The Work of the Commission on Macroeconomics and Health. (Round Table)

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More funds for health: the challenge facing recipient countries

The Report of the Commission on Macroeconomics and Health makes a strong case for a substantial increase in investments in health sector development. However, as the Report recognizes, we should not ignore the challenges of ensuring that any additional funds are spent effectively. This will require new ways of working on both sides of the donor-recipient country partnership. Here, I want to focus on the challenges that recipient countries will face. This focus should not be interpreted as implying that there are no difficulties associated with the aid instruments -- clearly there are -- but I will leave others to address them.

A major area of emphasis in the thinking adopted by Working Group 5 of the Commission on Macroeconomics and Health was directed towards achieving a better understanding of the "constraints" to improving health outcomes and how such constraints might be overcome. Constraints were conceived to be conditions that hamper efforts to scale up the provision of effective interventions. Following this reasoning, we developed a typology of constraints (1) and examined evidence for strategies that can "buy out" or otherwise ameliorate constraints (2). In addition, case studies were prepared on Chad (3), the Indian states of Kamataka and Tamil Nadu (4), and the United Republic of Tanzania (5). We classified factors that constrain the expansion of services into the following categories, according to the area in which they operate: community and household; health services delivery; health sector policy and strategic management; overall public policy; and environmental characteristics. Subsequently, we examined the extent to which the constraints could be bought out by additional funds.

Lack of money is often a governing constraint, especially at the peripheral level, and any attempt to scale up will require significant increases in expenditure. However, the fact that progress is not possible without money does not mean that it is assured if money becomes available. Without a health system that can use money well, spending will not merely be inefficient -- it may be useless, or conceivably counterproductive. Most of the world's poorest people lack access to an adequate health system, and this limits all efforts to scale up the provision of effective interventions. In many cases these systemic problems will become governing restraints if spending is quickly increased, driving the marginal benefit of spending on materials or staff to zero.

The removal of structural constraints and the building of new management and service delivery capacity are thus necessary precursors to the scaling up of health interventions. But this does not mean that the need for a commitment to greatly increased funding is deferred or lessened. Instead, money must be used immediately to remove constraints as quickly as possible. There must be system-wide spending in order to make progress, with a deliberate focus on careful phasing of investments that will increase absorptive capacity.

Historically, one way of avoiding the problems of limited capacity has been to adopt a "vertical" approach to a particular intervention or family of interventions. …