Fiscal federalism an equity in the financing of primary health care: The case of South Africa

Includes bibliographical references.This thesis investigates the implications of fiscal federalism on the equitable distribution of primary health care resources in South Africa. The study evaluates the processes and criteria for intergovernmental and sector budgeting, the influence of key stakeholders, community involvement in PHC budgeting, and policy objectives of the health sector to assess how they impact on the realisation of an equitable distribution of PHC resources. A combination of qualitative and quantitative analyses was employed in the study. Quantitative analysis of health expenditure and health need data was used to assess whether the distribution of PHC resources has become more or less equitable. Health districts were the units of analysis. Deprivation indices were generated using principal components analysis for each district from demographic and socio-economic variables. The deprivation index was used as a proxy for relative need at the level of districts, and was compared with non-hospital PHC per capita expenditure using regression analysis. This analysis was carried out for per capita PHC from 2001 to 2007. Data on the process for intergovernmental fiscal arrangements and budgeting for health was collected through review of government publications and interviews with government officials. These were analysed thematically. Literature on the subject predicts that if lower levels of government have considerable autonomy in determining primary health care allocations, there is a greater scope for inequities in the distribution of primary health care resources. However, the results of the study are contrary to expectations. Although, the introduction of fiscal federalism in South Africa created an additional constraint to achieving a more equitable distribution of PHC resources, recent trends in primary health care allocations are more equitable than in previous years. A growing public sector budget, consistent increases in health sector allocations, and overwhelming political support for equity in South Africa have been the key reasons for the shifts towards a more equitable distribution of primary health care resources. These findings form the main contribution to the literature on the subject