Malawi’s recently launched heath sector strategy, which requires funding to the tune of $ 2.7 billion, suffers from funding gap of more than half a billion dollars, a confidential government document seen by amaBhungane reveals.
And a well-placed source in the seat of government, Capital Hill in Lilongwe, said that a key reason for this shortfall was that a number of foreign donors were cutting back on their planned contributions to the strategy.
The source said the shortfall posed a major threat to the implementation of key activities envisaged under the plan.
This confirms recent statements by the principal secretary in the ministry of health, Dan Namalika, who was quoted this year as saying that health funding is becoming major challenge for the government.
Namalika said this was because donors, who currently finance about 63% of annual financial requirements in the health sector, have constantly reduced their contribution in recent years, with further cuts expected.
The leaked document, entitled “Health Sector Strategic Plan 2017-2022”, states that the budgetary commitments from government and grants from donors to the strategy will total about $2.2 billion over the five years from 2017 – about $0.6 billion less than required.
The strategy, a partnership between the government and donors, aims to improve service delivery and access to health services over 2017-2022 by, among other things, constructing new health facilities, providing medical equipment and supplies, recruiting more health workers and refurbishing dilapidated facilities.
In particular, it seeks to remedy the vacancy rate in the health sector, which it estimates at 43%, as well as construct district hospitals in Lilongwe, Blantyre, Zomba, and Mzuzu for the referral of seriously ill patients from other facilities.
About 900 health service points are also planned in rural areas to ease access.
Malawi’s health system has been hard hit by inadequate public funding: hospitals are running out of drugs, hospital ambulances have been grounded, and patients are dying of treatable diseases such as malaria, tuberculosis and HIV/Aids.
In an interview, the Minister of Finance, Economic and Planning Development, Goodall Gondwe, admitted that the government is not in a position to finance the deficit.
However, Gondwe was quick to say that as the health strategy has not yet been reviewed by his ministry, it is difficult for him to provide comprehensive response.
“It will be difficult for me to comment as the strategy has not come to my level,” Gondwe said. “But when it comes, we will have to scrutinise it to see how realistic it is.”
The British High Commission in Lilongwe said Britain has maintained its level of support for the Malawian health system. The United Kingdom’s Department for International Development (DfID)is one of the largest donors to the health sector.
The commission’s communications officer, Benson Linje, said, “Our spending on health has fairly been constant since 2012”.
A graph provided by Linje shows a rise in project spending on health by the United Kingdom over 2014-16, to a peak of about £15-million. But the projected budget then tails off to about £10-million in 2018/9 and collapses to £2-million in 2019/20.
Linje did not respond to a question about what lies behind the steep decline in projected spending. The British Prime Minister, Theresa May, recently pledged to maintain Britain’s foreign aid contribution at 0.7% of the GNP, but observers see a steady trend under the Conservatives of the redirection of aid spending away from DfID, with a growing emphasis on ensuring British business benefits.
Unicef, another donor, said that its contribution had risen in recent years. Its resident representative, Johannes Wedenig, provided figures showing that fund’s donations have grown from $22.6-million in 2014 to $25.6-million last year.
However, a breakdown shows that most of the increase is attributable to spending on nutrition during a period of drought and flooding, which caused widespread hunger in Malawi last year, while direct spending on health care has fallen dramatically.
Programme figures provided by Wedenig showed that the outlay on nutrition, particularly for children, trebled from $4.8-million in 2014 to $15.2-million last year, while health spending crashed from $14.5-million to $7.8-million.
In addition, Unicef’s spending on HIV/Aids alleviation fell from $3.2-million to $2.6-million.
“We scaled up our nutrition response to identify and treat malnourished children throughout the country, including through mass screenings and door-to-door visits,” Wedenig said.
“We also provided stocks of ready-to-use therapeutic food to health centres throughout Malawi, in order to treat children suffering from malnutrition.”
One reason for the sharp decline in funding for the health programme last year, he said, was that donor grants from the Norwegian government and Germany’s KFW Development Bank ended as programmes drew to a close.
“We also did not have any large-scale procurement activities in 2016, which led to smaller expenditures than in previous years,” he said.
However, the Capital Hill source gave a different interpretation, saying that the feeling among most donor countries is that Malawi is hemorrhaging public funds because of corruption and poor priorities in the allocation of resources.
In particular, they believed the inefficient uses of resources in public hospitals is leaking substantial resources.
Donors stopped direct budget support to government following the Cash Gate scandal, which saw hundreds of millions of dollars stolen through fraudulent contracts.
Namalika did not answer a question about which donors have reduced funding and why. However, he said that the moratorium on budget support is hurting the health sector.
He said that amid dwindling foreign aid, “Malawi has to be innovative in finding ways of funding the health sector … We also need to protect the ultra-poor that have no means.
“The health ministry has been mandated to explore ways of increasing health financing, and this is one of our reform areas.”
In the past, Namalika has proposed a national insurance scheme that would require regular contributions by workers and employers.
Gondwe recently told Malawi’s Parliament that “it will be a challenge to close (the health service financing) gap without either raising taxes or asking donors to increase contribution”.
This story has been supported by the Center for Investigative Journalism Malawi, the National Integrity Platform (Malawi) and the AmaBhungane Centre for Investigative Journalism (South Africa).