Small grant but a big opportunity for local bodies

Contact Counsellor

Small grant but a big opportunity for local bodies

  • In recent, a potentially game-changing and transformative development went by, almost unnoticed the release of ₹8,453.92 crore to 19 States, as a health grant to rural and urban local bodies (ULBs), by the Department of Expenditure, the Ministry of Finance.
  • This allocation has been made as part of the health grant of ₹70,051 crore which is to be released over five years, from FY2021-22 to FY2025-26, as recommended by the Fifteenth Finance Commission.
  • The grant is earmarked to plug identified gaps in the primary health-care infrastructure in rural and urban settings.
  • Of the total ₹13,192 crore to be allocated in FY 2021-22, rural local bodies (RLBs) and ULBs will receive ₹8,273 crore and ₹4,919 crore, respectively.

Health Grant: It is significant:

  • The allocation in FY2021-22 is relatively small by some comparisons.
  • It would be 2.3% of the total health expenditure (both public and private spending together) of ₹5,66,644 crore in India and 5.7% of the annual government health expenditure (Union and State combined) of nearly ₹2,31,104 crore (both figures for 2017-18), the most recent financial year for which national health accounts data are available.
  • This grant is equal to 18.5% of the budget allocation of the Union Department of Health and Family Welfare for FY 2021-22 and around 55% of the second COVID-19 emergency response package announced in July 2021.
  • Yet, it is arguably the single most significant health allocation in this financial year with the potential to have a far greater impact on health services in India in the years ahead.

Some obstacles for Local Municipal Bodies:

  • Urban India, with just half of the rural population, has just a sixth of primary health centres in comparison to rural areas.
  • Contrary to what many may think, urban primary health-care services are weaker than what is available in rural India.
  • Regular outbreaks of dengue and chikungunya and the struggle people have had to undergo to seek COVID-19 consultation and testing services in two waves of the novel coronavirus pandemic are some examples.
  • The low priority given to and the insufficient funding for health is further compounded by the lack of coordination between a multitude of agencies which are responsible for different types of health services (by areas of their jurisdiction).
  • A few years ago, there were a few reports of three municipal corporations in Delhi refusing to allocate land for the construction of mohalla clinics (an initiative of the State Health Department) and even the demolition of some of the under-construction clinics.
  • It is in this backdrop that the Fifteenth Finance Commission health grant — the urban share is nearly five-fold that of the annual budget for the NUHM and rural allocation is one-and-a-half-fold that of the total health spending by RLBs in India is an unprecedented opportunity to fulfil the mandate provided under the two Constitutional Amendments, in 1992.

Essential steps to empower Local Bodies in Health care services:

  • First, the grant should be used as an opportunity to sensitize key stakeholders in local bodies, including the elected representatives (councilors and Panchayati raj institution representatives) and the administrators, on the role and responsibilities in the delivery of primary care and public health services.
  • Second, awareness of citizens about the responsibilities of local bodies in health-care services should be raised. Such an approach can work as an empowering tool to enable accountability in the system.
  • Third, civil society organizations need to play a greater role in raising awareness about the role of LBs in health, and possibly in developing local dashboards (as a mechanism of accountability) to track the progress made in health initiatives.
  • Fourth, the Fifteenth Finance Commission health grants should not be treated as a ‘replacement’ for health spending by the local bodies, which should alongside increase their own health spending regularly to make a meaningful impact.
  • Fifth, mechanisms for better coordination among multiple agencies working in rural and urban areas should be institutionalized.
  • Time-bound and coordinated action plans with measurable indicators and road maps need to be developed.
  • Sixth, local bodies remain ‘health greenfield’ areas. The young administrators in charge of such RLBs and ULBs and the motivated councilors and Panchayati raj institution members need to grab this opportunity to develop innovative health models.
  • Seventh, before the novel coronavirus pandemic started, a number of State governments and cities had planned to open various types of community clinics in rural and urban areas. But this was derailed. The funding should be used to revive all these proposals.