DESK REVIEWS | Who is responsible for deciding how much funding is available for health care?

DESK REVIEW | Who is responsible for deciding how much funding is available for health care?

The Ministry of Planning (Ministério do Planejamento, in Portuguese) (International Budget Partnership, 2018).


International Budget Partnership. (2018). Defining and managing budget programs in the Health Sector: The Brazilian Experience.


The Government is responsible for deciding on the allocation of funding for healthcare services in Hong Kong. It involves the Chief Executive, Legislative Council, Financial Secretary, and Secretary of Food and Health Bureau, which work together to ensure the equitable distribution, allocation, and utilisation of financial resources for health care services.

The federal structure of the country and the recognition of health as a state subject implies that both centre and the states decide how much should be spent on health. States depend on central funds for many of the health programmes. While most of the taxation powers are with the central government (for example income tax), the bulk of spending on health is done by the states. Thus, transfer of resources from the central government to the states is a critical part of the overall financing arrangement, and the Finance Commission – set up every 5 years to indicate principles of allocation of divisible taxes as well as the share between central government and the states – is a key entity that recommends how much additional funds should be allocated to the states and how these should be distributed across states. However, recommendations of the Finance Commission are not binding for the central government (Finance Commission India, n.d.; MoHFW, 2017).


Finance Commission India. (n.d.). Finance Commission. Government of India. Available from:

Ministry of Health and Family Welfare. (2017). National Health Policy. Government of India. Available from:

The World Bank suggests that health care spending has been ‘accorded a generally low priority’ in Indonesia given that expenditure of total government budget amounted only to 4.7 per cent, which is lower than that of neighbouring countries such as the Philippines, China, and Thailand (World Bank, 2016b, p.4). In 2015, the Government of Indonesia passed legislation that requires 5 per cent of the national budget to be allocated to the health sector. This target was reached by 2016. In addition, district governments must spend 10 per cent of their budget on health-related issues (Agustina et al., 2019, p.85). Despite these allocations, spending on health in Indonesia is comparatively low (3% of GDP) in comparison to other LMICs and other countries in the Association of Southeast Asian Nations (Agustina et al., 2019, p.85).

In an effort to provide communities with greater ability to respond to local needs, the Village Law (Law Number 6/2014) and a law to strengthen the role of provinces (Law Number 23/2014) have been enacted.  The Village Law regulates the transfer of an estimated one billion rupiahs per village to 77,548 villages. These funds may also contribute to improvement of community-based healthcare and lifestyle interventions. The law strengthening the role of the provinces creates a closer link between provincial governors and central governments and offers an opportunity for provinces to be responsible for monitoring Minimum Service Standards in health care. Besides monitoring activities, provinces can impose sanctions on district/city level to enforce adherence to Minimum Service Standards (Ministry of Health Republic of Indonesia, 2015b, p.36).


Agustina, R., Dartanto, T., Sitompul, R., Susiloretni, K. A., Suparmi, Achadi, E. L., Taher, A., Wirawan, F., Sungkar, S., Sudarmono, P., Shankar, A. H., Thabrany, H., Susiloretni, K. A., Soewondo, P., Ahmad, S. A., Kurniawan, M., Hidayat, B., Pardede, D., Mundiharno, … Khusun, H. (2019). Universal health coverage in Indonesia: concept, progress, and challenges. The Lancet, 393(10166), 75–102.

Ministry of Health Republic of Indonesia. (2015b). National Strategy: Management of Alzheimer and Other Dementia Diseases: Towards Healthy and Productive Older Persons. Ministry of Health Republic of Indonesia.

The President of the Republic of Indonesia. (2014). Law of the Republic of Indonesia Number 6 of 2014 concerning village

The President of the Republic of Indonesia. (2014). Law of the Republic of Indonesia Number 23 of 2014 about local government

World Bank. (2016b). Indonesia Health Financing System assessment: spend more, spend right & spend better. Available at:


The national government is funded through various channels and allocates specific proportions to each Ministry. The Ministry of Finance sets 3-year budget ceilings for each sector rather than each sector submitting a budget request based on actual needs. The Ministry of Health (MoH) then distributes the funds through the county Health Management Boards in each county (Nyakundi et al., 2011).


Nyakundi, C. K., Teti, C., Akimala, H., Njoya, E., Brucker, M., Nderitu, R., & Changwony, J. (2011). Health Financing in Kenya: The case of RH/FP. Nairobi, Kenya.

The Ministry of Finance (Secretaria de Hacienda y Credito Publico) is in charge of presenting the Federal Public Budget to the legislative branch for its review and approval.

South Africa’s National Treasury is responsible for managing budget preparation processes, the equitable distribution of the country’s revenue raised and in so doing, the allocation and utilisation of public financial resources (National Treasury, 2019).


National Treasury. (2019). Department: National Treasury. National Government of SA. Available from: