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The Sub-recipient Agreement

Following the selection process, UNDP engages Sub-recipients (SRs) by entering into binding legal agreements with them (SR agreements). The SR Agreement should be prepared using the relevant Template SR Agreement approved by the UNDP Office of Legal Services (OLS). There are different Template SR Agreements depending on the type of entity to be engaged.

If the SR is a government entity, there is a Template SR Agreement for Government Entities, available in English, French and Spanish. There are also Special Conditions to be included in the SR Agreement for those SRs that will receive/manage assets from previous PR/SRs, available in English and French. Please note that the document on the Special Conditions include two sections, one relates to asset and one that relates to any additional special conditions that COs might want to include in the SR Agreement.

If the SR is a Civil Society Organization (CSO), there is a Template SR Agreement for CSOs, available in  English, French and Spanish.

The SR Agreement template is consistent with the terms of the UNDP-Global Fund Framework Agreement and Grant Regulations, and also ensures compliance with UNDP rules, policies and procedures. Therefore, deviations from the Standard Terms and Conditions of the SR Agreement Templates are to be discouraged by UNDP. However, where an SR insists on making deviations to the STCs of the SR Agreement Template, the UNDP Country Office (CO) should liaise with Global Fund Partnership and Health Systems Team (GFPHST) to obtain written approval from the OLS for any such deviations. Likewise, if any Special Conditions or Conditions Precedent are to be included in the SR Agreement, the CO should liaise with GFPHST to obtain written approval for any such conditions.

The Work plan to be annexed to the SR Agreement is based primarily on the proposal submitted by the SR. However, the CO may decide to have discussions/negotiations with the SR regarding particular aspects of the proposal, to modify the proposed Workplan. Discussions can encompass programmatic and performance indicators and financial issues. Negotiations are generally conducted between the designated person in the project management unit (PMU) and the authorized representative(s) of the SR.

Items that may be negotiated include: Items that may not be negotiated include:
  • Specific activities and deliverables;
  • Replacement of key SR personnel;
  • Reporting template and schedule;
  • Core activities the SR has indicated it will perform;
  • Specific budget items;
  • Performance indicators of the Global Fund; and
  • Final budget amount; and 
  • Disbursement schedule.
  • Geographical coverage of activities.

Any substantive departures from the model SR agreements should be approved by the UNDP Global Fund/Health Implementation Support Team for programmatic issues and by the Legal Office (LO) for legal issues.[1] 

The SR work plan, budget and performance framework (PF) form essential parts of the SR agreement and should be attached as annexes. While the SR activities may be part of a larger programme being carried out by the SR, the work plan, budget and PF should extrapolate only Global Fund activities. This means that, while SR targets and detailed budgets can be considered during grant-making, following grant signing between UNDP and the Global Fund it is necessary to ensure that targets agreed with SRs aggregate to the final PF agreed between UNDP and the Global Fund. Likewise, the SR’s budget should be within the limit set for specific activities in the detailed grant budget approved by the Global Fund. The UNDP CO should ensure that the SR work plan, budget and PF are consistent.

Practice Pointer

The UNDP CO can include additional clauses in the SR agreement as required and appropriate, subject to LO clearance, when applicable.

There are clear advantages to entering into a one-year agreement when dealing with a completely new SR, which would allow reviewing achievement of targets, costs and staffing after the first year.

[1] If it is not clear whether the change to the SR agreement template is substantive, the UNDP CO should contact Legal Office for guidance.

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