Is the sector approach still relevant to development assistance and aid given the track record and the rapidly changing global context? Or is it time – again – to look for something new that might work better? This paper argues that the sector approach continues to be relevant, but that it needs to become a 'sector approach version 2.0'. This requires significant – and difficult - changes in how external funders work. The new approach has to make where connectivity, collaboration, communication and horizontal knowledge acquisition central to its aims. This entails addressing five closely linked challenges: accepting the complexity of the task; working proactively with the new global interconnectedness; paying more attention to knowledge, dialogue, quality and results; adapting the sector approach to the specific context and sector, particularly in fragile situations; and gaining leverage as 'brokers' of knowledge and agendas.
Resource allocation and health financing
This report examines the evidence for and against foreign aid, and finds that, while there is much room for improvement, good quality 21st century aid not only saves lives, but is indispensable in unlocking poor countries’ and people’s ability to work their own way out of poverty. It makes a number of recommendations. Countries and stakeholders should ensure aid is channelled to help support active citizens, build effective states as a pathway to reducing poverty and inequality, and support diverse forms of financing to contribute to development. They should deliver aid through a mix of models, including increasing budget support wherever possible, and ensure that a percentage of aid flows are channelled to civil society organisations, to enable people to better hold their governments to account. Also, there is a need to dramatically improve the predictability of aid, by increasing the proportion of aid that is general budget support where possible and by sector support where general budget support is not an option, and limit conditions attached to aid to mutually agreed poverty indicators. Rich countries should give at least 0.7% of their national income in aid, and set out how this target will be reached, with legally binding timetables. Furthermore, the global community should reject a culture of corruption, uphold human rights standards, and act in ways which are transparent and open to scrutiny. It should also provide legal environments in which civil society organisations monitoring government activities can flourish and respect the independence of non-government bodies like audit offices and the judiciary.
This article argues that, as a result of the current financial crisis, there has been a resurgence of commitment to transparency in overseas development aid (ODA) in all areas and greater focus on the effectiveness of spending. It notes that progress on ODA transparency can occur swiftly and the impacts can be significant. Eighteen donors are reported to have signed up to the International Aid Transparency Initiative (IATI), including major multilateral and bilateral donors like the World Bank and the United Kingdom’s Department for International Development (DFID). The process of defining the standards is ongoing, calling for common standards of transparency, including publication of what is funded. One of the consequences of lack of transparency on ODA resources is the issue of donor ‘orphans’ or ‘darlings’ - where aid flows disproportionately to a particular region, sector, issue or ministry. Greater levels of information and transparency is needed on ODA benefits to civil society, including non-governmental organisations, parliamentarians and direct beneficiaries. This is a prerequisite for not only holding donors and service providers accountable over commitments they have made, but also for citizens to hold their governments to account over discrepancies between ODA received and spent on behalf of beneficiaries.
The academic literature on budget institutions in low-income countries is scarce, and originates to a large extent from the field work of donors and development agencies. This study is intended to fill that research gap. It has developed a composite index of the quality of budget institutions for 72 low-income and middle-income countries drawing upon empirical studies, budget survey databases and assessment reports, supplemented by case studies and other reports and data from the International Monetary Fund (IMF), the World Bank and donors engaged in capacity building in low-income countries. It found that, in general, budget institutions in low-income countries are much less developed than in developed and emerging market countries, and display widely different characteristics that reflect country-specific factors, such as colonial heritage, and a variety of cultural and administrative traditions and practices. Evidence suggests that weak capacity, ineffective civil society institutions and political/economic factors act as a severe constraint on the progress of modernising budget institutions. In low-income countries, numerical targets and formal constraints on spending and fiscal deficit that exist on paper may not be binding in practice because mechanisms that make adherence to budget rules and procedures transparent, and hold government ministers and officials accountable for their decisions, are usually not well established. Therefore, this study argues, enhancing the transparency and comprehensiveness of the budget process, and public dissemination of budget documents, even in the absence of formal rules, may be particularly important.
This study's main objective was to estimate the cost to the health system of obstetric complications due to female genital mutilation (FGM) in six African countries. A multistate model was used, which depicted six cohorts of 100,000 15-year-old girls who survived until the age of 45 years. The risk of obstetric complications was estimated based on a 2006 study of 28,393 women. The annual costs of FGM-related obstetric complications in the six African countries studied amounted to I$ 3.7 million and ranged from 0.1 to 1% of government spending on health for women aged 15–45 years. In the current population of 2.8 million 15-year-old women in the six African countries, a loss of 130,000 life years is expected owing to FGM’s association with obstetric haemorrhage. This is equivalent to losing half a month from each lifespan. Beyond the immense psychological trauma it entails, FGM imposes large financial costs and loss of life. The cost of government efforts to prevent FGM will be offset by savings from preventing obstetric complications.
The goal of this paper is twofold. First, the paper extends the analysis evaluating the performance of aid agencies by creating several best and worst practices indices, including an overall aid agency index. It does so by relying on a newly available dataset and draw from the benchmarks established in the previous literature where different measures of aid transparency, specialisation, selectivity, ineffective aid channels and overhead costs are utilised. Secondly, the analysis attempts to explain agency behaviour, addressing why agencies behave the way they do. This section relies on bureaucracy theory to address the capability of agencies to achieve best practices, highlighting both economic and political constraints.
Every year, billions of dollars of environmental overseas development aid (ODA) flow from high income countries in the North to low income countries in the South. This book interrogates this flow of ODA by addressing a number of questions. Why do countries provide this ODA? What do they seek to achieve? How effective is the ODA provided? And does it always go to the places of greatest environmental need? These questions are addressed using a comprehensive dataset of ODA.
This study was based on a systematic analysis of all data sources available for government expenditures on health as agent in developing countries, including government reports and databases from the World Health Organization and the International Monetary Fund. It found that, in all developing countries, public financing of health in constant US$ from domestic sources increased by nearly 100% from 1995 to 2006. Furthermore, development assistance for health (DAH) to government appeared to have a negative and significant effect on domestic government spending on health – for every US$1 of DAH to government, government health expenditures from domestic resources were reduced by $0•43. To address the negative effect of DAH on domestic government health spending, the study recommends strong standardised monitoring of government health expenditures and government spending in other health-related sectors; establishment of collaborative targets to maintain or increase the share of government expenditures going to health; investment in the capacity of developing countries to effectively receive and use DAH; careful assessment of the risks and benefits of expanded DAH to non-governmental sectors; and investigation of the use of global price subsidies or product transfers as mechanisms for DAH.
This information sheet provides basic facts about financing of health care in South Africa. Health care financing is based on tax, which, in South Africa, is relatively progressive. Tax revenue is the only funding in South Africa that is used for health services that benefit all. Out-of-pocket payments or direct payments to health care providers are regressive. Medical scheme contributions are the biggest single share of health care financing in South Africa. Lower income medical scheme members contribute a higher percentage of their income than higher income medical scheme members. The greatest burden of funding health services rests on medical scheme members, particularly the lowest income scheme members, and the largest part of this burden takes the form of medical scheme contributions.
This article argues that South Africa’s proposed national health insurance (NHI) puts it on a trajectory of achieving universal access to quality health care for all its residents. It reports that current inequalities and inequities in access and utilisation of health care services place a greater burden on the poor and vulnerable. While it argues that the proposed NHI is not a magic bullet for all the problems of the health sector in South Africa, if it is well designed, planned, managed and effectively implemented, it is likely to improve the overall health outcomes of South Africans, as well as nudge the country towards achieving the Millennium Development Goals.