Declining health spending risks SDG goals
(Source – The Hindu, International Edition – Page No. – 9)
| Topic: GS2 – Social Justice – Health |
| Context |
| ● Recent trends in government health spending across low-income and lower middle-income countries (LICs and LMICs) show a decline in health funding, particularly after the pandemic.
● A World Bank report highlights this worrying shift, which challenges the progress toward Sustainable Development Goals (SDGs) for health. ● India is also affected by these trends. |
Study Overview:
- A World Bank study examines government health spending in 63 low-income countries (LICs) and lower middle-income countries (LMICs) between 2019 and 2023.
- It compares post-pandemic trends with pre-pandemic data from 2015 to 2019, focusing on the implications for achieving the Sustainable Development Goals (SDGs) related to health by 2030.
- The study reveals a concerning decline in health spending per capita in these countries, particularly as the deadline for SDGs approaches.
Pandemic Spending Surge and Subsequent Decline:
- There was an initial surge in government health spending during the pandemic in 2020.
- However, this spike was followed by a steady decline in health expenditures after the peak pandemic years.
- The reduction in health spending is now more permanent, reversing the pre-pandemic trend where health had gained a greater share in national budgets.
- This decline poses risks to achieving health-related SDG targets, especially in LICs and LMICs.
| Modest Growth in Health Spending: |
| ● From 2019 to 2023, government health spending per capita grew modestly.
● The average annual growth rate of health spending per capita was just 0.4% in low-income countries (LICs) and 0.9% in lower middle-income countries (LMICs) . ● This growth rate is significantly lower than the pre-pandemic period, where LICs saw a 4.2% growth and LMICs saw 2.4% growth from 2015 to 2019. ● The slowdown in health spending growth highlights the increasing strain on public health systems in these countries. |
Declining Share of Health in Government Budgets:
- As general government expenditure grew faster than health spending, the share of government budgets allocated to health has decreased.
- In LICs, health spending as a share of total government expenditure dropped to 5.6% in 2023, a notable decline from its pandemic peak.
- LMICs saw a similar trend, with health spending as a share of the budget declining to 6.5% in 2023.
- These reductions reflect challenges in maintaining adequate funding for health while general government budgets remain largely stagnant or show modest growth.
Challenges Faced by LICs and LMICs:
- The decline in health spending per capita is particularly pronounced in LICs, where health funding has historically been low and highly dependent on external aid.
- In LMICs, while the decline is less severe, it still presents significant challenges in sustaining health improvements.
- Projections indicate that many countries, including India, are likely to experience further budget contractions from 2023 to 2029, which may require difficult trade-offs in funding priorities.
India’s Declining Health Spending:
- India is among the LMICs where government health spending has significantly decreased since its pandemic peak.
- Health’s share in the Indian budget dropped from over 2% during the pandemic to around 1.75–1.85% in subsequent years.
- This decline underscores the challenges India faces in maintaining its health budget allocation, particularly as the country grapples with increasing healthcare demands
| Practice Question: Discuss the impact of declining government health spending in low-income and lower middle-income countries on achieving health-related Sustainable Development Goals. How can countries like India address these challenges to ensure sustainable health financing? (250 Words /15 marks) |
