Current Issues in Sector-wide Approaches for Health Development: Tanzania Case Study

WHO PUBLICATIONS ON SECTOR-WIDE APPROACHES

Cassels, A. A gtiide to sector-wide approaches f o r health development: concepts, issues and working arrangements. WHO, DANIDA, DFID, EC. WHOIARAI97.12. 1997 Asamoa-Baah A and Smithson P, Donors and the Ministry of Health: new partnerships in Ghana. Discussion Paper No. 8. Forum on Health Sector Reform, WHO. WHOIEIPI99.1. 1999 Foster, M, Brown A and Conway T. Sector-wide Approaches f o r Health Development: A Review of Experience. WHOIGPEIOO.1. 2000 Conway, T. Current Issues in Sector-wide Approaches for Health Development: Cambodia Case Study. WHOlGPEl00.2. 2000 Brown A. Current Issues in Sector-wide Approaches f o r Health Development: Uganda Case Study. WHOlGPEl00.3. 2000 Brown A. Current Issues in Sector-wide Approaches for Health Development: Mozambique Case Study. WHOlGPEl00.4. 2000 Conway T. Current Issues in Sector-wide Approaches f o r Health Development: Vietnam Case Study. WHOIGPEIOO.5. 2000 Brown A. Current Issues in Sector-wide Approaches f o r Health Development: Tanzania Case Study. WHOlGPEl00.6. 2000

June 2000 This study was carried out by the Centre for Aid and Public Expenditure of the Overseas Development Institute, London, UK, for the World Health Organization and the Inter-Agency Group on Sector-wide Approaches and Development Cooperation. This document is not a formal publication of the World Health Organization (WHO) and all rights are reserved by the Organization. The document may, however, be freely reviewed, abstracted, reproduced or translated, in part or in whole, but not for sale or for use in conjunction with commercial purposes. The views expressed in documents by named authors are solely the responsibility of those authors. (c) World Health Organization, 2000

WHO/GPE/00.6 Original English Distribution: General

CURRENT ISSUES IN SECTOR-WIDE APPROACHES FOR HEALTH DEVELOPMENT Tanzania Case Study

Adrienne Brown Overseas Development Institute

WORLD HEALTH ORGANIZATION Strategies for Cooperation and Partnership Global Programme on Evidence for Health Policy

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Current Issues in Sector-wide Approaches for Health Development

Tanzania Case Study

ABOUT THE INTER-AGENCY GROUP ON SECTOR-WIDE APPROACHES AND DEVELOPMENT COOPERATION The Inter-Agency Group on Sector-wide Approaches and Development Cooperation (IAG) is a small informal group of experienced senior technical people from international development agencies. WHO provides its secretariat. The group's interest is in advancing policy and practice of development assistance for health development. Toward this end, members of the group meet to review and discuss specific issues and topics in development aid, commission new analytic work, review results and disseminate information both through the communication networks of their own organisations and through WHO's publications series. In 1999, the Inter-Agency Group commissioned five country case studies and a synthesis report to review experience with sector-wide approaches to date. Additional case studies are planned to document the evolution of sector-wide approaches in the context of other development initiatives and instruments, particularly poverty reduction strategies.

For additional information, please contact: Dr K Janovsky, Secretary Inter-Agency Group on Sector-wide Approaches and Development Cooperation World Health Organization CH 1211 Geneva 27 Switzerland tel 41 22 791 2568 fax 41227914881 e-mail janovskyk@who. int

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Current Issues in Sector-wide Approaches for Health Development

Tanzania Case Study

CONTENTS ACRONYMS

iv

EXECUTIVE SUMMARY

v

1 BACKGROUND AND METHODOLOGY

1

2 CONTEXT

3

2.1 2.2 2.3 2.4 2.5

3 3 4 4 5

Economic situation Poverty profile National development plans Public sector and government reforms Health context

3 PROGRAMME SUMMARY 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8

7

Background Content and scope of sector plan Programme Financing Programme Monitoring Programme Management Pro-poor content of strategy Participation in programme development UNDAF, CDF, and role of the UN

7 7 9 10 11 12 13 14

4 KEY ISSUES

15

4.1 4.2 4.3 4.4

15 21 23 24

Basket funding Decentralisation Capacity issues and transaction costs Affordability of programme

5 PROGRESS AND PROSPECTS

27

5.1 5.2

27 28

What has and has not changed Prospects

ACKNOWLEDGEMENTS

31

ANNEXES Annex 1 Pooled funding support to Tanzanian health services Annex 2 Terms of Reference Annex 3 List of key people met Annex 4 Bibliography

33 35 37 39

iii

Current Issues in Sector-wide Approaches for Health Development

Tanzania Case Study

ACRONYMS BoT CDF CMO DFID EPI GDP GNP GoT GTZ HIV HIPC HMIS HSDP IFI I-PRSP LGRP MoF MoH MTEF MRLAG NGO NORAD ODA TDHS PEAP PER PHC POA POW PRSP PS/MOH PSRP SDC TA TOR UNICEF UNDP UNFPA UNDAF WHO

Bank of Tanzania Comprehensive Development Framework Chief Medical Officer Department for International Development Extended Programme for Immunisation Gross Domestic Product Gross National Product Government of Tanzania German Technical Co-operation Agency Human Immunodeficiency Virus Heavily Indebted Poor Countries Health Management Information System Health Sector Development Programme International Financial Institution Interim Poverty Reduction Strategy Paper Local Government Reform Programme Ministry of Finance Ministry of Health Medium Term Expenditure Framework Ministry of Regional and Local Government Non Governmental Organisation Norwegian Development Agency Overseas Development Assistance Tanzania Demographic Health Survey Poverty Eradication Action Programme Public Expenditure Review Primary Health Care Programme of Action Programme of Work Poverty Reduction Strategy Papers Permanent Secretary, Ministry of Health Public Service Reform Programme Swiss Development Corporation Technical Assistance Terms of Reference United Nations Children's Fund United Nations Development Programme United Nations Population Fund United Nations Development Assistance Framework World Health Organization

iv

Current Issues in Sector-wide Approaches for Health Development

Tanzania Case Study

EXECUTIVE SUMMARY Of all the five country case studies carried out1, the United Republic of Tanzania has the most advanced sector-wide approach. Although the implementation programme has been in existence only since July 1999, a significant proportion of it is being supported by pooled donor funds disbursed through the government system. These funds are therefore better integrated into the government budget cycle with donors increasingly required to make commitments and disbursements in line with government budgetary requirements. Although there have been delays in the first year, and a substantial amount of donor development assistance remains off budget, this represent major progress in facilitating a SWAp. Annual programme management is being changed to reflect this development with the programme becoming more integrated into mainstream government management. It is not yet clear what impact the SWAp has made to health sector reform as a whole, and GoT and partners are understandably sensitive to being judged so early in the programme. The problem of the affordability of the programme remains, and like all the other sector programmes reviewed, Tanzania still has a long way to go to widen its vision of health provision by capitalising on the efforts of other health providers, and building knowledge about poverty constraints to service utilisation. Also the parallel programme of decentralising health care provision to local government presents a significant challenge to the SWAp where MoH is having to adjust its role and approach to sector management. The development of the pooled funding arrangement has been significant for the reasons outlined above. The Tanzania experience raises important issues about the way governments manage a range of donor modalities of support within a sector programme. GoT has been careful to promote equality amongst donors regardless of their means of support, but as the management of pooled funds becomes less arduous, and relations with pooling donors increasingly focuses on sector-wide policy issues rather than sub sector monitoring and disbursement, GoT may find a distinction between the two groups of donors is inevitable, and even preferable. Transaction costs remain a burden for GoT, and low capacity has been further strained by pressures to develop a programme within a tight time frame. An emphasis on developing the role of MoH within a decentralised system, plus other capacity building efforts will help with long term sustainability, but reductions in transaction costs with donors will be necessary to support this. Although the SWAp in Tanzania continues to face a number of major challenges and some key problems are currently unresolved, the strength of the programme and partnership between government and donors is in the emphasis on a process approach to developing and implementing the sector-wide approach, and the focus on realism and manageability. Despite high aid dependency, government ownership of the programme is growing and national commitment to sector programmes and public expenditure reform create a positive environment for health SWAp expansion.

1

Case study countries include Mozambique, Uganda, Tanzania, Cambodia and Vietnam. See inside front cover for full references. v

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Current Issues in Sector-wide Approaches for Health Development

1

Tanzania Case Study

BACKGROUND AND METHODOLOGY

This case study is one of five carried out for the World Health Organization and the Inter-Agency Group on Sector-Wide Approaches and Development Co-operation, conclusions from which have been drawn together in a synthesis entitled Sector-wide Approaches for Health Development: A Review of Experience . For full references of other country case studies in the series, see inside front cover. The work was carried out by the Centre for Aid and Public Expenditure at the Overseas Development Institute. This report is based on findings from interviews and review of available literature. Field work was carried out for one week in early November 1999, and entailed interviews and round table discussion with senior government officials in the Ministries of Health and Finance, donors, representatives of other agencies, and NGOs. A list of people met is attached in Annex 3. A week was a very short time to become familiar with complex and sensitive issues, and conclusions should therefore be taken in the spirit of the Terms of Reference: "Given the breadth of the concerns set out below, the aim will be to make well informed judgements, rather than collect large amounts of quantitative data" (See Annex 2). It should also be noted that the report refers primarily to the situation at the time of the field work, and therefore events and opinions may have developed subsequently beyond those described here.

2

Foster, M., Brown, A., and Conway, T., Sector-wide Approaches for Health Development: A Review of Experience WHO/GPE/2000.1, April 2000. 1

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Current Issues in Sector-wide Approaches for Health Development

2

CONTEXT

2.1

Economic situation

Tanzania Case Study

Tanzania experienced a severe economic downturn in the early 1980s. The economic reforms which began in the mid 1980s have brought about positive economic growth, but implementation of structural adjustment measures has been sluggish and government remains very bureaucratic. This has held back private investment and made public investment less efficient. The average GDP growth of 4% per annum is below the country's potential, and only slightly higher than population growth. Macroeconomic management is variable. Tanzania has undergone wide macroeconomic fluctuations, and government has lost control several times in the last decade. Sustained future growth will depend on the ability to continue structural economic reforms. Tanzania's economy is heavily dependent on agriculture (primarily, coffee, cotton, tea, cashew nuts, sisal, maize, rice, wheat, cassava, and tobacco), which produces half of national income, employs 90%of the work force, and accounts for 85% of exports.3 Foreign assistance in 1998 amounted to around US$1 billion, or around 15% of GNP. The main donors endorse Tanzania's economic and institutional reform effort. There was a temporary dip in donor flows in 1994-95 as the Tanzanian Government deviated from its agreed IMF programme. As soon as government policy was back on track, donors responded with expanded levels of assistance. 2.2

Poverty profile

In 1997 GNP per capita was estimated at US$210, making Tanzania one of the poorest countries in the world.4 The proportion of population which is poor fell by around 30% between 1983 and 1994, but around half of the population of 31 million still live in poverty.5 Tanzania has been slower than other countries in eliminating poverty,6 which continues to be a mainly rural phenomenon7 8. 70% of the population live in rural areas and, of these, 60% are poor compared with 15% of the urban population. Overall, non-income poverty indicators such as literacy, primary school enrolment and access to safe water have fallen since the 1980s and indicators for life expectancy, adult literacy, access to health services, and proportion of under-weight children are among the worst in Africa. Poverty in Tanzania has a gender dimension with twice as many female-headed households regarding themselves as poor than households headed by men9.

3

World Bank website country profile. World Bank (1998). 5 In 1991, 50 percent of the population was living below the poverty line of US$ 1 a day and 42 percent were living below the lower line of US$ 0.75 (World Bank 1996). 6 The UNDP Human Development Reports show that Tanzania's ranking in the Human Development Index was 126th in 1992, by 1996 its rank had worsened to 144th in the world, whereas the GNP per capita indicator had Tanzania ranked 158th in 1992, dropping to 170th in 1996 (UNDP, various years). 7 World Bank (1993). 8 Sahn, Dorosh and Younger (1997). 9 World Bank (1996).

4

3

Current Issues in Sector-wide Approaches for Health Development

2.3

Tanzania Case Study

National development plans

Tanzania's long-term development strategy is spelt out in The Tanzania Development Vision 2025. Decision-making is often based on consensus. Policy development and implementation take more time, but so far this approach has prevented policy reversals. Key policies for poverty reduction have been published in the National Poverty Eradication Strategy10. Government is currently preparing an Interim Poverty Reduction Strategy Paper (I-PRSP), which builds on the work that was done to develop the National Poverty Eradication Strategy and sector plans, including health. A draft of the I-PRSP11 states that "for the coming three years, sector plans for health, water and basic education will be respected as a basis for ensuring more effective delivery of services". A number of short and long term targets have been identified for health under the objectives of lowering infant, child and maternal mortality rates, reducing malnutrition among children under 5s, and preventing the spread of HIV/AIDS. Policy actions to achieve these targets include increasing budgetary allocations for basic health care, with monitoring to ensure that resources reach health care facilities; increasing allocations within health sector budgets to reach priority areas; and cross sectoral education activities, e.g. to reinforce AIDS information in the last year of the primary school curriculum. In order to finalise the I-PRSP, the government intends to enter a period of consultation from December 1999 with civil society representatives, including non-governmental institutions, businesses, academia and the media, as well as with stakeholders at district, ward and village level. The Government of Tanzania is in the process of preparing for the HIPC decision point meeting planned for January 2000. A World Bank mission in October 1999 advised on a number of actions needed for GoT to reach completion point, including integrating poverty reduction priorities and targeting criteria into current budget instruments such as PERs, budget guidelines, policy reviews, and sector reviews and development programmes, and the establishment of inter-sectoral and intra-sectoral budgetary allocations in 2000/01 and beyond that reflect PRSP priorities in key sectors, including health. 2.4

Public sector and government reforms

Both Public Service (PSRP) and Local Government (LGRP) reform are underway in Tanzania with the same aim: to reorient government so that central and sectoral ministries are responsible for policy making, regulation, monitoring, and assessing performance and interventions, whilst local government, services boards, executive agencies, NGOs and the private sector take responsibility for implementation of services. The decentralisation of health services under this policy, commencing in January 2000 (see section 3.2) has meant that MoH has had to closely involve the Ministry for Regional and local Government (MRALG) in the reform process. The Minister for MRALG is responsible for co-ordinating central and local relations, including initiatives from sectoral ministries on matters relating to local government e.g. sector development plans such as the Health Sector Reform Programme. There is 10 11

GoT (1998). Interim poverty reduction strategy paper, draft, Oct 1999.

4

Current Issues in Sector-wide Approaches for Health Development

Tanzania Case Study

strong political backing behind the LGRP - it has been declared the lead reform programme of all those underway in Tanzania. The Public Service Reform Programme (PSRP) which started in 1992 has had a positive impact on some aspects of the civil service, e.g. pay has increased by 75% in real terms, and ministerial structures have been rationalised. This has been made possible, in part, by a 24% reduction in the public service workforce of and continued restrictions on new employment, but this may have had a negative impact on capacity to develop and expand services. 2.5

Health context

The health status in Tanzania is poor (See Table 1). Mortality rates are high and HIV prevalence varies between 11 and 30% and is still on the increase. Life expectancy figures will be negatively affected in the near future. The leading cause of death is AIDS (18.2%) followed by diarrhoea (16.7%). The most likely cause of under 5 deaths is malaria (18.4%).13 Table 1 Indicators of health status Indicator Infant mortality rate (per 1000 live births) Under-5 mortality (per 1000 live births) Life expectancy (years at birth) Maternal mortality ratio (per 100,000 births) Sources: UNDP (1997), DBS (1996)

88 137 50 592

Date 1996 1996 1996 1996

The government provides 60% of facilities in the health sector and coverage of the government health service is good by comparison with other sub Saharan African countries. 70% of the population lives within five kilometres of a state funded health facility. Nevertheless, health outcomes and access to services have not improved since the 1980s14. In addition to state provided care, there is also a significant private not-for-profit element. Private for-profit health services are still less important than in neighbouring countries,15 but this sector has been growing rapidly, mostly in the urban areas, since private health provision was made legal again in 1991. Traditional medicine is popular, but seen as a complement to rather than a substitute for modern health care.

12

DFID(1999). Ministry of Health (1998). 14 World Bank, (1996). 15 There is little quantitative information to substantiate these observations. 13

5

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Current Issues in Sector-wide Approaches for Health Development

3

PROGRAMME SUMMARY

3.1

Background

Tanzania Case Study

Tanzania already had a health sector reform programme prior to the introduction of a sector-wide approach to donor co-ordination and programme financing. This began in 1993 and established the approach of implementing a sector strategy16 through an action plan17 agreed between government and donors. There had also been a health 1 ft policy revision. In June 1998 MoH and donors signed a Joint Statement of Intent19 to adopt a sectorwide approach to health reform, confirming their commitment to the health reform programme, and undertaking to move to common implementation mechanisms. This was taken forward through the following process: •

GoT and donors agreed on a SWAP implementation plan for 1999-02 • some donors committed themselves to joint funding, and GoT and donors agreed actions needed to facilitate this • health sector reform programme documents were finalised and agreed: > health sector programme of work 1999-2002 (POW)20 > health sector plan of action July 1999 - June 2000 (POA)21 • donors providing 'basket financing' and GoT, signed a Memorandum of Understanding to agree terms and procedures • first disbursements were made through the 'basket financing' arrangement. 3.2

March 1998 April 1998 June 1999

October 1999 December 1999

Content and scope of sector plan

The main aim of the health sector reform programme is to improve the availability and quality of essential services through managerial, financial and organisational reforms. Eight strategies are identified for the 3-year period: • •

provide accessible, good quality, well supported, cost-effective district health services, with clear priorities and essential clinical and public health packages which are organised at the decentralised level provide secondary and tertiary level referral hospital services to support primary health care

16

Strategic Health Plan for 1995 - 98 (February 1995). Action Plan for 1996-99 (May 1996). 18 MoH (1998). 19 MoH/Partners(1998). 20 MoH (1999d) This restates longer term policies, priorities and objectives, and sets objectives and targets for the period in order to "guide the preparation of one year plans and budgets by all the various units of the health sector" 21 MoH (1999c) This extracts priority activities from the three year POW, which are to be implemented in the first year by both MoH and MRALG; a separate document details those activities to be taken forward by the MoH Directorates with joint funding from GoT and Donors. 17

7

Current Issues in Sector-wide Approaches for Health Development

• • •

•

• •

Tanzania Case Study

redefine the role of MoH to be a facilitator of health services, providing policy leadership and a normative and standard setting role develop human resources management to ensure well-trained and motivated staff, deployed at the appropriate health service level ensure central support systems including personnel, accounting and auditing, supplies, equipment, physical infrastructure, transportation and communication ensure health care financing which is sustainable, involves both public and private funds as well as donor resources, and explores a broader mix of options such as health insurance, and community cost sharing as well as user fees address the appropriate mix of public and private health care services restructure the relationship between MoH and the donors . 22

The strategies are based on the following assumptions, which will be addressed through the Programme: • • • • • •

more resources will be injected into the system and existing resources will be used more efficiently resources will be distributed more equitably priority objectives and standards will be clearly defined and monitored managers at institutional and district level will have greater authority in the allocation and use of available resources staff will be better motivated through improvements in working conditions 23 drugs and essential supplies will be available as required .

The POW does not cover the whole sector, but focuses primarily on key reform areas; this is reflected in the first year POA. However the government clearly states that programme development is a process, which will enable the SWAp to become more comprehensive over time as key policy objectives and outcomes are identified and progressed24. This would seem to be a realistic approach. GoT has struck a balance between identifying priorities which are essential for undertaking any kind of improved service provision such as resolving staffing problems and logistical issues, whilst taking a long term view of such issues as improving health financing by mobilising other resources. Under-developed areas in the programme at present include multi-sectoral issues, some vertical programme work, and the contribution of NGOs and the private sector. Outcomes at regional and district level are also not reflected in the POA, as these are the responsibility of the Ministry of Regional and Local Government, the implications of which are discussed in section 4.2. The intention is to reflect these in consolidated plans once the LGRP is more advanced, which will probably not be until 2001, but in the meantime the POA reflects only those activities for which MoH is responsible.

22

MoH(1999d). ibid. 24 In interview. 23

8

Current Issues in Sector-wide Approaches for Health Development

3.3

Tanzania Case Study

Programme Financing

The Government of Tanzania intends to increase its funding to the health sector. The MTEF (FY1999/01) gives MoF approved recurrent allocation ceilings as follows in Table 225. Table 2 MoF approved recurrent allocation ceilings

Recurrent allocation ceilings (in Tsh billion)

FY 99/00

FY00/01

FY01/02

59.2

67.2

82.2

This increase however, is being undermined by the fall of the Tanzanian shilling against the dollar26, which will mean that the most recent estimates (see Table 3) of GoT/donor funding proportions to the programme will change. Table 3 Estimated Resource Envelope FY99/00 - FY01/02 (in Million US$)27 FY99/00

Total

FY01/02

FYOO/01

Sources of funds

US$

%

us$

%

us$

%

US$

%

Gov't budget

93.6

48.9

98.4

50.5

103.3

55.8

295.3

51.7

3.6

1.9

3.6

1.8

3.6

1.9

10.8

1.9

94.3

49.2

92.8

47.6

78.3

42.3

265.4

46.4

User fees Donors Total

191.5

185.2

194.8

571.5

•

There have been problems in trying to estimate the size of the resource envelope for the three year POW:

•

in this transition phase to a sector-wide approach, significant resources are still committed by donors bilaterally and off budget although the POW proposes a number of ways of increasing funding to the health sector by mobilising other resources (e.g. developing further cost sharing initiatives, introducing widespread community health funds schemes and national health insurance, and ensuring private and NGO provider activities complement those of government ), the extent of funding available is not yet known in entirety as yet, no household accounts surveys are available to show personal expenditure. Best estimates give combined donor, government and personal expenditure to be around $7.34 per capita29.

•

•

25

WHO (1999). ibid. 27 World Bank (1999) with addition of percentages. 28 MoH(1999d). 29 World Bank (1999). 26

9

Current Issues in Sector-wide Approaches for Health Development

Tanzania Case Study

There is a clear commitment by government and donors to move towards budgetary support for as much of the programme as possible30. This has started through 'basket financing' whereby some donor funds have been pooled into a consolidated fund and disbursed through government systems for selected activities in the first year Plan of Action (July 1999 - Jun 00). Five donors31 signed up to provide pooled funding for F Y99/00 with the result that, for the above period, approximately 52% of programme financing is planned to be disbursed through this system, adding an extra 35 cents per capita on top of the 8 cents allocated by GoT to district grant funds. The first disbursement took place in December 1999 after a period of extensive systems review which began in April 1998. Two further donors have joined the arrangement for FYOO/0132 . Commitments and indicative figures for disbursement into the pooled fund for FY00/01 are shown in Table 4. Preparedness to move to budget support amongst donors currently outside the pool is mixed. GoT has made it clear that it would welcome other donors, but some still have doubts about the quality of government systems, and some agencies (e.g. UN agencies, USAID, EU) have rules and procedures which currently preclude them from such an arrangement. The implications for the programme of varied donor funding arrangements are discussed in section 4.1. In. order to improve financial management, which will also have the effect of increasing donors' confidence in government systems and facilitate budget support, GoT is undertaking a number of initiatives including: • •

3.4

the introduction of performance-based budgets which will be underpinned by national minimum standards of service delivery (see Box 5, p. 22) implementing an integrated computerised management system. 'Platinum' is already in operation in MoH and other selected Ministries down to sub Treasury level, although at district level the system will remain manual in the immediate future. Programme Monitoring

GoT has devised three sets of indicators for monitoring: •

programme impact indicators monitor the long term effect of the health reform programme (e.g. infant and maternal mortality rates, contraceptive prevalence rate using modern methods, distance from health facilities, the effect of preventative services such as bed net use for malaria and HIV prevalence in pregnant women). Monitoring and information systems are in place to generate most of the information required at this level, but some systems will need further review and modification • programme performance indicators monitor progress against each of the eight POA implementation strategies for the first year. Outputs include improved management, quality of service and financial viability in level 2 and 3 hospital

30

The joint Statement of Intent says "Resources -will be channelled through government systems and increasingly be consolidated into joint accounts, with a view to moving towards overall budgetary support. Common disbursement, accounting, reporting and procurement systems will be developed and agreed upon" MoH/Partners (1998). 31 DFID, Ireland Aid, NORAD, Danida and SDC. 32 World Bank and Netherlands.

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Current Issues in Sector-wide Approaches for Health Development

Tanzania Case Study

services. These indicators largely rely on existing monitoring and evaluation systems, with some improvements planned for the first year of the programme programme process indicators measure the achievement of critical timebound short-term activities and milestones specified in the first year work plan. Table 4 Disbursements into the pooled fund,33 Funding organisation

Danida (centre) (districts)

FY00/01 (confirmed) USD millions

In millions

USD millions

In millions

DKK 4.9

0.7

DKK xx.x

x.x

DKK xx.x

x.x

DKK 16.6

2.2

DKK 25.0

3.4

DKK 35.0

4.7

UK£5.1

8.2

UK£ 10.7

17.1

UK£ xx.x

xx.x

IRP 1.5

1.8

TBD

TBD

TBD

TBD

USD 1.5

1.5

1.0

1.0

1.0

1.0

NOK 15.0

1.9

NoK 7.5

0.9

TBD

TBD

Ireland

Norway

FY02/03 (indicative)

In millions

DFID

Netherlands

FY01/02 (indicative)

USD millions

SDC

CHF 4.0*

2.6

CHF 4.5

2.9

TBD

TBD

World Bank

USD 2.0**

2.0

USD 4.0

4.0

TBD

TBD

Total for Pool

20.9

TBD = to be determined * Including CHF one million (US$ 600,000) which can be rolled over from FY99/00 if not spent, as well as CHF 500,000 committed for DUHP ** Including up to USD 4.5 million that are unallocated and could be used for non-pooled financing.

Although there are targets for improving financial management of the programme, mobilising other funds, and establishing donor contributions, there are no financial monitoring targets for the programme as a whole in terms of per capita funding increase, or redistribution of funds to primary health care facilities. This reflects the thin availability of sector financing information. A recent health care financing study could start to provide data on which such information could be based , but much remains to be done. Also, the first year POA proposes to commence public expenditure reviews in the first 35 decentralised districts. 3.5

Programme Management

3.5.1 Management structure Prior to the development of the SWAp, Tanzania already had an internal Health Sector Reform Management structure which was further developed to manage the SWAp. The structure is summarised in Box 1 (p. 13). The strengths of this structure are that: •

33 34

SWAp management rests on a government co-ordination system that was already in place for the health sector reform programme, rather than having to develop a new arrangement

GoT/Partners (2000). HERA (1999). 11

Current Issues in Sector-wide Approaches for Health Development

•

• • •

3.5.2

Tanzania Case Study

GoT has been careful to establish the Basket Committee as a sub committee of the SWAp overall management committee. While not what was originally planned in the POW, this has the advantage of giving all donor partners access to sector policy making (see section 4.1 for further discussion) both NGOs and the private sector are represented on the SWAp committee the presence of MRALG and MoF representatives on the SWAp committee helps to create links with key ministries whilst the PHC secretariat assumes the co-ordination role for reform implementation, government and donors are endeavouring to maintain the distinction that it is not implementing reform strategy, which is the responsibility of MoH directorates. Managing the annual cycle

The cycle for monitoring the health sector reform programme will be based on an annual review in March. The timing and outcome of the review will be essential for the following year's programme, an issue which is further discussed in section 4.1. All development partners supporting the SWAp, either through the basket fund or individually, will be present at the review, which will be convened by MoH. GoT and donors will assess actual expenditure and achievements against the implementation plan and performance indicators and milestones. The medium term strategy and plan of action for the coming year, including the financing plan, will be reviewed and revised. Donors will then be asked to make their financial commitments in support of the proposed programme35. This meeting will be proceeded by a technical review, which will focus on areas of specific concern, in time to brief formal delegations for the main review. The first of these reviews took place in March 2000. 3.6

Pro-poor content of strategy

The health sector reform programme does not have an explicit primary focus on poverty, nor does the POW state explicit targets for redirecting resources towards primary health care (PHC). However, the POW does refer to issues of access and equity and other factors affecting poor people's utilisation of services. The Health Policy focuses on equitable health development as a starting point for poverty reduction in the sector, but it is recognised that the poorest require specific attention to ensure their needs are addressed. The MTEF shows an increase in allocations to PHC but it is difficult to know how accurate this is when donor allocations are unpredictable. Additional funds directed to districts from donor contributions through the basket should promote more pro-poor activities, provided that local governments are sufficiently able, and representative of their populations, to address these issues.

35

GoT/Partners (2000). 12

Current Issues in Sector-wide Approaches for Health Development

Tanzania Case Study

Box 1 Health sector reform management arrangements The original health sector reform management structure consisted of: •

Primary Health Care Steering Committee, chaired by the Permanent Secretary, MoH. Membership includes the CMO, all MoH directors and representatives from collaborating sectors: MRALG, Water, Education, Agriculture and livestock, Land and housing, and the Prime Minster's office. It meets quarterly

•

Health Sector Programme of Work/Programme of Action Implementation and Management Committee, chaired by Permanent Secretary/MoH. Membership includes all MoH directors, the CMO, and the head of the PHC secretariat. It meets monthly

•

Technical Committee for Health Sector Reform Strategy. Chaired by the Head PHC secretariat. Membership includes all eight strategy co-ordinators. It meets monthly.

In addition to these there are two other committees involving development partners which focus on the SWAp: •

SWAp committee, chaired by Permanent Secretary/MoH. Membership includes the CMO, all directors of MoH, the Head of PHC Secretariat, donors who support the reform programme, representatives of MRALG, MoF, the private sector and not-for-profit health organisations including religious agencies

•

Basket Committee, which is a sub committee of the SWAp Committee, chaired by the PS/MoH. Membership includes the Permanent Secretary/MRALG, and the CMO, reform managers of MoF and MRALG, Directors of MoH, the Head of PHC secretariat and all donors who are pooling funds through the basket.

There are also a number of sub committees e.g. for hospital reform.

Although some donors suggested in interview that the poverty agenda is largely being led by them and equity issues are not being fully addressed, there is a general sense that GoT is beginning to grapple with poverty issues and conducting meaningful dialogue on the subject. The I-PRSP will be a welcome development in setting an agenda for poverty reduction and helping the sectors to better understand and address poverty in ways which ultimately affect resource transfers. This should help to address the current lack of knowledge about poverty in Tanzania, and the possible impact of health sector reform, e.g. the impact of user charges. An area of concern expressed among donors36 was the lack of an explicit poverty focus in the Local Government Reform Programme which will have a major influence on the success of health sector reform and improving the provision of care to the poor. 3.7

Participation in programme development

Participation in the development of the health reform programme has been limited. Although there have been efforts to develop internal consensus within the MoH amongst senior staff who are implementing the programme, there has been little consultation beyond this. The September 1999 appraisal mission report stated that "the reform programme is poorly understood outside of those in the MoH who have 36

In interview. 13

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"37

been preparing the reform" . Some of the NGOs met in the course of the field work said that there was not much information available about the Programme, not only in their own circles (and even where they had institutional links with GoT to provide services), but more worryingly at district level amongst those who were expected to start implementing it from January 2000. Senior MoH officials when given the opportunity to comment subsequently, however, did say that they were aware of the need to carry out wider advocacy38. It is also encouraging that representatives of the for-profit. and not-for-profit sectors are participating in SWAp design and implementation through membership of the SWAps Committee (see Box 1, p. 13). 3.8

UNDAF, CDF, and role of the UN

Both the Common Country Assessment of the UNDAF process and the CDF will be based on the Technical Assistance Strategy, which GoT is currently preparing. A concept paper and implementation strategy were issued in August 1999 setting out a programme for development39. The preparation of the Common Country Assessment paper is also in progress, with a UN consultant attached to the UNDP office to coordinate the process.40 The UN agencies hope that GoT will take a lead but there are concerns about how practical this is, given the workload the government already has to manage. However, the principle applies that the UN is concerned to open up its internal practices and focus more on GoT needs. This may have a positive impact on the role of the UN agencies in the SWAp, but there is no evidence of it having done so as yet. WHO has played some co-ordinating function for donors in the past, and has been able to provide strategic support for SWAP development in the form of technical assistance which has been valued by GoT, and has meant it has been an active player in the SWAP process. It was not clear from the field visit or subsequent research how much of a role other UN agencies have played although they are clearly interested, and UNFPA and UNICEF have had preliminary discussions with some donors on the potential for them to engage in the SWAp41. This will be important because they undertake a large component of health sector activities, which are not reflected in the POW or POA (see section 3.2).

37

MoH/Partners (1999a). In interview. 39 MOF(1999). 40 Leach, Valerie (1999). 41 Reported in interview. 38

14

Current Issues in Sector-wide Approaches for Health Development

4

KEY ISSUES

4.1

Basket funding

Tanzania Case Study

Of all the case study countries, Tanzania has the most advanced joint funding arrangements operating within a sector-wide approach. At the time of writing (April 2000) systems have been set up for disbursement, monitoring and reporting, and one tranche of donor funds has been disbursed to support the central activities specified in the first year POA. Box 2 outlines the development process. Box 2 'Basket Funding' development process The principle of joint funding was established in the joint Statement of Intent signed between GoT and all development partners: "Resources will be channelled through government systems and increasingly be consolidated into joint accounts, with a view to moving towards overall budgetary support. Common disbursement, accounting, reporting and procurement systems will be developed and agreed upon"42. In April 1999 a Joint Donor and Government of Tanzania Side Agreement was signed between GoT and some donors (Danida, DFID, Ireland Aid, NORAD, SDC and the World Bank), confirming their commitment to establishing joint funding mechanisms and identifying the steps that needed to be taken to facilitate this43. A detailed financial systems analysis for pooled arrangements was undertaken and a subsequent 'Accounting Manual' was agreed by partners. This outlined procedures for pooled financing at the central level, and detailed arrangements for channelling, management accounting and auditing. A MolJ between partners to the basket and GoT was signed in October 1999, following the first Basket Financing Committee meeting44. However, first disbursements to the central pool did not take place until December 1999 when the Bank of Tanzania holding account was opened.

For government, the development process has been intensive, time consuming but rewarding45. Despite the increase in workload when officials were already very busy, reported benefits to MoH include a growing sense of trust by donors in government systems and a strengthening of the partnership between the two parties . At the same time there have been frustrations. MoH has felt under pressure to complete the process of system development faster than it would like, and has had to resist this. "Better to spend 6 hours sharpening your bush knife than three days trying to skin the animal with a blunt blade" as one senior official remarked in interview. There have also been concerns at the speed with which donor money then became available once the system had been agreed47, although during the field research it was not possible to ascertain whether this was due to donor delays or problems on the government side in ensuring systems were ready. Either way the March 2000 joint review mission concluded that "The delayed disbursement of funds from the joint basket account and government budget (from second quarter)) led to a significant delay in implementation of most of the activities planned for July 1999 to March 2000 " .

42

MoH/Partners(1998). GoT/Partners (2000). 44 MoH/Partners(1999b). 45 Reported in interview. 46 ditto. 47 ditto. 48 MoH/Partners (2000). 43

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The arrangements that had been agreed prompt a number of questions about joint funding within a sector-wide approach: •

how crucial is participation in joint funding of a SWAp?

•

what is the appropriate role for donor involvement in joint reimbursement procedures?

•

what impact does the joint funding have on donor influence over government policy?

•

how can the predictability of donor funds be assured?

•

can signed agreements help with donor fund predictability?

4.1.1 How crucial is participation in joint funding to support to a SWAp ? There have been lengthy debates between government and partners, and within the donor community about the importance of providing joint funding to the sector programme. The government clearly sees it is as a central part of the new way of working with donors, given the opportunities it presents for reducing the complexity of donor relations. In practice, however, donor movement to common disbursement and reporting arrangements has been limited. Five bilateral donors currently contribute to the pool (SDC, Ireland Aid, NORAD, Danida and DFID), with the World Bank and Netherlands joining from July 2000. Other donors remain hesitant for the variety of reasons seen in other countries. Either their own systems preclude pooling or they cannot yet invest through those that have been set up, but may be able to do so in the future if sufficiently confident of government systems. In response therefore, while the government has been clear about its desire to receive pooled funds, it has taken active steps to ensure that there is room within the sector programme for all donors regardless of their method of contribution:

49

•

government is giving the strong message that they and partners are in a process of sector programme development and therefore a range of modes of partnerships, whilst not ideal, are currently acceptable - all partners are important to programme support. This position was particularly crucial during the phase in which the basket funding arrangement was being set up. The process consumed much time and energy from MoH, and some donors, who did not intend to join the pool, had a perception that they were being excluded from wider SWAp development issues; there was an impression amongst some of them that information was less forthcoming than it had been and less attention was given to them49

•

in order to emphasise the equal value of different forms of participation, government renamed the 'Health Sector Reform Implementation Steering Committee' as the 'Basket Financing Committee', the intention being to downplay the central role of pooled funding in programme implementation as a whole. The composition of the Health Sector-wide Approaches Committee

in interview. 16

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consisting of all health donors is also intended to emphasise the equality of partners (see section 3.5). Interestingly it seems to have been the donors themselves, especially those in the 'Basket', who have been more critical about whether being outside the basket still counts as supporting the SWAp. This was a continuation of a debate during the 1999 appraisal process in which donors questioned each other about how serious they were about supporting the SWAp if they were not intending to be in the pool. Whilst accepting at least temporarily the differences amongst donors in their means of support, at the same time GoT is clearly keen to reap the benefits of joint disbursement. MoH is exploring whether donors outside the pool may accept joint reporting on their funds in line with the Basket Fund system, in order to make the reporting workload more manageable. If donors cannot agree on this, then it suggests that GoT is going to have to adopt a range of strategies to address the spectrum of donor positions within the SWAp, and still deal vigorously with a variety of relationships to avoid conferring 'most favoured donor' status on some. This begs a number of questions: •

will the awaited reduction in transaction costs emerge? Certainly there has been no reduction as yet. Indeed the problem of perceived donor neglect during basket fund development may be partly indicative of an increase in transaction costs coupled with capacity problems in MoH. MoH officials reported50 that despite joint funding arrangements, donor demands for individual reports had not yet lessened, and that 'flag raising' was still a problem with all basket funds still being earmarked for specific activities, and systems now running parallel instead of being replaced by the new one. It is felt by MoH that generally there is far more agreement on technical issues than there is on financial matters

•

how will donor influence be affected? As GoT grows increasingly able to demonstrate ownership of the programme and its capacity to manage donor funds through its own systems, it would not be unreasonable to expect it to become less responsive to those donors who do not pool their funds, despite the current messages of equality (especially where it is a question of donor confidence in government systems). This adds an interesting dimension to the way in which donors can become influential - not just by size and focus of funding, but increasingly by means. It may be that the anxiety amongst some donors of being left out in the cold because they cannot pool funds is an indication that they are aware of this as a possible development for the future.

4.1.2 What is the appropriate role for donor involvement in joint disbursement procedures? The Basket Financing Committee will be the mechanism by which donors, with GoT officials, will monitor the management and utilisation of joint funds being disbursed through government systems. Objectives and approval criteria are outlined in Box 3. The committee will meet quarterly, to tie in with the planned disbursement schedule. The functions outlined in the Terms of Reference (TOR) are quite detailed and will 50

in interview. 17

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Box 3 Basket Financing Committee The committee has three objectives: • • •

to approve annual and quarterly sector plans for pooled funding and ensure the release of approved resources against these sector plans and budgets to oversee use of resources to support priority action plans following set financial, administrative and management procedures in the context of transparency and accountability to monitor overall progress and sector performance against quarterly and annual achievements and outputs51.

The committee will approve release of funds to districts in accordance with a number of criteria: • • • •

an approved health plan and budget technical and financial management capacity positively assessed by MRALG according to benchmark criteria government contribution deposited satisfactory and timely reports received52.

involve close scrutiny of a range of documents and systems. From the TOR it is not clear to what extent the committee members themselves will carry out these detailed reviews, and how much they will rely on government systems and GoT officials reporting to the committee as a whole. Nor is it clear how long this arrangement will remain in place, although it is not intended to be permanent - merely an interim strategy until government systems are better able to carry out these functions without donor participation. Either way, this is an additional structure built onto the existing government ones in the interests of the SWAp. Although there is a rationale behind donor involvement at this level as pooled funding is being tried for the first time, it is questionable whether this is an appropriate, or even practicable role, once the number of districts goes beyond 35, the range of central activities to be funded increases, and the process of producing a good standard of plans and monitoring reports has had a chance to bed down and become more manageable. The system set up at the moment looks very much like a project monitoring one. Despite the language of partnership in the Statement of Intent and other key joint documents, the committee does create a mechanism whereby donor conditionality could be employed, in that aid disbursements are triggered by those of government, and are also dependent on monitoring reports being adequate and timely etc. At the same time, however, it reinforces the concept of partnership by helping to go some way towards tying donor systems in more closely with those of government as it will ''confirm partners' annual contribution" and "approve the release of funds from donors' holding account to the consolidated fund according to specified criteria" . It will be essential for the success of the Health Sector Reform programme that donors are able to make firm commitments on disbursement and stand by them. 4.1.3 What impact does joint funding have on donor influence on government policy? As discussed above, the pooled funding arrangements may have the effect of changing donor relationships with government, as those who contribute to the pool 51

GoT (1999). DFID(1999). 53 GoT (1999). 52

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may gain greater policy influence. This is implied by the opportunities donors will have for wielding the conditionality implicit in the decisions they will make on the basket funding committee, thereby influencing programme implementation and thus policy. Whether this is just relative to each other, relative to their previous influence, or in fact is an increase of overall influence of the donor community on government policy is not possible to judge at this point. At the same time, GoT may be able to increase its ownership of the health reform programme by balancing donor influence in a way that was not possible before. One perception expressed by some within the donor community54 is that GoT had become uncomfortable at the influence wielded by Danida, which had been making the largest financial contribution to health in some key strategic areas including transport, drugs, EPI and management information systems. GoT may have sought to balance this with the influence of other donors. It was not possible to explore this issue in the course of the field work, and whether any such strategy is effective remains to be seen. With the inclusion of these areas under the basket financing system, MoH may just be exchanging one powerful donor for five. 4.1.4 How can the predictability of donor funds be assured? The introduction of pooled funding, with donor monies being integrated into government flows to meet core programme costs, implies that donor funds will have to flow predictably. Donors will have to make commitments sufficiently early in the process to facilitate planning, and then subsequently deliver on these funds as expected. However, this also applies to donors not participating in the basket fund but contributing to implementation of the sector plan. Trying to improve donor fund predictability will be one of the main challenges to the Government of Tanzania and partners. Although efforts have been made to improve the information on donor commitments and disbursement, two problems have remained: •

•

over-optimism about the flow of commitments and disbursement to the budget. This is the biggest problem for the SWAp. For financial year 1999/00 an initial estimate of $54 million of new support to the health sector turned out to be only $15.7 million which meant that the Plan of Action for that year had to reprogrammed55 under-reporting of projects outside the budget.

GoT and partners aim to address these problems by attempting to get all donor commitments to the health sector tabled in time to include them in the mainstream budget cycle and the MTEF, allocated to the correct budget. This began in March 2000 when donors and government jointly reviewed programme progress and then donors confirmed their support for 2000/01 and gave indicative figures for future years. At the review, a major step forward was made when it was agreed that MoH would prepare a Performance Budget based on agreed targets and outputs, including GoT resources and all donor funds. Therefore, no separate POA would be produced for the coming year, but the GoT budget (MoH plus the health component of the 54 55

From interview. Reported in interview. 19

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MRALG) would serve as the Plan of Action for 2000/0156. This will make it all the more important that donors are able to deliver on their commitments. 4.1.5

Can signed agreements help with donor fund predictability?

One way of increasing the predictability of donor funding may be through the MoU that was signed to clarify responsibilities and relationships within the Basket Funding system, including the obligation of donors to provide funds as outlined above57. This was agreed after the first Basket Committee met in October 1999 and is one of a series of such agreements which mark the development of the SWAp (see Box 4).

Box 4 GoT and donor SWAp agreements June 1998: Joint Statement of Intent to adopt a sector-wide approach to health reform. This confirmed GoT and donor commitment to the health reform programme, and their undertaking to move to common implementation mechanisms including joint appraisal, review, programming, monitoring and evaluation, and disbursement through government systems. April 1999: Joint Side Agreement between GoT and those donors proposing to provide basket funding (Danida, DFID, Ireland Aid, NORAD, SDC and the World Bank) confirming their commitment to joint funding and detailing actions that has to be taken to set up joint disbursement systems. The document also stated some assumptions under which the donors were proceeding, including that GoT addressed issues of sustainable financing especially rationalisation of services. October 1999: Memorandum of Understanding, which agreed detailed terms and procedures for basket funding, and specified the contributions and obligations of partners. Levels of funding were not specified. March 2000: Side Agreement between GoT and pooled fund partners, which detailed agreements on next steps for developing the pooled fund arrangement following the March 2000 joint review.

Although both GoT and donors reported to have found the process of negotiating the MoU helpful58, it is not clear to what extent it could be used as anything more than a reminder of what was agreed at the time, if one or other party decides to contravene what was signed. The MoU is the most specific document of all those signed, as it is very clear about the obligations of each party, but it is not legally binding. It could serve as a way of calling either party to account and the individual agreements could be read as conditions, but there is no mention of what would happen if agreements were not met, nor how to resolve disputes about them. It has however served to make sure that assumptions are explicit and the basis on which donors and GoT are proceeding is understood by all. The Programme of Action makes reference to Negotiation mechanisms to be applied in case of disputes or disagreements59 [and states:] "In case of disagreements or conflicts, or when violation of agreements or irregularities are observed, open dialogue and consultations 56

MoH/Partners (2000). MoH/Partners (1999b). 58 In interview. 59 MoH(1999c)p22. 57

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should be the first means in resolving the problems. Unilateral actions by one party, without proper consultations with others affected, should be avoided. Before any decisions are made for cancellation of activities or suspension of support, a meeting will be called between the government and Partners with a defined period of notice60 . Again this is not legally binding but it is encouraging that GoT and partners have signed up to it as a way of resolving disputes.

4.2

Decentralisation

Tanzania is undergoing a major programme of local government reform and decentralisation. This offers a particular challenge to developing and implementing a health sector reform programme through a sector-wide approach, because it will involve a major change in the way that government delivers health services: • •

it will necessitate different relationships between the MoH and local government its development and implementation require a high degree of co-ordination between central Ministries.

Responsibility for health delivery is currently divided between national government through MoH and local government through MRALG. MRALG has responsibility for Regional and District hospitals; districts run the health centres and dispensaries in their municipalities, which are funded by subventions from central government, and revenue raised locally. Although the regional and district teams lie administratively under MRALG, they are 'technically answerable' to MoH which has overall responsibility for health matters. It is also responsible for appointing, transferring and training specialist staff at all levels, plus it has direct responsibility for national and referral specialist hospitals, medical training schools, and national health programmes i.e. vertical programmes. The result has been unsatisfactory. Lines of authority and accountability at district level are unclear, and staff lack decision-making powers over use and allocation of resources, which makes it difficult to manage day to day affairs. Also the policy framework for district guidance has been weak. Under the Local Government Reform Programme, (which is an integral component of the wider Public Sector Reform Programme), 35 districts will have decentralised decision-making powers from January 2000. Two subsequent years will extend this to the remaining 113 districts in phases. Districts will gain responsibility for hiring and firing staff, and managers will be trained in planning and budgeting, and reorienting health services based on essential drugs, medical supplies and equipment61. It will be up to districts to set priorities and allocate funds accordingly. Subventions with itemised line budgets will be replaced by block grants earmarked for sectors against approved district plans. Donor funds through the basket financing system will be added to these grants. Implementation will be monitored against planned outputs and achievements in line with the National Minimum Standards (Box 5). If districts do not attain these standards, then supplementary and conditional grants to improve specific aspects of service delivery will be withheld. 60 61

ibid. World Bank (1999). 21

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Box 5 Recommended National Minimum Standards for Health Activity

Unit of Measure

Minimum Standard

Curative Services

Capacity provided for: % bed occupancy in hospitals and RHCs

60% bed occupancy

Rural Health Centres & Dispensaries

No of visits per capita per year to outpatient facilities

Equivalent to 1 visit per capita per annum

Immunisation & Health Education

% of population reached by preventative medicine programmes

80% reached

Source: MRALG (1998)

This reform programme will therefore have a wide ranging impact on the implementation of the health sector programme. Two key issues are emerging regarding how the decentralised system will work in practice: •

districts currently lack the capacity to take greater responsibility for service delivery, which may jeopardise the success of current programmes, for example as vertical programmes become integrated into mainstream services. Also, much still needs to be done on building local structures and improving integration with other district managed services.62 At facility level, the problem is one of over-staffing and under-usage, and in district offices there is a lack of appropriate skills and. experience in management and priority setting. Accountability is weak and corruption levels high63 and it remains to be seen whether devolving management responsibility to the extent planned will provide sufficient discipline and incentive to overcome these problems. In response to this, MoH has started training District Health Management Teams in district-based planning, health sector reform, district health structures, promoting partnerships with other providers, managing resources, and planning and restructuring district services, but it is questionable whether MoH has the capacity, at present, to provide all the technical support necessary to overcome these problems

•

co-ordination between the local government and health sector reform programmes has been weak64, suggesting that preparation for decentralisation has been inadequate. This has been exacerbated by political pressure to hasten the Local Government Reform Programme process, creating a tight timescale. Concern was expressed among several donors65 that the move to decentralisation of health services from January 2000 is something of a step into the dark, with a major burden suddenly being placed on the shoulders of district health teams who were probably not ready to receive it. This suggests that decentralisation is a risky strategy under current circumstances.

62

MoH /Partners Joint Appraisal (1999) and MoH/Partners (1999). DFID(1999). 64 MoH /Partners Joint Appraisal (1999) annex 2, see also MRALG (1998). 65 In interview.

63

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In the course of the field work it was not possible to conclude whether the fact that the health sector reform programme is being run through a SWAp has been a centralising force on the reform process. Evidence available suggests it may not be, partly because there has been a strong political will to make the LGRP the primary national direction for service reform, but also because the health reforms are focussing on clarifying the roles and responsibilities of the MoH to facilitate decentralisation. 4.3

Capacity issues and transaction costs

Evidence from development of the Basket Funding system (see section 4.1) and reports of the process of programme strategy development suggest that capacity within MoH has been strained by SWAp development, and that transaction costs have not yet gone down. Government officials in interview reported that the process of developing the POW and the POA had also placed heavy demands on their limited capacity, exacerbated by what they perceived as a donor preoccupation with detail, which lengthened the process. It took from 1996 to 1999 for the POW to be developed, finalised and agreed. However, the senior ranks of MoH were philosophical about this, having expected a lengthy period of negotiation with donors to agree the programme66 . There is an expectation that as the POW progresses and the Basket Financing is running, there may be less demand for this level of detail. The next POA is due to be completed before March 2000 in time for the first annual review. It is to be hoped that the experience of having prepared and implemented one annual plan will mean that GoT finds the task less arduous and donors require less detail. It is intended to move away from detailing micro-budget lines and focus more on strategic outputs which is encouraging. If this change occurs, a reduction in transaction costs may be expected. However, if MoH has to manage a range of donor funding arrangements as discussed in section 4.1.1, the overall impact on transaction costs may not be significant. The capacity to implement programmes is a key issue for both MoH and local government (see also Section 4.2). The picture in the centre is brightest. Although MoH has been severely over-stretched by a shortage of staff with the right skills and experience to develop the POW and POA, donors reported67 an increase in capacity in the course of developing the programme, as commitment to it has grown. Donors have supported this by trying to encourage realistic targets and be responsive to MoH needs. Nonetheless, representatives of MoH suggest68 that donors take too narrow a view of how to solve capacity problems, relying on training rather than supporting recruitment. They maintain that a basic problem about lack of people has been exacerbated by the PRSP's major retrenchment exercise, which has hit the health sector especially hard. Some concessions have been made in the course of negotiations with the civil service department but the problem still remains. The reform process should help MoH increase capacity, as its activities will become more focused on formulating technical policies, regulations, legislation, and developing guidelines to facilitate the implementation of national health policy. At the moment, there is no separation between these and other functions of implementation, 66

In interview. In interview. 68 In interview. 67

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administration and policy interpretation. Similarly, there will need to be a move away from older administrative behaviour to a stronger managerial and empowering function. 4.4

Affordability of programme

Given the lack of clarity about the size of the resource envelope (see section 4.1.4), it is difficult to establish whether the health sector programme as proposed in the POW is affordable. It seems likely that it is not. There has been a long-term problem of underfunding for the sector such that the government currently meets approximately 29% of the financing requirement of the public health system69. This makes it unsustainable even in the medium term. Moreover, it is not clear what the cost of running it efficiently should be. Figures vary between $5.20 per capita70, which assumes a high allocative and technical efficiency, and $9.00, which takes account of investment needs to rehabilitate the extensive health network71. With an estimated combined per capita expenditure of $7.34 (government, donors and private spending)72, this leaves a problematic funding gap. Moreover, of those government funds that are available for health expenditure, not all are released as budgeted73. GoT is trying to address the problem by improving resource mobilisation and cost recovery, achieving better distribution of budgetary resources between central MoH and local government to refocus funds toward primary health care, and developing initiatives in health insurance and cost sharing. Even with these measures, plus more rational use of donor contributions, GoT is still unlikely to be able to afford a basic health package for all. The donors' reaction to this is mixed. Some accept that attainment of comprehensive coverage is a long-term goal and regard the decentralisation of resource allocation as a way of meeting local priorities in the most effective and efficient way with the limited funds available74. Others have a perception that GoT does not seem to be addressing the problem directly but continues to talk about rehabilitating the infrastructure, regardless of the cost implications75. One donor76 suggested that both donors and government were guilty of ignoring the issue and pushing it further down the line because no one wants to admit it is a 'killer assumption' that could seriously disrupt the reform programme. At the same time, it is encouraging that the MTEF is providing an increasingly rigorous framework in which these resource discussions can take place. Efforts to include donor funds early in the budget cycle will allow for greater clarity in the definition of the resource envelope, as will the continuation of the Public Expenditure Review process which has helped to ensure that plans are resource-based and increasingly grounded in a more realistic expenditure planning process (See Box 6).

69

World Bank (1999). World Bank (1998a). 71 Danida(1999). 72 World Bank (1999). 73 For example in 1996/97 only 60% of MoH expenditure for other charges (i.e. non personal emoluments was released. This is in contrast to over 100% of personal endowments. World Bank (1998a). 74 In interview. 75 In interview. 76 In interview 70

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Box 6 Tanzania MTEF Tanzania previously had a rolling plan and forward budget to try to give a medium term public expenditure planning perspective. This was located in the Planning Ministry and lacked credibility because it was not integrated with the budgets. The government therefore moved towards a Medium Term Expenditure Framework for the budget itself. Since 1998 the Public Expenditure Review (previously an externally driven donor exercise), has been integrated with the process of rolling forward the MTEF. It has included technical support to line ministries and the MoF to prepare medium term expenditure plans and the overall medium term budget, and has included a joint government/donor meeting at which budget priorities, programmes and finance are discussed. There is growing commitment to the Public Expenditure Review process by MoF, and increasing realism in budgets. A senior MoF official said that GoT has welcomed the PER process because it provides a mechanism for effective consultation between MoF and line Ministries on resource allocation. However, Tanzania remains on a tight cash budget system, in which monthly budget release depends on revenue collection. Spending departments cannot therefore rely on approved budgets actually being available.

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Current Issues in Sector-wide Approaches for Health Development

5

PROGRESS AND PROSPECTS

5.1

What has and has not changed

5.1.1

What has changed

Tanzania Case Study

What has changed is that: • donor funds are being disbursed through government systems, with all that this has entailed including agreeing joint reporting and accounting mechanisms • agreements have been signed which are explicit about the obligations of both parties, although it is not clear to what extent these could hold the process together if it ran into difficulty • extensive plans have been drawn up and, although these are probably somewhat ambitious, there have been efforts to break them down into manageable pieces • monitoring systems, whilst still requiring more work, are largely based on information-gathering processes already in existence • donors and GoT have shown strong co-operation in developing the sector plans and work programmes • the MTEF is in operation as a framework for resource management, and donor funds will be included from next year • there are clear demands on donors to identify financial contributions and stick to their commitments from March 2000 • there are growing links between health delivery and poverty alleviation through the formation of the PRSP • HIPC may make further funds available for health • there is commitment from central government to increase allocation to the health sector • policy dialogue is becoming more open • MoH is taking a stronger leadership role • health policy is becoming more responsive to experiences of programme implementation, and more open to change • the health sector reform programme is expanding to become more sector-wide in scope • participation in programme design and implementation is gradually expanding. 5.1.2

What has not changed

What has not changed is that: • links between the reform programmes are weak, with the result decentralisation may lead to problems with service delivery implementation of health sector reform. There are informal reports that coverage is falling which may worsen when vertical programmes integrated

27

that and EPI are

Current Issues in Sector-wide Approaches for Health Development

•

• • •

• • • • • 5.2

Tanzania Case Study

it is not clear to what extent health donors have been able to work meaningfully with MRALG other than through structures set up with MoH. This is a concern when primary health care delivery relies substantially on MRALG activities local representation is weak so community participation in health delivery is unlikely to improve other service providers have not played a strong role in developing the reform programme transaction costs for MoH have increased without there being a clear indication of when they may reduce. This is an added burden for an already overloaded MoH there is still strong focus on rehabilitating health infrastructure without clarity on whether this can be afforded or not donors are still very concerned with details of plans and implementation the reform vision still sits very much at senior MoH level and is not shared outside this group the poverty focus of the health programme is still limited there is a major question over whether the proposed programme is affordable. Prospects

The process of developing and starting to implement the S WAp in Tanzania seems to have been constructive and encouraging. There appears to be a genuine atmosphere of good will shared between GoT and most of the donors, especially those who are contributing basket funds, and a degree of good faith exists which suggests trust and optimism. No one is expecting instant benefits from the programme and both parties seem to be realistic about the strengths and shortcomings of the other, and the difficulties ahead. A good foundation has been laid for joint working which should provide a strong framework for further developments. A number of challenges lie ahead that will need to be addressed as the programme develops. The basket financing system is a good start but donors will need to step back as it expands to cover more districts, and re-examine their role in programme implementation. GoT may have to adapt its relationships with donors, possibly adopting a range of strategies for dealing with those who are inside the basket and those who are outside but who want equal partnership status. There is an immediate need to address the capacity problems at district level in order to ensure that integrated services do not deliver a weaker standard of services than vertical programmes. Additional funding for districts through the basket, while valuable, may not be enough to ensure this, and the success of the sector-wide approach may be threatened if there are simultaneous high profile service failures. As more data are gathered on health financing, a clearer picture of health costs in Tanzania will become more apparent and available as a basis for policy making. At the same time, accurately planned donor commitments will make sector planning easier. However, the impact of resource restrictions will also become clearer, which

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will necessitate government and donors making some difficult decisions about programme priorities.

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ACKNOWLEDGEMENTS The author would like to thank all those in the Government of Tanzania, development partner agencies and NGOs, who so willingly gave up their time to support and inform this research and provide much valuable insight and material. Thanks are also due to those who kindly commented on drafts of the report, and especially the WHO Representative and his staff who organised the programme. The views expressed in this case study are purely of the author and should not be taken to be representative of any other party. Responsibility for any remaining errors of fact or interpretation are also those of the author.

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Annex 1

Tanzania Case Study

Pooled funding support to Tanzanian health services77

Five donors agreed to pool funds from October 1999. When the system is fully operational, funds will be channelled not only to central activities but also to 35 health districts in the first wave of decentralisation. Central funds The first disbursement to central activities was made in December 1999, under the following system. The MoH requests the Basket Financing Committee to approve the release of funds for activities costed in the agreed Plan of Action. If approved, this is passed to the Ministry of Finance who request forex transfer from donors. Donor funds are merged in a joint Holding Account in the Bank of Tanzania (BoT), converted by BoT into Shillings, and placed in the Consolidated Fund, where they are merged with Government of Tanzania (GoT) funds. The Accountant General warrants funds to the Permanent Secretary for Health (who is the accountable officer). District funds In line with the LGRP, new arrangements for release of GoT funds to district level will apply initially to 35 pilot districts (year 1) and be extended to all districts by year 3. A system of block grants to local authorities (recurrent expenditure only) is proposed in which funds would be disbursed for the achievement of national minimum standards of service at district level. Pooled funds will be integrated as part of the conditional block grant. The Ministry of Regional Administration and Local Government will make the request to the Basket Committee. If approved, the request will be passed to MoF and funds will flow to the Consolidated Fund as described above. From the Consolidated Fund, the Accountant General will instruct the BoT to transfer funds to the Regional SubTreasuries which will issue cheques to district accounts against their approved sectoral budget. The Permanent Secretary Ministry for Regional Administration and Local Government (MRALG) will be the accountable officer. Issuance of cheques will be centralised, which will allow the Platinum system to track spending by source of funds and activity code. Block Grants to districts will be deposited in health account 6, where recurrent non-salary funding is merged with government funding for the same purpose. District health plans will be agreed at council level, scrutinised at regional level against guidelines and ceilings, consolidated and then forwarded to MRALG. Proposed minimum standards to be reached at district level will be reconciled with the essential service package (see box 4, p. 20). The Basket Committee will receive district plans and approve the release of funds on a quarterly basis against approved district plans and budgets. Readiness criteria will have to be met before districts will be able to receive and manage funds: these will include an approved district health plan and budget, positive assessment by the MRALG of technical and financial management capacity according to benchmarking criteria, satisfactory and timely reports, and the government budget contribution deposited. 77

from DFID( 1999).

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Under the accounting system (and disregarding the delays that have occurred in practice) the first request for funds will cover 2 quarters. At end of Q2, request for Q3 funds will be accompanied by a statement of accounts for Ql, to be prepared within 30 days of close. A Basket Committee decision is to be made within 15 days of receipt. An annual independent audit is to be carried out, and a management letter produced assessing controls and systems. Potential problems arise in reconciliation of accounts produced by Platinum with those produced by the manual system at district level, and in consolidation at regional level.

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Annex 2 Terms of Reference Background The Partnerships for Health Sector Development Project seeks to commission a consultant to carry out and report on a series of country case studies - and subsequently to prepare a synthesis paper - on current issues in sector programmes and development assistance in the health sector. The work will be carried out on behalf of Inter-Agency Group on Sector-Wide Approaches and Development, for which WHO provides the Secretariat. The purpose of the assignment is to provide insights and recommendations relevant to the policies and practices of agencies which are members of the group, as well as to the governments with whom they interact. The scope of work which follows is based in part on discussions and issues arising at a preliminary meeting of the Inter-Agency Group (1 June 1999). It will be further refined following the completion of a preliminary desk study by the Centre for Aid and Public Expenditure (to be completed by 31 July 1999), and comments received from members of the Inter-Agency Group (1AG). Countries Case studies will be carried out in Mozambique, Tanzania, Uganda, Cambodia and Vietnam. These countries have been selected because of their engagement in the development of sector approaches as well as the nature of their cooperation with international financial institutions (CDF, ESAF). Their physical proximity within Eastern and Southern Africa and South East Asia will allow efficiencies in travel. Work in additional countries may be financed by other partners in the IAG. In preparing the synthesis paper the consultant will also draw on relevant experience from other countries. The studies in each country will take the form of policy analyses and will be based on interviews with key actors and reviews of documents. Given the breadth of the concerns set out below, the aim will be to make well informed judgements, rather than collect large amounts of quantitative data. Scope of work Reports should assume an understanding of the rationale for and basic concepts of sector-wide approaches. They will focus on issues emerging as sector programmes are implemented in practice. In each of the country studies, and in preparing the synthesis paper, the consultant will pay particular attention to the following questions: policy quality and policy process: what evidence is there to suggest that the process of developing sector programmes has influenced the content of sectoral policies? Most agencies supporting SWAps see them as a way of promoting pro-poor health policies: how has this intention been expressed in practice? Is there any evidence to suggest that sector programmes have been successful in promoting a greater concern for health outcomes? To what extent do donor concerns about ownership and national concerns about consensus limit the scope for real policy negotiation? managing relationships between governments and development partners: what have we learnt about the negotiation/transaction costs of SWAps? How effective are the various types of accord/compact / MOUs? What conclusions can be drawn about the need for and effectiveness of, conflict resolution systems? Is there any evidence that processes such as UNDAF have increased the effectiveness of UN agencies as participants in sector programmes? planning: a great deal of emphasis has been placed on the preparation of sectoral plans of different kinds: what conclusions can be drawn about sectoral planning processes? Are sector programmes over-determined? Is there a risk that the focus on planning reduces flexibility and the need to adjust policies in the light of changing levels of performance? Do donors demand too much detail in preparing programmes work and operational plans? How much variation in planning processes is beginning to emerge between countries?

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scope of sector programmes: does it remain true that many SWAps constitute a discrete programme within the sector? To the extent that this hypothesis is correct, what elements of sectoral spending tend to be omitted? With what implications? What needs to happen to move on toward time-slice funding of national sectoral budgets? What evidence is there to suggest that sector programmes have been successful in influencing intra-sectoral resource allocation in line with stated policies? links with the PFP and medium-term budget frameworks: to what extent are sector programmes fully reflected in overall budget plans? Is new thinking on the comprehensive development framework likely to influence this process? Where is there scope for more effective macro-sectoral dialogue? preconditions and conditionalities: do we need to revisit the whole idea of preconditions for SWAps if it is a term that is increasing being applied indiscriminately? To what extent do donors still impose conditionalities within the context of sector programmes? What form do these conditionalities take? Is there any evidence for their effectiveness? capacity building: to what extent does adequate capacity in national management systems have to be in place prior to the implementation of pooled funding arrangements? Is there a risk of a hiatus in the provision of essential services when moving toward a S WAp? sector performance: have we got any further in developing manageable ways of monitoring performance? Does monitoring improve over time? Does it take into account distributional issues which are often overlooked by routine systems? decentralisation: it was predicted that designing sector programmes in decentralised systems would be difficult - what has been the experience to date? To what extent have fears about SWAps acting as a centralising force been realised in practice? What national approaches to earmarking of sector priorities have been agreed and applied by central and local governments? civil society and NGOs: most governments and development agencies emphasise the importance of broad participation in the development of sector programmes: how has this intention been reflected in practice? with what effects? OUTPUTS AND TIME FRAME The consultant will submit draft reports and make a presentation to the Inter-Agency Working Group in November. Final reports are to be completed by 31 December 1999. Additional ToRs on debt relief (added later) 1. Is there a government policy on poverty reduction in place or in the process of production? 2. Are there plans for the production of a poverty reduction strategy paper (PRSP)? If the answer to 1 is yes, what is the relationship between the government policy and PRSP? 3. If the answer to 2 is yes, what is the process for producing it - who will? Government? IMF, Bank, all three? Others? Time frame? 4. Is the MoH involved in writing/advising on the health component of the PRSP? If not, why not? If so, how? 5. What do we know about negotiations (if any) and about conditionalities (if any) attached to HIPC Initiative II? How is the poverty focus reflected in the health policy and in the health sector expenditure framework?

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Annex 3

Tanzania Case Study

List of key people met

Organisation Government Ministry of Health

Name

Position

Dr G. L. Upunda Dr Sam Nyaywa

Ministry of Finance Bilaterals Embassy of Ireland

Mr Peniel M Lyimo

Chief Medical Officer Advisor, Health Sector Reforms Deputy Permanent Secretary

JICA

Ms Bernadette Crawford Mr Jackson Biswaro Ms Kazuko Hashimoto

Programme Officer

Ms Sandra Baldwin Dr S Hanson

Chief Programme Officer Health Co-operation Planning Advisor Health and Population Adviser EU Advisor NACP

Dr Emmanuel Gaudensio Malangalila

Senior Operations Officer Human Resources

UN Agencies UN UNDP UNFPA/DFID

Ms Valerie Leach Mr Stefan Bruni Ms Clare Taylor

WHO

Dr Eileen Petit-Mshana

Special Advisor on UNDAF Programme Officer Technical Co-operation Officer Officer for Managerial Process of National Health Development National Officer Primary Health Care Advisor

DFID EU IFIs World Bank

Dr G E Gomile Dr Joaqim Saweka Other Aga Khan Foundation Christian Social Services Commission AMREF DFID Adult Morbidity and Mortality Project Tanzania Essential Health Interventions World Food Programme Tanzania Public Health Association

Ms Margaret Kaseje Dr W Flipse Dr F C Kigadye Dr Darus Bukenya DrYusufHemed Mr David Whiting Dr Graham Reid

Regional Programme Officer TA Policy Advocacy Director

Ms Irene M Lacy DrKRMchatta

Representative Representative

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Deputy Project Director Data Manager Project Manager

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Tanzania Case Study

Bibliography

DANIDA 1999 Appraisal Report, Health Sector Programme Support (HSPS-11) Phase2 (July 1999-June 2004) Tanzania Mainland: Denmark. DFID 1999 PRC Submission, Support to the Tanzania Health Sector 1999-2004. GoT 1998 The National Poverty Eradication Strategy, Dar es Salaam. GoT 1999 Terms of Reference Programme 1999-2002.

Basket Financing Committee. Health Sector

GoT/Donors Memorandum of Understanding, concerning the joint funding of the Prioritised Plan of Action of the Government of Tanzania for the Health Sector for the Financial Year 1999/2000. GoT/Donors 1998 Aide Memoire, Joint Government Mission with Interested Donors May 11th-15th. GoT/Donors 1999 Health Sector Appraisal Side Agreement. GoT/Partners 1999 Memorandum of Understanding between The Partners (Government of Tanzania and donors) participating in the joint funding of the Health Sector concerning the joint funding of the Prioritised Plan of Action of the Government of Tanzania for the Health Sector for the Financial Year 1999/2000: Dar Es Salaam. GoT/Partners 2000 Side Agreement Between Government of Tanzania and Pooled Fund Partners following Joint Review of Health Sector. HERA 1999 Health Care Financing in Tanzania Costing Study of Health Services Volume I & II. Leach, V. 1999 Work in Progress towards a Common Country Assessment for Tanzania, Dar Es Salaam. Macro International 1996 Tanzania Demographic and Health Survey 1996, Macro International: Maryland. MOF 1999 Tanzania Assistance Strategy (Concept Paper and Implementation Strategy), Dar Es Salaam. MOFA/Danida 1996 Health Sector Programme Support Phase 1 July 1996-June 1999, Dar Es Salaam. MoH 1994 Proposals for Health Sector Reform, Dar Es Salaam. MoH 1998 Health Sector Policy Paper (Revised): Dar Es Salaam.

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MoH 1998a Proceedings of the 1st Sector-wide Approach (SWAp) Workshop 17-18 March 1998, Dar Es Salaam. MoH 1998b Proposed package of essential health interventions in Tanzania. MoH 1999 Expanded Programme of Immunization, EPI Annual Evaluation Meeting 22nd-26th March 1999, Dodoma. MoH 1999a Priorities Activities to be Implemented By Directorates in MoH/HQS July 1999-June 2000. Dar Es Salaam. MoH 1999b The Health Sector Plan of Action July 1999-June 2000, Dar Es Salaam. MoH 1999c The Health Sector Plan of Action, July 1999-June 2000: Dar Es Salaam. MoH 1999d The Health Sector Reform Programme of Work July 1999-June 2002: Dar Es Salaam. MoH/Donors (1995) Health Sector Reform Appraisal for Tanzania October 4-19th.

(Mainland)

MoH/Partners 1998 Statement of Intent for the Further Development of Health Sector Reform in the Context of a Sector-wide Approach: Dar Es Salaam. MoH /Partners Joint Appraisal 1999 Draft Aide Memoire 15-25 March 1999: Dar Es Salaam. MoH/Partners 1999a Draft Aide Memoir e, Tanzania Health Sector Development Programme Appraisal Mission, August 23 to September 3 1999: Dar Es Salaam. MoH/Partners 1999b Memorandum of Understanding between the partners (Government of Tanzania and Donors) participating in the joint funding of the Health Sector concerning the joint funding of the Prioritised Plan of Action of the government of Tanzania for the Health Sector for the Financial Year 1999/2000 Dar Es Salaam. MoH/Partners 2000 Main Report of the Joint MOH/Partners Health Sector Review of Implementation Progress of Health Sector Plan of Action 1999/2000 and Appraisal of The Proposed Health Sector Plan of Action 2000/01, Dar Es Salaam. Ministry of Regional Administration and Local Government 1998 Policy Paper on Local Government Reform, Local Government Reform Programme: Dar Es Salaam. Ministry of Regional Administration and Local Government 1998a Cross Cutting Issues on Which the Health Programme of Work (POW) for the Heatlh Sector Reform will be based, Dar Es Salaam. Sahn, Dorosh and Younger 1997 Structural adjustment reconsidered : economic policy and poverty in Africa, Cambridge University Press: Cambridge. World Bank 1993 Tanzania: Poverty Profile World Bank: Washington DC. 40

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World Bank 1996 Tanzania: The Challenge of Reforms: Growth, Incomes and Welfare World Bank: Washington DC. World Bank 1998 World Development Report 1998/99. World Bank 1998a Public Expenditure Review, Volume 1: Main Report, Macroeconomics 2, Africa Region: Dar Es Salaam. World Bank 1999 Project Appraisal Document on a proposed credit to the Government of Tanzania for a health sector development programme.

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