Alliance welcomes launch of airline levy for health and development, but questions remain on funding for HIV/AIDS
06 March 2006
At a high-level meeting in Paris on 28 February, the French, Brazilian, and Chilean governments launched a new levy on airline tickets to fund international development. The Alliance welcomed the airline levy, which will see national governments impose a levy or tax on each airline ticket sold, with proceeds going towards funding ‘health and development’.
However, Susie McLean, Senior Policy Advisor at the Alliance, who attended the meeting, also sounded a note of caution. “Just what ‘health and development’ means remains to be seen,” she said. “There are insufficient resources to provide universal access to HIV/AIDS treatment, care and prevention by 2010, a commitment made at the 2005 G8 meeting in Gleneagles. Using the proceeds from the levy to fund the Global Fund to Fight AIDS, Tuberculosis and Malaria rather than create new mechanisms to disburse the resources will be crucial to achieving universal access.“
Prior to the meeting, the Alliance and many of its partners had signed an NGO statement in support of the levy, but calling on governments to use the proceeds to fund the Global Fund to Fight AIDS, Tuberculosis and Malaria. At the meeting, France announced that part of the proceeds from the levy would be going to a proposed International Drug Purchase Facility — a mechanism to bulk purchase medicines for HIV/AIDS, TB and malaria. How this facility might relate to the Global Fund is not yet clear, but Richard Feacham from the Global Fund spoke about the potential of a procurement fund to free up other Global Fund monies to fund other aspects of AIDS programming, and to encourage pharmaceutical companies’ research and development efforts with market incentives.
Some estimates of the potential of the airline levy are initially for $600 million to $1 billion. These figures could grow substantially depending on the number of governments who sign up. The French government will introduce a levy for all airline tickets from July, ranging from one to 40 euros, depending on the class of the ticket and the destination.
France, Brazil, Chile, Congo, Cyprus, Ivory Coast, Jordan, Luxembourg, Madagascar, Mauritius, Nicaragua, Norway and the UK have all pledged their support for the levy. A number of other governments are expected to sign on in the next six months.
Funding development in innovative ways
The launch of the groundbreaking initiative comes at a time when new ways of raising money for development are urgently needed. Anti-poverty groups have been pushing for development to be funded in innovative ways, as traditional official development assistance alone is not enough to turn around poverty, to halt epidemics and to achieve access to basic education. According to the UN, official development assistance needs to be increased to nearly $200 billion a year to achieve the Millennium Development Goals by 2015. Currently $65 billion is invested each year.
Further funding initiatives include the International Finance Facility — the UK Government’s preferred innovative financing mechanism — and a tax on international currency transactions.
