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External Funding and Health Development

There is an urgent need for development assistance in health (DAH): for immediate crisis relief; for short to medium term relief of urgent health needs; and for putting in place the conditions for long term health improvement. For most people the argument for increased development assistanc in health is self-evident; the existence of profound need is argument enough. However, if the arguments had to be labelled we might refer to them as a combination of humanitarian and social justice arguments. How development assistance for health is mobilised, prioritised, packaged and disbursed is of pressing concern to people's health activists but the field is complex and opaque and directions and strategies for organising and campaigning are not always obvious.
Other arguments for development assistance
The humanitarian and social justice arguments are not the only arguments for development assistance in health. Two other particularly influential arguments are: (i) the productivity argument; and (ii) the security argument.
The WHO Commission for Macroeconomics and Health provides a clear articulation of both these arguments. The 'security argument' speaks about the threat to global stability (the stability of the current global regime) of widening inequality and increased desparation. The argument is articulated largely by people whose own personal commitment derives from more humanitarian concern. However, it is seen as necessary to encourage the more backward aid givers to increase their aid allocations. The 'productivity argument' speaks about health as an input to economic development. It points out that in certain circumstances disease and disability are a barrier to economic development. The clearest example is AIDS HIV. However, this is a somewhat tricky argument because it risks the possibility that aid might be skewed away from those conditions which are not seen to be economically relevant (infant mortality perhaps). This argument is also articulated largely by people who are personally committed to health development for humanitarian reasons. However, it is seen as necessary to encourage finance ministries in the donor and recipient countries to increase their aid allocations to health. Both of these alternative arguments for development assistance in health have the potential to skew priorities and implementation arrangements.
Other purposes of 'aid'
Development assistance also serves a number of other purposes:

  • achieving goals related to the strategic 'national interests' of the donor (eg bullying or buying) (or the collective interests of the stakeholder countries)
  • directing covert assistance to domestic interests (eg boomerang aid);
  • pursuing the neoliberal agenda: opening up developing and transitional economies to private investment and to the global market; and
  • shoring up the perceived legitimacy of contemporary regime of globalisation; ameliorating domestic concern about inequality and injustice; defusing domestic pressure (in donor countries) for structural change in the global economy.

The Global Fund for AIDS, TB and Malaria is a particularly good example of the latter, in two respects: (i) it continues the long-standing efforts of the US and its G8 allies to weaken the WHO; and (ii) the focus of the GF on providing funds for medications is designed in part to cut the ground from under the critiques of the prevailing intellectual property regime. [elaborate] These non-health development purposes have undoubtedly skewed priority setting and disbursement in the health sector as in other sectors.
Unintended consequences
Even where aid is directed by the most humanitarian and social justice objectives it can have negative consequnces. These can include:

  • corruption
  • weakening of national sovereignty
  • distorting human resource allocations
  • creating dependency.

Not surprisingly there is widespread scepticism about the role of development assistance generally, including in relation to health. Total aid flows are dwarfed by the reverse flows of value from developing to developed countries. However, the cynicism of many donor governments should not be allowed to obscure the pressing needs in the developing world and the real (humanitarian and social justice based) concerns of many people and some governments in the rich world.
Increasing aid levels
The donor countries have substantially increased their aid commitments in recent years, including development assistance for health:

  • DAH has increased from US$ 2.5 billion in 1990 [0.016% of gross national income (GNI)] to over US$ 13 billion in 2005 (0.041% of GNI)], and has also increased from 4.6% of official development assistance (ODA) in 1990 to close to 13% in 2005.
  • Much of this assistance is targeted to specific diseases or interventions which raises issues of funding imbalances and prioritization.
  • Partially as a result of increased DAH, overall health spending in developing countries has also been increasing. Between 1990 and 2002, total health spending in developing countries increased by over 100%: from US$ 170 billion in 1990 to US$ 351 billion in 2002, or from 4.1% to 5.6% of developing country GDP. However, in some countries, domestic spending on health has stagnated or even reversed.

Changing patterns of decision making at the country level
Over the last decade official thinking (among the major donors) about development aid has gradually been shifting from donor-led projects towards recipient-led sector programmes and direct budget support. Some donors are slowing relinquishing their hands-on control over the use of development aid resources in exchange for opportunities to be involved in policy dialogue with the government and a greater involvement in institutional reform of public institutions through capacity building, including a strengthening of accountability mechanisms, including accountability towards citizens. Civil society actors and the media would all be expected to play a role in deepening accountability under this new approach to aid. However, it is not clear that donors, recipient governments or civil society organisations are fully assuming their newly assigned responsibilities in this new thinking. What is the experience 'on the ground' in terms the 'new' roles of these three players - donors, recipient governments, and civil society?
The institutional world of development assistance
The development assistance 'world'is complex and opaque. It comprises:

[fill in the dots]
The complexities of development assistance in health
There are more major global stakeholders in health than any other sector and literally hundreds of different flows of public and private funds to specific countries. Issues include:

  • The various international organizations and stakeholders have overlapping and unclear mandates; no single organization coordinates global health policy, financing and implementation processes at country or regional levels, nor knowledge dissemination (WHO, 2007).
  • Much of the increase in health aid over the past 10 years has come from new organizations such as foundations and global funds, and is targeted to specific diseases and interventions. The latest Global monitoring report shows that while the share of health aid devoted to HIV/AIDS more than doubled between 2000 and 2004, the share devoted to primary care dropped by almost half.
  • While some issues, such as international efforts to fight 'emerging disease' like SARS and avian flu have attracted considerable attention, many others have not. These include the development of vaccines and medicines for so-called 'neglected diseases' which tend to occur only in very poor countries
  • It is often politically advantageous for donors to raise and spend aid 'vertically', in order to show a direct link between their tax monies, and results. While this is an issue in all sectors, the consequences are particularly acute in health as the sector requires flexible resources that can be used to support recurrent costs and health systems.

Some suggested criteria for evaluating development assistance in health

  1. DAH addresses the most pressing health needs
  2. DAH contributes to health systems strengthening
  3. DAH contributes to addressing the determinants of health (health protection and health promotion, intersectoral action for health)
  4. DAH promotes coherence between health sector goals, planning in other sectors and overall development assistance flows
  5. DAH contributes to sustainable development in relation to the health system and in relation to the conditions for health

Sub Topics
International Health Partnership

  • The Global Fund for AIDS, TB and Malaria
  • Vaccines and drugs (GAVI and DiNDI)
  • The Millenium Development Goals

Exercises and discussion questions

  1. Describe the profile of foreign development assistance (focusing on health) in your country, and the pathways, policies, decision making arrangements and sectoral allocations or structures through which aid is delivered.
  2. Identify one program and describe the development logic / programme logic (institutional, political, human resources, etc) through which the program is expected to produce health outcomes.
  3. Identify one program and test it against the key principles for evaluating of development assistance in relation to health (including the conditions for population health as well as health systems strengthening)
  4. Evaluate the pattern of development assistance in health in your country against the above principles.
  5. Identify the major international players shaping development assistance in health in your country: the players, the fora, the issues, the debates
  6. Identify the NGOs and social movements domestically and internationally which are challenging the official wisdom regarding development assistance in health
  7. Identify the key strategic directions for PHM nationally and globally in reforming development assistance, generally and regarding health

This topic developed by John Mahama and David Legge 1607