Health and HIV & AIDS Minister Michael Malabang happy with 2016 National Budget

The Minister for Health and HIV & AIDS Michael Malabag released a statement today in response to the passage of the O’Neill government’s budget for 2016 early on Tuesday evening.

The Minister said he was proud to be a member of a Government committed to long term economic stability and broad fiscal discipline while always keeping the health and welfare of the people and the nation in mind. This was evidenced by a budget which saw a strong allocation to all elements of the health system. Although there were some reductions which had to be worked through, overall the budget delivered on the priorities in the Health System.

In terms of funding Capital Investment in the Department of Health, the Minister was very happy to see K2 million of GoPNG funding for ‘Medical Equipment Replacement for District and Rural Health Services’, K2 million for ‘Development/ establishment of Community Health Posts’, and an additional K2 million towards child health and nutrition through the ‘Young Child Survival and Development’ Project. The Minister was also grateful of the K299 millions of Development Partner support to the Department, including grant assistance from USAID, Department of Foreign Affairs and Trade and UN. He was also happy to see the continued support from ADB to the Rural Primary Health Service Delivery Programme.

The Minister was also grateful for the Government’s continued commitment towards funding Provincial Health Authorities (PHA), with the Operational budgets across the PHAs increasing by 25 % to K193million. This was an important initiative as evidence demonstrated that this model of health service delivery delivered tangible improvements to the communities served. The Minister also welcomes the continued commitment by the Government to rural health service delivery, which even during this difficult economic time the Government has increased Health Function Grants by K12 million or 12%.

The Minister went on to say that Funding for Public Hospitals more generally had been relatively stable and preserved the staffing and goods and services levels currently being experienced, given the overall increase in funding to hospitals by 5% or K13 million. The Minister was in complete agreement with regards to the Government’s decision to reallocate K225 millions of Provincial Support Improvement Progarmme (PSIP) funding to ensure that all the Hospitals were properly financed in 2016 for capital redevelopment and rehabilitation. The shift of funds from these Provincial Development Grants to Hospital Management Services was a welcomed move. Further details of the allocation of these funds, scope of works, disbursement schedules and reporting requirements will be discussed in detail with key agencies towards the beginning of 2016. 

The Government’s commitment to right sizing and pay roll cleansing was also applauded by the Minister, and the reduction in salary costs has been a welcomed move to ensure greater efficiencies and freeing up of much needed funds in future years. These funds would have been otherwise wasted on ghost employees or unattached officers. 

The Minister is planning to institute a payroll cleanse within his own Department to reduce inefficiencies in the usage of public funds once and for all and reallocate these funds to ensure better performance and service delivery. Also, even with the reduction in salaries, Hospital Awards will still be funded for our Doctors and Nurses at K40 million under Department of Treasury (DoT) Vote 207. The Government remains committed to Fee Free Health care with K20 million being maintained under DoT Vote 207 as well.

The reduction in the Department of Health’s Operational Budget of 12% or K44 million has been embraced as an opportunity by the Department rather than a challenge, to strengthen the performance of the Department by identifying efficiency savings across all programmatic areas of the Department, reducing the duplications of expenditures, centralizing key functions in the Department such as spending across rentals, vehicle maintenance and fuel, stationaries, refreshments, workshops, domestic and international travels. 

The Minister stressed that the fiscal situation has been compounded by the effects of the drought, and that there is an emerging Multi Drug-Resistant Tuberculosis (MDR TB) and Extensively Drug-Resistant Tuberculosis (XDR TB) situation that the sector will have to carefully manage in the coming months. He has full confidence that the Government will support the Sector to mobilize resources with the help of our Development Partners and key stakeholders. 

Rather than focusing purely on the funds available to the Sector, he is committed to assessing the current methods by which funding is reaching the rural areas for frontline service delivery and that more efforts will be made to ensure that funds get to where they need to in a timely manner and that proper reporting on the usage of these funds and roll out of vital services will be expected for 2016 and beyond. This is to ensure this Government is efficiently and effectively managing its scarce resources wisely.

The Ministry remains committed to supporting the Governments direction and ensuring the effective delivery of services even with the current fiscal downturn. Despite fluctuations in revenue, health services need to be consistently provided and have to learn to be more resilient to such changes. This is an opportunity for the sector to identify more efficient measures to do more with less resources, through better coordination of services under the PHAs, a consolidation of efforts across all stakeholders in the Sector and a refocusing of priorities in line with the recommendations in the Mid Term Review of the National Health Plan