Working Group Paper
Low-income countries remain far from the $60 annual per capita expenditure on health that the 2009 High-Level Taskforce on Innovative Financing for Health Systems estimated was needed to deliver a limited set of key health services to their citizens by 2015. Although development assistance for health (DAH) almost tripled between 2000 and 2011, several studies suggest that this increase has, in some instances, displaced government health expenditure from domestic sources (GHE-D). This is clearly not in the interest of either donor or partner countries – to use the terminology of the Paris Declaration on Aid Effectiveness. This is but one example of why donor and partner countries need to re-examine aid delivery mechanisms and explore innovative approaches to achieving shared objectives. With that goal in mind, this paper addresses the desirability of a central international pool of DAH – called a Global Fund for Health for the exercise.
This paper analyses the desirability of a Global Fund for Health from a ‘political realism’ perspective, not from a normative one. The central question here is not whether the international community ought to create a Global Fund for Health, for ethical or human rights reasons. It is whether the international community would be willing to create such a fund and use it as the main channel for DAH because of the impacts such an approach would have on certain qualities of DAH – some desirable, some undesirable.
The option examined here uses the parameters that have been developed in other papers of Working Group 2 on Sustainable Financing for Health, namely that all countries should aim for a level of GHE-D equivalent to 5% of gross domestic product (GDP), and that high-income countries should provide DAH equivalent to 0.1% of GDP. We will not explain or defend the rationale of these parameters here, we simply refer to the relevant papers. However, we will suggest somewhat lower intermediate targets for GHE-D in low- and middle-income countries.
The idea of a Global Fund for Health is not new. Since 2006 we have proposed and discussed the idea in several academic journals, and the arguments described in this paper are largely based on feedback we received on earlier publications and on the discussions within Working Group 2 on Sustainable Financing for Health. We structured them, as much as possible, around the desired qualities of aid espoused in the Paris Declaration. We argue that:
Donor countries want:
- To preserve control over the DAH they provide,
- DAH to increase their standing and reputation,
- DAH to be focused on infectious disease control,
- DAH to be additional to the GHE-D,
- To share the burden of DAH for global public goods, and
- To discourage corruption.
Partner countries want:
- DAH to be aligned with their priorities,
- DAH to be reliable in the long run,
- The administrative burden of managing DAH to be as low as possible,
- Unconditional DAH,
- To overcome ‘recipient’ stigmatization, and
- More DAH.
For each of these statements, we evaluated the option of a Global Fund for Health compared with the option of maintaining the DAH status quo, i.e. mostly bilateral and a few global funds for infectious disease control.
From the perspective of partner countries, a Global Fund for Health is, on balance, more desirable than the option of keeping DAH as it is. From the perspective of donor countries, the picture is more mixed and the desirability of preserving control over the DAH they provide may well override all other considerations. Donor countries have so far accepted ‘collective-choice arrangements’ if and only if they cannot avoid them – for example, when there are global public goods like infectious disease control requiring financing.
However, we believe that political developments beyond global health may provide the impetus required to motivate donor and partner countries to look for new solutions to old and new common concerns. We suggest that the political motivation for supporting a Global Fund for Health may come from global warming. The necessity of capping greenhouse gas emissions from all countries may oblige donor countries to support at least the provision of subsistence rights in partner countries.