Letter to the Editor, Tropical Doctor, Vol.26, No.2, April 1996.
In Green’s article on ‘Financial Management in Times of Severe Resource Constraints’1, he centered his paper on said problems at the district level- My concerns are more at the central (national) level. Both our concerns deal with health budgets overspent (or underfunded), that result in very deficient, ad-hoc responses.
However, although Dr Green says it is the managers’ responsibility to manage such situations, I contend that it is almost unmanageable under prevalent conditions in the Third World, particularity in Africa.
Keeping services running by juggling items of expenditure in the budget can only go so far. This ‘management of cuts’1 (p 10) makes running health services an impossible task. Management options reach a point where triaging is the only alternative and selected health services are the clear victims of such a slashing exercise.
In times of severe resource constraints managers face challenges for which they are ill-prepared,. There is no training that prepares them for operating under such tight financial decision-making options. What keeps being ignored is the dire constraints under which health ministries work here in the South. Here government management simply does not obey the golden rules of ‘good management’ as they have. been set in the North. Existing theories and recommended practices do not seem to work.
In the 1990s, and under structural adjustment, managing a health ministry in Africa simply is a monumental task. It would be monumental even for the top-paid champion managers of Europe or North America.
The reason is that ministries are managing their affairs under conditions of extreme poverty; they are practicing management under conditions of severe financial constraints, with an extreme scarcity of cash resources. To this, add each country’s chronic problems with an inflated civil service that uses over 70% of the recurrent budget and this catch-22 scenario of the 1990s becomes fully apparent.
Unfortunately, the type of critical (triage) management skills needed are taught nowhere! No university teaches this brand of management that could prepare public managers to make difficult daily decisions when scarce resources have to be allocated among so many vital competing, real-life priorities.
Triage management is several steps worse than management by crisis. No financial forward planning holds when one gets the news that the water supply of a major government hospital was cut for non-payment of bills for the last year.
Health ministries not only start the fiscal year with scarce financial voted resources, but with an accumulated debt of unpaid bills skilfully carried over to the current fiscal year; this debt further erodes already skimpy budgets. Further, when senior management tries to call-forward its voted budgetary allocations, it finds the Treasury has a cash-flow problem and delivers those funds late (or never). When Treasury cannot balance its own books anymore, it may even ‘close’ the fiscal year a month or two ahead of its usual date of closure. Even the ‘Fortune 500’ managers would not be able to cope, and yet the ‘Misfortune 100’ ministerial managers in Africa somehow do.
Donor funds-typically already comprising over 70% of development budgets of health ministries – actually also get affected by triage management. If and when Treasury makes these donor funds available they are often used as temporary stopgap measures to manage the latest crisis thus being, at least temporarily, siphoned away from their intended purpose.
All the above is not an apology for Third World ministries of health mismanagement or despondency, of which there is a fair amount. This is rather a desperate call for technical support, for a search of new avenues that can come up with realistic managerial triage techniques to cope with this kind of extreme adversity. What this calls for is an effort commensurate with the challenge economists had to face 10 cope with the unknowns of hyperinflation. Some of their theories had to be revised from scratch in the places where this was happening not in their own ivory towers.
I am aware that there will be no miracle management techniques coming up from such a search, primarily because the main challenge remains, i.e. solving the chronic fiscal insolvency issue. However, perhaps a South-South sharing of tricks can yield some collective wisdom from which to select coping interventions that can be tried elsewhere, especially as relates to identifying no-cost or minor-cost interventions that show or make a difference. Perhaps there is a recipe that can maximize the utilization of human and other resources already in place; direct fund-raising techniques (cost-sharing or other) may have to be considered as a realistic alternative. A more systematic survey of such palliative measures is needed. Perhaps some readers are willing to share their experience with the rest of us or to influence an academic institution to start such a research. I believe most potential help will come from this South-South sharing since the prospects for more structural adjustment-like measures will continue to squeeze public funding in the Third World in the foreseeable future.
CLAUDIO SCHUFTAN
Saigon, Vietnam.
schuftan@gmail.com
Reference
1 Green, Andrew. Financial management in times of severe resource constraints. Tropical Doctor, 1994, 24:7-10