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Public Expenditure Review, HIV/AIDS Multi-Sectoral Update for 2004

Foster, M. and Mwinyimvua, H. (2003) Public Expenditure Review, HIV/AIDS Multi-Sectoral Update for 2004. UNSPECIFIED. (Unpublished)

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This is the report of a multi-sectoral review of public expenditure on HIV/AIDS, carried out for TACAIDS in October 2003 by a team comprising Mick Foster (Mick Foster Economics Ltd and IHSD) and Hamisi Mwinyimvua (IMMMA Consultants). Our TORs are at Annex 4. International comparisons and direct estimates of the funds required suggest that an effective, mainstreamed response to the HIV/AIDS epidemic will require Tanzania to spend in excess of $100mn per annum. Total identified spending on HIV/AIDS has increased by 180% in 2002/03 to TSh 47bn, but is still less than half of the levels that have been estimated to be needed, even before considering the costs of expanding ARV treatment for HIVAIDS sufferers. We estimate that there has been a doubling in aid disbursements on HIV/AIDS via Government agencies and a more than fourfold increase in official donor flows to HIV/AIDS programmes of NGOs in 2002/03.The figures provide only incomplete coverage of Government-financed spending, but on the data available there has been a TSh 4.75bn increase in Government spending on HIV/AIDS, almost entirely accounted for by the establishment of TACAIDS in the Prime Minister’s Office. Our best estimate, adjusting for incomplete data, is that Government spending in 2002/03 would have financed 45% of public expenditure on HIV/AIDS, and 26% of total expenditure including NGOs. The Government budget for HIV/AIDS was 99% disbursed in 2002/3, a big improvement on 81% in 2001/02. Spending is dominated by TACAIDS (64%), MOH
(26%) and MOEC (8%), with all other MDAs accounting for only 2% of recurrent expenditure. The March 2003 Budget Guidelines envisaged a flat ceiling of TSh43-44bn for budget spending on HIV/AIDS in the 2003/04-2005/06 period. A significant increase in the ceilings beyond this level should be feasible in the new MTEF period (2004/05-2006/07). By maintaining the HIV/AIDS share in total revenues, Government could increase domestic finance for HIV/AIDS to nearly TSh20bn by 2005/06 and at least TSh 22bn by 2006/07, compared to TSh16.6bn envisaged in the final year of the
previous MTEF. Adding in existing donor commitments of TSh 50bn for spending by Government agencies in 2005/06 gives identified public sector resources for HIV/AIDS of TSh 70bn in 2005/06. Not all existing donor commitments are available for spending on Government (as opposed to donor) priorities, and disbursement to specific projects often falls short of predicted levels. On the other hand, existing donors nearer the time will make new commitments, there are new sources of
funding in prospect, and HIV/AIDS continues to have high profile in donor priorities. It should be feasible to raise total spending close to the required level, but Government will need to work hard to mobilise additional resources, and to persuade donors to move away from poorly donor-driven projects in favour of helping finance a coordinated strategy, based on the National Multisectoral Framework and using Government allocation and public expenditure management procedures. The Care and Treatment Plan prepared with support from the Clinton Foundation and recently approved by the Cabinet envisages costs of $519mn over 5 years, equivalent to 6.5% of Government spending in the final year. The funds will mainly be spent on treatment with anti-retroviral drugs for over 400000 AIDS patients, plus necessary supporting improvements in VCT and in health services. The intention is to finance it from ‘additional’ money, but existing donors are being approached, and the experience of HIPC is that donor assurances of the additionality of funding cannot be verified and should probably not be believed. It is extremely important that the financing of the Care and Treatment Plan does not divert attention away from fully funding the NMSF, especially the necessary expenditure in scaling up effective prevention measures. Research suggests that each extra year of healthy life achieved as a result of expenditures on prevention costs less than $20, compared to more than $350 for each year achieved as a result of treatment. Moreover, speed matters. One African study found that rapid scaling up of prevention has the potential to prevent 58% of new infections, but only half as many if expansion is delayed by three years1. The humanitarian case for offering treatment is a strong one, but the first priority must be to ensure that the prevention effort is fully funded, to prevent infection among those entering the sexually active age groups and among as many as possible of the 88% of the adult population currently free of infection. There is already some evidence that the pattern of spending is becoming unbalanced, with a big increase in commitments to care and
treatment, while prevention interventions remain too small scale and localised, and mitigation continues to lack policy direction or significant funding. The draft section for the Budget Guidelines at Annex 2 sets out our proposals for spending ceilings by sector. Overall, we propose an increase in spending to $100mn per annum by 2006-7, excluding the costs of spending on Care and Treatment beyond that envisaged in the health sector HIV/AIDS strategy. For health, the proposed ceilings are based on the cost of implementing the strategy for HIV/AIDS, expected to increase from $25mn in 2003.4 to $60mn in 2006/07. Although donor commitments have increased sharply, it is unclear what proportion of those commitments contributes to financing the MOH strategy. Identified HIV/AIDS commitments to MOH (both budget support and direct project aid) plus Government MTEF resources equal one third of the cost of the strategy. Over the MTEF period, nearly 40% of the funds will be required for prevention, 57% for care and treatment, with the balance for crosscutting expenditures. For education, the proposed ceilings are derived from rough estimates of the costs of scaling up interventions in order to mainstream HIV/AIDS in the curriculum and ensure that all teachers, senior primary school pupils and secondary students are covered. The proposed TACAIDS ceilings are intended to enable them to carry out their leadership and advocacy role, and to take on new responsibilities in managing the World Bank TMAP project, but they assume that funds for implementing HIV/AIDS activities will from 2004/05 be budgeted for by the implementing MDA. Most of the activities required in order to mainstream HIV/AIDS need to take place at District and Community level, and this report recommends a substantial increase in spending via LGAs. Spending at LGA and community level is at present dominated by NGO and donor projects, with spending skewed towards those districts and regions fortunate to have donor and NGO projects. The $87mn Global Fund project will reinforce this, focusing an unprecedented level of resources on just 45 districts, and on care and treatment rather than prevention or mitigation. The World Bank financed TMAP project aims to support a more even pattern of district and community response, appointing Regional Facilitating Agents to build capacity and help manage district and community funding in each of the thirteen regions, and developing comprehensive HIV/AIDS strategies at District level as the basis for a balanced multi-sector approach. Initial HIV/AIDS action plans have been prepared by most LGAs, but the quality has been weak, confirming the need for capacity building support. Moreover, the peak spending of $30,000 per district from TMAP compares with $350,000 per district under the global fund project. Achieving the required scaling up of the district and community response, while also improving the balance between prevention, care, and mitigation, and the balance between districts, requires significantly increased funding to be allocated to districts and communities on the basis of need and of capacity. Funding for LGAs should be earmarked for HIV/AIDS spending, and should be subject to effective mechanisms to ensure sound planning, effective implementation, and accountability. Though LGAs have a role in planning, coordination, resource allocation, and monitoring, most spending programmes will be undertaken using NGOs. CBOs and FBOs.

Item Type: Other
Keywords: Public Expenditure;HIV/AIDS;Tanzania
Subjects: HIV > Surveillance
Divisions: Other
Depositing User: Mr Joseph Madata
Date Deposited: 14 Jan 2013 06:52
Last Modified: 14 Jan 2013 06:52

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