Presented byEsther Agbon

Health Budget Analysis

Definition of a BudgetThe budget is an estimate of Governments revenue

and expenditure within a specified period, usually one year.

The document shows how government plans to make, borrow or spend money

Nigeria Health BudgetThe Federal health budget has averaged 5.0% in the

last 5 yearsHealth sector budget are not prioritized at both at

Federal and state levelRecurrent budget is about 80% of the entire health

allocationOften times capital expenditure get less than 20%

Nigeria Health BudgetThe capital budget is overtly focused on construction

of upgrade of facilitiesBudget allocations for health personnel training and

service provision is minimalFor state budgets the revenue side, recurrent and

capital budgets are distinct parts of the budget document

Some state categorize capital budget of sectors into Economic, Social and Commercial/Industry, Environmental etc

2014 Health Budget - Quote• Osahon Enabulele, Former President, Nigerian Medical

Association (NMA) said that “with about 80 percent of the proposed 2014 budget earmarked for recurrent expenditure, Nigerians should not expect much from the health sector”.

• He added that the government needs to pump more money in capital expenditures like infrastructure, expansion and upgrade of medical facilities, research and development, human capital development among others.

3. Budget Execution: Budget Execution: The Executive collects the

Revenue and spend the money as per the

allocation made in the budget law

22. Budget Approval:. Budget Approval:The Legislature reviews and amends the budget and then

enacts it into law

4. Budget Oversight: . Budget Oversight: The Budget Accounts are

audited & Audit findings are reviewed by NASS, which

requires action to be taken by the Executive to correct Audit

findings

Key budget

Documents: Executive’s Budget

Proposal; supporting budget

reports ie MTEF

Key budget

Documents: Executive’s Budget

Proposal; supporting budget

reports ie MTEF

Key Budget Documents: Budget

Law; Reports of Legislative Budget

Committee

Key Budget Documents: Budget

Law; Reports of Legislative Budget

Committee

Key Budget

Documents: In-Year Reports;

Mid-Year Report; Year-end Reports;

Supplementary Budgets

Key Budget

Documents: In-Year Reports;

Mid-Year Report; Year-end Reports;

Supplementary Budgets

Key Budget Documents: Audit

Reports; Legislative Audit

Committee Reports

Key Budget Documents: Audit

Reports; Legislative Audit

Committee Reports

KEY STAGES IN THE BUDGET CYCLE

PRESTON © 2013

BUDGET PROCESS IN THE HEALTH SECTOR

SMOH

Budget Department Ministry of Finance

State Budget Committee

State House of Assembly

Approved Budget

Approved Budget copy sent to SMOH for implementation

Formulates and prepares the Ministerial budget

SMOH defends the budget to the Budget dept. Min. of Finance

SMOH defends budget to the State Budget Committee

SMOH finally defends budget to State House of Assembly

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Basic Budget Classification• Revenue and Expenditure

-Revenue is made up of oil and non oil sources

• Components of the expenditure include:

- Recurrent = Personnel and Overheads - Capital

WHAT IS BUDGET ANALYSISBudget analysis: a set of ways or systematic

steps, which communities can use to examine and understand different aspects of the budget in comparison to the norms of good budget and its implication on their lives and environment.

Why do we Analyse the budget?– Participation: Were citizens actively involved in the

budget process, from formulation to evaluation?– Accountability: Are government officials and politicians

open to scrutiny on what, when, and how they spent public money?

– Transparency: Is the budget process open to the people; documents available to the public; followed a legal, public and acceptable procedure?

– Accuracy: Can the budget revenue and expenditure meet the demands it plans to meet?

Why do we Analyse the budget?Equity: Is the budget fair in the distribution of resources,

especially to disadvantaged and vulnerable groups?Efficiency: Does the budget planning and

implementation ensure value for money?Timeliness: Is the extent to which the budget was

implemented within the defined time frame?

Basic Analysis for Advocacy

Calculating the share of the budget

Sector/Total X 100

Share of the budget is best represented in percentage

COMPUTING TRENDS IN BUDGET ALLOCATIONS

2013 2014

Total Annual Capital

Budget

86,104,997,06084,474,126,708

Amount Percentage Amount Percentage

Ministry

HEALTH 2,692,940,000 3.18,000,000,000.00

9.4

Works 33,941,000,000 39.4 21,819,000,000.00

25.8

Drainage and sewage

12,893,000,000 14.9 0

Calculating rate of increaseThe rate of increase/decrease can be determined thus:

(Spending in Year 2– Spending in Year 1)/(Spending in Year 1)

84,474,126,708 - 86,104,997,060/86,104,997,060 =

0.02The budget decreased by 0.02%

Per Capita Spending

Analysts and advocates often adjust budget data on a per person or per capita basis to allow comparisons between countries or between states.

Per capita spending is obtained with the population and amount spent variables. The equation is as follow:

Spending/Population= Per Capita Spending

Total Health budget for 2014 /3million people = N X annuallyN8,000,000,000/3,233,366 = 2,474

Calculate Ratio:

• Purpose: To measure the frequency of occurrence of a budgetary allocation over another eg.

= Sector B Sector A• E.g, Ratio of Works to Health = Works

Health

• 21,819,000,000 = 2.73 8,000,000,0001 part of health :3 parts of works

Adjusting for inflation (Real Figures)

Nominal Amount Real amount = Deflator

•N8000,000,000/1.12 = N7,142,857,142.86

Calculating the Deflators Deflator = Price index of Current Year

Price Index Base Year

Deflator = Inflation Rate + 1 = (12/100)+1 = 1.12 100

Nominal Vs Real

We need to distinguish between Nominal and Real values in analyzing budgets because an increase in a nominal allocation may be offset by a higher inflation rate. Budget information in nominal terms does not tell us whether the real value of the allocations has increased, decreased or remained the same.

Budget Monitoring tools

Community Scorecards

• This a participatory community-based approach for assessing government services or facilities by grading them according to a range of scores

• It draws different stakeholders into discussion with the aim of finding out:- whether inputs promised for a service or facility have actually

reached the frontline- How community members grade the performance of that

service or facility- How frontline service providers themselves grade their own

performance or that of their facility- What can be done to overcome problems at a facility and

improve service delivery

Main steps in a community score-card process

Preparation (collecting information and mobilizing support (1)

Community gathering (raise awareness about commitments and standards). (2)

INPUT SCORECARD To track inputs like funds and medicines to a service site (3)

Establish focus groups (4)

Develop input indicators (5)Collect

evidence on inputs (conduct site visits if appropriate (6)

Interface meeting (8)

Record and discuss findings (7)

Community Score card

Challenges- Success depends on good facilitation to ensure group

discussions stay on track and elicit authentic views- Heightened expectations amongst communities and service

providers

Advantages- simple, inexpensive and can be conducted in a short period of

time- Regular means for feedback to government by the community- Inform future plan for service delivery- When successful, builds confidence of community members

and service providers to tackle problems constructively and generate their own solutions

Public Expenditure Tracking Survey (PETS)

PETS are used to track the flow of public budget resources through different levels of government

Traces the amounts originally allocated to each level to see what share of these allocated funds actually reach where they were supposed to

Main steps in a PETS process

Choose a budget focus (1)

Analyse budget commitments and standards (2)

Gather information on original budget (3)

Compare original budget amounts with transferred amounts (4)

Identify respondents and gather answers (5)

Design questions to investigate transfers of resources (6)

Compare with budget commitments and standards (7)

Analyse differences and summarize (8)

Social Audits

• A participatory method for investigating whether government projects have been implemented as planned

• It culminates in a public hearing where the responsible politicians and government officials are expected to answer questions on based on evidence presented by community members

Main steps in a social audit process

Preparation and ground work (1)

Information gathering (2)

Create social audit teams (3)

Social audit teams develop skills and knowledge (4)

Project verification and site inspection (5)

Dialogue and analysis (6)

Public hearing (7) Follow-up (8)

Identifying your advocacy issue

Either directly from carrying out an analysisOr drawing from the standards provided by the

‘Right to Health’

Right to health – provides a standard for analysis

• Availability –

- Assesses existence of health facilities, goods and services to meet the basic health needs of the people

- This includes hospitals, clinics, trained medical personnel, essential drugs

Right to health -Accessibility

- Geographical accessibility ( without any discrimination or conditionality)

- Economic accessibility (no constraints in the form of payments for seeking health care)

Right to health -Acceptability –- Health facilities, goods and services must be

appropriate for all ( respectful of people’s culture and aimed at improving peoples health status

Right to health - Quality – - Health facilities, goods and services must be

scientifically and medically appropriate

- Skilled medical personnel, scientifically approved drugs and hospital equipments

What is the health situation of your state/Community? - Group Work• Using your state/Community as example• Identify gaps within each area of service provision • Prioritise one and state implications

Area Gaps in service provision or causes

What can be done to solve the problem

Does it have policy or budgetary implications

Availability

Budget Advocacy Goal

This is a good time to start developing your budget advocacy goal and objective......................