Building Capacity for the Health Sector Program Approach (TA 7446-LAO)
The Government of the Lao PDR requested capacity development technical assistance (TA) from ADB for the health sector program approach. The TA developed the program planning and funding mechanism and improve financial management for the sector program approach at the provincial and district levels. Under the decentralized system introduced in 2000, provincial authorities are responsible for financing recurrent health expenditures from provincial revenues. As most provincial authorities face fiscal constraints, the Ministry of Health (MoH) wants to increase recurrent budget support for the sector. This requires a new flow of funds mechanism between the Ministry of Finance (MoF) and MoH and greater capacity of the provincial and district authorities in program planning and budgeting.
This project, therefore, first focused on strengthening the capacity of provincial teams to set provincial priorities based on policies and resources, improve annual operational plans and budgets, and request for program support to help fill financing gaps. Second, the details of the flow of funds were established. Third, while provincial and district health offices had built up capacity in the financial management of projects, this needed to be improved further for the programme approach.
The overall impact of the TA was greater efficiency of targeted health services in three pilot provinces, namely Xayaboury, Khammouane, and Saravan. The outcome improved availability and allocation of funds for provincial health services.
The specific outputs were:
- Stronger provincial and district health office capacity in program planning;
- An operational funds flow mechanism; and,
- Better financial management at provincial and district health offices.