The USAID Cuts: Little Sign of Mercy for “Life-Saving” Health Programs

Updated estimates of USAID award cancellations are available here.

On March 10th, Secretary of State Marco Rubio tweeted that “After a 6 week review we are officially cancelling 83% of the programs at USAID.” He suggested 5,200 awards (grants and contracts) had been cancelled. Punchbowl News was given a copy of a list of 5,724 terminated awards that had been leaked to the Senate Foreign Relations Committee at the end of last week. Here’s what we think that list suggests, and what is still hard to figure out.

The bottom line: we estimate the cancelled awards represent somewhere over 34 percent of USAID programming. And notably, “life-saving” program areas like maternal and child health, HIV/AIDS, malaria, and tuberculosis are not spared from major cuts. But there’s a lot of guesswork in those estimates.

The dollar values listed next to the cancelled awards are not very meaningful

First, it is worth noting this isn’t a list of programs, it is a list of grants and contracts, with the same programs appearing multiple times (and sometimes payments to the same contractors for ongoing services). At the low end it includes items like buying Procreate image-editing software for an iPad ($13) or buying a USAID stamp for official purposes ($30). 1,114 awards involve obligated amounts of $10,000 or less and the median value of the 5,413 awards with any obligations is $1 million.

The leaked document lists two dollar figures for each award. Both numbers probably overstate the true size of the impact of termination by quite a lot:

• The total theoretical value of terminated awards is $257 billion. But this includes “indefinite delivery/indefinite quantity” (IDIQ) contracts where reported contract value is very much a theoretical maximum, often set in the billions, considerably larger than any likely spending. For example, there are a series of cancelled IDIQs for the Swift 5 Program of transition support dating back to the first Trump administration that add up to $30 billion in theoretical contract value, but actual obligations—contracted commitments to spend—under the contracts since 2019 adds up to just $300,000 (note also these contracts may have simply expired rather than have been terminated).
• If we look instead at total “obligations to date” under the full list of terminated awards as a more reasonable measure of scale, it is $51.6 billion. That’s considerably more than USAID’s total new obligations in fiscal year 2024. But note that is comparing a stock of all current (cancelled) awards and their historical obligations with a flow of new obligations. Using foreignassisstance.gov, we estimate that in FY2024 “obligations to date” under USAID active awards was in the region of $149 billion.

A lot of awards involve considerable obligations already outlayed (spent). To take the five largest obligations listed:

1. The grant of $4 billion to Gavi covering the Covax facility for COVID vaccines (the largest obligation listed) has been cancelled, but it isn’t clear how that works given all $4 billion has already been handed over to Gavi (outlayed or liquidated demanding on your preferred terminology).
2. The malaria task order for the Global Health Supply Chain Program (which is helping local partners strengthen their capacity to deliver products like bed nets and malaria drugs) has already spent $1.5 billion out of $2.5 billion obligated.
3. The Global Partnership for Education, run by the World Bank, has already received $570 million out of the $928 million obligated.
4. The main contract under the Ukraine Energy Security through Competitive Energy Markets Program has been cancelled. The obligated amount was $920 million, but $398 million has already been spent (and the project only had three months out of seven years to run).
5. The USAID contribution to Gavi covering the 2021-25 core program has been cancelled, but $580 million out of $880 million has already been spent.

Add it up, and for the five largest cancelled awards by obligation value, more than three quarters of the obligated amounts have already been spent, so potential “savings” (losses to implementing partners and recipients) are actually $2.2 billion out of the listed value of $9.2 billion.

As the above examples also suggest, the cuts include a lot of activities that you might have thought would be covered by a waiver for “lifesaving” activities: not least supporting the delivery of malaria nets and treatments as well as vaccines. (The Global Fund does appear to have been spared.) But (unsurprisingly) the cancelled awards appear to cover every sector USAID works in.

What share of USAID spending do these cancelled programs represent?

The information available doesn’t allow us to answer this question with great confidence. But to give a more meaningful sense of the scale involved, below we try to estimate the share of USAID spending accounted for by these cancelled awards. To do so, we proceed as follows:

• We match ID numbers in USAID’s award management system (GLAAS) from terminated awards to data from foreignassistance.gov. That allows us to see how much activity was actually happening recently under these cancelled awards (not just their theoretical maximum, or multi-year historical totals).
• We then compare how much USAID obligated last year (fiscal year 2024) in total to the amount obligated under these specific cancelled awards.

This is still a crude estimate for three reasons: first, this reflects obligations in fiscal year 2024. In principle, the obligations planned for these specific canceled awards could be much higher or lower in the fiscal year 2025 plans. We can’t observe that. Second, about two thirds of the awards being cancelled (though only one-third by dollar value) don’t match anything in the foreignassistance.gov database. So we are under-estimating cancellations, although some of those awards may have naturally expired. Third, our list of terminated awards includes some that have since been “unterminated.” For those interested in replicating our work: You can download the full foreignassistance.gov data set here. And here’s the list of cancellations as an excel file and the Stata code to put it all together.

With those caveats in mind, we estimate that the cancellations reflect somewhere more than 34 percent of USAID’s work based on the contracts and grants we can see in foreignassistance.gov. In fiscal year 2024, USAID obligated about $35 billion, and of that amount, about $12 billion was obligated to awards that the State Department memo implies will now be cancelled. Again, we think this may be a lower bound on the total (comparative) size of the cancellations, because of the missing awards.

Life-saving health programs have not been spared

Using the method above, we can drill down to see which sectors are being hit hardest by the cuts we can see:

• Of the biggest USAID sectors, the hardest hit—denoted in red, with cuts of over 40 percent by our estimation—are agriculture, maternal and child health, infrastructure, good governance, and pandemic preparedness.
• In yellow, experiencing cuts between 20 to 40 percent, the biggest sectors are “protection assistance and solutions,” which includes humanitarian relief and refugee assistance, as well as HIV/AIDS, malaria, and basic education, among others.
• The big program areas which have been relatively spared include “macroeconomic foundation for growth” and direct administrative costs.

Note that sectors might considerably vary by the average length of the obligation period (for emergency projects this might be shorter, for example), and that will add further uncertainty to our estimates.

Table 1. USAID award cancellations by sector

The table shows total USAID spending in fiscal year 2024 by sector, for USAID as a whole and under the specific programs now slated for cancellation.

Source: FY 2024 values are taken from foreignassistance.gov. Award cancellations are taken from Punchbowl leaked State Department list of awards to be cancelled.

Note: Dollar values reflect total obligations during FY 2024. This differs from the remaining amount to be spent in FY 2025 or beyond, which is not observed. Roughly 35 percent (by value) of the awards slated for cancellation cannot be matched to an active program in FY 2024 and are not included here, thus this should be interpreted as a lower bound on the size of cuts.

The appearance of maternal and child health, HIV/AIDS, malaria, and tuberculosis on the list of program areas set to be cut is a bit surprising given all of Secretary Rubio’s statements to date about sparing these critical health sectors. Though humanitarian aid—which includes food aid with considerable backing from some US farm states—appears to have been more protected.

The cuts are global, but a number of African countries will be hit hard

The same methodology above can be applied to country allocations. Again, we look at the list of awards slated for cancellation, match them to active projects in FY 2024, and see how much of the spending they comprised last year.

In absolute terms, the big losers are global programs and Ukraine. But it’s hard to see evidence that Ukraine has been singled out here.

In proportional terms, the cancellations are pretty evenly distributed, albeit with fairly deep cuts in some African countries with large USAID programs including Mozambique (42 percent canceled), Uganda (47 percent), and Tanzania (46 percent).

Table 2. USAID award cancellations by country

The table shows total USAID spending in fiscal year 2024 by sector, for USAID as a whole and under the specific programs now slated for cancellation.

Source: FY 2024 values are taken from foreignassistance.gov. Award cancellations are taken from Punchbowl leaked State Department list of awards to be cancelled.

Note: Dollar values reflect total obligations during FY 2024. This differs from the remaining amount to be spent in FY 2025 or beyond, which is not observed. Roughly 35% (by value) of the awards slated for cancellation cannot be matched to an active program in FY 2024 and are not included here, thus this should be interpreted as a lower bound on the size of cuts.

Are canceled awards being replaced by new ones?

The short answer is no, not yet, or at least not that we can see.

In principle, Secretary Rubio’s announcement that he is canceling a given contract, or even thousands of awards at once, does not change the amount of aid that USAID must spend under the budget resolution passed by Congress. The agency is free to choose different contractors and issue different awards. But of course, there is some skepticism that the administration plans to do so.

USAID has not been issuing many, if any, new contract or grant awards since January, which suggests a considerable and increasing impact on future spending levels. The figure below compares cumulative USAID obligations over the fiscal year for 2025 to previous years. As can be seen, the line for 2025 is flat since the start of the year.

Secretary Rubio has said that aid monies will now be managed directly by the State Department. But the bottom panel of the figure below suggests there is no sign of any new aid activity at the State Department. The two flat lines for State and USAID might simply reflect the fact that the data in foreignassistance.gov hasn’t been updated, but if not it suggests a considerable potential problem.

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But it’s not too late: while new foreign aid activity has been frozen for some months now, the cumulative activity for fiscal year 2025 is not far behind previous years at this point, given lots of activity last fall. If Secretary Rubio is sincere, and he lifts the freeze and puts USAID staff back to work or absorbs them and their programs in the State Department, it wouldn’t be impossible to meet the legal requirement to spend appropriated funds.

Without an updated list of cancelled grants and contracts as well as further contract details and updated data on new awards, it is hard to get a full picture of how deep are the cuts and which activities have fared worse. And the impact of the disruption at USAID will only increase over time if contracting doesn’t restart. But clearly a lot of activities including lifesaving projects have already been severely affected, and restarting the award system is an urgent priority.