Impact of Union Budget 2020 on Health sector

By Dr. Shyama Nagarajan

The budget 2020 reflects a shift towards including “Health in every Policy”. The focus of the allocation in the last few years has been ensuring ‘Public Good’ beyond public health infrastructure up-gradation under National Health Mission (NHM) into water, sanitation, and Ayushman Bharat. However, the constant shifting of goal post since we committed to the “Alma-Ata Declaration on Health for All by 2000 AD” is a point to ponder. This is especially relevant for India because the world watches the Indian ways of frugality in offering solutions to the underdeveloped nations. Some of the reasons that might be standing in way of achieving the desired results are:

  1. Lack of capacity within the public system to execute the proclamations made. To exemplify: while the variation in Budget Estimates to Revenue Expenditure in FY 19-20 for Integrated Child Development Scheme (ICDS) was 7.4% and that of NHM was 2% (NHM consumes 50% of the allocation of funds on Health); the latest Comptroller and Auditor General’s (CAG) report 2019, on Hospital Performance for the state of Uttar Pradesh (UP) reports only 84% of fund utilization under NHM during the period 2013-2018. Thus, what seems as 2% variation in spending at the Central level, turns out to be 16 % at the State level. Further analysis at the district level would reflect an even larger unspent amount accruing interest in the banks. This can be concluded by the same CAG’s report of UP on allocation of budget to districts on ad-hoc basis without rigorous planning and absence of regular reports to the state raising demand with details on consumption of drugs and consumables at local levels. UP is just a case state in reference, where most studies have been conducted. The situation is no different in terms of lack of capacity in many other states.
  2. Lack of trust within the envisaged Public-Private Partnerships (PPP); adhoc and short-term responses to address the shortage of skilled manpower at various levels across line ministries. One of the recent unsuccessful healthcare PPP stories is the ITKI, Jharkhand Medical City Project, which is yet to conclude for the last three years despite repeated tendering.

It is time that we deliberate and probe the reasons for these failures and find out the key stakeholders at the various levels of decision making, their expectations, to what extent expectation-provision mismatch can be tolerated by the system, and how should the institutional governance and management mechanisms be strengthened to influence adequate and appropriate utilization of funds deployed.

 Unless we as a nation internalize and find solutions, our spending will never be able to effectively impact the health outcomes in the long term.