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In many large federal or decentralized countries, the majority of public spending on health is executed by state and district governments (see graph below). Improving health in these countries—and globally—depends on improving the sufficiency, efficiency, and effectiveness of health spending at the subnational level. The Intergovernmental Fiscal Transfers for Health Working Group, a partnership of CGD and the Accountability Initiative in India, is tasked with identifying practices that improve health and increase the efficiency of subnational allocations.
Health status, access, and care vary greatly across subnational entities, and the decentralization of health systems and spending has mixed and complex results. To understand this complexity better, CGD and researchers at the Accountability Initiative (AI) in India have examined national-to-subnational fiscal transfers in India to identify practices that have global implications. The goal is to identify lessons for domestic reforms and implications for countries and donors facing similar challenges. We have also examined worldwide experience in allocating budgets according to health needs, leveraging greater subnational spending on health, and boosting subnational performance on health outcomes and delivery.
Key questions for the working group
What are better practices in intergovernmental fiscal transfers for health worldwide that can also help improve health outcomes in India?
How can the central government create incentives for increased allocation to health by states, given low levels of current spending?
What should be done to increase synergies in health expenditure by the central government and states?
What role can intergovernmental fiscal transfers play in supporting state and district level innovations to improve health outcomes?
What role for external funders in this space? What is the policy research and data agenda going forward?
Working Group Members
Yamini Aiyar, Accountability Initiative, Center for Policy Research Sambit Basu, IDFC Foundation Pinaki Chakraborty, 14th Finance Commission Samik Chaudhuri, Institute of Economic Growth Mita Choudhury, National Institute of Public Finance and Policy Ravi Duggal, International Budget Partnership Victoria Fan, University of Hawaii at Manoa Saurabh Garg, Ministry of Finance Amanda Glassman, Center for Global Development Indrani Gupta, Institute of Economic Growth Nishant Jain, GIZ Avani Kapur, Accountability Initiative, Center for Policy Research Anit Mukherjee, Center for Global Development Aparajita Ramakrishnan, Bill and Melinda Gates Foundation Rajeev Sadanandan, Ministry of Labor and Employment Deepak Sanan, Government of Himachal Pradesh Shakthivel Selvaraj, Public Health Foundation of India Tapas Sen, National Institute of Public Finance and Policy
In his early days as India’s new prime minister, Narendra Modi has shown remarkable leadership in all sectors, including health, for which he’s articulated his vision to create a Swasth Bharat, a Healthy India. Combined with two major policy windows—the proposed restructuring of the Planning Commission and the report of the 14th Finance Commission expected by the end of the year—the policy reforms under the ruling National Democratic Alliance (NDA)’s mandate of “Universal Health Assurance for All” have the potential to be a game-changer for India’s neglected public health system.
In the big federal countries where global disease burden is concentrated, most public money for health isn’t ultimately spent by the national ministry of health, the traditional counterpart for global health funders and technical agencies.