Many low-income countries face significant challenges to their capacity to fund priority health areas in the next five years, according to a new report.
The report, Progress in Peril? The changing landscape of global health financing, says in the next five years at least 24 low-income countries are facing a “transition” period when they will lose external financing, often from multiple sources, because their economies have grown.
Transition can pose serious risks to national budgets, health systems, and ultimately health outcomes, according to the report.
Leila Stennett, Campaigns Manager for RESULTS International Australia, and a contributor to the report, writes below that financing agencies need more extensive and flexible assessment criteria for when countries make a transition.
These should take into account factors such as health inequalities, the capacity of individual governments to raise additional revenue and operate effective health systems, and governments’ willingness and capacity to engage with and serve the interests of vulnerable or disadvantaged groups.
Leila Stennett writes:
A term getting increased attention in the development sector at the moment is “transition”. In this context, it refers to countries experiencing a phase-out of bilateral and multilateral support from agencies including Gavi, the Vaccine Alliance and The Global Fund to Fight HIV, Malaria and Tuberculosis and concessional support from The World Bank.
All of these agencies use a country’s Gross National Income (GNI) as a key criterion to determine whether or not the country is eligible for funding. When the GNI per capita exceeds a certain level, the donors begin to withdraw or transition aid out of the country.
As all of the agencies use similar criteria, this can mean that they lose a high proportion of aid funding within a few years. On paper, middle income countries may be able to replace aid funding with their own resources; however, what happens on paper and what happens in practice doesn’t always match up.
A transitioning country is similar to a person who receives a social security benefit – such as a single mother with two children who also works part-time – and then receives small pay rise from her employer. The pay rise is good news and she has worked hard for the increase but it affects her income just enough that she loses several means-tested benefits – her pension is cut, she also loses her subsidised travel card and receives reduced Family Benefit Part A.
On paper, her family should be better off but in reality their net income and standard of living will barely change. In domestic policy discussions, this is called the low-income trap. In our example, the family loses assistance from all these sources simultaneously and perhaps without time to prepare. This leaves the family at risk of falling backwards into, as the bus fare to work and medications are now less affordable.
Similarly just because a country’s income increases that doesn’t mean the livelihoods and living conditions for all people within that country do. In fact, the benefits of national economic growth often don’t apply to the most marginalised and the sick who are always the last to benefit from improvements in economic developments.
Vulnerable groups include sex workers and LGBTQIA+ communities for whom governments are reluctant to provide science based services. These people, for example, without adequate programs around needle sharing contract HIV and HepC. The Global Fund has been a major support for those programs and the concern is that without them these groups will be particularly vulnerable and that important gains in the fight against HIV/AIDS will be lost.
While sustained increases in per capita income in countries are welcome, it is important that countries receive support when they face reduced assistance from donors, especially those experiencing multiple transitions simultaneously. There are currently at least 24 countries facing this situation in the coming five years, including Vietnam, Papua New Guinea and East Timor.
It is important for countries that experience sustained economic success to become more self-reliant in providing services for their populations. International aid is not meant to be a permanent source for funding services and economic development, but more extensive and flexible assessment criteria for when countries make a transition is needed.
These criteria should also take into account a variety of factors including income and health inequalities, the capacity of individual governments to raise additional revenue and operate effective health system, the commitment of countries to expand universal healthcare and the willingness and ability of governments to engage with and serve the interests of vulnerable or disadvantaged groups in the community.
Thailand is an example of a qualified success in transition. Since 2011, Thailand has been classified as an upper-middle-income country, and has made significant progress in social and economic issues, with the proportion of the population living below the poverty line falling from 67% in 1986 to 7.2% in 2015.
Government health spending in Thailand has doubled in recent years, and is one of the highest per capita levels in Southeast Asia. On this basis, Thailand has transitioned from Global Fund support for HIV, TB and Malaria to domestic funding. Thailand still faces some challenges in returning to higher economic growth rates, and addressing continuing high rates of TB and HIV infections which they are working to address.
The important questions around transition are: how are people going to be able to access health services and what can governments do to prepare?
A new report on transition by the ACTION Global Health Partnership, Progress in Peril, suggests that national governments can prepare for transition by including all relevant stakeholders in the process for planning for reduced donor support, make clear commitments to increase funding for health programs, and start to improve their health systems in advance of transition taking place.
A key part of this process is to engage CSOs in affected communities so they can keep governments accountable and ensure existing preventative measures are maintained within communities.
It is vital that in order for transition to be effective international donors much invest in CSOs in countries, so they can build their own advocacy and organise to ensure that the most vulnerable are not left behind.
Extract from report
• Leila Stennett is the Campaigns Director of RESULTS International Australia, Gavi CSO Steering Committee Representative and contributor to the ACTION transition report, ‘Progress in Peril?’.
RESULTS Australia is a member of the ACTION Partnership, which released the report recently at the UN General Assembly and is a global partnership of independent organisations working to influence policy and mobilise resources to fight diseases of poverty and achieve equitable access to health.
• Follow on Twitter: @RESULTS_AU