1. Preparations for Regional Budget workshops
Ministry of Health

2. Overview of the 2017/18 Grant Information and Budget Guidelines
The structure of the presentation is as follows:
Policy priorities/sector objectives
Structure and Purpose of Sector Transfers
Allocation Formulae
Budget Requirements for 2017/18
Other Sectoral Issues

3. Policy Priorities/Sector objectives
In line with the NDP II and the HSDP FY2015/20, the health sector efforts will be geared towards attainment of universal health coverage through:
Strengthening of the national health system including governance and regulatory framework.
Reproductive, Maternal, Neonatal, Child and Adolescent Health (RMNCAH) Services
Communicable and Non-communicable disease prevention, mitigation and control.
Health Education and Promotion (Lifestyle, hygiene, nutrition) using a multi-sectoral approach

4. Policy Priorities/Sector objectives
e) Health Education and Promotion (Lifestyle, hygiene, nutrition) using a multi-sectoral approach
f) Essential clinical care services including rehabilitation and palliative care.
g) Health infrastructure development.

5. Cont……
In order to achieve the above priorities, Local Governments have the responsibility of ensuring that the population has access to health services through annual operational planning, management and delivery of quality health services by carrying out:
Community mobilization
Supervision
Monitoring
Resource mobilization and allocation and
Enforcement of health related laws and regulations

6. Structure and Purpose of Sector Transfers
Grant
Purpose
Wage Conditional Grant
To pay salaries for all health workers in the district health service including health facilities and hospitals.
Non-Wage Conditional Grant
o/w Health Office
To fund service delivery operations by the health department supervision, management, and epidemic preparedness
o/w Hospital
To fund service delivery operations by hospitals both government and private non for profit - prevention, promotion, supervision, management, curative, epidemic preparedness
o/w PHC Health Centres
To fund service delivery operations by the health centres, both government and private non for profit - prevention, promotion, supervision, management, curative, epidemic preparedness
o/w HSD
To fund HSD operations - health assemblies, medical camps, outreaches, planning and management meetings, supervision etc 
Development Grant (Normal) – To provide additional resource
To carry out maintenance, development and rehabilitation of health infrastructure, procure medical equipment, service delivery vehicles and IT equipment
Transitional Development – Sanitation
To funds software activities such as community sensitisations and advocacy work that contribute to the reduction of morbidity and mortality rates from sanitation-related diseases.
Transitional Development – Ad Hoc
To fund hospital rehabilitation and other specified capital investments in selected LGs.

7. Key Variables Used in Allocation Formulae
Weighting
Wage
NWR
Hospital NWR
Dev
Justification
Population 84 60 25
Population represents the overall target beneficiaries, and is an indicator of demand for health services and the scale of services required
Population of HLGs with Public or PNFP Hospitals 82
Population of districts with hospitals represents a proxy for demand for hospital services and the scale of services required.
Infant Mortality 10 8
Equalizing health outcomes: most of the causes of infant mortality are preventable using already proven interventions. These include immunisation, ORS, nutrition and hygiene. Therefore strengthening the health system will address the causes that enhance disparities in IMR.
Poverty Headcount 4 2
Approximates socio-economic goal of increasing access for poorer communities
Fixed Allocation 6
A fixed allocation to cover the running of the health department / hospital
Number of Health Sub Districts 24
A constant amount to cover the fixed cost of running a health sub district
Population in Hard to Reach Hard to Stay Areas 5
Mountainous, islands, rivers etc have peculiar terrain. Provides greater allocations to areas where costs are likely to be high.
Population per HCIII, HCIV or Hospital 50
This is an indicator of the degree to which local governments are lagging behind in terms of access to a major health facility.

8. Overview of Issues in the 2016/17 budget guidelines and how they were addressed
How addressed
Inadequate capacity by some LGs to implement the Budget Guidelines for FY2016/17
A sensetization workshop and technical support visits were conducted
Inability to comply to the agreed "No Harm Policy' in allocations to facilities for LGs which suffered "losses" in IPFs provided
The Budget Guidelines were revised
Failure by many LGs to provide for Health Sub District funds i.e 29m earmarked for each HSD
The Budget Guidelines were revised. (From a fixed allocation to a minimum of FY2015/16 level)
Some LGs allocated more funds to the District Health Office by lowering allocations to the health facilities
DHOs allocations were fixed at FY2015/16 level

9. Overview of issues in the 2016/17 budget guidelines and how they were addressed(2/n)
How addressed
Wrong Bank Account Details were provided by the LGs.
LGs were called to validate the Bank A/C Details
The submissions made by the LGs did not indicate supplier numbers required by the Accountant General’s Office to effect payments.
MoH engaged the LGs and Supplier Numbers were provided
New facilities had been included in the FY2016/17 allocation schedule many of which had not gone through due approval process
Directive was passed to exclude new facilities on the schedule till MoFPED provides additional funding to avoid over fragmentation of the grant
Some LGs did not provide allocations to facilities for FY2016/17 in the OBT
Allocations made based on FY2015/16 allocations

10. Overview of the 2017/18 Grant Information and Budget Guidelines
Area
 Summary of Budget principles and requirements
Narrative and performance contract
The budget narrative summarises information on revenue, expenditure and key outputs in the performance contract.
Overview of Workplan Revenues and Expenditure
Total Workplan revenues and expenditures balance and are divided correctly between wage, non-wage recurrent, GoU and donor development.
Salaries and Related Costs
Salaries of permanent staff must be within the overall staff and budget ceilings.
Staff of the health department/office should be paid from the Unconditional Wage Grant.
Service delivery staff should be paid from the Sector Conditional Wage Grant.
Allocations from grants under this sector should not be used to fund salaries of contract staff

11. Overview of the 2017/18 Grant Information and Budget Guidelines
Area
 Summary of Budget principles and requirements
Cont…..
Salary allocations must be according to the filled posts within the approved structure, recruitment plan and salary scales within a given financial year.
The hard-to-reach allowance equivalent to 30% of a member of staff’s salary must be provided for staff in the hard-to-reach areas outside town councils and HLG headquarters, in line with the Hard-to-Reach Framework and schedule designated by the Ministry of Public Service.
Local governments with wage conditional grant allocations greater than what their allocations would be under the new formula are required not to budget for hiring new staff.

12. Overview of the 2017/18 Grant Information and Budget Guidelines
Area
 Summary of Budget principles and requirements
Lower Local Services (Allocations to Lower Level Health Facilities)
The total allocation to District Hospitals and Lower Level facilities including HSDs must be at least 80% of the sector non-wage recurrent budget.
Local Governments are required to allocate funds to Lower Level health facilities consistent with minimum funding requirements.
Lower Local Services (Allocations to Hospitals)
Allocations to general hospitals should at least be the value of the non-wage grant for hospitals.
Lower Local Services (Allocations to Private-Not-For-Profit Facilities)
Allocations to Private Not for Profit (PNFP) facilities will be made as an integral part of the district health service as follows:
PNFP facilities playing the role of general hospitals should be funded from the grant window of general hospitals.
PNFP facilities playing the role of health facilities, their funding should come from the grant window for Primary Health Care

13. Overview of the 2017/18 Grant Information and Budget Guidelines
Area
 Summary of Budget Principles and Requirements
Monitoring and Management of Service Delivery
A maximum of 20% of the non-wage recurrent budget can be used for monitoring and management of district health services.
Capacity Development
Up to 5% of the development budget may be allocated for capacity development.
Capacity development should include the needs of both DHO’s office staff and field service delivery staff.
Capacity building activities should be consistent with the positive and negative lists
Development Investments
At least 85% of the development budget will be used to fund health centre infrastructure rehabilitation or construction, or the purchase of equipment.
Priority for health facility infrastructure will go to:
1) HCIIIs and HCIVs without requisite medical buildings and less than 50% of required staff housing must be given the highest priority in allocating investments.

14. Overview of the 2017/18 Grant Information and Budget Guidelines
Area
 Summary of Budget Principles and Requirements
Cont…..
2). The second priority is equipping existing facilities with the basic medical equipment.
3). The construction of new or upgrading of a HCII to HCIII should be considered if there are populations greater than 20,000 without access to a HCIII. Construction of new or upgrading of HCIII to HCIV should only be considered if there is a population of 100,000 without access to HCIV or Hospital.
Upgrading should be given priority over new construction and this should be done in line with the MoH Guidelines for Establishing and Upgrading Health Facilities.
A local government must receive written approval from MoH before budgeting for a new health facility to be constructed, or an existing one to be upgraded.
Recurrent costs including wage of new / upgraded facilities must be available in the budget year.

15. Overview of the 2017/18 Grant Information and Budget Guidelines
Area
 Summary of Budget Principles and Requirements
Cont….
At most, 5% of budget allocations to health infrastructure and rehabilitation (capital outputs) will finance investment service costs, such as bills of quantities or economic impact assessments.
Local Governments must not budget for activities specified in the negative list for development investments

16. Proposed LG approaches to improve Health Service Delivery
Adoption of a whole of life cycle approach to health by addressing adolescent health, school health, elderly, neonatal and gender issues in addition to the previous sector priorities of maternal and child health.
Increased focus on addressing the quality of care challenges by conducting regular facility assessments, leadership involvement in quality improvement and establishing client feedback mechanisms.

17. Cont..
3. Expansion of the PHC approach, from focusing on curative to basic preventive services through the Community Health Extension Workers and VHTs. 4. Increased Community participation and ownership in their own health through; Hospital / Health Unit Management Committees, Community Health Extension Workers and VHTs, HSD/Constituency task force, and community dialogue.

18. Cont…..
5. Increase focus on addressing health risk factors as a holistic preventive approach to addressing the disease burden. Guidelines shall be circulated to the LGs on this approach. 6. Multi-sectoral collaboration to have clear strategies for addressing the socio-determinants of health. 7. Focus on health worker productivity (improving working environment, minimise absenteeism, results/performance based financing)

19. Cont….
8. Focus on proven high impact Prevention interventions e.g Immunisation, Child health days, sanitation, mass treatment, Timely reporting and information dissemination, strong and effective regulation., discarding of counterfeit medicines 9. Strengthen procurement and supply chain management systems.

20. Policy Issues Under Review
Status
HSD Concept
Introduced FY2015/16 with allocation of 4.7 Bn
FY2016/17 Allocation of 5.65 Bn
Review required in view of the implementation challenges faced
PHC Dev’t Grant - Normal
FY2015/16 allocation – 3.2Bn
FY2016/17 allocation - Zero
Review required to enable completion of projections
PHC Development of 12 Bn re-allocated to Medical furniture & equipment and Hepatitis B in FY2015/16 for 3 years
Centrally procured furniture was delivered to LGs
Gaps being analyzed
Review required to determine how much to be retained and how much to be re-instated

21. Other Issues to Note New Directives on Upgrading Health Centres:
All HCIIs shall be phased out
No more HCIIs shall be constructed
Each Sub County shall have a HCIII
Each HCII serving a Sub County shall be upgraded to a HCIII
Each Constituency shall have a HCIV
All Private and PNFP health facilities that will not fulfill the set criteria shall not access public funds