Health Minister Aceng Advocates for Enhanced Domestic Financing for Health Sector
Dr. Jane Ruth Aceng, Health Minister, calls for enhanced domestic financing for health due to diminishing partner resources. She says there’s need for innovative funding strategies in a constrained fiscal environment.
The Health Minister, Dr. Jane Ruth Aceng, has emphasized the necessity of increasing domestic financing for health, citing the anticipated decline in partner resources.
“There is no sustainability in partner funding. Consequently, we must generate more domestic resources for health rather than relying on partner financing,” Dr. Aceng stated.
She further highlighted that the government is currently operating within a constrained fiscal environment, necessitating innovative approaches to fund the health sector.
Richard Kabagambe, Commissioner of Budget and Health Financing, concurred, noting that external funding often comes with stipulations. “External donors allocate funds for specific interventions that may not align with our conditions, and they can withdraw their support at any time,” he explained.
Dr. Aceng stressed the importance of domestic health financing as the country transitions to the National Development Plan (NDP) IV, which aims to achieve the Sustainable Development Goals by 2030. Unlike previous plans, NDP IV will focus on reforms for financing and domestic resource mobilization to enhance the funding of government programs. Dr. Aceng emphasized that health financing should be viewed as an investment for social and economic development in Uganda.
“We need our own domestic financing and should view health as an investment, not just a social service,” she asserted, adding that the health sector is crucial for achieving Universal Health Coverage (UHC) aspirations.
Progress in Health Financing
Uganda has made significant strides in health financing. For instance, the out-of-pocket expenditure decreased from 41% to 27.4% from the financial year 2018/19 to 2020/21, though it remains high. Domestic resource allocation for health increased from 17% to 21.7%, while external financing rose from 41% to 50.3% in the financial year 2021. This reliance on external donors is unsustainable, according to Dr. Aceng.
The government’s health budget as a percentage of the national budget has increased from 5.9% in the financial year 2019/20 to 7.7% in 2022/23. However, this is still below the Abuja target of 15%. Dr. Charles Ayume, Chairperson of the Parliamentary Committee on Health, noted that the growth in the health budget does not match the increasing healthcare demands, the high costs associated with rapid population growth, the rising disease burden, and the shift from communicable to non-communicable diseases, such as cancers, which require substantial funding.
Options for Domestic Health Financing
Dr. Aceng indicated that the Health Ministry will collaborate with the Ministry of Finance to explore various avenues for increasing health sector funding. One potential source is the targeted taxation of harmful products, such as alcohol and cigarettes, which contribute to non-communicable diseases.
“Can we allocate a small percentage of the revenue from SIN taxes to the Uganda Cancer or Heart Institute to care for patients suffering from diseases like liver or lung cancer due to excessive alcohol consumption or smoking?” she proposed.
Dr. Ayume emphasized that increasing domestic financing for health necessitates strengthening public financial management systems to ensure governance, transparency, and accountability. This includes fighting corruption, reducing wastage, conducting thorough monitoring and evaluation, and ensuring value for money at all levels of government to improve efficiency.
