use of funds by component and 1-B ­ investment by components, in the currency of the borrower) on a cash accounting basis and submit them to the Bank, no later than sixty days after the end of each semester. The IFRs would state the expenditure figures by semester, accumulated for the year and accumulated for the loan. 10. For disbursement purposes, additional reports (IFR 1-C) for Component 1(a) of the Project will show annual achievement of the agreed 70% budget execution threshold and the DLIs and will be submitted every semester after review and approval by the Independent Verification Agency (IVA) and the Task Team Leader (TTL), and (IFR 1-D) Designated Account (DA) Activity Statement for Components 1(b) and 2 of the Project. The format of the IFRs is attached to the Disbursement Letter and is included in the POM. In agreement between the Bank and the DST/AIDS, the reports indicated below can be adjusted during project implementation: IFR 1 - A: Statement of Sources and Uses of Funds, by project category: EEP (Component 1 (a)), Component 1(b) and Component 2, respectively; cumulative (project-to-date; year-to-date) and for the last calendar semester. IFR 1 - B: Statement of Investment by project budget line, components and subcomponent, cumulative (project-to-date; year-to-date) and for the period, showing budgeted amounts versus actual expenditures, (i.e., documented expenditures), including a variance analysis. IFR 1 - C: % of EEP budget execution threshold and disbursement linked indicators (DLI). " IFR 1 - D: Designated Account Activity Statement: 11. External Audit. An external audit will be undertaken by SFC ­ Federal Secretariat of Control, observing the auditing guidelines provided to MOH. The audit report should be delivered to the Bank up to six months after the end of the previous calendar year, as 87 stated in the Bank`s Financial Management Audit Guidelines (June 2003). The TOR for the annual audit required by FM will be adjusted to include the requirements of the external annual procurement audit, if applicable. The TOR will be determined by MOH in agreement with the Bank and will be based on the specific circumstances of the project. 12. The Bank will provide its no objection to the audit TOR at the quarter of loan effectiveness and these will be included in the POM. The scope of the audit TOR will include, but not be limited to: (i) fully reviewing the IFRs and use of Designated Account; (ii) reviewing the appropriate observance of the financial management arrangements included in the POM, this PAD, the Loan Agreement (LA), as well as any other official Bank documentation; (iii) reviewing the use of SIAFI and other FM monitoring systems; (iv) ensuring internal control arrangements; (v) observing agreed disbursement arrangements; and (vi) ensure that amounts disbursed were used for good and services eligible under the agreed EEPs which are supported by the disbursement of loan proceeds. . 13. Disbursements and Flow of Funds. Overall, project funds would be disbursed to STN (through the Reimbursement method for Component 1(a) of the Project and Advances to the Designated Account for Component 1(b) and Component 2 of the Project. Details of the flow of funds for the three main execution schemes are detailed below: (i) direct implementation by MOH`s Department of Logistics (DLOG)-DST/AIDS; (ii) transfers to SES, SMS and CSO; and (iii) transfers to IO for further transfers to CSO and payments of DLOG activities. Rules and procedures are defined and included in the Loan Agreement, Disbursement Letter and Project Operational Manual. 14. The loan will finance the eligible expenditures made at central and decentralized level through fund to fund mechanism.53 STN will open a Designated Account on its name in Banco do Brasil NY to receive advances in USD (with a fixed ceiling of US $ 1,250,000) from the loan, to fiannce Components 1(b) and 2 of the Project, for further withdrawal to its unique account in Banco do Brasil (Reais), in Brasilia. DLOG is expected to submit withdrawal applications every six months to STN attaching the respective reports and support documentation documenting the use of funds advanced. The frequency for reporting eligible expenditures paid from the Designated Account is every six months. The minimum application size for Reimbursements is US $2,000,000 equivalent. 15. Disbursements will be report-based (IFRs), which would include a tailored report stating specific disbursements information (IFR 1-C), which will be subject to prior review by the IVA once a year and the Bank every semester. The disbursement main features include: (i) execution of pre-defined EEPs, assigned to budget codes approved by LOA;54 (ii) upper limit for each disbursement will be subject to a ratio against achievement of EEP expenditure; and (iii) in case of partial achievement of agreed 53 Law 8080 and a specific portaria` state all specificities of the Fund-to-Fund transfer and legal documentation which will support the eligibility of such transfers, including in case that further transfers from the SES and/or SMS is made to any IO or CSO. 54 LOA has a specific budget code for the funds to be financed under the loan: source of funds 148. 88 disbursements, the difference will be carried forward to the next period. Rules and procedures are defined and included in the Loan Agreement, Disbursement Letter and Project Operational Manual. 16. The flow of funds to SES and SMS under Component 1(a) will be as follows: DST/AIDS will prepare the annual budget proposal, which is formally approved through the LOA. LOA is updated in SIAFI, which registers all payments and decentralization of funds to FNS. FNS will transfer funds to SES and SMS. DST/AIDS will request monthly advances from STN through SIAFI, which will be transferred through SIAFI to FNS unique account for the Incentive Policy. DST/AIDS authorizes FNS to transfer funds to the SES and SMS pooled accounts. FNS will process payments according to the Fund-to-Fund automatic transfers. For project disbursements purposes, although SIAFI accounts such transfers as budget- executed, SES and SMS will have to comply with project and PAM targets. SES and SMS use own accounting systems to execute funds. DST/AIDS is responsible for monitoring the transfers through SIAFI, SIS-Incentivo and FNS site as well as achievement of agreed benchmarks. All respective contracts, invoices and other support documentation, including the IVRs reports and management reports on the use of funds will be kept at the SES and SMS for auditing purposes. Such arrangements are detailed in the POM. DST/AIDS prepares consolidated IFRs attaching IVR through SIAIDS/SOE, assuring IVA and Bank approval. IFRs are sent to STN, which will request the respective reimbursement from the Loan Account. 17. The flow of funds for direct execution for Components 1 (b) and 2 of the Project by the DST/AIDS, through DLOG, will be as follows: DST/AIDS prepares the annual budget proposal, which is formally approved through the LOA. LOA is updated in SIAFI, which registers all payments and decentralization of funds to FNS. FNS transfers funds to MOH. DST/AIDS will request monthly advances from STN through SIAFI, which will be transferred to the FNS unique account through SIAFI. STN withdrawal funds from the project DA to its unique account in Reais to be transferred to the FNS unique account through SIAFI . FNS transfers funds to DLOG to process direct payment to beneficiaries and monitored through SIAIDS. DST/AIDS will prepare consolidated IFRs attaching IFR 1-D through SIAIDS/SOE, assuring IVA (annually) and Bank approval. The IFR`s are sent to STN. STN prepares the Bank reconciliation and DA Activity Statement, attaches the Bank Statement and DA Activity Statement to the previously referred to IFR and submits it to the Bank Disbursement Department in Brasilia. 89 Component 1(a) Flow of funds to SES and SMS Docs Agencies Systems Funds Bank World approval Bank of WA Brasilia Loan Account Withdrawal Office Applications (WA) attaching reconciled Disbursements and approved IFR 1-C confirming agreed EEP M&E system, Budget and SIAIDS financial availability IVA confirms achievement of MOH STN Treasury Unique DST/AIDS Account agreed DLI DST/AIDS Counterpart and IBRD SIAFI Wire transfers based on the PPA and Ledge Account achievements of Report confirming outputs DLI FNS/MS Support Disbursements documentation SES SISIncentivo follow ontractual SMS Schedule Incentive Policy SES SMS Incentive Policy CSO 90 Components 1 (b) and 2 flow of funds for direct execution Docs Agencies Systems Funds Bank World approval Bank of WA Brasilia Loan Account Office Disbursements Withdrawal Applications (WA) attaching reconciled and approved IFR 1-C Budget and financial availability M&E system, SIAIDS MOH STN Treasury DST/AIDS Unique Account DST/AIDS Counterpart and SIAFI IBRD Wire transfers Ledge Account based on the PPA and achievements of Report confirming outputs DLI FNS/MS Support documentation Disbursements follow contractual schedule MOH DLOG 18. The flow of funds through IO55 for Components 1 and 2 will be as follows: The DST/AIDS prepares the annual budget proposal, which is formally approved through the LOA. LOA is updated in SIAFI, which registers all payments and decentralization of funds to FNS. FNS transfers funds to IO. The DST/AIDS requests monthly advances from STN through SIAFI, which are transferred to the FNS unique account through SIAFI. STN withdrawal funds from the project DA to its unique account in Reais to be transferred to the FNS unique account through SIAFI DST/AIDS authorizes FNS to transfer funds to the IO unique account. The transfers are based on the agreed monthly disbursement schedule included in the respective Project Document ­ PRODOC. Execution is controlled by SIADIS and IO FM system. DST/AIDS authorizes IO to either process payments related to project activities or to transfer funds to CSO, which are responsible for subprojects. Such transfers are stated under pre-defined legal instruments signed by the subproject and the IO. 55 Agreement of the World Bank and the United Nations of March 10, 2006, in line with OP10.02. 91 IO provides DST/AIDS with timely reports on the status of transfers and their execution. DST/AIDS monitors all expenditures, including subproject transfers/execution through SIAIDS/SIMOP. DST/AIDS prepares consolidated IFRs attaching IVR through SIAIDS/SOE, assuring IVA and Bank approval. IFRs are sent to STN.. DST/AIDS will prepare consolidated IFRs attaching IFR 1-D through SIAIDS/SOE, assuring IVA (annually) and Bank approval. The IFR are sent to STN. STN prepares the Bank reconciliation and DA Activity Statement, attaches the Bank Statement and DA Activity Statement to the previously referred to IFR and submits it to the Bank disbursement department in Brasilia. Each IO has an internal operational manual, independent auditors and financial management arrangements. Components 1 and 2 flow of funds through IO Docs Agencie Systems Funds Bank s World approval Bank of WA Brasilia Loan Account Withdrawal Applications Office (WA) attaching (conciliated) and Disbursements approved IFR 1-Cs confirming agreed EEP M&E system, Budget and financial SIAIDS availability STN Treasury Unique Account IVA confirms Counterpartt and MOH FNS - SIAFI achievements of IBRD Wire transfers DST/AIDS Ledge Account agreed DLI based on the PPA and DST/AIDS achievements of outputs Report SPO/MS confirming DLI FNS/MS Support documentation International IO unique account Organizations IO FM systems Disbursements follow ontractual Schedule CSO account and CSO account and others others beneficiaries beneficiaries 92 Allocation of Loan Proceeds Category Loan amount Bank Financing (US$ Component 1(a) of the Project: 57,000,000 30% EEPs Component 1(b) and 9,832,500 100% Component 2 of the Project: Goods, consultant services and non- consultants services, training, Results based Grants and operating costs Total 66,832,500 Front-end-Fee 167,500 Amount payable in accordance with Section 2.07 (b) of the General Conditions Premia for Interest Rate Caps 0 and Collars Total Loan Proceeds 67,000,000 33.5% Component 1 Component s Total (a) 1 (b) and 2 US$ million Semester 1 5.15 0. 782 5.9325 Semester 2 5.15 0.95 6.10 Semester 3 9.10 1.55 10.65 Semester 4 9.10 1. 55 10.65 Semester 5 8.35 1. 45 9.80 Semester 6 8.35 1. 45 9.80 Semester 7 5.90 1.05 6.95 Semester 8 5.90 1.05 6.95 Front end fee 0.1675 Total 57.0 9.832,500 67.00 19. In accordance with Bank procedures, disbursements for Component 1(a) of the Project will be for eligible expenditures incurred under the EEPs, provided that DST/AIDS executes at least 70% of its annual budget, and achieves the DLI targets for the respective semester. EEPs are included in Annex 5 and in the Loan Agreement. For Component 1(a), Bank disbursements will consist of eight disbursements (Reimbursements) against actual EEP expenditures. The annual IVA and supervision missions will review project implementation and achievement of DLI targets prior to disbursement. The limits of each disbursements for Component 1(a) are indicated in the table below. For Component 1(b) and 2 of the Project, a Designated Account will be opened as indicated above, and Bank disbursements will consist of advances and subsequent documentation of actual expenditures. 20. The DST/AIDS will provide training on these fiduciary arrangements to mitigate associated control risks and avoid related delay in project execution at sub national level. The DST/AIDS will also provide support to the SES and SMS in preparing their PAMs, understand project disbursements, and in case of delay in implementation. 93 # DLI Disbursement Schedule for Component 1(a) Reporting US$ Date Million Reimbursement Provide baseline data for the following indicators: DLIs measured 5.15 1st semester 1-2- MSM, SW, DU reporting use of condoms. 12/31/2010 3 IFR Effectiveness 12- MSM, SW, DU reporting access to free condoms. -December 31, 13- 2010 submitted 14 March 2011 15- MSM, SW, DU reporting having been tested for HIV. WA56 and Project 16- Progress Report 17 submitted June 2011 (with IFR) Reimbursement GI 70% execution EEPs 201057. DLIs measured 5.15 2nd semester 6 65% SES reaching at least 70% of PAM targets. 12/31/2010 7 51% SMS Capital City reaching at least 70% of PAM IFR 2011-S1 targets. January 1-June 10 25% CSO projects financed by results. 30, 2011 11 Outline of the National HIV/AIDS Strategic Plan. submitted 19 68% SES executing at least 70% of Incentive Policy September 2011 resources. WA and Project 20 62% SMS Capital City executing at least 70% of Progress Report Incentive Policy resources. submitted December 2011 (with IFR) Reimbursement 4 39% PLHA accessing condoms. DLIs measured 9.1 3rd semester 5 61% prisoners accessing condoms. 12/31/2011 Subject to IVA 8 >5% increase SES with institutional site information on IFR 2011-S2 review STD and HIV/AIDS (epidemiological and financial). July 1-December 9 >5% increase SMS Capital City with institutional site 31 information on STD and HIV/AIDS submitted March (epidemiological/financial). 2012 18 38.5% MSM accessing services which provide WA and Project condoms. Progress Report submitted June 2012 (with IFR) Reimbursement GI 70% execution EEPs 2011. DLIs measured 9.1 4th semester 6 70% SES reaching at least 70% of PAM targets. 12/31/2011 7 55% SMS Capital City reaching at least 70% of PAM IFR 2012-S1 targets. January 1-June 10 50% CSO projects financed by results. 30, 2012 11 First draft of the National HIV/AIDS Strategic Plan. submitted 19 71% SES executing at least 70% of Incentive Policy September 2012 resources. WA and Project 20 65% SMS Capital City executing at least 70% of Progress Report Incentive Policy resources. submitted December 2012 (with IFR) 56 Withdrawal Application (WA)/Reimbursement will be submitted together with the Project Progress Report and the relevant IFR as supporting documentation 57 70% Execution Rate will be for the period from the Effectiveness date until December 31,2010 94 # DLI Disbursement Schedule for Component 1(a) Reporting US$ Date Million Reimbursement 4 42% PLHA accessing condoms. DLIs measured 8.35 5th semester ­ 5 64% prisoners accessing condoms. 12/31/2012 Subject to IVA 8 >10% increase SES with institutional site information IFR 2012-S2 review on STD and HIV/AIDS (epidemiological-financial). July 1-December 9 >10% increase SMS Capital City with institutional site 31, 2012 information on STD, HIV/AIDS (epidemiological- submitted March financial). 2013 18 42% MSM accessing services which provide condoms. WA and Project Progress Report submitted June 2013 (with IFR) Reimbursement GI 70% execution EEPs 2012. DLIs measured 8.35 6th semester 6 80% SES reaching at least 70% of PAM targets. 12/31/2012 7 62% SMS Capital City reaching at least 70% of PAM IFR 2013-S1 targets. January 1-June 10 75% CSO projects financed by results. 30, 2013 11 Second draft of the National HIV/AIDS Strategic Plan. submitted 19 77% SES executing at least 70% of Incentive Policy September 2013 resources. WA and Project 20 70% SMS Capital City executing at least 70% of Progress Report Incentive Policy resources. submitted December 2013 (with IFR) Reimbursement 1-3 +15% MSM, DU reporting use of condoms. DLIs measured 5.9 7th semester 2 + 10% SW reporting use of condoms. 12/31/2013 Subject to IVA 12- +15% MSM, SW, DU reporting access to free IFR 2013-S2 review 13- condoms. July 1-December 14 31, 2013 15- +15% MSM, SW, DU reporting having been tested for submitted March 16- HIV. 2014 17 WA and Project Progress Report submitted June 2014 Reimbursement GI 70% execution EEPs 2013. DLIs measured 5.9 8th semester 4 49% PLHA accessing condoms. 12/31/2013 5 70% prisoners accessing condoms. IFR 2014-S1 6 85% SES reaching at least 70% of PAM targets. January 1-June 7 66% SMS Capital City reaching at least 70% of PAM 30, 2014 targets. submitted 8 >20% increase SES with institutional site information September 2014 on STD and HIV/AIDS (epidemiological-financial). WA and Project 9 >20% increase SMS Capital City with institutional site Progress Report information on STD, HIV/AIDS (epidemiological- submitted financial). December 2014 10 85% CSO projects financed by results. (with IFR) 11 National HIV/AIDS Strategic Plan available on the web. 18 49% MSM accessing services which provide condoms. 19 83% SES executing at least 70% of Incentive Policy resources. 20 76% SMS Capital City executing at least 70% of Incentive Policy resources. 95 Annex 8: Procurement Arrangements BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service 1. Procurement for the proposed project will be carried out in accordance with the World Bank Guidelines: Procurement under IBRD Loans and IDA Credits" dated May 2004 and revised on October 2006; and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated May 2004 and revised on October 2006, and the provisions stipulated in the Legal Agreement. The various items under different expenditure categories are described in general below. For each contract to be financed under the project, the different procurement methods or consultant selection methods, the need for pre-qualification, estimated costs, prior review requirements, and time frame are agreed between the Borrower and the Bank in the Procurement Plan. The Procurement Plan will be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity. 2. The Project is comprised of two components: (i) Component 1 - Improve surveillance, prevention and control of STD and HIV/AIDS; and (ii) Component 2 - Build decentralized governance capacity and innovation. Procurement arrangements for each component are as follows: Component 1 (a)- EEP1: procurement conducted either by the Ministry of Health Logistics Department (DLOG) or UN agencies (currently UNESCO or UNODC). Under EEP1, DLOG may procure goods and services and hire consultants applying a SWAp approach, i.e., applying one of the following methods: (i) for goods and services the procurement methods convite, tomada de preços and concorrência, respecting the respective thresholds as provided for under the National Procurement Law, up to the NCB threshold (US$1,000,000) ­(ii) for goods and services the procurement method known as "pregão eletrônico, as provided for in the Brazil`s Law, through COMPRASNET, the procurement portal of the Federal Government, or any other e- procurement system approved by the Bank, up to the NCB threshold (US$1,000,000) ­); and (iii) for consultants services of firms and individuals, estimated to cost less than $100,000 and $50,000 equivalent, respectively, i.e., contracts for very small assignments that meet the criteria for direct contracting under Bank`s policy, the methods of técnica e preço and/or melhor técnica, as provided for in the Brazilian Procurement Law, ensuring economy and efficiency and providing equal opportunity to all qualified consultants. UN agencies have to follow Bank procurement guidelines in all cases. Component 1 (a) - EEP2: procurement conducted by eligible Health Secretariats of states and municipalities will also follow a SWAp approach, i.e., applying one of the following methods for goods and services : (i) the procurement methods convite, tomada de preços and concorrência, respecting the respective thresholds as provided for under the National Procurement Law, up to the NCB threshold (US$1,000,000)and (ii) the procurement method known as "pregão eletrônico, as provided for in the Brazil`s Law, through COMPRASNET, the procurement portal of the Federal Government, or any other e-procurement system approved by the Bank, up to the NCB 96 threshold (US$1,000,000) Component 2: procurement conducted either by the Ministry of Health Logistics Department (DLOG) or UN agencies (currently UNESCO or UNODC) under Component 2 follows Bank procurement procedures . The SWAp approach does not apply to Component 2.) Centralized Procurement Decentralized Procurement Component 1 - EEP1 Component 2 Component 1 ­ EEP2 Procurement needs on, Goods and Services as per Project procurement need Project procurement need agreed PAM as per approved as per approved procurement plan procurement plan Goods and DLOG UN Agencies DLOG UN Agencies Services Bank's Procurement Bank's Procurement Above yes methods and selection methods and selection US$ 1,000,000 procedures as Consultants procedures as Consultants Guidelines Guidelines Procurement through acceptable procedures of the no no National Procurement Law Above US$ 500,000 yes Procurement through Bank's acceptable procedures of the National Procurement Law Bank's prior-review ICB subject to Bank's prior-review 3. Procurement of Goods. Goods procured under this project will include: IT equipment, laboratory equipment, vehicles, laboratory supplies, etc. Under the decentralized level, goods up to the NCB threshold of US $1,000,000 will be procured in accordance with the following procurement methods and the respective thresholds, as provided for under the National Procurement Law: convite; tomada de preços and concorrência. Procurement of common goods up to the NCB threshold may also be carried out in accordance with the method known as "pregão eletrônico, as provided in the Brazil`s Law, under COMPRASNET, the procurement portal of the Federal Government, or any other e-procurement system approved by the Bank. For EEP1, (i) DLOG may apply the SWAp approach described above, and (ii) UN agencies have to follow Bank guidelines and use Bank Standard Bidding Document (SBD) for all ICB and National SBD agreed with or satisfactory to the Bank for all NCB. For Component 2, DLOG and the UN agencies will follow Bank` procurement procedures and use Bank`s Standard Bidding Document (SBD) for all ICB and National SBD agreed with or satisfactory to the Bank for all NCB. All contracts estimated to cost more than US$500,000 equivalent per contract will be subject to prior review by the Bank. 4. Procurement of non-consulting services. Non-consulting services to be procured under the project include: training logistics (hotel services, catering, travel services, printing services), workshops, seminars, events, printing services etc. Under the decentralized level, non-consulting services up to the NCB threshold of US $1,000,000 may be procured in accordance with the 97 following procurement methods and the respective thresholds as provided for under the national procurement law: convite; tomada de preços and concorrência. Procurement of common non-consulting services up to the NCB threshold may also be carried out in accordance with the method known as "pregão eletrônico, under COMPRASNET, the procurement portal of the Federal Government, or any other e-procurement system approved by the Bank. For procurement under Component 1 - EEP1, (i) DLOG may apply the SWAp approach described above, and (ii) UN agencies will follow Bank procurement procedures and use Bank`s Standard Bidding Documents (SBD) for all ICB and National SBD agreed with or satisfactory to the Bank for all NCB. For procurement under Component 2, DLOG and the UN agencies will follow Bank`s procurement procedures and use Bank`s Standard Bidding Document (SBD) for all ICB and National SBD agreed with or satisfactory to the Bank for all NCB. At the central level, services for small events and its logistics as per the approved procurement plan, up to US$50,000, may be directly contracted observing the criteria defined in the Project Operational Manual (POM). All contracts estimated to cost more than US$500,000 equivalent per contract will be subject to prior review by the Bank. 5. Selection of Consultants. Selection of consultants is only anticipated at the central level and will include studies, researches, etc. Throughout the project, these services will be hired through Quality and Cost Based Selection (QCBS), Selection Based on Consultants Qualification (CQS), Least Cost Selection (LCS), Single Source Selection (SSS ­ with due Bank`s No- objection Letter on a case by case basis) and Individual Consultants (IC). Studies and research to cost less than US$200,000 per contract, as per approved procurement plan, may select consultants` firms through the process known as Editais de Seleção using the project`s Standard Request for Proposal (RFP) as defined in the POM and agreed with the Bank. The Editais de Seleção process was assessed by the Bank and considered to be acceptable and widely advertised, ensuring economy and efficiency and providing equal opportunity to all qualified consultants. It is comparable to a simplified QCBS, which results in the signature of various small consultants` contracts. Short lists of consultants for services estimated to cost less than $500,000 equivalent per contract may be composed entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. All contracts estimated to cost more than US$100,000 equivalent per contract will be subject to prior review by the Bank. 6. The need for special arrangements regarding engaging universities, Government research institutions, public training institutions, Civil Society Organizations (CSO) or other types of organizations was identified during project preparation: (i) universities and research institutes will be competitively selected, whenever possible, through one of the selection methods listed above in number 6. Also, a variety of Single Source Selection (SSS) is anticipated, which will require Bank`s no-objection on a case by case basis; (ii) the need to SSS CSO up to US$50,000 per contract for small events, as anticipated in number 5 above, will be part of the approved procurement plan and follow the process defined in the POM, as agreed with the Bank. A detailed procurement file, as described in the POM, shall be kept available for each of those SSS for procurement post-review; and (iii) the need to contract CSO for the instrument known as CSO Networking Project (Projeto em Redes de ONGs) will follow the competitive process defined in the POM. This competitive process and its SBD were assessed by the Bank and considered to be acceptable. A limited number of fifteen Brazilian CSO, strong and well established, have administrative capacity to qualify for the selection process, as the 98 objective is to transfer up to US$400,000 to about five CSO every six months to one year and have them transfer small amounts to at least five smaller CSO under its network. Therefore any increase in competition is not foreseen and the same CSO are likely to be shortlisted for every selection, simply because there is no reason for any other CSO to invest in administrative structure to qualify for the selection, as being part of the network is enough to receive the necessary funds to perform HIV/AIDS activities. The use of funds is defined in the parent CSO proposal, therefore becoming part of the contract. Expenses are for goods and equipment, airline tickets and other transportation, event logistics, training, small firms or individual consultants, and operational costs. Procurement for those eligible items follows the National Procurement Law and will be limited to US$100,000 for goods and services and US$50,000 for consultants per contract. The selection process results in the signature of an average of five contracts, which will be subject to post-review. The first process will be prior reviewed and annual independent audits will be required for 100% of those contracts and its subcontracts. 7. Operating Costs. During project preparation, it was agreed that operating costs will include individual consultants expenses, supplies, and miscellaneous expenses. The operating costs to be financed by the project will be procured using the implementing agency`s administrative procedures which were reviewed and found acceptable to the Bank. Contracting of individual consultants to compose the project base team will be processed by DLOG and follow Individual Consultants` selection processes as per chapter V of the Consultant`s guidelines. 8. Others. The need for special arrangements for scholarships, was not identified during project preparation. As defined under Annex 4, criteria were agreed for annual Results-based grants, under Component 1 (b), to SES, SMS, and CSO with good performance. The 27 SES may receive grants up to US$ 100,000, the 26 SMS Capital City may receive grants up to US$ 50,000, and CSO may receive grants up to 10% of initial allocation. 9. Considering the high level of decentralization of the procurement function, the procurement risk has been rated as substantial, and the prior review and procurement method thresholds were defined as follows: 99 Procurement Method Threshold - Central Level Expenditure Contract Procurement Processes subject to prior review category value method threshold (US$ thousands) Goods 1,000 ICB All processes < 1,000 100 NCB First process and all processes above US$500,000 < 100 Shopping First process. Non-consulting 1,000 ICB All processes services < 1,000 100 NCB First process and all processes above US$500,000 (incl. training, < 100 Shopping First process communication) 200 QCBS/QBS All processes Consulting < 200 100 (firms) < 100 LCS/CQS First process under each selection method. Individual Section V in consultants the Guidelines Direct All cases regardless of the amounts involved contracting Procurement Method Threshold - Decentralized Level Expenditure Contract Procurement Processes subject to prior review category value method threshold (US$ thousands) Goods 1,000 ICB All processes < 1,000 NCB All processes above US$500,000 Non-consulting 1,000 ICB All processes services < 1,000 NCB All processes above US$500,000 Direct All cases regardless of the amounts involved contracting and Single Source Selection Assessment of the agency's capacity to implement procurement 10. The overall project risk for procurement is substantial, due to the high level of decentralization and involvement of CSO. Procurement activities at the central level will be carried out by the DST/AIDS. The agency`s Financial and Administration Unit (UAD) is staffed by one UAD Manager, overseeing 6 functional areas: Procurement, Financial Management, Financial Reports, Events, Travel and General Services. The procurement function is staffed by 4 procurement specialists and one contracts management/payments specialist. 11. UAD processes each procurement process through one out of two procurement agents: (i) the Ministry of Health Logistics Department (DLOG), (ii) or a UN Agency (currently 100 UNESCO or UNODC). DLOG capacity was assessed by PS Luciano Wuerzius on November 2007. DLOG is composed by a 6-member 1 bidding committee and 15 auctioneers. The bidding committee is composed by staff from the DLOG who has accumulated substantial experience in procurement. The auctioneers are staff from the Ministry of Health State units who are considered elite in their original units. The project plans on sending 2 DLOG`s members to training on Bank`s procurement procedures, as a means of developing such capacity and supporting a future migration of procurement actions from UN agencies to DLOG. Regarding procurement capacity of UN agencies, although their performance has been questionable, they implement a number of Bank`s projects in Brazil and are experienced on following Bank`s procurement guidelines and use Bank`s SBD. 12. An assessment of the capacity of the Implementing Agency (DST/AIDS) to implement procurement actions for the project has been carried out on June 2009, and included an update on the capacity assessment conducted in 2003. The assessment reviewed the organizational structure for implementing the AIDS-SUS Project and the interaction between the project`s staff responsible for the procurement activity and the Ministry`s relevant central unit for administration and finance. Key issues and risks concerning procurement indentified in 2003 were reviewed in 2009 and are considered to be all resolved. One risk identified now relates to procurement processes being triggered and processed without UAD`s and its procurement specialist`s involvement. The mitigating action for this issue is a revision to the POM to include the need to procurement clearance by the UAD on a specific standard form. Therefore, all Bank financed procurement at the centralized level must have this clearance document on file. Processes identified, during Bank`s procurement post review, if missing such clearance, will be declared not eligible for financing. The procurement procedures and standard bidding documents to be used for each procurement method, as well as model contracts for non-consulting services and goods procured, are presented in the POM. 13. Action Plan to Build Agency's Capacity: The capacity assessement helped identify the actions to be taken and the associated timetable to improve the long-term capacity of the implementing agency to administer procurement. The proposed actions bellow cover matters such as procurement planning and monitoring as well as continuing training in procurement. Technical assistance will be provided under the project to address procurement deficiencies and mitigate fiduciary-associated risks. Action PlanRisks/Issues Corrective measures Time frame 1. Preliminary Procurement Finalize the procurement plan Completed Planning 2. Breach of procurement Development of a specific and required Before processes (procurement UAD (Financial and Administration effectiveness triggered without UAD Unit) clearance form participation) 3. Preliminary Project Revise and finalize the POM ­The Before Operating Manual ­ POM POM should include model contracts effectiveness for non-consulting services and goods. 101 14. Procurement Plan. A procurement plan is required for all procurement to be conducted by DLOG or UN agencies under Components 1 and 2; and, for procurement carried by SES and SMS, for all ICBs and for any NCB above the prior review thresholds, . In respect of all other expenditures subject to procurement processes, the Bank will carry out post review of program- related documentation and contracts, as part of normal supervision. The Borrower presented a satisfactory procurement plan for project implementation during the first 18 months which will provide the basis for the procurement methods. The Procurement Plan will be updated in agreement with the Bank annually or as required to reflect the actual project implementation needs and improvements in institutional capacity. 15. Frequency of Procurement Supervision. In addition to the prior review supervision to be carried out by the Bank, the capacity assessment of the Implementing Agency suggests the need for annual supervision missions to visit the field to carry out post review of procurement actions. An annual external procurement audit satisfactory to the Bank will be a covenant in the Loan Agreement, and will be required to assess and verify a sample of processes procured at the decentralized level. All contracts and subcontracts under the CSO Network Project will also be object of the audit. This audit will focus on local procurement methods. As a result of the post reviews and external procurement audits, the Bank will be in a position to identify cases of noncompliance and apply the remedies provided for in the loan agreement. The Bank will declare misprocurement in any misprocured contract funded by the whole pool of funds, and will have the option of canceling from its loan (or requesting reimbursement of) an amount equivalent to the contract amount multiplied by the Bank`s percentage participation in the pool of funds. Details of the Procurement Arrangements Involving International Competition 1. Goods, and Non Consulting Services (a) List of contract packages to be procured following ICB and direct contracting: 1 2 3 4 5 6 Contract Estimated Procuremen Domestic Review Expected (Description) Cost t Preference by Bank Bid- (US$) Method (yes/no) (Prior / Post) Opening Date Laboratory equipment 2,000,000 ICB Yes Prior Laboratory supplies 3,500,000 ICB Yes Prior Furniture and 1,500,000 ICB Yes Prior equipment for (b) ICB contracts for Goods and non-consulting services estimated to cost above US $500,000 per contract and all direct contracting will be subject to prior review by the Bank. Consulting Services (a) List of consulting assignments with short-list of international firms. 102 1 2 3 4 5 Description of Assignment Estimated Selection Review Expected Cost Method by Bank Proposals 1,000 (Prior / Submission Post) Date Audit on technical reach of goals 750 QCBS Prior (b) Consultancy services (firms) above US$500,000 and all single source selection of consultants will be subject to prior review by the Bank. (c) Short lists composed entirely of national consultants: Short lists of consultants for services estimated to cost less than US$500,000 equivalent per contract may be composed entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. 103 Annex 9: Economic and Financial Analysis BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service 1. The economic analysis revealed that the project will yield a net present value of benefits, after investment and recurrent costs, of about US$682 million, and produce an internal rate of return (IRR) above 49 percent over a 10-year period. A cost-benefit analysis based upon project costs and the expected, measurable economic benefits flowing from successful implementation was undertaken as part of project appraisal. In addition to the project costs of US$67 million, the analysis included the costs of capital and recurrent expenditures related to the expansion and improvement of HIV/AIDS activities, which will be continued once the main interventions of the project are finished. The expansion and improvement of HIV/AIDS services is envisaged through prevention and treatment and by improving the program`s governance throughout the three levels of implementation (federal, state and municipal. Table 1. Estimated Project Costs and Benefits58 4 years 10 years NPV -67.6 681.7 US$ millions IRR 49% Benefit/Cost 4.3: 1 Ratio 2. The actions proposed in the project will produce substantial savings over the medium to long-term, primarily through reductions in new infections and the corresponding savings in hospital costs, outpatient costs, and treatment costs. These changes will also reduce the number of deaths, since the project`s prevention activities will focus on those groups that have the highest risk, and will contribute to the reduction of the burden of disease. Cost Benefit Analysis 3. The economic analyses of the project aimed at quantifying the health gains and translate these gains into estimates of the direct benefits and indirect benefits. The analysis used several indicators of the expected savings to the health care system as proxies to measure the net direct economic benefits of the project. The analysis was based on the following assumptions: Two scenarios were developed: o The "do nothing" case where the existing program is maintained and no new initiatives provide prevention and treatment to new cases identified. The no intervention scenario considered that the HIV prevalence rate remains constant at 58 NPV Benefits are equal to the direct and indirect benefits, minus total project costs. Benefit/Cost Ratio is equal to NPV of total benefits divided by NPV of total costs. IRR is based on net benefits over 10 years. 104 0.6% of population 15-49 years. Mortality rates are expected to remain constant at 6 deaths per 100,000 in the scenario without project. o Strengthening of the existing programs for prevention and treatment, for a higher impact on the burden of the disease. For the estimation of new cases of HIV avoided as a result of the implementation of the project, it was assumed that HIV prevalence rate will decrease at an average rate of 5%. Therefore, the prevalence rate at the end of the 10-year period of the project would be 0.57% (from 0.6% in year 2010). In the scenario with the project, the mortality rates are expected to decrease at an average annual rate of 0.8%, a figure that represents the compounded annual growth rate of the number of deaths during the period 2000- 2006. The following groups were considered in this analysis: MSM, SW, Clients of sex workers, IDU, Prisoners and Children of HIV+ mothers. The following HIV prevalence rates were used: o 19.87% for the MSM population.59 o 6.7% for the SW population.60 o 0.82% for SW clients.61 o 36.5% for the IDU population of IDU.62 o 16% for prisoners.63 o 0.6% for general population.64 The size of groups most at risk was estimated based on population projections published by the IBGE. The population in the 15-49 age years group represents approximately 55% of the Brazilian population. Discount rate: 10% Total cost (inpatient and outpatient) per person per year: US$3,439 ART cost per person per year: US$ 2,450.00 Ambulatory care-lab test cost per person per year: US$ 45.86 Hospitalization care cost per person per year: US$ 943.00 Benefits associated with the project are expected to start in the second year of the project. 59 Velasco de Castro CA, Grinsztejn B, Veloso V, Bastos FI, Pilotto J.H, Friedman R, Moreira RI, Morgado MG 2007. 60 Trevisol FS, Silva MV 2005. 61 Official estimate. 62 Ferreira AD, Caiaffa WT, Mingoti SA 2004. 63 Burattini MN, Massad E, Rozman M, Azevedo RS, Carvalho HB 2000. 64 Official estimate. 105 4. The direct benefits were estimated based on the reduced burden on the health care system resulting from a decreased morbidity. Under this scenario, the direct cost savings increase from US$8 million in 2010 to approximately US$74.2 million in 2019. The net present value of the direct cost savings was estimated at US$205 million. This results from preventing nearly 188,000 cases of AIDS and the corresponding savings to the health system. To estimate the total direct cost savings, the annual treatment costs per person were multiplied by the annual number of HIV/AIDS cases averted. The direct costs savings were then discounted at 10% to determine the present value of the direct cost savings. The results of the analysis are presented on Table 2. Table 2. Direct Project Benefits Cost Saved PV of treatment Prevented costs saved costs Year per case cases (US$) (US$) 2010 3,439 0 0 0 2011 3,439 4,110 8,046,255 7,314,778 2012 3,439 8,248 16,150,367 13,347,411 2013 3,439 12,409 24,304,108 18,260,036 2014 3,439 16,597 32,463,341 22,172,898 2015 3,439 20,816 40,769,398 25,314,588 2016 3,439 25,062 49,082,824 27,705,975 2017 3,439 29,327 57,440,813 29,476,219 2018 3,439 33,602 65,824,631 30,707,676 2019 3,439 37,876 74,215,060 31,474,430 188,047 Total PV 205,774,011 Total 5 years 61,095,123 5. In addition, the project will produce substantial indirect benefits related to the (i) cost savings associated with reduced morbidity and mortality; (ii) the impact on the quality of life; (iii) the positive economic benefits associated with the reduced economic costs of illness and death of adults of working age; and (iv) the cost of the production lost to the Brazilian economy due to each AIDS case. Each life of year saved is valued using the gross national income per capita (PPP values) of US$9,270, a proxy for the marginal product of labor, or the value of each productive year of life lost. The indirect benefits increase from US$7.8 million in 2011 to US$272 million in the year 2019. The total indirect costs prevented over a 10-year period would total US$1,268 million, which represents a NPV of nearly US$682 million. Additional indirect cost savings can be expected as a result of reductions in the incidence of sexually transmitted diseases (STDs). However, these benefits werel not calculated in the present analysis. 106 Table 3. Indirect Project Benefits Years of Deaths life Productivity PV of indirect Year avoided saved losses averted benefits (US$) 2010 0 0 0 0 2011 196 850 7,877,217 7,161,107 2012 295 2565 23,777,789 19,651,065 2013 395 5733 53,140,409 39,925,176 2014 495 10805 100,162,271 68,412,179 2015 595 17372 161,040,652 99,993,575 2016 696 20355 188,690,608 106,510,929 2017 798 23356 216,512,329 111,105,060 2018 899 26376 244,506,657 114,064,160 2019 1001 29409 272,623,096 115,618,806 Total 5,369 136,821 1,268,331,029 682,442,056 6. The present value of the proposed investment and recurrent costs is estimated at US$58 million over a five-year period. This information is critical to determine overall net benefit (benefits net of project costs). Annual investment and recurrent costs are shown in Table 4. While the investment costs are clearly defined in the project implementation plan, the recurrent costs were estimated at 5% of the total investment costs during the 5 years of the project. The overall investment in HIV/AIDS prevention and treatment should be determined in the context of the relative cost-effectiveness of the proposed project in light of alternative investments. The present analysis used conservative estimates on the reduction in mortality and morbidity over the 10 year period. Table 4. Project Investment National National WB Total Project Project PV Project WB PV Project Total PV Investment investment Investment investment Investment investment Year US$ US$ US$ US$ US$ US$ 2010 23,225,373 23,225,373 11,700,000 11,700,000 34,925,373 34,925,373 2011 43,274,627 39,340,570 21,800,000 19,818,182 65,074,627 59,158,752 2012 39,900,000 32,975,207 20,100,000 16,611,570 60,000,000 49,586,777 2013 26,600,000 19,984,974 13,400,000 10,067,618 40,000,000 30,052,592 2014 10,000,000 6,830,135 10,000,000 6,830,135 2015 10,000,000 6,209,213 10,000,000 6,209,213 2016 10,000,000 5,644,739 10,000,000 5,644,739 2017 10,000,000 5,131,581 10,000,000 5,131,581 2018 10,000,000 4,665,074 10,000,000 4,665,074 2019 10,000,000 4,240,976 10,000,000 4,240,976 Total 193,000,000 148,247,842 67,000,000 58,197,370 260,000,000 206,445,212 7. The estimated stream of benefits yields a net present value in excess of US$681 million with an internal rate of return of 49%. Table 5 displays the summary results of the quantitative returns of the project. Returns are presented by estimating a 10 year stream of benefits and costs and thereby calculating the Net Present Value and the Internal Rate of Return 107 of the project. It is worth noting that the stream of benefits and costs takes into account the recurrent costs of maintaining the specific programs that will produce the savings. Table 5. Cost-Benefit Summary Project Direct Indirect PV of Net Year Investment Benefits Benefits Total Benefits Net benefits Benefits 2008 34,925,373 0 0 0 -34,925,373 -34,925,373 2009 65,074,627 8,046,255 7,877,217 15,923,473 -49,151,154 -44,682,867 2010 60,000,000 16,150,367 23,777,789 39,928,156 -20,071,844 -16,588,301 2011 40,000,000 24,304,108 53,140,409 77,444,517 37,444,517 28,132,620 2012 10,000,000 32,463,341 100,162,271 132,625,612 122,625,612 83,754,943 2013 10,000,000 40,769,398 161,040,652 201,810,050 191,810,050 119,098,950 2014 10,000,000 49,082,824 188,690,608 237,773,432 227,773,432 128,572,165 2015 10,000,000 57,440,813 216,512,329 273,953,142 263,953,142 135,449,698 2016 10,000,000 65,824,631 244,506,657 310,331,288 300,331,288 140,106,762 2017 10,000,000 74,215,060 272,623,096 346,838,155 336,838,155 142,852,259 Total 260,000,000 368,296,796 1,268,331,029 1,636,627,825 1,376,627,825 NPV (10% discount rate) 681,770,855 IRR 49% Fiscal Impact 8. Estimates of the fiscal impact were based on a model to evaluate the expected fiscal expenditures and revenues that are projected as a result of the project. The following assumptions were used: official figures from Central Government Operations from 2002 to 2007 were used for the estimate of growth rates of main categories of analysis. Growth rates for main categories of revenues and expenditures were used to project fiscal behavior for the period in which the project will be implemented and the Government will make payments. The category of amortization expenditures was used from the period 2017-2031 to include repayment of the loan by the Government of Brazil (interests and capital). Loans and advances were estimated according to the expected disbursements in the 2010- 2013 period only. GDP grows at a rate of 1.75% in 2009. 9. The Government of Brazil has a significant opportunity to fulfill the needs of groups most at risk without compromising the fiscal stability of the country. The project will not represent a fiscal problem in Brazil. The trend for the overall superavit as a percentage of GDP is to decrease over the years, and this trend will not change after disbursements and repayments of the loan. Table 6 displays the main results of the fiscal impact analysis. The results are projected to 2031 to accurately reflect the full repayment of the loan. 108 Table 6. Estimated Project fiscal impact in US$ million 2010 2011 2015 2019 2025 2026 2030 2031 Current 152,823 153,198 156,586 157,164 157,282 157,303 157,294 157,296 Expenditure Interest and 7,646 7,665 7,834 7,869 7,882 7,884 7,886 7,886 Debt Charges Other 145,177 145,533 148,752 149,295 149,400 149,419 149,409 149,410 Capital 19,109 19,156 19,580 19,664 19,705 19,712 19,728 19,733 Expenditure Amortisation 5,699 5,713 5,839 5,874 5,905 5,910 5,927 5,932 Other 13,410 13,443 13,740 13,791 13,800 13,802 13,801 13,801 Total Expenditure 171,932 172,354 176,166 176,828 176,987 177,015 177,023 177,029 Total Revenue 178,081 186,211 184,350 184,950 185,079 185,093 185,081 185,081 Tax 108,318 113,249 112,097 112,462 112,541 112,549 112,542 112,542 Loans and 639 690 716 719 719 719 719 719 Advances Other 69,124 72,271 71,536 71,769 71,819 71,824 71,820 71,820 Deficit/ Superavit 6,149 13,857 8,184 8,122 8,092 8,078 8,058 8,052 Overall Deficit as 0.39% 0.85% 0.43% 0.37% 0.29% 0.28% 0.24% 0.23% % GDP Source: Estimates based on Ministry of Finance of Brazil data. 10. Despite the best attempts at mitigating risks, experience shows that there are always negative elements that affect projects. The sensitivity analysis analyzed to what extent project benefits will be affected by risks leading to: (i) delays in implementation; or (ii) direct reduction in benefits. Another risk that could alter the project benefits is related to a lower than expected level of benefits. Lower benefits could result from either the selection of poor-quality subprojects, resulting in subprojects of lesser cost-effectiveness and fewer cases averted, or from logistical problems in the implementation, which will minimize expected benefits. Both of the above alternatives were considered by evaluating the project benefits assuming a 40 and 50 percent reduction in overall benefits. 11. Under this scenario, total savings will be impacted by a reduction in expected benefits. These reductions are based on 40% and 50% reduction of benefits, respectively. Assuming total savings were 40 percent lower than expected, the net present value of the savings over a 10 year period will be reduced to nearly US$326 million, with a rate of return of about 28 percent; while in the extreme case of 50 percent fewer benefits than expected, NPV will be reduced to US$237 million with an IRR of 22%. The table below shows that in the case of a 2 year delay, project benefits will be reduced by about US$352 million and the rate of return will be reduced from 48 to 43.6 percent. 109 Table 7. Project Sensitivity Analysis simulated indicators base case case change % change 1 Delay in Project Implementation by 2 years - a. 4% discounting rate NPV 1,031,721,656 532,187,968 499,533,689 -48% IRR 57.2% 51.9% -5.3% - b. 10% discounting rate NPV 681,770,855 329,596,557 352,174,299 -52% IRR 48.6% 43.6% -5.0% 2 Delay in Project Implementation by 3 years - a. 4% discounting rate NPV 1,031,721,656 369,367,104 662,354,553 -64% IRR 57% 48% -9% - b. 10% discounting rate NPV 681,770,855 220,214,843 461,556,012 -68% IRR 49% 40% -8% 3 Decrease in Total Benefits by 40% - a. 4% discounting rate NPV 1,031,721,656 524,979,889 506,741,768 -49% IRR 57% 35% -22% - b. 10% discounting rate NPV 681,770,855 326,484,428 355,286,427 -52% IRR 49% 28% -21% 4 Decrease in Total Benefits by 50% - a. 4% discounting rate NPV 1,031,721,656 398,294,447 633,427,210 -61% IRR 57% 29% -29% - b. 10% discounting rate NPV 681,770,855 237,662,822 444,108,034 -65% IRR 49% 22% -27% 110 Annex 10: Safeguard Policy Issues BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Environment 1. OP 4.01 is not triggered. The project will not present any potential impacts that would be of environmental concern, and will not involve any resettlement. Given that this is a follow on project, with no new construction envisaged, no new environmental assessment will be required. Project activities will not result in increased waste, and the project will monitor the proper disposal of health care waste by health care providers. Under the project, the DST/AIDS will develop (i) a communication strategy for proper disposal of non biodegradable condoms (mainly feminine condoms); and (ii) a system of payment for environmental services to protect the forest and its biodiversity with the objective of attaining reduced emissions through international financial mechanisms and national funds such as the recently created Amazon Fund. This will provide an added stimulus to rubber tappers and their families to increase latex production thereby contributing to the financial and environmental sustainability of the extraction of non-timber forest products. 2. The project will focus on policy and institutional arrangements and management, financing and results. The nature of the activities is policy formulation and regulation, information management, research and technology innovation, national and international cooperation, decentralized performance-based management and financing network organization, transparency, accountability and social control. The project will also focus on capacity building of the National STD and AIDS Program. These investments will not cause any direct or irreversible impact on society or the environment. 3. The National Health Service (SUS) has guidelines on proper handling and disposal of health care waste. The DST/AIDS also has monitoring guidelines for reducing health risks. The SUS and the DST/AIDS have training programs for participating organizations and health staff on handling blood products and delivering health care to PLHA. Training of health staff regarding the handling of blood products and delivering health care to HIV and AIDS patients is a regular program activity. To ensure compliance with existing waste management regulations, the program developed a long distance learning program (TELELAB) for laboratory workers and hemotherapy units. In addition, the program provided an average of three one-week courses at different types of health care institutions on environmental issues related to the project. A communication strategy on proper usage of condoms has been implemented for several years. Indigenous Populations 4. OP 4.10 is triggered. Considering that: (i) the majority of Brazil`s indigenous populations live in the North region, followed by the Northeast and Center-West; and (ii) that further developing effective outreach prevention activities involving groups most at risk at state and municipal level present a significant technical and operational challenge, an Indigenous Peoples Planning Framework (IPPF) was prepared by the DST/AIDS in collaboration with the Brazilian agency which was responsible for Indigenous Health, to appropriately manage any 111 impact, negative or positive. The IPPF was disclosed at the InfoShop and in the country on July 15, 2009. DST/AIDS develops protocols, and provides condoms, rapid HIV tests and ART to indigenous populations; the Special Secretariat of Indigenous Health delivers services to Indigenous Populations. The IPPF includes training of indigenous groups, CSO working with indigenous groups, and health staff working in Indigenous Health Districts (Distritos Sanitarios Especiais Indigenas - DSEI). 5. After a long period of population loss, the Brazilian Indian population is growing at an estimated 3.5% rate per year, contrary to what is happening with other indigenous people in the world. In the last decade, there were high levels of fertility, combined with the fall - though slow - in mortality. This phenomenon has been defined as "demographic recovery." The Brazilian indigenous population has an estimated 530,000 people, of 225 different ethnic groups, spread over 34 Special Indigenous Sanitary Districts (DSEI), and speaking 180 different languages. Between 100,000 to 190,000 live outside indigenous lands, in state capitals and other metropolitan areas, and there are groups that have not been contacted. The indigenous population is 0.25% of the Brazilian population and 2% of the indigenous population of the Americas. 6. About 60% of the indigenous population lives in the Amazon, where 99% of indigenous lands are located, while the other 40% live in land in the East, Southeast, South and Northeast country. Brazil has 633 officially recognized indigenous lands, corresponding to 14% of the national territory. Most of these lands are concentrated in the Amazon; 405 of them represent 21% of the Amazon and 99% of indigenous land. The rest of the indigenous lands are spread among the Northeast, Southeast, South and the state of Mato Grosso do Sul. The indigenous communities are small - 28% consist of up to 200 people, 40% have between 200 and 1,000 people, and only three communities have more than 20,000 people. Besides the widespread socioeconomic inequality between indigenous and non-indigenous population, there are significant inequalities within this population. Figure 1. Indigenous Population by Region 2007 Source: SIASI FUNASA 7. The European and other occupation of the Central-West and North of the country, as well as the advancement of the agricultural frontier and mining, have resulted in profound transformations of indigenous cultures. This impact can be measured in the 112 increase of disease and mortality in indigenous lands, and conflicts that have emerged between indigenous and non-indigenous populations because of agricultural expansion. 8. The Brazilian Constitution recognizes indigenous groups, their customs, languages, beliefs and traditions, and their rights to the land that they traditionally occupy. The Brazilian Constitution establishes the duty of the Government to define and establish the boundaries of indigenous lands, and to protect them. Recently, some indigenous people have moved to urban centers in search of better standards of living, opportunities to study and/or health care. However, they do not loose their identity, establishing community spaces for rituals and maintaining ties of kinship and contacts with their original communities. Certain groups have organized ethnic associations in some larger cities - São Paulo and Campo Grande, for example -- or community centers where families arriving from indigenous lands can gather. Such facilities are usually located in the most impoverished urban centers. In indigenous lands, the sense of marginalization, exacerbated by frequent conflicts between the economic interests of local elites and indigenous territorial rights, contributes greatly to the indigenous resistance to any proposal of "municipalization" of the functions currently assigned to the federal Government, and this resistance is very marked in the health sector. Indigenous Health 9. The infant mortality disparity between indigenous and non-indigenous people in Brazil is lower than in other developing countries. Infant mortality decreased from 57.3 to 48.6 per 1,000 live births between 2000 and 2006, while the overall infant mortality decreased from 26.7 to 21.7 in Brazil during the same period. In all continents, indigenous people have worse health indicators than the general population; and in Latin America, indigenous populations have mortality rates 3 to 4 times higher than the respective national averages. 10. The indigenous population is experiencing a complex epidemiological transition. Some groups already have significant prevalence of morbidity and mortality from chronic degenerative diseases associated with violence and infectious diseases. This pattern strikes especially males due to the increase in sedentary lifestyle. Other indigenous people are still in a transitional pattern typical of deficiencies in access to public goods and services. Among others, this is characterized by high prevalence of malnutrition among children less than 5 years old, malaria, tuberculosis and leishmaniosis. Mental health, infanticide, alcoholism and suicide among indigenous groups are important and complex issues, which the Government has had difficulty in tackling. 11. In this context, the efforts that Brazil has been making to reverse inequalities, and to rescue the historic debt with indigenous people through the adoption of a national policy, are remarkable. As a whole, the legislation passed since 1999 attests to the enormous effort made over the last nine years to build a legal and institutional framework for the Indigenous Health Subsystem. The background of this policy is the 1988 Constitution, which recognizes and respects the cultural organizations of indigenous people, ensuring them full civil rights, rendering obsolete guardianship institutions and mandating the Government with the exclusive power to legislate on issues related to indigenous people. The Constitution also defined the general principles of the Unified Health System (SUS), recognizing the right to health and ensuring 113 service equity for vulnerable populations. In comparison, countries with a per capita income higher than Brazil have faced great difficulties in structuring systems that can reverse the health inequalities between indigenous people and non-indigenous people (e.g., Australia, Canada and USA). 12. Consolidation of an Indigenous Health subsystem was achieved with the adoption in 1999 of the Arouca Law, which established the territory-based Special Indigenous Health Districts (DSEI) under the responsibility of the National Health Foundation (FUNASA). The subsystem works within the same principles promoted by the national health service (SUS), based on equity and integrality, to guarantee indigenous people the right to universal access, based on health needs identified by the communities, and involving indigenous populations in all stages of planning, implementation and evaluation of actions. The sub-system provides health promotion, disease prevention and health care for indigenous groups. 13. Under the Indigenous Health Subsystem, the DSEI are service-oriented organizations, which carry out technical activities, promote the organization of the health network, and undertake the necessary managerial and administrative activities for the provision of health care, with participation of the indigenous community and social control. The DSEI have technical staff and other professionals such as managers, administrative staff, drivers and others. The multidisciplinary teams of Indigenous Health (EMSI) that act on the DSEI are equivalent to the Family Health Program teams, which also operate on a territorial basis. The EMSI have been hired either by FUNASA, through contracts with CSO, or by the respective municipality, and provide services that are DSEI-specific. Graph 1. Distribution of Indigenous Population by DSEI 2007 Source: SIASI - FUNASA 14. In 2009, a Presidential Decree provides that capacity of the DSEI should be built until December 2010 so these can become autonomous. This will empower the DSEI to 114 coordinate, supervise and implement the activities of the Indigenous Health Subsystem in the context of the SUS. 15. Since 1997, the Bank-financed VIGISUS Project invested $400 million to assist improving indigenous health and building the capacity of the Indigenous Health Subsystem. The first phase of the project closed in 2004 with satisfactory results; the second phase is closing this year also with satisfactory results (Table 1); the third phase is under identification. This last phase of the project will focus on improving indigenous health governance and innovation to improve results. Financial transfers from the MOH and transfers to third parties (agreements) will be tied to the monitoring of targets and management for results. Indigenous Health stakeholders agree on the need for autonomy of the DSEI. Indigenous Health: Main Indicators Indicator 2004 2008 Target 2009 Vaccination Coverage 39% in 10/34 DSEI 65% in 34 DSEI 60% in 34 DSEI Prenatal visits 30% in 21 DSEI 50% in 33 DSEI received 50% according to MOH received 3.4 visits 3 visits protocol Mothers with children 0 100% in 32/34 DSEI < 5 100% <2 identified with years inadequate weight gain receive nutrition education/counseling Children <2 in 88% in 1 DSEI 64% in 32 DSEI 80% targeted districts 8,414 children < 5 years children < 2 years 56% in weighed according to 32 DSEI MOH norms 52,650 children < 5 years Cases of diarrhea in NA 76% in 33/34 DSEI 80% children <6 treated with ORT TB cases on DOTS 74% treated out of 617 87% treated out of 515 30% increase cases cases Reliable data on 1 32 DSEI for nutrition 10 DSEI nutritional status, 10 DSEI for substance substance abuse and abuse and suicide suicides available in 10 DSEI NGO and public 0 100% under the project 50% providers operating under performance- based contracting scheme Health teams 100% 100% 70% providing integrated, benchmark service plan 115 16. In 2008, FUNASA started to work under the VIGISUS project on setting targets and designing new models of indigenous health care, financing, organization, management, monitoring and evaluation. This work aimed at identifying and discussing with the DSEI more realistic, effective and efficient options for the Indigenous Health Subsystem, and levels of integration into the SUS. Proposals for new models of Indigenous Health and an Implementation Plan were completed, and reviewed by 5 Regional Workshops in 2008 and 2009, with participation of the 34 DSEI; a Technical Workshop in March 2009, to review the proposed targets and models; and a National Workshop with participation of representatives of the indigenous leadership, Presidency of Brazil, Ministry of Health, FUNASA and World Bank on May 20-21, 2009. HIV/AIDS and other STD in the indigenous population 17. In the period 1988-2007, 624 cases of AIDS were reported in indigenous groups; between 2000 and 2008, SINAN recorded 401 cases of AIDS in indigenous populations. The gender ratio is similar to the general population with 1.6 cases in men for every case among women, but this trend has been changing toward higher numbers of women being affected; people 30-60 years are most vulnerable, representing 65% of all reported cases (Tables 3 and 4). 18. Epidemiological data show that the main category of exposure is heterosexual, accounting for 61% of cases reported. Nevertheless, 21% of cases are recorded in the categories gay and bisexual and 6.7% are in the category of injecting drug users. With regard to vertical transmission of HIV, from 2001 to 2008, 94 cases of women were registered in the SINAN; and in the period 2005-2007, 132 cases of congenital syphilis. 19. The most affected DSEI in each region are: North: Alto Solimões; East Roraima; Amapá and North of Pará; DSEI Manaus; Parintins Northeast: Potiguara; Maranhão; Pernambuco Midwest: Mato Grosso do Sul; Araguaia; Cuiabá South/Southeast: South and Interior Litoral 20. The first notified case of AIDS in a Brazilian indigenous population occurred in the state of Paraná in 1987. Two years later, in 1989, the National STD and AIDS program was established, and included indigenous communities among its priority populations, with specific activities for the prevention of HIV/AIDS and other STD within this population. In the 1990s, the epidemiological profile of HIV/AIDS in Brazil began to change, with data showing the epidemic moving towards the interior, poorer groups and women. These trends are also reflected 116 in the reported cases in the indigenous population. Reported data show an increased incidence of HIV/AIDS and other STD among indigenous residents and visitors from urban areas and the border regions. 117 Table 2. AIDS cases in indigenous areas by gender 2000-2008 Year Male Female Total 2000 39 21 60 2001 36 22 58 2002 21 17 38 2003 22 16 38 2004 22 16 38 2005 23 21 44 2006 32 19 51 2007 49 20 69 2008 4 1 5 Total 248 153 401 Source: SINAN up to June 30, 2008 Table 3. AIDS cases by age group 2000-2008 Age Group 2000 2001 2002 2003 2004 2005 2006 2007 2008 Total < 5 anos 1 0 2 0 3 1 0 0 1 8 5-12 0 0 0 0 4 1 1 0 1 7 13-19 0 1 4 2 0 1 1 0 0 9 20-24 6 11 1 3 3 9 5 4 0 42 25-29 9 10 8 7 7 6 12 13 1 73 30-34 13 5 8 12 7 3 9 13 1 71 35-39 15 10 6 6 7 7 6 11 1 69 40-49 13 14 7 5 5 10 12 18 0 84 50-59 2 5 2 3 2 5 3 6 0 28 60 e mais 1 2 0 0 0 1 2 4 0 10 Total 60 58 38 38 38 44 51 69 5 401 Source: SINAN up to June 30, 2008 Table 4. AIDS cases by exposure category and gender 2000-2008 Exposure Group 2000 2001 2002 2003 2004 2005 2006 2007 2008 Total Male Homosexual 5 7 5 4 5 4 5 12 2 49 Bisexual 5 7 3 4 2 2 6 5 0 34 Heterosexual 17 16 9 10 9 10 9 24 0 104 IDU 5 3 2 0 3 3 3 2 0 21 Transfusion 1 0 0 0 0 0 0 1 0 2 MTCT 1 0 1 0 2 1 0 0 1 6 Unknown 5 3 1 4 1 3 9 5 1 32 Subtotal 39 36 21 22 22 23 32 49 4 248 Female Heterosexual 20 21 13 16 11 18 19 20 1 139 IDU 1 1 2 0 0 2 0 0 0 6 MTCT 0 0 1 0 5 1 0 0 0 7 Unknown 0 0 1 0 0 0 0 0 0 1 Subtotal 21 22 17 16 16 21 19 20 1 153 Total 60 58 38 38 38 44 51 69 5 401 Source: SINAN up to June 30, 2008 118 The Brazilian response to HIV/AIDS and other STD epidemic among indigenous people 21. Since the end of the 1980s, the national program has supported several initiatives aimed at prevention of HIV/AIDS and other STD among indigenous populations. At the time, actions were conducted in partnership with the National Indian Foundation (FUNAI), and the main objectives were to investigate and initiate field work on HIV/AIDS and other STD. In general, actions were conducted on an ad hoc basis and were not sustained over time, and thus did not result in consolidated structures for systematic development of prevention and care. Considering the growing number of cases, one of the principal challenges was to develop sustainable support to the DSEI on surveillance, prevention, assistance and monitoring. 22. Since 1994, under the AIDS I Project, preventive actions targeted at indigenous population have been institutionalized and have gained relative importance. In 1995, to guarantee program implementation in the DSEI, the PN and FUNASA established a technical and financial partnership. The AIDS II and AIDS III Projects consolidated these earlier initiatives and gave new impetus to preventive actions. The 2002 National Health Policy on Indigenous people identified AIDS as one of the serious health problems that affected the indigenous population. In 2003, under the AIDS III Project, the Executive Secretariat of the Ministry of Health and FUNASA signed an agreement with the objective of supporting the Indigenous Health Subsystem organizing actions for control of HIV/AIDS and other STD. As a result of this partnership, the DSEI have incorporated into their plans and have implemented HIV/AIDS and STD activities in the last 6 years. 23. In 2004, given the need to ensure the sustainability of these activities in indigenous communities, the DST/AIDS and FUNASA agreed to direct resources to strengthening the network of health services in indigenous areas. Under the AIDS III Project, which closed December 31, 2008, four decrees were published regarding the transfer of funds for implementation of HIV/AIDS and STD activities in the 34 DSEI through the Indigenous Health subsystem and the SUS. A total of R$10 million was allocated to HIV/AIDS and other STD activities among indigenous groups, and the Ministry of Health approved the guidelines for implementation of HIV/AIDS and STD activities among indigenous populations. In 2008, the indigenous health system set quotas for SES and SMS to provide condoms to indigenous communities; 35 % of DSEI were equipped with rapid test for HIV; reference for diagnosis and treatment of HIV and syphilis was established, including tests for viral load, CD4 and others; and the DSEI were provided with drugs for treatment of STD. The 34 DSEI approved Plans to prevent and control HIV/AIDS and STD in indigenous communities, with FUNASA`s funding and the DST/AIDS technical assistance. This process has strengthened the institutionalization of the program in the Indigenous Health Subsystem. The District Plans were discussed and approved by the DSEI social control mechanism, with 50% of indigenous representation. The Ministry of Health, through the Department of Science and Technology, approved an assessment of the implementation of HIV/AIDS and STD activities in the 34 DSEI, This study will be carried out by a team of a federal public university in 2009. 119 Brazil Indigenous HIV/AIDS and other STD Program Main Results and Challenges in 2008 Main Results Improvement of notification. All 34 DSEI have been carrying out prevention activities, including condom distribution. The main clientele are youth and adolescents. 52% DSEI supply condoms in sufficient quantity to meet demand. More than 60% of the health centers are involved in prevention actions. DSEI established partnerships with states and municipalities to coordinate the logistics of condom distribution and roll-over of staff trained in administering the rapid test; and coordinated logistical plans to receive the diagnostic kits and monitor their implementation. More than 700 indigenous health agents, who have an important role in prevention activities, were trained. 35% DSEI implemented rapid testing. Community acceptance of the rapid test was positive (83.3%) in 10 DSEI where it was used. The DSEI adopted syphilis and HIV testing for pregnant women: 61% had access to the syphilis test and 49% had access to the HIV test. In 2007, the best coverage (measured by the percentage of pregnant women served by health centers that took either an HIV or syphilis test) were in the Southeast and Mid-west regions. There are more pregnant women with syphilis in the Mid-west Region, from which 82% made at least one test, followed by the North Region with 50%. In 2009, the rapid test for syphilis will be implemented as a pilot project in the 7 DSEI of the state of Amazonas and the 2 DSEI of the state of Roraima, in partnership with the Alfredo da Matta Foundation, with a preferential access given to pregnant women. All DSEI have adopted STD syndromic management, improving the diagnosis and treatment of STD. 52% DSEI supply medication for the treatment of STD. All DSEI received treatment protocols and instructional materials for training health staff. All DSEI established partnerships in the context of the newtwork of specialized services for reference for treatment of cases of AIDS among indigenous people. Main Challenges Indigenous groups have different patterns of living sexuality with extensive and complex networks of sexual partnerships. There is underreporting of HIV and AIDS cases, and the pre-filling of information in the notification sheets of HIV-positive pregnant women and children. There are cases of HIV among injecting drug users who are indigenous pregnant women in the Southern region. Prevention activities are sporadic and not all villages are covered. Rapid testing should be available in all DSEI, especially for indigenous pregnant women, and it is necessary to shorten the waiting time for results in hard to reach communities. Condom distribution as a response to spontaneous demand needs to be better planned and cover all locations frequented by the population. Urban indigenous populations are not covered by these interventions. DSEI have a high rotation of health professionals in multidisciplinary teams. The National Health Service (SUS) has low capacity to meet the demand for the indigenous population and incorporate the intercultural dimension. The SUS network is less structured and decentralized in the Northern Region, and offers fewer services for STD and HIV/AIDS. 24. Today, one important aspect of the work is the community participatory approach and the respect of the indigenous culture and their traditional knowledge and experiences. The responsibilities have been divided as follows: 120 DST/AIDS o Develops surveillance, M&E, and management of HIV/AIDS and STD interventions in indigenous communities; and prevention activities for urban indigenous groups, who are not covered by the DSEI. o Develops protocols, and provide condoms, rapid HIV tests and ART to indigenous populations. o In partnership with the University of Brasilia (UNB), evaluates the HIV/AIDS and other STD programs implemented by the DSEI. o These activities were co-financed by the AIDS I, II, III Projects, and will continue to be co-financed under the AIDS-SUS Project. FUNASA65 o Delivers health care services to Indigenous Populations. o Trains indigenous groups, CSO working with indigenous groups, and health staff working in Indigenous Health Districts on HIV/AIDS and other STD. o Activities are implemented by indigenous organizations, CSO and universities working with indigenous populations, states, and municipalities. o These activities have been co-financed by the VIGISUS I and II Projects, and will continue to be co-financed under the VIGISUS III Project. 25. The proposed AIDS-SUS project will support the current policy of focusing on the groups most at risk, including MSM, SW, IDU and prisoners. Indigenous communities are also considered vulnerable populations, and strategies should take into account the epidemiological issues discussed above, in particular the strengthening of prevention and assistance programs within DSEI and preparation of indigenous health worker teams to deal with issues of sexual orientation. These issues may be decisive factors in containing the growth of the epidemic in indigenous communities. Specifically, the Brazil AIDS-SUS Project will (i) provide technical assistance to SES and SMS to support DSEI improving HIV/AIDS and other STD prevention, diagnosis and treatment activities in indigenous populations; (ii) monitor the implementation of the DSEI Plans on HIV/AIDS and other STD through a project monitoring indicator; (iii) carry out a review and dissemination of the findings of the 2009 evaluation; and (iv) carry out a second evaluation of the program implementation in 2011. Brazil AIDS-SUS: Indicator of Indigenous Health Activities Proportion of DSEI with an The Indicator will measure: HIV/AIDS and STD Action Plan Distribution of male condoms implemented Implementation of STD syndromic approach Availability of HIV and syphilis diagnosis Availability of prevention of mother to child transmission DSEI implementing 3 or more of the above actions will be considered as having implemented the Plan; 2 of the above actions will be considered as having partially implemented the Plan; One or none of the above actions will be Source: DSEI Reports and SIASI considered as not having implemented the Plan. 65 The Special Secretariat of Indigenous Health is expected to become responsible for Indigenous Health in 2010. 121 Action Plan for HIV/AIDS and STD intervention in Indigenous Communities66 Improve the surveillance and notification of HIV/AIDS and STD in indigenous populations. In 2000, information about skin color and race were incorporated into data gathered and analyzed by the SINAN. This allows for analysis of health problems of indigenous populations. However, these variables are not always collected and/or available for all diseases, reflecting the need for incentives and to increase professional awareness of the importance of completing this data fields when information is gathered in the field. Actions: (i) Improve the system of surveillance and notification and combine the information in the DST/AIDS and SIASI databases; (ii) Improve access to HIV testing and diagnosis for this population; (iii) Increase reporting of cases; and (iv) Increase completion of the data field for race/color. Improve Monitoring and Evaluation. A set of basic data on HIV/AIDS and other STD is to be monitored in all DSEI through the Indigenous Health Information System (SIASI ). However, completion of datasets by the DSEI is still weak and intermittent. Actions: (i) Use HIV/AIDS and STD indicators that are already collected by the Indigenous Health network; (ii) Prepare the indigenous health network to monitor HIV/AIDS and other STD prevention projects; and (iii) Carry out another evaluation in 2011. Strengthen the mobilization of indigenous communities. Follow up on agreements reached at the 2003 macro-regional meetings. Actions: (i) Promote indigenous participation and mobilization, together with health services that reflect indigenous health policies. Improve prevention of HIV/AIDS and STD in indigenous populations living in urban areas, including the promotion of safe sex practices and provision of condoms in a culturally appropriate manner. Indigenous populations living in urban areas have little or no access to preventive actions developed by the DSEI, which prioritize villages within the indigenous lands. Actions: (i) Deliver preventive actions to indigenous populations residing in urban areas through community mobilization; (ii) Effectively and appropriately promote access to condoms; and (iii) Develop actions that strengthen the human rights of indigenous people of all sexual orientations and those living with HIV/AIDS. Improve prevention of HIV/AIDS and STD among indigenous populations living in villages, including the promotion of safe sex practices and provision of condoms in a culturally appropriate manner. The 34 DSEI undertake prevention activities related to HIV/AIDS and STD. These actions are carried out in the community, in schools and on home visits. All the DSEI report providing condoms, with higher demand from young people. However, most are done in a sporadic manner and not all villages are covered. An important aspect of these actions is the role played by Indigenous Health Agents, who work in the communities, expanding access to information and services. Actions: (i) Increase the coverage of the village population by prevention activities, increasing the frequency and outreach activities in all DSEI; (ii) Increase the availability of condoms; and (iii) Develop actions that strengthen the human rights of indigenous people of all sexual orientations and those living with HIV/AIDS. Prevent vertical transmission of HIV, hepatitis and congenital syphilis. The DSEI offer testing for HIV and syphilis for pregnant women. However, in 2007 only 61% of indigenous pregnant women had access to diagnosis of syphilis and 49% for HIV. Actions: (i) Expand the supply and safety of testing services for indigenous women, and shorten the time for availability of test results especially in areas of difficult access; (ii) provide two tests to each indigenous woman; (iii) implement the rapid test for HIV and syphilis in all DSEI; (iv) with states and municipalities, provide infant formula; and (v) inform indigenous women with HIV about the importance of restricting breastfeeding. 66 Co-financed by the Borrower`s entity responsible for Indigeneous Peoples` Health and DST/AIDS, under the VIGISUS and AIDS Projects. 122 Action Plan for HIV/AIDS and STD intervention in Indigenous Communities66 Expand access to testing and diagnosis of HIV and syphilis. Teams were trained to deploy rapid tests for diagnosis of HIV in 12 DSEI (35%): Alto Rio Negro, Bahia, Xingu, Kaiapo MT, Mato Grosso do Sul, Minas Gerais, Araguaia, Rio Alto Purus, Altamira, PA Kaiapo, and Porto Velho. In the DSEI of Bahia and Mato Grosso do Sul, although trained, teams did not implement the rapid test. Where it was implemented, 83% DSEI reported that community acceptance was good. In 2009, the seven DSEI in the state of Amazonas and the two DSEI in Roraima are implementing the rapid test for syphilis as a pilot, in partnership with the Fundação Alfredo da Matta, with priority given to pregnant women. Actions: (i) Increase the access of indigenous people with STD and TB to testing for HIV; and (ii) increase access to test results/diagnosis of HIV and syphilis. Improve adoption of the STD syndromic approach. All DSEI adopted the syndromic approach for treatment of STD as a result of the training of multidisciplinary teams of indigenous health workers. This approach is improving the diagnosis of STD, and increasing the screening of women of childbearing age for cervical and uterine cancer. Actions: (i) Further improve the logistics of STD drug distribution in the 34 DSEI; (ii) Increase the number of health workers trained in the STD syndromic approach; and (iii) familiarize indigenous health teams with the traditional forms of STD treatment used by communities. Brazil AIDS-SUS Project: Budget of Indigenous Health Activities Component 2 Action Activities US$ 000 TOTAL US$000 Year 1 Year 2 Year 3 Year 4 Build TA to SES and Training 15 15 15 15 60 decentralized SMS to support governance DSEI Supervision 30 30 30 30 120 capacity and Implementing STD and HIV/AIDS Preparation of 20 20 20 20 80 innovation. Action Plans Reference documents Regional events 60 60 60 60 240 Technical intersectoral 25 25 25 25 100 meetings TOTAL 150 150 150 150 600 123 Annex 11: Project Preparation and Supervision BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Planned Actual PCN review March 26, 2009 March 26, 2009 Initial PID to PIC April 21, 2009 Initial ISDS to PIC May 15, 2009 Appraisal June 30, 2009 July 1, 2009 Negotiations October 26, 2009 April 5-7, 2010 Board/RVP approval May 18, 2010 Planned date of effectiveness September 1, 2010 Planned date of mid-term review September 1, 2012 Planned closing date December 31, 2014 Key institutions responsible for preparation of the project: MOH - DST/AIDS Project Preparation Team Members DST/AIDS IBRD Team Leader Mariângela Simão Joana Godinho Eduardo Barbosa M&E Specialist Ana Roberta Pati Pascom Greet Peersman Operations Ruy Burgos Daniela Pena Lima Planning Specialist Sergio d`Àvila Maria Alice Tironi Procurement Specialist Adalberto Antunes Frederico Rabello Renato Chuster Luis Prada Augusto Bernardes Financial Mgmt Specialist Adalberto Antunes Susana Amaral Ricardo Luiz Lawyer Graziela de Queiroz Macedo Mariana Montiel Environmental Specialist Gunars Platais Social Specialists Karen Bruck Ximena Traa-Valarezo Ivo Brito Jane Galvão Vera Lopes Economist Rodrigo Briceno Editor Cecilia Brady Data Collection Yuki Murakami Claire Guimbert Program Assistant Ieda Fornazier Veronica Jarrin Team Assistant Bruna Yara Nascimento Judith Williams Laís Silva Garcia Carla Zardo Lilian Mello Marize Santos Peer Reviewers Elizabeth Lule David Wilson Elisabeth Pisani John Langenbrunner 1. Bank funds expended to date on project preparation: Bank resources up to FY09: US$ 207,637 Trust funds: US$ 11,250 2. Estimated Approval and Supervision costs: US$ 105,000 Remaining costs to approval: US$ 15,000 Estimated annual supervision cost: US$ 90,000 (including fixed and variable costs) 124 Annex 12: Documents in the Project File BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Documents Brazil Decreto nº 3.964, de 10 de Outubro de 2001. Establishes the National Health Fund. Portaria nº 2313, de 19 de Dezembro de 2002. Regulates the Incentive Policy. Decreto nº 6.860, de 27 de Maio de 2009. Establishes the Department of Surveillance, Prevention and Control of STD and AIDS in the Ministry of Health. Ministry of Health. Secretaria de Vigilância em Saúde. DST/AIDS 2008. Carta Consulta. Projeto: Estruturando a governança para a resposta nacional ao HIV/AIDS e outras DST. 2009. Projeto AIDS SUS 20102014. Manual Operacional. 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Weiss HA, Halperin D, Bailey RC, Hayes RJ, Schmid G and Hankins CA 2008. Male circumcision for HIV prevention: from evidence to action? AIDS 22: 567­574. 129 Annex 13: Statement of Loans and Credits BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service Difference between expected and actual Original Amount in US$ Millions disbursements Project FY Purpose IBRD IDA SF GEF Cancel. Undisb. Orig. Frm. Rev`d ID P099469 2010 (APL 2) 2nd National Environment 24.30 0.00 0.00 0.00 0.00 24.30 0.0 0.00 P101508 2010 BR-RJ Sustainable Rural 39.50 0.00 0.00 0.00 0.00 39.40 1.83 0.00 Development P119215 2010 BR AF Minas Gerais Swap 461.0 0.00 0.00 0.00 0.00 461.00 0.00 0.00 P108654 2010 BR Pernambuco Sustainable Water 190.00 0.00 0.00 0.00 0.00 190.00 0.00 0.00 P106663 2010 BR Sao Paulo Feeder Roads Project 166.65 0.00 0.00 0.00 0.00 55.73 -110.50 0.00 P103770 2010 BR ALAGOAS Fiscal & Public 195.45 0.00 0.00 0.00 0.00 74.96 -120.00 0.00 Mgmt Reform P104995 2010 BR Municipal APL5: Santos 44.00 0.00 0.00 0.00 0.00 44.00 0.00 0.00 P111996 2010 BR RJ Mass Transit II 211.70 0.00 0.00 0.00 0.00 210.67 -0.50 0.00 P006553 2010 BR SP APL Integrated Wtr Mgmt 104.00 0.00 0.00 0.00 0.00 104.00 3.78 0.00 P117244 2010 BR Rio State DPL 485.00 0.00 0.00 0.00 0.00 485.00 0.00 0.00 P104752 2009 BR Paraiba 2nd Rural Pov Reduction 20.90 0.00 0.00 0.00 0.00 20.90 0.00 0.00 P099369 2009 BR Ceara Regional Development 46.00 0.00 0.00 0.00 0.00 45.89 0.07 0.00 P095205 2009 BR 1st Prog. DPL for Sust. Env 1,300.00 0.00 0.00 0.00 0.00 1,300.00 1.30 0.00 Mgmt P094315 2009 BR Municipal APL4: Sao Luis 35.64 0.00 0.00 0.00 0.00 33.49 -1.90 0.00 P106208 2009 BR Pernambuco Educ Results& 154.00 0.00 0.00 0.00 0.00 97.84 -55.77 0.00 Account. P106765 2009 BR Ceara Inclusive Growth (SWAp 240.00 0.00 0.00 0.00 0.00 137.05 27.29 0.00 II) P106767 2009 BR RGS Fiscal Sustainability DPL 1,100.00 0.00 0.00 0.00 0.00 450.00 0.00 0.00 P107146 2009 BR Acre Social Economic Inclusion 120.00 0.00 0.00 0.00 0.00 104.00 -0.70 0.00 Sust D P107843 2009 BR Fed District Multisector Manag. 130.00 0.00 0.00 0.00 0.00 129.68 29.23 0.00 Proj. P110614 2009 BR: Sergipe State Int. Proj.: Rural 20.80 0.00 0.00 0.00 0.00 17.55 2.81 0.00 Pov P088716 2009 BR Health Network Formation & 235.00 0.00 0.00 0.00 0.00 234.41 4.07 0.00 Quality Im P106038 2008 BR Sao Paulo Trains and Signalling 550.00 0.00 0.00 0.00 0.00 307.04 34.30 0.00 P083997 2008 BR Alto Solimoes Basic Services and 24.25 0.00 0.00 0.00 0.00 21.59 5.04 0.00 Sust P101324 2008 BR-Second Minas Gerais Dev't 976.00 0.00 0.00 0.00 0.00 235.40 6.34 0.00 PArtnership P088966 2008 BR Municipal APL3: Teresina 31.13 0.00 0.00 0.00 0.00 28.64 4.42 0.00 P095626 2008 BR (APL2)Family Health Extension 83.45 0.00 0.00 0.00 0.00 83.24 26.15 0.00 2nd APL P089013 2008 BR Municipal APL: Recife 32.76 0.00 0.00 0.00 0.00 32.68 13.96 0.00 P094199 2008 BR-(APL) RS (Pelotas) Integr. Mun. 54.38 0.00 0.00 0.00 0.00 39.36 5.42 0.00 Dev. P089929 2008 BR RGN State Integrated Water Res 35.90 0.00 0.00 0.00 0.00 31.20 20.73 0.00 Mgmt P082651 2007 BR APL 1 Para Integrated Rural Dev 60.00 0.00 0.00 0.00 0.00 51.20 45.20 0.00 P089793 2007 BR State Pension Reform TAL II 5.00 0.00 0.00 0.00 0.00 4.99 3.17 0.00 130 P095460 2007 BR-Bahia Integr.Hway Mngmt. 100.00 0.00 0.00 0.00 0.00 87.90 24.43 0.00 P089011 2007 BR Municipal APL1: Uberaba 17.27 0.00 0.00 0.00 0.00 13.05 9.49 0.00 P050761 2006 BR-Housing Sector TAL 4.00 0.00 0.00 0.00 2.70 0.96 3.66 -0.29 P090041 2006 BR ENVIRONMENTAL SUST. 8.00 0.00 0.00 0.00 0.00 4.88 4.85 0.69 AGENDA TAL P089440 2006 BR-Brasilia Environmentally 57.64 0.00 0.00 0.00 0.00 21.22 19.30 0.00 Sustainable P093787 2006 BR Bahia State Integ Proj Rur Pov 84.35 0.00 0.00 0.00 0.00 30.72 0.22 0.00 P092990 2006 BR - Road Transport Project 501.25 0.00 0.00 0.00 0.00 228.70 209.95 0.00 P081436 2006 BR-Bahia Poor Urban Areas 49.30 0.00 0.00 0.00 0.00 38.96 38.96 0.00 Integrated Dev P083533 2005 BR TA-Sustain. & Equit Growth 12.12 0.00 0.00 0.00 0.00 7.70 7.70 0.00 P069934 2005 BR-PERNAMBUCO INTEG DEVT: 31.50 0.00 0.00 0.00 0.00 9.15 9.15 0.00 EDUC QUAL IMPR P087711 2005 BR Espirito Santo Wtr & Coastal 107.50 0.00 0.00 0.00 0.00 31.06 -40.26 -17.93 Pollu P076924 2005 BR- Amapa Sustainable Communities 4.80 0.00 0.00 0.00 0.23 2.35 2.58 1.99 P060573 2004 BR Tocantins Sustainable Regional 60.00 0.00 0.00 0.00 0.00 18.19 18.19 0.00 Dev P076977 2003 BR-Energy Sector TA Project 12.12 0.00 0.00 0.00 0.00 5.63 5.63 0.00 P049265 2003 BR-RECIFE URBAN UPGRADING 46.00 0.00 0.00 0.00 0.00 8.13 8.13 0.00 PROJECT P066170 2002 BR-RGN Rural Poverty Reduction 45.00 0.00 0.00 0.00 0.00 15.49 -6.95 15.55 P060221 2002 BR FORTALEZA 85.00 0.00 0.00 0.00 62.60 9.79 65.37 13.65 METROPOLITAN TRANSPORT PROJ P051696 2002 BR SÃO PAULO METRO LINE 4 304.00 0.00 0.00 0.00 0.00 27.67 -67.10 27.90 PROJECT P006449 2000 BR CEARA WTR MGT 239.00 0.00 0.00 0.00 0.00 96.74 -6.00 1.00 PROGERIRH SIM Total: 8,945.66 0.00 0.00 0.00 65.53 5,753.44 253.04 42.56 BRAZIL STATEMENT OF IFC`s Held and Disbursed Portfolio In Millions of US Dollars Committed Disbursed IFC IFC FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic. ABN AMRO REAL 98.00 0.00 0.00 0.00 15.77 0.00 0.00 0.00 2005 2005 ABN AMRO REAL 98.00 0.00 0.00 0.00 15.77 0.00 0.00 0.00 2001 AG Concession 0.00 30.00 0.00 0.00 0.00 30.00 0.00 0.00 2002 Amaggi 17.14 0.00 0.00 0.00 17.14 0.00 0.00 0.00 2005 Amaggi 30.00 0.00 0.00 0.00 30.00 0.00 0.00 0.00 2002 Andrade G. SA 22.00 0.00 10.00 12.12 22.00 0.00 10.00 12.12 2001 Apolo 6.04 0.00 0.00 0.00 3.54 0.00 0.00 0.00 1998 Arteb 20.00 0.00 0.00 18.33 20.00 0.00 0.00 18.33 2006 BBM 49.40 0.00 0.00 0.00 49.40 0.00 0.00 0.00 2001 Brazil CGFund 0.00 19.75 0.00 0.00 0.00 18.15 0.00 0.00 2004 CGTF 54.01 0.00 7.00 65.12 54.01 0.00 7.00 65.12 131 Committed Disbursed IFC IFC FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic. 1994 CHAPECO 10.00 0.00 0.00 0.00 10.00 0.00 0.00 0.00 1996 CHAPECO 1.50 0.00 0.00 5.26 1.50 0.00 0.00 5.26 2003 CPFL Energia 0.00 40.00 0.00 0.00 0.00 40.00 0.00 0.00 1996 CTBC Telecom 3.00 8.00 0.00 0.00 3.00 8.00 0.00 0.00 1997 CTBC Telecom 0.00 6.54 0.00 0.00 0.00 6.54 0.00 0.00 1999 Cibrasec 0.00 3.27 0.00 0.00 0.00 3.27 0.00 0.00 2004 Comgas 11.90 0.00 0.00 11.54 11.90 0.00 0.00 11.54 2005 Cosan S.A. 50.00 5.00 15.00 0.00 50.00 5.00 15.00 0.00 Coteminas 0.00 1.84 0.00 0.00 0.00 1.84 0.00 0.00 1997 Coteminas 1.85 1.25 0.00 0.00 1.85 1.25 0.00 0.00 2000 Coteminas 0.00 0.18 0.00 0.00 0.00 0.18 0.00 0.00 1980 DENPASA 0.00 0.52 0.00 0.00 0.00 0.48 0.00 0.00 1992 DENPASA 0.00 0.06 0.00 0.00 0.00 0.06 0.00 0.00 Dixie Toga 0.00 0.34 0.00 0.00 0.00 0.34 0.00 0.00 1998 Dixie Toga 0.00 10.03 0.00 0.00 0.00 10.03 0.00 0.00 1997 Duratex 1.36 0.00 3.00 0.57 1.36 0.00 3.00 0.57 2005 EMBRAER 35.00 0.00 0.00 145.00 35.00 0.00 0.00 145.00 1999 Eliane 14.93 0.00 13.00 0.00 14.93 0.00 13.00 0.00 1998 Empesca 1.33 0.00 2.67 0.00 1.33 0.00 2.67 0.00 2006 Endesa Brasil 0.00 50.00 0.00 0.00 0.00 50.00 0.00 0.00 2006 Enerbrasil Ltda 0.00 5.50 0.00 0.00 0.00 0.00 0.00 0.00 2006 FEBR 12.00 0.00 0.00 0.00 12.00 0.00 0.00 0.00 2000 Fleury 0.00 0.00 6.00 0.00 0.00 0.00 6.00 0.00 1998 Fras-le 4.00 0.00 9.34 0.00 4.00 0.00 6.04 0.00 2006 GOL 50.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2005 GP Capital III 0.00 14.00 0.00 0.00 0.00 0.14 0.00 0.00 GP Cptl Rstrctd 0.00 2.22 0.00 0.00 0.00 2.16 0.00 0.00 2001 GPC 0.00 0.00 9.00 0.00 0.00 0.00 9.00 0.00 GTFP BIC Banco 44.91 0.00 0.00 0.00 44.91 0.00 0.00 0.00 GTFP BM Brazil 4.22 0.00 0.00 0.00 4.22 0.00 0.00 0.00 GTFP Indusval 5.00 0.00 0.00 0.00 5.00 0.00 0.00 0.00 1997 Guilman-Amorim 18.08 0.00 0.00 14.37 18.08 0.00 0.00 14.37 1998 Icatu Equity 0.00 5.46 0.00 0.00 0.00 4.16 0.00 0.00 1999 Innova SA 0.00 5.00 0.00 0.00 0.00 5.00 0.00 0.00 1980 Ipiranga 0.00 2.87 0.00 0.00 0.00 2.87 0.00 0.00 1987 Ipiranga 0.00 0.54 0.00 0.00 0.00 0.54 0.00 0.00 2006 Ipiranga 50.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2006 Itambe 15.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2000 Itau-BBA 12.86 0.00 0.00 0.00 12.86 0.00 0.00 0.00 2002 Itau-BBA 70.61 0.00 0.00 0.00 38.47 0.00 0.00 0.00 1999 JOSAPAR 7.57 0.00 7.00 0.00 2.57 0.00 7.00 0.00 2005 Lojas Americana 35.00 0.00 0.00 0.00 35.00 0.00 0.00 0.00 1992 MBR 0.00 0.00 10.00 0.00 0.00 0.00 10.00 0.00 2006 MRS 50.00 0.00 0.00 50.00 0.00 0.00 0.00 0.00 2002 Microinvest 0.00 1.25 0.00 0.00 0.00 0.82 0.00 0.00 132 Committed Disbursed IFC IFC FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic. Net Servicos 0.00 10.93 0.00 0.00 0.00 10.93 0.00 0.00 2002 Net Servicos 0.00 1.60 0.00 0.00 0.00 1.60 0.00 0.00 2005 Net Servicos 0.00 5.08 0.00 0.00 0.00 5.08 0.00 0.00 1994 Para Pigmentos 2.15 0.00 9.00 0.00 2.15 0.00 9.00 0.00 1994 Portobello 0.00 0.59 0.00 0.00 0.00 0.59 0.00 0.00 2000 Portobello 4.28 0.00 7.00 0.00 4.28 0.00 7.00 0.00 2002 Portobello 0.00 0.90 0.00 0.00 0.00 0.90 0.00 0.00 2000 Puras 0.00 0.00 1.00 0.00 0.00 0.00 1.00 0.00 2003 Queiroz Galvao 26.67 0.00 10.00 0.00 26.67 0.00 10.00 0.00 2004 Queiroz Galvao 0.60 0.00 0.00 0.00 0.08 0.00 0.00 0.00 2006 RBSec 22.83 1.51 0.00 0.00 0.00 1.51 0.00 0.00 Randon Impl Part 2.33 0.00 3.00 0.00 2.33 0.00 3.00 0.00 1997 Sadia 2.55 0.00 2.33 3.28 2.55 0.00 2.33 3.28 1997 Samarco 3.60 0.00 0.00 0.00 3.60 0.00 0.00 0.00 1998 Saraiva 0.00 1.24 0.00 0.00 0.00 1.24 0.00 0.00 2000 Sepetiba 26.24 0.00 5.00 0.00 11.24 0.00 5.00 0.00 2002 Suape ICT 6.00 0.00 0.00 0.00 6.00 0.00 0.00 0.00 1999 Sudamerica 0.00 7.35 0.00 0.00 0.00 7.35 0.00 0.00 2006 Suzano petroq 50.00 0.00 10.00 140.00 39.50 0.00 10.00 110.50 2001 Synteko 11.57 0.00 0.00 0.00 11.57 0.00 0.00 0.00 2006 TAM 50.00 0.00 0.00 0.00 17.00 0.00 0.00 0.00 1998 Tecon Rio Grande 3.55 0.00 5.50 3.71 3.55 0.00 5.50 3.71 2004 Tecon Rio Grande 7.87 0.00 0.00 7.76 7.59 0.00 0.00 7.48 2001 Tecon Salvador 2.95 1.00 0.00 3.10 2.95 0.77 0.00 3.10 2003 Tecon Salvador 0.00 0.55 0.00 0.00 0.00 0.55 0.00 0.00 2004 TriBanco 10.00 0.00 0.00 0.00 10.00 0.00 0.00 0.00 2006 TriBanco 0.35 0.00 0.00 0.00 0.35 0.00 0.00 0.00 2002 UP Offshore 9.01 9.51 0.00 23.29 0.00 2.51 0.00 0.00 2002 Unibanco 16.89 0.00 0.00 0.00 16.89 0.00 0.00 0.00 Total portfolio: 1,164.15 253.88 144.84 503.45 703.91 223.86 141.54 400.38 Approvals Pending Commitment FY Approval Company Loan Equity Quasi Partic. 2000 BBA 0.01 0.00 0.00 0.00 1999 Cibrasec 0.00 0.00 0.00 0.00 2006 Ipiranga II 0.00 0.00 0.00 0.10 2002 Banco Itau-BBA 0.00 0.00 0.00 0.10 Total pending commitment: 0.01 0.00 0.00 0.20 133 Annex 14: Country at a Glance BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service 134 135 Annex 15: Map IBRD 37818 BRAZIL: AIDS-SUS PROJECT National AIDS Program - National Health Service 136