Alison Hickey

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Public expenditure on HIV/AIDS in South Africa Alison Hickey Research Unit on AIDS and Public Finance IDASA ~ Cape Town, South Africa HIV/AIDS and Business in Africa 10 June 2003 ~ Durban : 

Public expenditure on HIV/AIDS in South Africa Alison Hickey Research Unit on AIDS and Public Finance IDASA ~ Cape Town, South Africa HIV/AIDS and Business in Africa 10 June 2003 ~ Durban

Slide2: 

South African story thus far: 2 primary vehicles to transfer funds to provinces from national: conditional grants & equitable share - 98% of provincial budgets come from national - Approximately 85% from ES; rest from condtl grants National Integrated Plan for HIV/AIDS - Multi sectoral plan implemented by departments of health, education and social development - Utilises conditional grants to fund 3 primary programmes New funding approach gives provinces more freedom to allocate resources and implement programmes as determined by provinces

Slide3: 

Abuja Declaration 2001—15% target 1. What share of the South African budget is allocated to health?

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2. How much is specifically targeted for HIV/AIDS interventions?

Slide6: 

Funds set aside for HIV/AIDS interventions in national budget:

South Africa: Estimates of public health expenditure on HIV/AIDS (indirect): 

South Africa: Estimates of public health expenditure on HIV/AIDS (indirect) DOH estimates very significant expenditure already incurred by public health system Combined national and provincial expenditure on HIV/AIDS = R4.4448 bn or 15.0% of 2001/2 consolidated public health expenditure In 2000, estimated 628 000 admission to public hospitals for AIDS-related illnesses, or 24% of all public hospital admissions (DoH, Abt) Cost of hospitalising AIDS patients in public facilities at least R3.6 billion in 2001/2, or 12.5% of total public health budget (DoH)

National govt relying heavily on block grants: R1.1 billion of R1.952 billion set aside for HIV in this budget is sent to provinces via equitable share.: 

What are the appropriate funding mechanisms for HIV/AIDS interventions? National govt relying heavily on block grants: R1.1 billion of R1.952 billion set aside for HIV in this budget is sent to provinces via equitable share. Two main purposes of ES funds: 1. To ensure health services strengthened generally 2. To allow provinces to fund care and treatment including ARVS, ‘as policy develops’ Block grants allow provinces discretion: - to make different political choices (outside natl policy) - to allocate funds to most cost-effective programmes

At the provincial level:: 

At the provincial level: HIV/AIDS programmes in provincial health depts totaled R680 m in 2003/4--this is over 90% real increase from last year.

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EMERGING ISSUES AND THEMES 1. Are provinces allocating funds for HIV/AIDS from their own budgets (drivers)? Mainstreaming Provincial budgets as moment of truth 2. Massive resource boost needed to strengthen health sector generally. Are provincial health departments benefiting or is money diverted to other departments and priorities? 3. Absorption capacity becomes critical question, given direction of Budget 2003/4 provincial programme management skills financial management skills

Public expenditure on HIV/AIDS in South Africa: Alison Hickey Research Unit on AIDS and Public Finance IDASA Thank you: 

Public expenditure on HIV/AIDS in South Africa: Alison Hickey Research Unit on AIDS and Public Finance IDASA Thank you

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Serious problem assessing indirect impact of HIV/AIDS on health expenditure Methods attempted are estimates or projections (2) Assumes full delivery of services (100% take-up rate) Assumes ‘crowding out’ and rationing do not occur Actual fieldwork research encounters confidentiality & stigma issues Direct and indirect expenditure How do we measure impact of HIV/AIDS on public health expenditure?

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Funds set aside for HIV/AIDS interventions in national budget: 2. How much is specifically targeted for HIV/AIDS interventions?

2. Use of ES funding channel allows resources for anti-retroviral programme. • Addtl future funding options: contingency reserve, cgs to be announced in Oct. : 

2. Use of ES funding channel allows resources for anti-retroviral programme. • Addtl future funding options: contingency reserve, cgs to be announced in Oct. • Compares reasonably to UCT/TAC cost estimates of national prevention & treatment plan (R1.6bn for 2003; R5.6bn in 2005) Funding mechanisms, cont. Block grants allow provinces discretion: - to make different political choices (outside natl policy) - to allocate funds to most cost-effective programmes

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