WHO: Secretariat bypasses FENSA restrictions on private sector secondments through “Nil-Remuneration Contracts”

TWN Info Service on Health Issues (Jan2020/01)

Third World Network Geneva, 29 January 2020(TWN) – The secondment of industry personnel to the World Health Organization (WHO) under “Nil-Remuneration” contracts raises a red flag.

This practice of the WHO Secretariat bypasses the regulation on secondments under the Framework of Engagement with Non-State Actors (FENSA) adopted by the World Health Assembly (WHA) in May 2016.  The WHO website states clearly that FENSA “endeavours to strengthen WHO engagement with non-State actors (NGOs, private sector entities, philanthropic foundations, and academic institutions) while protecting its work from potential risks such as conflict of interest, reputational risks, and undue influence”.

Accordingly FENSA has the explicit regulations on secondments.

First, FENSA prohibits secondments from the private sector. Paragraph 47 of the Framework states: “WHO does not accept secondments from private sector entities”. Thus FENSA allows secondment from other non-state actors (NSAs) such as academic institutions, NGOs and philanthropic foundations.

Secondly, WHA Resolution 69.10 that adopted FENSA regulates the secondments from NSAs other than the private sector. It requested the WHO Director-General “to develop, in consultation with the Member States, a set of criteria and principles for secondments taking into account the following issues for the consideration … of the 70th World Health Assembly:

a) specific technical expertise needed and excluding managerial and/or sensitive positions (emphasis added);

(b) the promotion of equitable geographical distribution;

(c) transparency and clarity regarding positions sought, including public announcements;

(d) secondments are temporary in nature not exceeding two years; …”

However, while developing the criteria the Secretariat deleted the words “sensitive positions” and modified the first condition as follows: “managerial and/or positions that involve the validation or approval of WHO’s norms and standards are excluded”.  This modification allowed for secondment to sensitive posts in the WHO.

Further, in 2017 the Secretariat did not submit the criteria for the approval of WHA but requested the WHA to note the document (see WHO Secretariat proposes non-state actor secondment to ‘sensitive posts’at https://twn.my/title2/health.info/2017/hi170502.htm).

The conditions developed by the Secretariat are as follows:

a) managerial and/or positions that involve the validation or approval of WHO’s norms and standards are excluded;

(b) consideration has been given to gender and geographical diversity by the releasing entity;

(c) the releasing entity has wherever possible proposed at least three qualified candidates to WHO from whom the Secretariat may select the most suitable candidate giving due regard to gender and geographical distribution;

(d) the proposed arrangement for a secondment has undergone a due diligence and risk assessment;

(e) secondments are temporary in nature not exceeding two years;

(f) a declaration of interest has been signed by the seconded, irrespective of their grade level, and no (actual or perceived) conflict of interest has been identified for which adequate mitigation measures are not possible.

It is not clear whether the Secretariat can bypass the condition set by WHA resolution.

Paragraph 10 of the Director-General’s Report of FENSA Implementation to the 146th meeting of the Executive Board (3 to 8 February 2020 in Geneva) states “… guidance is being provided to staff, along with specific recommendations during the initial stages of engagement with non-State actors for proposed nil-remuneration contracts and for potential interns that may be financially supported by non-State actors”.

The Report does not provide any details of the conditions or safeguards required while executing so-called Nil-Remuneration Contracts.

The Nil-Remuneration Contract is effectively a secondment. The only difference is that the remuneration is directly paid by the NSA and is not channeled through WHO. Instead, WHO enters into a contract with the individual concerned and treats that person as a consultant, with payment to the consultant from a third party set out in a separate contract. A third party is acting as the real employer under the Nil-Remuneration Contract making this arrangement a secondment through the backdoor.

The only major difference is that in a secondment, the person seconded is considered as a staff of WHO. In a Nil-Remuneration Contract, the person is considered as a consultant. For instance, a 2019 contract between Preva Group, LLC and WHO states: “The work will be performed free of any charge to WHO. WHO understands the Bill & Melinda Gates Foundation (the “Foundation”) has agreed to cover the cost of the Work, by making a direct payment to Preva (pursuant to a separate agreement between Preva and the Foundation)”.

The footnote to Paragraph 10 of the Director-General’s Report states that: “In the vast majority of cases, the non-State actors are either academic institutions or philanthropic foundations”. This means that such contracts have been issued to the private sector and employees of the private sector who are currently working in WHO. As mentioned above, FENSA prohibits secondment from the private sector.

Furthermore, WHA 69.10 excludes secondments in managerial and/or sensitive positions. The report does not provide any details on the Nil-Remuneration Contract such as the number of people under such contract, their positions, the name of NSAs in Nil-Remuneration Contracts etc.

Third World Network learned that the WHO considers Nil-Remuneration Contract as a donation. The contract between Preva Group and WHO states: “The value of Work being provided free of charge to WHO hereunder has been calculated at USD 415,000 (United States dollars), and will be recorded by WHO in its books of accounts”.

However, the footnote to Paragraph 17 of FENSA that deals with donations excludes secondments from the scope of in-kind contributions because secondments are covered in Paragraph 47 that in turn prohibits secondments from the private sector. In the contract with the Preva Group, the company’s employee is required to be made available to the WHO Headquarters on a part term basis.

It would appear that WHO uses the Nil-Remuneration Contract to seek services from the private sector and such services are paid by a third party. During the last three years since the implementation of FENSA, the WHO Secretariat has taken such services from at least two entities viz. Seek Foundation and Preva Group LLC. The services of these entities are paid by the Bill & Melinda Gates Foundation. Nil-Remuneration Contracts raise concerns of conflicts of interest because such contracts bear the threat of undue influence from the donor. The entities performing such services are selected by the donor and not through an open bid. Secondly, such service providers often have prior engagements with the donor. For instance, Preva Group LLC is a recipient of grantsfrom the Bill & Melinda Gates Foundation.

Apart from public announcement on secondments, WHA 69.10 also requested the Director-General “to make reference to secondments from non-State actors in the annual report on engagement with non-State actors to be submitted, including justification behind secondments …”

Since 2018, the director-General’s report to the Executive Board provides details of secondments. For instance, Paragraph 11 of the 2018 report on FENSA Implementation states: “In July 2018, three people were seconded by non-State actors, one by an academic institution and two by philanthropic foundations. Two of the secondments were to headquarters and one to a country office”.

Further, the footnote to Paragraph 11 provides the following details: “The University of Kanazawa, Japan, made one secondee available to the WHO Department of HIV/AIDS, to provide technical support to the Global Hepatitis Programme. The Bill & Melinda Gates Foundation made one secondee available to support projects to strengthen the transparency and accountability of the Polio program; and the United Nations Foundation seconded a senior strategist to strengthen the donor outreach and advocacy activities of the Global Polio Eradication Initiative”.

Without citing any reason, this year’s report does not provide any details on secondment. It merely states: “As in previous years, all proposed secondments from non-State actors for 2019 have been reviewed for compliance through a well-defined clearance process involving review across multiple areas of work”.

Meanwhile, an evaluation of the implementation of FENSA found seven factors affecting the implementation of FENSA. Among these, two important factors are: the initial lack of endorsement and support of the senior management, and absence of an organization-wide FENSA implementation strategy.

The WHO Director-General has stated a few times that FENSA is not a fence and WHO is open for engagement. It is unfortunate that under the current leadership of Dr. Tedros Adhanom Ghebreyesus the Secretariat has ignored key FENSA provisions. For instance, in 2018 the Secretariat allowed the UN Foundation to sit alongside international organisations without even an official relationship (with WHO) status. Secondly, the Secretariat allowed UNAIDS to organise an exhibition of pharmaceutical and diagnostic companies during the 2019 WHA session.

Paragraph 11 of FENSA’s private sector policy states: “There shall be no commercial exhibitions on WHO premises and at WHO’s meetings”. However, UNAIDS organised the exhibition at the entrance of the WHA venue. WHO is one of the sponsors of UNAIDS and thus FENSA is applicable in WHO’s engagements with UNAIDS.

The 2019 Director-General’s Report on FENSA Implementation will be discussed at the 30th meeting of Program and Budget Committee (29-31 January) and 146th meeting of the Executive Board (4-8 February at the WHO Headquarters in Geneva.+

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