USAID’s $400 million Global VAX initiative can work, but only if it pays for shots in arms

The global vaccine effort is failing for many reasons, but now there may be a glimmer of hope. In December, United States Agency for International Development (USAID) Administrator Samantha Power said the U.S. government would take a greater global leadership role in the fight against COVID-19. The agency she leads will launch a $400 million Global VAX initiative to get vaccines into arms in developing countries. 

But if there’s one thing we’ve learned while watching the global effort struggle to vaccinate even 10 percent of people in poor countries, big funding announcements and vaccine donations alone won’t cut it. We need a change in business as usual to get control of this pandemic and stop it from mutating one step ahead of us. USAID’s Global VAX can lead the way, but only if it pays for results.

Contrary to what many Americans might think, very little U.S. foreign aid goes directly to other governments. Nor does USAID send legions of aid workers to far-flung villages around the world. Instead, it largely relies on a handful of U.S.-based government contractors and international NGOs to do its work, and they get paid for their time, not their success. 

You would not pay a builder in full for finishing just half of your house, but USAID might. According to a 2019 internal audit, USAID paid 97 percent of total award values for 43 percent of projects that failed to deliver their “intended objectives.” This doesn’t mean that every project was wholly unsuccessful, although some were. But it clearly shows that USAID needs to change how it incentivizes good performance. For example, of the $11.5 billion in grants that USAID disbursed in 2019, the agency allocated just $58 million, or 0.5 percent, using “fixed amount awards,” which pay against the delivery of milestones.   

It is far easier for USAID to reimburse organizations for costs rather than set ambitious but achievable success metrics up front. Relatively low staffing means the average USAID contracting officer has to move four times more money than their Department of Defense counterpart. One can understand why officials look for the most expeditious ways to move large sums. 

In the context of Global VAX, however, success should be easy to define: Did vaccines get into arms or not? 

Structuring Global VAX awards to pay for results would also enable more local organizations to work with USAID, which is essential to getting a handle on COVID-19. Typically, to compete for awards, the agency requires expensive audits or arcane documentation, which few organizations have. Even more byzantine rules govern how organizations must track expenses. Move to a model that pays against the delivery of agreed-upon metrics, however, and the compliance headaches that keep untapped players on the sidelines disappear. 

Take logistics, for example. One of the most tragic but recurring stories of the global vaccine effort is that UNICEF has delivered millions of vaccines around the world only to have huge percentages of them sit and expire at countries’ ports of entry. Many governments can get vaccines to children during routine times but lack the infrastructure to vaccinate entire populations all at once. Global VAX could partner overnight with scores of local logistics firms – including those that deliver goods that require cold chain storage to last-mile communities every day – but this will work only if USAID uses straightforward, results-based payment models.

The international response to the pandemic leaves much to be desired. Rich countries have hoarded doses, donating millions to poor countries just days before they expire. Low-income countries have been blocked from obtaining the intellectual property needed to produce their own vaccines. Misinformation and vaccine hesitancy is high.

Yet we’ve seen what the U.S. government can do when it is singularly focused on delivering results. It’s this kind of thinking that just launched a new telescope that will help us see further than we ever have and gave us three COVID-19 vaccines in less than a year. Now it’s time that we direct this kind of energy to getting shots into arms. $400 million won’t be enough, but it’s a good start, and it can fill many gaps in the existing global effort.  

President Biden and Administrator Power have assembled a top team to lead USAID. With updated strategies to solve a global crisis in real time, Global VAX can be the reset that the United States desperately needs at home and abroad. It can be the reminder that when the U.S. government rallies to deliver results, we get the job done.

Walter Kerr is the incoming executive director of Unlock Aid, a global coalition of innovators focused on making aid agencies more innovative and results-oriented. The views here are those of the author alone and do not necessarily reflect the official position of Unlock Aid or any other organization. Follow Walter Kerr on Twitter @WalterAKerr.