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Assessing Fiscal Space for Health: Insights from Rwanda's Health Financing Strategies

This presentation by Chris Lane from the World Bank discusses the need for fiscal space in Rwanda's health sector to improve health outcomes. Despite economic growth, Rwanda faces significant health challenges, including high fertility rates and malaria prevalence. By using marginal budgeting for bottlenecks (MBB) and evaluating fiscal space scenarios, the presentation highlights the role of donor funding, government spending, and household contributions. It emphasizes the necessity for long-term aid commitments and efficiency gains to meet the health-related Millennium Development Goals by 2015.

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Assessing Fiscal Space for Health: Insights from Rwanda's Health Financing Strategies

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  1. Assessing Fiscal Space For Health: Rwanda Case Study Presenter: Chris Lane World Bank, HD learning week November 13, 2008

  2. Acknowledgements • Fiscal space paper drafted with Pablo Gottret, June 2008. Contributions from Agnes Soucat, Banefsheh Siadat, Laurence Lannes, Annika Kjellgren (all World Bank) and Sabine Furure (UNICEF). • With special thanks to officials at the Rwanda Ministry of Health.

  3. Outline of presentation • Context • Scale up health financing and improving health status • MBB costings (marginal budgeting for bottlenecks) • Fiscal space scenarios • Risks and policy implications

  4. Why is fiscal space for health needed? • 2005 health outcomes are similar to sub-Saharan Africa average. However: fertility rate is above average; HIV prevalence rate among adults is lower than average. • Malaria is the principal cause of morbidity and mortality. • Life expectancy and U5 mortality are in line with income per head. • Economic growth and aid per head are above SSA average • Rwanda aims to continue improving health status through 2015.

  5. Health financing expansion donors households government Source: Rwanda, National Health Accounts 2003, 2006

  6. Indications of progress to the health MDGs I Sources: Rwanda Ministry of Health, Rwanda Economic Devt and Poverty Reduction Strategy

  7. Progress to the MDGs II Sources: Rwanda Ministry of Health, Rwanda Economic Devt and Poverty Reduction Strategy

  8. Simulation of health MDG costs using MBB Sources: Rwanda Ministry of Health/ Unicef/ World Bank MBB simulations May 2008.

  9. ..

  10. Prospective fiscal space for health Assuming external finance remains At $250 million per year from 2008 Source: Rwanda NHAs, 2008 Budget, 2008 health donor tracking, author’s assumptions.

  11. Much depends on the US: Source of 50 percent aid for health

  12. Health share of budget - macroframework 15 percent of recurrent spending by 2015 Some technical factors Constant 8.3 percent of recurrent spending after 2010 Source: Rwanda, MoH; EDPRS, MTEF and author’s assumptions

  13. Financing gaps from 2011… Fiscal space for health High case Low case MBB costings Source: MBB costings, authors estimates based on Budgetary framework, MTEF, EDPRS.

  14. Policy implications • Large increases in health financing have put health MDGs within reach. Expansion of fiscal space for health likely to slow or reverse as aid tops out. • Aid dependency of health sector will remain for the foreseeable future (now 80 percent, 67 percent by 2020 in financing scenario). • Long-term aid commitments are needed. • Achieving the Abuja target also important. • Efficiency gains will be needed to cover financing gaps from 2011.

  15. How to realize efficiency gains • Some mismatch between govt. health priorities and allocation of donor funds: despite aid surge (much of which focussed on HIV/AIDs • MoH reports in 2008 financing shortfalls in support for CH workers, human resources for health; rural health services; family planning and reproductive health. • Mechanism needed to improve donor alignment. • Government-Donor health compact could address the coordination problems.

  16. Thanks for listening …..

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