The decline in budget allocation for the health sector as a percentage of GDP has been a cause for concern, with a Parliamentary Committee highlighting the need to increase outlays due to inflationary pressures and population growth. Despite the target of achieving a Government Health Expenditure (GHE) of 2.5 per cent by 2025, the current allocation falls short of this benchmark, standing at 1.84 per cent in 2021-22.
Challenges and Recommendations
The Committee emphasized the importance of addressing the increasing demands on the health sector, particularly in the face of rising inflation and population growth. The Budget Estimate (BE) per cent of GDP has seen a decline from 0.33 per cent in FY21 to 0.27 per cent in FY25, indicating a pressing need for higher allocations to meet the healthcare needs of the population.
In light of these challenges, the Committee recommended that the Department of Health and Family Welfare request higher budgetary allocations to enhance healthcare infrastructure and services nationwide. The impact of the Covid-19 pandemic has underscored the necessity of being better prepared for future health crises, emphasizing the importance of adequate funding in the healthcare sector.
Concerns and Criticisms
The Committee expressed concerns over the consistent shortfall in actual expenditure compared to budgeted allocations, with expenditures hovering around 0.27 per cent of GDP in recent years. The demand for higher fund allocations has also declined significantly since 2021-22, raising questions about the effective utilization of allocated funds.
Furthermore, the report highlighted that Revised Estimates (Budget allocations) have consistently been lower than Budget Estimates since FY23, casting doubts on the credibility of the Department’s demand for increased funding. This discrepancy underscores the need for a reassessment of the policy framework to ensure adequate resources for healthcare services.
In conclusion, the declining trend in budget allocation for the health sector as a percentage of GDP poses significant challenges for the healthcare infrastructure and services in the country. By addressing these issues and advocating for higher allocations, the Department of Health and Family Welfare can work towards achieving the goal of enhancing healthcare accessibility and quality for all citizens.
