Document of The World Bank FOR OFFICIAL USE ONLY Report No: 29517 IMPLEMENTATION COMPLETION REPORT (PPFI-Q1720 PPFI-Q1721 TF-25923 IDA-33800) ON A CREDIT IN THE AMOUNT OF US$ 16.2 MILLION TO THE GOVERNMENT OF TANZANIA FOR A HEALTH SECTOR DEVELOPMENT PROGRAM June 28, 2004 Human Development 1 Country Department 4 Africa Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective 30 June 2004) Currency Unit = TSh TSh 1 = US$ 0.00090 US$ 1 = T.Sh1107.5 SDR 1=US$1.47 FISCAL YEAR July 1 June 30 ABBREVIATIONS AND ACRONYMS APL Adaptable Program Loan MCH Maternal and Child Health CHF Community Health Fund MMC Muhimbili Medical Center CMS Central Medical Store MoF Ministry of Finance CHMT Council Health Management Team MoH Ministry of Health DANIDA Danish Agency for Development Assistance MOU Memorandum of Understanding DFID Department for International Development MSD Medical Stores Department DHMT District Health Management Team MTEF Medium-term Expenditure Framework DHS Demographic and Health Survey NBC National Competitive Bidding DRF Drug Revolving Fund NHIF National Health Insurance Fund EHP Essential Health Package NGO Non-Governmental Organization FY Fiscal year PER Public Expenditure Review GFAMT Global Fund against AIDS, Malaria, and PoW Program of Work TB Tuberculosis PORALG President's Office Regional and Local Government GoT Government of Tanzania PRS Poverty Reduction Strategy HIPC Highly Indebted Poor Countries PSR Project Supervision Report HMIS Health Management Information System QAG Quality Assessment Group HRH Human Resources for Health QA Quality Assurance HSDP Health Sector Development Program RBM Roll-back Malaria ICB International Competitive Bidding RHST Regional Health Support Team KCMC Kilimanjaro Christian Medical Center RS Regional Secretariat LGA Local Government Authority SWAp Sector-wide Approach TB Tuberculosis Vice President: Calisto E. Madavo Country Director Judy M. O'Connor Sector Manager Dzingai Mutumbuka Task Team Leader/Task Manager: Emmanuel Malangalila TANZANIA Health Sector Development Program CONTENTS Page No. 1. Project Data 2 2. Principal Performance Ratings 2 3. Assessment of Development Objective and Design, and of Quality at Entry 2 4. Achievement of Objective and Outputs 3 5. Major Factors Affecting Implementation and Outcome 23 6. Sustainability 26 7. Bank and Borrower Performance 27 8. Lessons Learned 29 9. Partner Comments 30 10. Additional Information 35 Annex 1. Key Performance Indicators/Log Frame Matrix 38 Annex 2. Project Costs and Financing 40 Annex 3. Economic Costs and Benefits 41 Annex 4. Bank Inputs 42 Annex 5. Ratings for Achievement of Objectives/Outputs of Components 45 Annex 6. Ratings of Bank and Borrower Performance 46 Annex 7. List of Supporting Documents 47 Project ID: P058627 Project Name: Health Sector Development Program Team Leader: Emmanuel G. Malangalila TL Unit: AFTH1 ICR Type: Core ICR Report Date: June 30, 2004 1. Project Data Name: Health Sector Development Program L/C/TF Number: PPFI-Q1720; PPFI-Q1721; TF-25923; IDA-33800 Country/Department: TANZANIA Region: Africa Regional Office Sector/subsector: Health (82%); Compulsory health finance (11%); Central government administration (7%) Theme: Health system performance (P); HIV/AIDS (P); Gender (S); Decentralization (S); Rural services and infrastructure (S) KEY DATES Original Revised/Actual PCD: 04/17/1998 Effective: 07/01/2000 09/29/2000 Appraisal: 03/15/1999 MTR: 03/01/2002 Approval: 06/15/2000 Closing: 12/31/2003 12/31/2003 Borrower/Implementing Agency: UNITED REPUBLIC OF TANZANIA/MINISTRY OF HEALTH & MIN. OF REGIONAL ADMIN. AND LOCAL GOVT Other Partners: Governments of Denmark, Ireland, Germany, the Netherlands, Switzerland and the United Kingdom STAFF Current At Appraisal Vice President: Callisto E. Madavo Callisto E. Madavo Country Director: Judy M. O'Connor James W. Adams Sector Manager: Dzingai B. Mutumbuka Dzingai B. Mutumbuka Team Leader at ICR: Emmanuel Malangalila Phillip Gowers ICR Primary Author: Wacuka W. Ikua; Jean-Pierre Manshande 2. Principal Performance Ratings (HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, HUN=Highly Unlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible) Outcome: S Sustainability: L Institutional Development Impact: SU Bank Performance: S Borrower Performance: S QAG (if available) ICR Quality at Entry: S S Project at Risk at Any Time: No 3. Assessment of Development Objective and Design, and of Quality at Entry 3.1 Original Objective: In support of the Government of Tanzania's health sector reforms, IDA approved a three-phase Adaptable Program Loan (APL) to support the Health Sector Development Program (HSDP) over the period 2000-2011. HSDP's overall purpose was "to improve access, utilization, quality, and financing of health services through increased efficiency and effectiveness in use and allocation of resources, and to maximize the impacts on health outcomes, especially among the poor, women, and children". This ICR addresses Phase 1 of the Program which covered the period from September 28, 2000 to December 31, 2003 with a Credit amount of SDR 16.2 million (US$22 million equivalent). Its specific objective was to accelerate the reforms and emphasize institutional capacity development. It focused on: (i) strengthening human resource capacity (particularly at local levels) to manage and adapt to the changing roles and responsibilities; (ii) developing and piloting systems to improve quality and delivery of services which in turn would improve the health status; and (iii) improving resource mobilization and management through increased coordination, and strengthening of the support systems. Progression to Phase 2 was triggered by: (i) the integration of health sector financing, with at least 50% of donor resources for the sector reflected in the MTEF; (ii) the testing and implementation of district block grants, linking inputs to outputs, outcomes and performance, in at least 30% of the 113 districts; and (iii) the establishment of effective national guidelines for an Essential Health Package for use by district management teams to ensure the quality of services. All triggers were determined to have been achieved by May, 2003. 3.2 Revised Objective: Improve resource management and quality of health services through sector reforms and institutional capacity building. The objectives were not revised The Development Credit Agreement (DCA) was amended (on March 6, 2001) to establish two new Special Accounts; in addition to the original Special Account (SA-A, used for activities outside the Basket), the DCA created the US Dollar Holding Account (SA-B to fund Basket activities) and the multi-sectoral HIV/AIDS component (SA-C). 3.3 Original Components: The Program's four components and six sub-components were: 1. Strengthening Service Delivery, comprising: i. District Health Services; ii. Level 2 and 3 Hospitals; and iii. Public/Private mix 2. Strengthening the MoH & Central Support Systems, comprising: i. the Role of Central MoH & Sector-wide Management; ii. Central Support Systems; and iii. Human Resource Development & Management; 3. Health Financing; and 4. the National HIV/AIDS Fund. 3.4 Revised Components: N/A - 2 - 3.5 Quality at Entry: Overall, the project quality at entry was rated satisfactory in June, 2000 by QAG. Per the reviewers, the team showed a broad mastery of the sector and its issues and also an ability to build borrower ownership for the project (the project was actually presented to the PAD decision meeting by the Tanzanian Minister of Health). There was a strong indication of donor support for a coordinated sector strategy managed by the government and well-formulated, long-term objectives of improving the access, utilization, quality and financing of health services so as to maximize impacts over the long term on health outcomes especially among the poor, women and children. The project employed innovative financing instrumentation, enabling joint programmatic donor support in addition to traditional parallel financing of elements of the sector development program. On the other hand, the reviewers found that the task team did not provide sufficient clarity about what would be monitored overtime. Given that this operation was prepared over a long time period, with considerable investment of staff and budgetary resources, it was felt monitoring should have been more developed. There were also understated risks, especially regarding (i) the likelihood that the donors would maintain discipline overtime, (ii) the weak capacity of the Tanzanian institutions as well as in the low level of community participation in project development, and (iii) the potential for conflict among stakeholder groups. 4. Achievement of Objective and Outputs 4.1 Outcome/achievement of objective: Given Phase 1's emphasis on capacity building and systems development to improve MoH's capacity to manage the sector and the regions/districts' ability to implement the activities, HSDP achievement of Development Objectives (Dos) is rated as satisfactory. As a SWAp, IDA's contribution to these achievements has been assessed on the basis of GoT's attainment of the PoW's 1999-2003 objectives and targets. Annex 1 summarizes the key performance measures. Program successes were obvious in many areas: (i) annual PERs and annual reviews of rolling three-year MTEFs have been fully established in the sector; (ii) basket funding functions smoothly; (iii) district-based health planning and management system and its financing through block grants have been expanded; (iv) immunization coverage has increased; and (v) zonal training centers have been strengthened. While HSDP resulted in the scale-up of several key reforms, it did not fully implement some important accompanying measures. In particular, it was less successful in: (i) setting up a functional quality assurance system; (ii) finding solutions to the insufficient and unbalanced mix of human resources; and (iii) persuading the Civil Service Department to accept propositions for revision of remuneration and incentive package for health manpower. Also, although the MoH has made progress in establishing indicators of sector performance (as presented in the Public Health Sector Performance Profile), the HMIS is currently unable to provide the kind of information and evidence required to report upon these indicators, and there has been no progress on strengthening the HMIS in the last year. The 1999 Tanzanian Reproductive and Child Health Survey and the 2002 census (results of IMR and U5M) not yet released) should provide enough evidence to measure the program's impact during Phase 1; these will be augmented by a Demographic and Health Survey (DHS), which is planned in August - 3 - 2004. 4.2 Outputs by components: 1. Strengthening Service Delivery The table in Annex 1b summarizes the current status of HSDP's efforts to develop systems to improve the quality and delivery of services and presents considerations for Phase II. (Total cost: US$520.00million; IDA: US$ 12.90 million) comprising: (a) District Health Services; (b) Level 2 and 3 Hospitals; and (c) Public/Private Mix (a) District Health Services Health systems development: As of July 2003, the MoH had devolved authority for managing the district hospitals, health centers and dispensaries to all 113 Council Health Management Teams (CHMT), thereby exceeding the initial target of 30% of the districts. In addition, managerial capacity has been strengthened in a number of important areas: · Planning and budgeting skills of the CHMT have improved considerably, especially for HSDP's Phase 1 and Phase 2 districts Technical Review of Health Service Delivery at District Level, HERA, March 2003.. CHMTs have been helped by the development of harmonized set of guidelines for comprehensive health planning, budgeting, reporting and procurement for all resources, GoT's, basket funds as well as "non basket" resources. Certain problems persist, however; as noted in March 2003 and again in the 2004 Joint Annual Review Meetings, the CHMTs have not always sufficiently used the planning, budgeting and reporting process to support service delivery. Too much time may have been spent (between 2.5 and 3 months per year) on the planning and budgeting process, diverting the attention of the CHMT from service delivery. · Resource allocation criteria and disbursement procedures have been improved. Though budget allocations were initially norm-based, input oriented, and established on national Minimum Standards, a new resource allocation formula was introduced last year and comprises population, poverty index, health (as illustrated by the under-five mortality) and number of km of road in the district, improved allocations to the districts by linking them to the district poverty level and to the district logistical constraints. (see also latest MoH and Local Government Reform Program proposals). MoH: Age and sex-weighted population (50%); Poverty levels, based on the Poverty Welfare; Index of the geographical area under question (15%); An index of mileage, to and within the LGA (15%); and Burden of disease, to incorporate under-five and adult mortality rates plus any others available (20%). LGRP: Population (70%), poverty count (regional) (10%), vehicle route mileage (10%), and infant or under-five mortality (10%), most closely reflecting the MoH proposed formula, but with an increased weighting for population In addition, restrictions on the use of the basket funds have been reviewed to improve their flexibility; the reported average delay (in March 2003) of one quarter in release of funds from the central level to the councils and, in some cases, between the District Council and the DMO's office has been reduced (2004). · Local financial management capacity remains a problem, as the council accountant was often overstretched, or sometimes not qualified. Auditing of the initial 37 districts during the first two years was relatively satisfactory; a third audit, covering 82 councils, provides a mixed picture, - 4 - with some deterioration, some improvement, and some unchanged. · A Master of Public Health Program (MPH) has been designed and introduced at the Muhimbili University College of Health Sciences (MUCHS) and at the Kilimanjaro Christian Medical Center (KCMC) to train the District Teams (LGAs) to manage the devolved District Health Services and Systems. Health service delivery: Phase I focused on the organization and delivery of key health services and on the population's satisfaction with the quality of services. To date, the results have been mixed. · The organization of health services has been based on a series of approximately 30 policy and disease specific guidelines. Unfortunately, these guidelines have proven to be confusing, not always consistent, and not as helpful for the DHMTs. In response, the MoH has recently streamlined the guidelines by level, establishing "Quality Standards & Criteria for District Health Services". The recent Technical Review determined that supervision of peripheral health facilities by DHMTs was inadequate and supervision of districts by regions was insufficient because only a single public health officer has been appointed at the Regional Secretariat (RS). · MoH has developed and disseminated national guidelines for an Essential Health Package (EHP), and personnel in all districts have been trained. The Office of the CMO has developed and disseminated Quality Assurance (QA) guidelines which employ criteria based on standards and norms for manpower, equipment and infrastructure and routine inspection. As perceived by some district level staff who were interviewed by the technical review team, however, the few QA activities that were conducted consisted of inspections by junior or inappropriate staff. · PORALG: a key actor in the provision of health services through its decentralized agents . This ministry: § Established and maintained close linkage and collaboration with the ministry of health at central and district levels. At the central level, PORALG is a core partner in the Basket Financing Committee § Reviewed the submission by the districts of their comprehensive plans, includes the submissions in its national budget and finances them. The financing is done through government block grants and basket funding. § Maintained oversight, coordination, and implementation of districts programs by the presence of its staff, the District Executive Officer, who chairs the district committee. · Districts (and municipalities) had the tasks of guaranteeing health service delivery, and ensuring the decentralization process. Their role involved disseminating government policy to various stakeholders and to the communities. They: § Prepared comprehensive district plans through a participatory process, which included the voluntary agencies and the private sector health providers in the districts. § Ensured the provision of curative, promotional and preventive health services. § Raised awareness of communities on the tools of the health reform agenda, for - 5 - example the NHIF, user fees and the CHF. § Ensured that facilities receive an adequate level of drugs and supplies and, wherever MSD supply is not adequate, that top-ups are freed from the different district funds, CHF/user fees. § Reviewed the facilities requests for utilization of user fees, ensured the maintenance and renovation of buildings, and equipped health centers as deemed necessary with the available resources. § The capacity of Council Treasurer (CT) widely varies across the districts, especially those operating manual accounting systems, being unable to account and report the basket expenditures separately. · Immunization coverage of children under one year old receiving DPT3 increased from 71% in 1999 to 85% in 2003.Though this data is consistent with previous household surveys, this result will be confirmed during the upcoming DHS. · IMCI was implemented in 28 districts, and a recent multi-country evaluation of IMCI showed a significant impact in Tanzania. Over the last years, the TEHIP TEHIP is the Tanzania Essential Health Interventions Project supported by the Canadian International Development Research Center (IDRC) which employs continuous demographic surveillance to assess the demographic impact of delivery of an essential package of services. project documented that IMCI, even if limited to the health facility level (as opposed to the comprehensive approach combining facility and community levels), can significantly lower the child mortality rate at a relatively low cost. The approach is currently being expanded to more districts to test the feasibility of scaling up IMCI countrywide. · Tanzania has effectively promoted locally made bed nets impregnated at an affordable price (Tsh.3,500-5,000). More recently, the Tanzania National Voucher Scheme (TNVS), with support from the Global Fund, provided vouchers worth Tsh.2,500 to pregnant women to further reduce the price of bed nets. Re-impregnation (at least once annually) remains a problem, and an evaluation of the re-impregnation rate in Tanzania could help reorient the bed net strategy. · Satisfaction with the accessibility/availability, affordability, and quality of preventive, curative and referral health services increased from 30% prior to Phase 1 to 62% in 2001 (based on the Household Budget Survey). No interim assessment has been conducted since then. Users probably perceive positively the availability of drugs and equipment. Bribery in service delivery practice is often cited as a significant problem at all levels, but it is reportedly less at the district level due to the recent increased involvement of LGA and communities in the overview of the health facilities. (b) Level 2 and 3 Hospitals Hospital reforms were intended to devolve management authority to Level 2 and 3 hospitals, thereby improving current resource utilization (financial, human, and infrastructure) and broadening future financing options. · Hospital reforms were initiated at Muhimbili Medical Centre (MMC), the national - 6 - referral hospital: a situation analysis was carried out, a Bill was to revise the current legislation and grant MMC autonomy, and an Executive Board was installed. In December 2003, the Director for the MMC was recruited internationally. The new management team however raised user fees substantially, which has resulted in overcrowding of the other lower level health facilities in Dar. The issue of user fees needs to be considered together with efforts to strengthen lower level health facilities and exemption systems to protect the poor. · Bugando and KCMC hospitals (level 3) are completely autonomous under the Catholic and Lutheran churches, respectively Bugando being more advanced than KCMC on the pay reform. Hospital Boards are being established and by December 2004 all hospitals will have boards (current level at 40%). Starting in July 2004, some Regional Hospitals (such as Morogoro, Tanga, Kagera,etc.) will start contracting out non-professional functions. (c) Public/Private Mix Development of a more collaborative relationship between the public and private sectors has been initiated during Phase I: · A study on health services delivery in the private sector, a precursor for the elaboration of a policy/strategy for private-public sector collaboration, is in progress. · A steering group on Private-Public Partnership (PPP), including active participants from the private sector, was put into place at the end of 2003. The group began drafting a standard service agreement, based upon the existing contractual relationships with the Designated District Hospitals (DDH). This standard agreement is expected to be adaptable to partnerships for "non-profit" as well as "for-profit" hospitals and clinics. · The Private Practice Bill, passed in 1977 and amended in 1991, was recently submitted to the Parliament for review. This bill now includes private hospitals, private health laboratories and pharmacies, and registered nurses. It will need to address as well the possibility for government doctors to practice privately within the public health infrastructure during certain hours (as is now the case in MMC and Bugando and as intended as well for district level facilities), and the role of local government PORALG - President's Office Regional Administration and Local Government - is the central agency responsible for district government. It has been one of the implementing agencies together with the MoH. in regulating local health facilities. · The MoH has initiated a number of accreditation and quality assurance systems. The QA unit of MoH registers Voluntary and NGO hospitals. Without a reliable system to track shortcomings in the quality of care on a continuous basis, the accreditation program for the private providers may not fulfill its role however. · The QA unit of the National Health Insurance Funds (NHIF) has developed an accreditation system which allows accredited private providers to be reimbursed for services. The criteria used for accreditation are currently limited to norms and standards for manpower - 7 - qualification, equipment and building. · The MoH has introduced a pharmacy accreditation system intended to increase the coverage of pharmacies and the availability of over-the-counter drugs. The Pharmacy Board, which is responsible for implementing the system, currently supervises 2,907 public facilities and is over-stretched in its ability to supervise the 4,600 pharmacies country-wide. The Pharmacy Board has established a pilot on Accredited Drug Dispensing Outlets (ADDO). ADDOs are authorized to sell drugs to public health facilities. · A bill has been issued outlining how the public health system should better coordinate with traditional healers, including their training on relevant subjects. 2. Strengthening the MoH & Central Support Systems which included: (a) Role of Central MoH & Sector-wide Management During Phase 1, HSDP concentrated on improving resource mobilization and management through increased coordination, and strengthening of support systems. · The MoH established operational structures and processes for implementing the SWAp. This has reduced the transaction costs associated with bilateral planning/negotiations/monitoring, However this has imposed a lot of load on MoH staff who are required to attend the many technical meetings of the SWAp sub-committees, the Bilateral and Multilateral Health Forum (BMHF) and the Basket Financing Committee. AJR improved over time as did the quality of the dialogue and follow-up among MoH, MoF, the local government authorities, and donors. · The MoH has increasingly focused on its role and responsibilities for reviewing and revising legislation, regulations, and national guidelines. A joint financing system (budgeting, disbursement, accounting, financial management, and reporting) was progressively set in place over the three-year period. · The Medium Term Expenditure Framework (MTEF) provided GoT with ownership of health sector activities and put MoH in the driver's seat regarding the health reforms. The share of on-budget spending has continued to rise, largely as a result of the concerted effort by MoH and MoF to strengthen the planning and budgeting process and to improve (and incorporate into the budget) information on external funding to the sector. As a result, on-budget estimates have risen dramatically from 69.5% in FY01 to 79.3% of the FY03 budget, while in terms of actual expenditure, the figure rose from 57.3% to 62.4% between FY01 and FY02. The MTEF continues to have certain limitations. First, because the block grants allocated by the GoT, as well as the conditional block grants provided through the Basket Fund at regional and district levels are only captured in the Local Government MTEF, a comprehensive overview of existing financial resources in the health sector is only possible through the annual PER, which consolidates the MoH and Local Government MTEFs. Second, at 700 pages, the current MTEF is extremely detailed, and it is difficult to discern a clear direction of planned, priority health sector - 8 - expenditures with regard to the sector policy priorities. · Basket expenditures (actual versus budgeted) substantially improved from 47% in FY01 to 86.6% in FY02. At the same time, there seems to have been a change in the total sector budget/expenditure as percentage of the total government budget/expenditure. Reallocations during FY04 have seen the Health Sector budget reduced by an additional Tsh 3.7 bn, and the proposed MoH budget ceiling for FY05 has been reduced by Tsh 3 bn . However, since the share of foreign aid in the total public expenditure has increased and thus has made the GoT more dependent on foreign aid to finance its recurrent expenditures, it is understandable for the GoT to focus on the total allocation to priority sectors rather than "domestic" resource allocations. The MoH can use the sector resource management tools (MTEF, PER) to lobby for more resources to the health sector, in particular since there are still large financing gaps in the MTEF: for example while total drug needs are estimated at around $42 million for FY04, available funds for drugs amount at approx $26 million (from 31 bn Tsh in FY03). (b) Central Support Systems · Management of Medical Store Departments (formerly known as Central Medical Stores) improved significantly during Phase 1. MSD was reorganized, an autonomous Executive Board installed, and new management was selected internationally. Procurement of supplies for several vertical programs (vaccines, contraceptives, TB drugs) was successfully integrated, and could be further expanded to other programs. Stock management however remains weak, and it is debatable as to whether the MSD list should include medical equipment. · Anti-malarias are available almost 100% in all health facilities through the kit and indent system. In fact the sector is now facing problems of excess of sulfadoxine /pyrimethamine (SP) in many of the health facilities after media distortion about it. · Strategies and financing for maintaining health facilities, medical equipment and transportation remain inadequate. Although the MoH developed a strategy for rehabilitating primary health care facilities, no comprehensive inventory was made to provide the basis for an affordable rehabilitation and rationalization plan. For hospitals, neither a strategy nor a plan was developed. The lack of a maintenance system for medical equipment constitutes a major impediment for hospitals to function properly countrywide. Vehicle maintenance has received attention, but no definitive solution has been proposed. The appropriateness of zonal maintenance centers, as proposed by the MoH, is not widely endorsed (c) Human Resource Development & Management HSDP had as a principal objective to strengthen human resource capacity (particularly at local levels) through improved personnel planning and management and through training to adapt health staff skills to changing roles and responsibilities. · Despite some progress in managing human resources, MoH has not succeeded in establishing the basis for a mid-term human resource development strategy. The MoH has thus - 9 - far been fairly unsuccessful in its HRH development efforts. It submitted proposals to the Civil Service Department to revise the remuneration and incentive package, but they have not been accepted. In 2003, MoH succeeded in opening vacant posts at district level to meet staff shortages; these posts were to be filled by the local government, but confusion about the process for recruiting health staff undermined the potential benefits of this measure. · A 2001 study focusing on Human Resources for Health (HRH) requirements and availability in the context of scaling-up priority interventions Human Resources for Health: Requirements and availability in the context of scaling-up priority interventions, A case study from Tanzania; Cristoph Kurowski, Salim Abdulla; and Anne Mills; October 2003. shows that current employment in the public sector falls considerably short of agreed staffing norms and the future size of the workforce will be grossly insufficient for a substantial scale up of priority interventions by 2015. In addition, it is likely that under current conditions surpluses of unskilled staff compensate for significant deficits among health professionals with a probable impact on service quality. As confirmed by all stakeholders, the HRH issue constitutes a major constraint that should receive priority attention during Phase 2. · In 2003, MoH created the National Human Resources for Health Working group, bringing together representatives of the HR Development Department of the MoH, the Presidential Office for Public Service Management, academia and development partners to facilitate policy decisions. However there are several limitations that were not addressed: key stakeholders were left out, no resources are available to perform policy analysis and the current action plan lacks prioritization. · The Bank, together with a local research institute, is currently preparing a review on health labor market outcomes, determinants and issues to be presented to the HR working group to stimulate the prioritization process within the objectives. The development of an HR mid-term strategy is facilitated by the analytical work that is undertaken by the Bank and other partners. To ensure that the translation of the findings into policy decisions takes place, a workshop will take place in January 2005. · Training capacity has been gradually improved during Phase 1. Curricula for almost all cadres were reviewed and corresponding health learning materials (HLM) were developed and disseminated to training institutions. Zonal training centers were strengthened to provide in-service training to health workers in regions and districts on a continuous basis. Computer training has also been provided to the MoH/Sector staff. This allowed for the progress reports, financial cash-flows, MTEF, HSSP and District Plans to be computerized. · The progress achieved by the health sector capacity to articulate reforms, managing change and policy development, would not have been possible without the deliberate move by the World Bank and the GoT to train its staff in the areas which were observed to be weak during the analytical phase. 3. Health Financing - 10 - The Government passed important pieces of legislation related to increasing available financing for the health sector. · At the end of Phase 1, user fees were expected to reach 13% of non-salary recurrent expenditures, but in fact represented less than 1% of the total sector resources in 2001-2002. User fees, initiated in 1994, are being implemented in a phased approach starting with national hospitals, followed by specialized hospitals, regional and district hospitals. With heavy subsidization and an exemption policy for the very poor, revenue collection reached a maximum of 15% of the non-salary recurrent expenditures for the health facilities. Cost sharing at health center and dispensary level is not yet compulsory, but if the District Board opts for it, user fees must be implemented per guidelines (for fee collection, record keeping, internal controls) provided by the MoH. A planned in-depth study of the cost sharing system planned before December 2002 was not conducted. · At the end of Phase 1, hospital drug revolving funds were in place in several hospitals. The drug revolving fund (DRF) was expected to improve availability of drugs and management of the hospital pharmacies and to build capacity at the hospital level to manage supplies and the ability to calculate the drug needs and improve supervision. However, to be sustainable the concept whereby hospitals sell drugs at half their purchase price demands a more efficient reimbursement system by the MoH. · The Community Health Fund (CHF) demonstrates both the potential for and difficulties of pre-payment schemes. The CHF was introduced as a form of annual prepayment for rural populations linked to the household's ability to pay (for example after harvest or sale of cash crops). Under Phase 1, Government matched the amount paid by household with funds from the IDA Credit. This fund exists alongside user fees, and both sources of funds are put in one CHF account, managed by the Council Health Board. The district boards have benefited from these new resources, which have been used for the improvement of facilities and additional drugs. The CHF also gives communities management and financial control over the health funds, and allows them to articulate locally defined criteria for user fees thus protecting the indigent groups. It also ensures that the communities' voices are included in decision-making and therefore mitigating corrupt practices. At the end of Phase 1, 45 districts were running CHFs with variable results. While this fund has potential to increase access to health services for the poor, more advocacy is necessary within the communities. Further, the utilization of health services by CHF members at Voluntary Agency hospitals seems to cause a burden on these facilities. Issues include: (i) centralized management of the CHF; (ii) reduced membership, due in several cases to the departure of public servants for NHIF; (iii) high utilization; (iv) protection of the poor; (v) delays in reimbursing the provider are caused by retaining the funds to the district instead of the facility level. · The National Health Insurance Fund (NHIF) has been successful enough to elicit multiple demands from the private sector to join. A compulsory contributory insurance scheme for public servants is administered by NHIF, a public institution established by the Act of the Parliament (1999). Envisioned as a social health insurance scheme for 55,000 civil servants, it - 11 - quickly expanded to cover teachers and local authority workers (public servants). It now has a 242,508 employee members contributing 3% of their monthly salary with employers matching these contributions. The scheme aims at ensuring access of health services for outpatient and inpatient care throughout the country in public, private and voluntary agencies accredited facilities as well as private practitioners, for its members and their approved dependants. 4. National HIV/AIDS Fund HIV/AIDS · The Tanzania Commission for AIDS (TACAIDS), a Multi-sectoral coordinating body, was established in December 2001 with a budget of USD 2 million, and a mandate "to provide strategic leadership and to coordinate the implementation of a national multi-sectoral response to HIV/AIDS". While it was intended to work closely with the MoH, specifically with the former National AIDS Control Program (NACP) secretariat, which initiated work on the Health Sector HIV/AIDS Strategic Plan, tensions aroused since it was not clear which organization was in charge of HIV/AIDS in the country. The implementation of this component was therefore delayed, and the budgeted financing was not fully utilized. · $0.8 million was used, mostly by MoH and TACAIDS, to: Ø produceguidelines/protocolstoimprovetheHIV/AIDScomponentofthedistrictwork plans (disseminated to all districts in May 2002) and quality surveillance system through Ante Natal Care surveillance in 6 regions Ø intervenewithspecialprogramsforAdolescentsReproductiveandSexualHealth(ARSH) through Behavior Change Communication (BCC) campaigns in partnership with the private sector Ø trainserviceprovidersatdistrictlevelthroughoutthecountry Ø provide,toallhospitals,guidelinesonappropriateuseandscreeningofblood Ø createaHIV/AIDS/STIlaboratory,andvoluntarycounselingandtesting(VCT)centersin 170 facilities; train 200 counselors Ø createanstructuredhome-basedcaremodelforthepublicsectoranddevelopetrainingfor district health facility staff and community people (as a result, twenty-eight districts had home based care services established, over 100 providers and trainers were trained and close to 200 voluntary agencies, NGOs and Community Based Organizations (CBOs) are now providing HBC). Ø producetheNationalMulti-sectoralStrategicFramework (2003-2007)forHIV/AIDS and the HIV/AIDS policy; while this was adopted, the elaboration of a HIV/AIDS work plan (2003-2006) was delayed. Upon Effectiveness of the Tanzania MAP in October 15 2003, with a fund component to finance the community/driven HIV/AIDS response, the funding of HIV/AIDS from HSDP was subsumed in TMAP. Prevention of Mother to Child Transmission (PMCT) was piloted in five public health facilities, benefiting from intense research, resources and planning, and a Medical Waste Management Plan was developed and disclosed in Tanzania in preparation for TMAP. 4.3 Net Present Value/Economic rate of return: Not applicable - 12 - 4.4 Financial rate of return: Not applicable 4.5 Institutional development impact: HSDP has contributed to a more effective enabling environment for health sector develop-ment through the adoption of polices, strategies, legislation, and regulation, specifically by: · harmonizing guidelines for comprehensive health planning, budgeting, reporting and procurement for all resources, government, basket funds as well as "non basket" resources; · promulgating national guidelines for an Essential Health Package (EHP) in all districts; · devolving management authority to tertiary hospitals; · strengthening Public Private Partnership by passing legislation, elaborating regulations (standard service agreement, accreditation) and making progress towards regulatory frameworks for service delivery, traditional practitioners and pharmaceuticals; · promoting a Quality Assurance program based on multiple criteria including norms and standards in terms of infrastructure, equipment and human resources as well as quality control supervisions. HSDP has established and/or reinforced the structures required to develop and maintain the evolving SWAp, in particular by: · establishing a Joint Donor Funding system (basket) with a well-defined Memorandum of Understanding and quarterly meetings of the Basket Financing Committee; · enabling the Bilateral and Multilateral Health Forum to monitor the implementation of the MTEF through regular meetings and annual reviews; and · bringing the experience of PIU staff to the SWAp management (ex. The head of the HSR/SWAp secretariat is a former PIU coordinator and current staff worked formerly for PIUs). The SWAp management has built capacity within MoH staff for planning, budgeting and policy dialogue with the partners. All departments are now actively involved in SWAp meetings, BFC meetings, PER/MTEF processes and various technical committee meetings. HSDP has contributed to the strengthening sectoral systems and capacity for managing scarce resources more efficiently and effectively by: · establishing an MTEF at central MoH and local government levels, allowing planning and budgeting to cover multiple financing sources; · conducting annual PER, capturing the financial flows in the sector, allowing an in-depth analysis of sector financing and timely identification of constraints and issues; · developing a planning tool at district level, based on priority setting using the Burden of Diseases Profile that allows an accurate and realistic assessment of health needs; · elaborating a budget allocation formula for districts, aiming both at efficiency and equity, by taking into account relevant variables Population, poverty level, burden of disease and logistical constraints; · strengthening procurement capacity and financial management in MoH and MSD; · developing a cost-sharing system that includes an exemption facility for the indigent (albeit one which is not yet fully successfully implemented) and ensures partial recovery of health costs; and - 13 - developing a range of health-financing schemes (NHIF, CHF, cost-sharing) adapted to specific group needs and their financial capacity. 5. Major Factors Affecting Implementation and Outcome 5.1 Factors outside the control of government or implementing agency: Overall macroeconomic context: Structural transformation has been extremely limited, with agriculture still dominating the non-diversified economy, hampering flexibility necessary to withstand shock occurrences. Nonetheless, the country intensified macroeconomic policy reforms, significantly stabilizing the economy, with falling inflation levels, climbing foreign exchange reserves, and an overall fiscal balance. The main factors identified behind the slow development progress are primarily: inadequate capital accumulation and productivity growth, poor support for the transformation of agriculture, disrupted progress in building human capital and the delayed demographic transition (Economic and Social Research Foundation, Justice Joel; 23 Dec 2003). Worsening HIV/AIDS epidemic: A steep increase in the number of TB infections associated with AIDS has placed an additional burden on all levels of the health care system (Tanzania Health Sector Joint Review, March 2004). Poverty undermines the community's ability to significantly participate in the health financing reform program introduced by government through the Community Health Fund. Donor resources channeled through "earmarked funding": The GoT is unable to completely capture financial flows as some partners remain with earmarked funding. Also, disbursement from the basket fund was delayed when donors' contributions were delayed; and when some donors requested specific reports. 5.2 Factors generally subject to government control: Government reform policies: GoT developed a Poverty Reduction Strategy (PRS), and ensured that all sectors, including health, conformed to it as they prepared their individual policy and strategic papers. Liberalization of the economy and decentralization occurred at a swift pace, which district reforms to move more rapidly than initially envisaged. Progress was less obvious in inter-sectoral collaboration as illustrated by the limited improvements in water, sanitation and nutrition. However, the GoT established the institutional setting for a strong and structured multi-sectoral response to the HIV/AIDS epidemic. GoT failed to launch a strong civil service reform to allow the revision of remuneration schemes and incentive package for health workers. In 2002, with financing from DANIDA the GoT introduced the Selective Accelerated Salary Enhancement (SASE), which will end in 2005. The beneficiaries of SASE are all directors and section heads of the MoH including HSR/SWAP secretariat and 5-7 members of the RHMT/DHMTs. However, the impact of this program has not yet been evaluated. Local government capacity: Lack of financial management capacity at the district level hampered proper accountability at the decentralized level. 5.3 Factors generally subject to implementing agency control: MoH: The MoH developed and started implementing a health policy reform. Based on the National Health Policy, the MoH developed a Strategic Health Plan 1999-2002, which was - 14 - revised for the period 2003- 2008. The 1999-2002 Plan of Work was developed to guide the implementation of the sector strategies, which included actions to promote a "Sector-wide Approach"(SWAp) to streamline implementation arrangements and coordinate inputs from development partners. The MoH coordinated the donors by: (i) producing and using the MTEF as the single common reference for donors' interventions; (ii) encouraging the largest donors to pool their resources in one basket and to use common implementation procedures; and (iii) holding Annual Joint Reviews. The MoH, through the Annual Joint Review, ensured the coordination among stakeholders and created an opportunity to address issues. This enhanced accountability, commitment and ownership of the process. In addition to taking the lead in coordinating the financial resources of the sector, the MoH was involved in: 1. Decentralization and devolution of authority to the District Health Board working in close collaboration with Presidents Office, Regional Administration and Local Government (PORALG). 2. Developing and revising when necessary policy guidelines, norms and standards, rules and regulations to ensure delivery of quality health services 3. Strengthening health care financing including the introduction of National Health Insurance Fund (NHIF) and the Community Health Fund (CHF). In the early stages of the reform, the MoH had difficulties in allocating adequate resources to the districts once they presented a comprehensive district plan. Due to the lack of resources, districts were unable to purchase adequate drugs and supplies resulting in shortages in many public facilities. However, substantial progress was made. In most health centers, dispensaries and district hospitals visited adequate stock of drugs and supplies, provided through MDS, were reported. The MoH also: 1. Introduced cost sharing at national, regional, and district health facilities levels. While providing a regulatory framework, the MoH left the responsibility to the District Board for enforcing this at the health center or the dispensary levels. 2. Initiated the tertiary and secondary hospital reform through the passing of the MMC Bill. 3. Provided strong commitment and support for HIV/AIDS prevention and control. The health sector response to HIV/AIDS is implemented through the Health Sector Strategic Plan. Implementing the above activities put a strain on the MoH's financial and human resources. The number of reforms and their implementation pace at times overloaded limited human resources, while incentives, financial and professional, are still lacking. The technical skills necessary for implementing reforms are also still limited. The lack in procurement capacity within the MoH and the other implementing agencies further slowed down processes. Recently this issue has been addressed by implementing the recommendations made in the joint procurement and financial assessments, but the results are pending. 5.4 Costs and financing: At appraisal, the total program cost was estimate at US$654.0 million. Three sources of financing were envisaged: - 15 - 1. Government, with a contribution of US$ 369.14. Government contribution was expected to be financed from the public budget (US$ 351.6 million) and from internally generated funds, mainly through user fees, which were expected to contribute US$17.5 million 2. IDA with a credit of US$22.0 million. 3. Other co-financing partners with an expected contribution of US$262.86 million (of which US$94.40 was unidentified in the PAD); this included pooled funds in the health account, earmarked financial contributions for the achievement of the health sector's objectives, or both. Government contributed more than foreseen (120 percent), however in FY04 the GoT allocation to the health sector has fallen to 9.2% from 10.4% recorded the previous year (Health Sector PER Update 2004). While the allocation to the sector has increased by 75% in real terms over the past three-years, this is from a very low base and generally the health sector is not doing as well compared to other PRS priority sectors such as education. Nominal spending on health has been rising. In FY02, spending increased 15 percent over the previous year, and in FY03 it increased 20 percent (Actuals for FY03 were calculated from the budgeted amount reflecting the same percentage spent as in FY02 actual vs. budgeted). However, much of this can be accounted for by the increase in basket funds, which rose by over 71 percent in FY03 over the previous year, and 80 percent in FY02 (expected increases at appraisal were 43 percent and 75 percent respectively). The share of the recurrent budget has continued to rise as a percentage of the on-budget total, from 83 percent in FY01 to 86 percent in FY03. This is largely due to the increasing share of the basket, and the fact that the majority of basket spending is accounted for through the recurrent budget. However, the expected rates set at 95.5 percent during appraisal could not be reached given the unforeseen increase in development expenditures. Contributions from donors exceeded expectations (137 percent of expected donor's contribution at appraisal) Expected expenditure from PAD Annex 5 Section B Table 2: Estimated Resource Envelope for the Health Sector; actual expenditure from Health Sector PER Update 2004, Table 7 Public health spending, by funding type (Billion shillings); exchange rate shillings/USD was calculated based on the average of the exchange rate at the end of the month for 12 months of each FY (Integrated Controller's System, Common Data Stores: Currencies database)), although actual spending from the pooled funds was less than projected (75 percent). While the nominal contribution of the donors was higher than expected in total, it varied by year - in the third year of the project donor financing decreased from the previous year, from US$128.73 million to US$119.88 million The exchange rate was calculated based on the average of the exchange rate at the end of the month for12 months in the FY. Integrated Controller's System, Common Data Stores: Currencies. The foreign contribution to on-budget expenditure (i.e. captured in MTEF) has increased from 22 percent in FY01 to 35 percent in FY03. Basket funds: For the first two fiscal years, 2001, 2002, the donor basket was at 64 percent and 66 percent respectively of the amounts anticipated at appraisal. In FY03, actual basket spending reached 79 percent of the expected amount. This translates into a growth in the donor basket to - 16 - an estimated 23 percent of total on-budget spending and 27 percent of the recurrent budget in FY03. Intra-sectoral trends: There has been a decrease year by year in the proportions of domestic allocations for all categories ( level 1, 2 & 3, hospitals and preventive/primary, although preventive/primary got the biggest share as compared to hospitals except for FY01. This means that the government continued to maintain its commitment to preventive/primary health care policy despite constrained budget 6. Sustainability 6.1 Rationale for sustainability rating: Project sustainability is assessed as `likely', due to (i) the government's commitment to continue and deepen the reforms; (ii) improvements in institutional capacity which have taken place to implement reforms; and (iii) the donors' commitment to work through a SWAp, with the annual reviews giving an opportunity for reviewing progress and agreeing upon the future. However, the challenges to sustainability are: (i) the continued dependence on external financing, (ii) the uncertainty of the GoT sustaining the level of financial resources to the MoH budget as donor shift to budget support; and (iii) the problem of human resources, particularly considering the difficulty faced by staff in responding to HIV/AIDS. Policy and Reform: The MoH has effectively ensured its leadership of the health sector by: (i) using the MTEF to capture most of the sector financing resources; (ii) harmonizing and simplifying budget and planning guidelines down to the district level; (iii) instituting a joint disbursement system and common implementation procedures; (iv) organizing annual joint reviews; and (v) conducting annual comprehensive PERs. These advances seem irreversible, and constitute major organizational progress. Institutional: The successful implementation of the reforms significantly increased health manpower's productivity from central level down to the district level. In particular, the reform agenda has strengthened and empowered the local level by creating councils to direct the implementation of services in the districts. In some cases (where the CHF is being implemented), the local authorities were able to hire technical staff as needed, and pay them from the CHF funds. After two years, and a negotiation process, the responsibility of employing this staff was handed over to the government. Donors: The donors funding the sector fully supported the SWAp and worked closely with the government, actively participating in the annual joint review and its output. While the Basket commenced with some initial "teething" problems most of them have been overcome and disbursements have became more regular and dependable. While a number of partners including the Bank are committed to finance Phase II of the program, some of them will opt to provide budget support ­ this includes the Bank, which will gradually shift financing to the PRSC if the MoF retains current levels of financing for the sector. Financial: In terms of total public expenditure in the sector, there has been a small increase in the - 17 - share of the health budget over few years since the publication of the PRS, from 7.5% in FY00 to an estimated 8.7% in FY03 (expenditures continued to rise from 6.6% to 8.3% between FY00 and FY02). However, this remains low relative to the target of 15% of government budget agreed in Abuja in 2001 (a target not achieved by Sub-Saharan Africa in general). Furthermore, there has been a continued downward trend, in both budget and expenditure, in the share of domestic funding in the on-budget total. The progressive move to general budget support opens the sector to the risk that the GoT may not allocate sufficient resources to the sector. 6.2 Transition arrangement to regular operations: Not applicable 7. Bank and Borrower Performance Bank 7.1 Lending: Satisfactory Bank performance during the project lending was satisfactory, consistent with QAG's assessment. The Bank incorporated the lessons learned from the Health and Nutrition project in the design of the HSDP I. It innovatively employed an APL, an instrument that had recently debuted to support SWAps and long-term policy reforms. The pharmaceuticals sector reforms were pursued as project outcomes rather than made a conditionality. The Bank employed global and regional knowledge on SWAps, particularly from the Ugandan and Ghanaian experiences. The Bank pre-appraisal team, thanks to its diversity, was able to ensure a thorough review of the issues. The composition of the pre-appraisal and appraisal teams demonstrated the Bank's serious commitment to the preparation of this project. The GoT showed a strong commitment and leadership in preparation, demonstrated partly by their presentation at Concept and Decision Meetings, a close collaboration and joint preparation with other donors (including some division of labor in financing technical work/analysis). 7.2 Supervision: Satisfactory The Bank TTL was initially based at headquarters, although the presence of a local Senior HNP Specialist in the field was critical to continuous supervision and support. Subsequently, the Bank placed the Lead Specialist TTL in the field office, but responsibility was later passed to the local senior staff. The posting of the HQ-based TTL to the field allowed him to be closely involved with all other relevant stakeholders in the preparation and holding of the Annual Joint Review meeting which was a crucial moment for the Project's supervision. The subsequent appointment of the TTL who managed the project through Closing ensured continuity and close collaboration and greatly informed the preparation of Phase II. The presence of financial and procurement specialists in the field has provided useful support to the government to implement the project and maintained bank supervision in the respective areas. In December 2000, a Bank supervision mission expanded its TORs to include a joint stock-taking exercise on the implementation of the government's health sector program, which identified the major constraints in the sector and assisted in the preparations of the following year's joint - 18 - review. After the MTR, conducted in March 2002, supervision missions were less often documented by Aide Memoires, relying more on the Annual Joint Review meetings that benefited from a wider scope of technical capabilities provided through the other donors and was increasingly better documented. PSRs reflected comments from the Sector Manager and the Country Director from July 2001 onward. 7.3 Overall Bank performance: Satisfactory. Borrower 7.4 Preparation: Satisfactory The Borrower was very efficient in putting into place the partnership setting and the institutional arrangements to initiate a SWAp with a Basket Fund involving some of the major donors, and a MTEF which sought to capture all donors. At Preparation the government revised the three-year Program of Work and a one-year Plan of Action, which was intended to serve as a framework for coordinated sector-wide approach. The Borrower effectively took steps to implement reforms. The government remained steadfast even when opposition was high, for example, the establishment of the NHIF and making mandatory deductions from employees despite initial opposition from the unions. Also, the GoT sought ways of revising addressing the reform rather than abandoning it. Government coordinated the participation of different stakeholders and maintained intensive collaboration within and out of government agencies. Finally, the Borrower swiftly processed conditions of effectiveness: (i) accounting and financial management (FM) system established satisfactory to IDA; (ii) independent auditors appointed under terms and conditions acceptable to IDA; and (iii) the Project Implementation Plan adopted, and an annual work plan for July 2000 to June 2001. However, once the SWAp was underway and the project was launched, the reduced pressure may have resulted in the implementation of some reforms--specifically the hospital and the civil reform ones--being delayed. 7.5 Government implementation performance: Satisfactory The borrower organized the Annual Joint Reviews according to the TORs produced by the MoH. The review process was organized in two parts: (i)a technical review; and (ii) a main review. The technical review consolidated key information and findings among six working groups, also making use of the information collected prior by a consulting Review Team Contracted out to HERA, an International Consulting Firm, prior to the AJR. The main review, a huge forum led by the MoH with a large participation of representatives from the stakeholders (MoH, PORALG, districts, donors, "basket" and "non-basket", NGOs, for profit and non-profit private sector and other civil society), had the responsibility to set milestones to be achieved in the following year. - 19 - The government introduced reforms that had very far-reaching consequences and did its best to manage the outcomes. Donor coordination is complex including the management of the Memorandum of Understanding, which the government made efforts to enforce though not always successfully. The project closed with a disbursement of 96.5%, as scheduled, and with some procurement withheld until phase II due to exhaustion of resources and time constraints. 7.6 Implementing Agency: Satisfactory Overall responsibility of the project was with the MoH while the day-to-day management of the different components was with Health Sector Reform Secretariat under the Policy and Planning Department within MoH. This department maintained close collaboration with the implementation agencies at national, regional, district and community levels. Despite being overstretched in overseeing a project with such complexity, the components were reasonably related to achieving the development project objectives. Furthermore, the MoH succeeded in leading an open and frank dialog with all the donors within the SWAp framework, particularly during the preparation and holding of the Annual Joint Review Meetings. The MoH quickly and smoothly imposed the MTEF as the single reference for most interventions in the health sector. As a result, the shift to the SWAp, implying transparency in managing GoT's and donors's activities, was highly successful. 7.7 Overall Borrower performance: Satisfactory Major issues were identified and addressed; most reform topics agreed at project identification were implemented though with diverse outcome and success. Moreover, the Borrower took the lead of the SWAp and remained in control while gradually improving its quality. However, the Borrower could have improved the SWAp reviewing process by increasing the review frequency, for example semi-annually, and by widening the scope of the review through joint field visits. 8. Lessons Learned · Advocacy for reform and information dissemination at all levels is essential for success. While government senior staff and partners may have been fully aware of the expected reform, and had access to most of the reform documents, this information was not readily available at the lower levels, especially within communities. This sometimes led to delayed appreciation and ownership of reforms hence slowing the process. The government and partners need to invest in reform advocacy on a continuous basis with the different stakeholders including the community level. · Donor coordination, a necessary input to health reform especially when it involves a SWAp, demands commitment from partners, and management skills from the government. The management of pooled financing has been a challenge for the ministry, evolving over-time and causing delays in the implementation of the programs. This, mainly because donors have different mandates, and disbursement periods which often differ from government's. There was - 20 - also inconsistency between the financial years of local and central government. To coordinate all these different and sometimes conflicting mandates, requires high leadership to anticipate and prepare for various issues and to negotiate an acceptable compromise for all, while not derailing the project. However, the high coordination transactions costs translated into a sharp increase in basket funding and its efficient utilization. There have also been challenges for the government staff in shifting from project financing (where they prepare procurement plans for IDA's financing, for example) to programmatic support (where a procurement plan for the entire budget is required). · Reforms require new and diversified skills. Reform introduces new and unfamiliar ways of doing things in most areas, which poses a challenge for local staff. Training and continuous education has to be a core pillar of reform program. Investment in the training and retraining of staff has to be integrated in the resource allocation of reform if success is to be achieved. · During the critical transition from Project lending to budget support (PRSC) it is important to maintain a transparent dialog between MoF, MoH and donors to ensure proper level of financial resources in the health sector. With the progressive move to general budget support, the sector may become at risk of being unable to maintain expenditure at the needed level without strong advocacy by MoH and donors. Since the GoT, as well as the Bank and some other donors take into account inter-sectoral priority shifts due to macroeconomic circumstances, it is expected that the MoH uses tools like the MTEF and the PER, to elicit adequate actions from MoF on the health share of the GoT budget. At the same time, the popularity of the health sector can distort the budget. Although some partners are frustrated that donor financing accounts for a large share of the health budget, it is understandable that because donors earmark financing for health, the GoT will reallocate some of its discretionary resources to less well-financed, but important sectors. · Trade-off between capacity strengthening and service delivery. Like in other African countries which adopted the SWAp, the experience in Tanzania shows that while focusing on system capacity strengthening can be initially detrimental to service delivery due to overall capacity weakness, it is a necessary step in achieving long term acceptable performance of health service delivery. · Human resources issues can be resolved only by addressing the civil service as a whole (throughout all ministries). Although the health sector can try to address its special issues, because staff are employed by the public sector, there are limitations on what the sector alone can accomplish. 9. Partner Comments (a) Borrower/implementing agency: REHABILITATION OF HEALTH IN INFRASTRUCTURE UNDER PORALG: · implementation of project was slowed due to the frequent changes in the strategies and approaches in implementing the project, as well as the few resources allocated by the government towards the health sector - 21 - · generally the government was well prepared; however project ranked as medium as some of the good lessons captured from the previous Health and Nutrition Project have not been brought on board CAPITALIZATION OF HOSPITAL PHARMACIES · after one year of piloting this program, one of the major successes were an increase on availability of drugs and medical supplies in hospitals and an increase in utilization of public hospital services · there are problems with this program, especially due to lack of adequate right skill mix of human resources and monopoly of government procedures of printing government documents, lack of motivation of staff implementing DRF in hospitals which has lead to low morale at work and lack of good management on the part of hospital administration to hold responsible heads of cost centers for not overseeing collection of revenue in their centers · the Drug Revolving Fund (DRF), established in order to ensure uninterrupted supply of drugs and medical supplies, was found to be sustainable · the overall performance of the DRF is ranked medium and some of the lessons learnt are not to budget WB funds to procure products which cannot follow WB procedures, that training is vital to avoid misunderstandings and misconceptions especially in harmonizing all hospital accounts and that close supervision of staff under DRF is mandatory to solve operational issues on the ground PROCUREMENT · some of the major factors affecting implementation and outcome were the long procedures with authorities who take part in the decision making during the procurement process, the poor cooperation between end users of goods and services and lack of sufficient training on part of procurement staff · more authority will be vested to the Ministries and most of the decision making will be done there which will reduce the bureaucracy and therefore reduce delays DISTRICT HEALTH SERVICES · some of the factors contributing to the success of the implementation process of the Council Health Service Board (CHSB) are the availability of financial and technical support from the donor community such as the WB and the Basket Fund, the high support from PORALG and the community at all levels and the recognition and approval of decentralization policy by devolution by relevant stakeholders such as the Parliament/Cabinet and NGOs. · However there were some constraints encountered during the implementation such as the delay of disbursement of basket funds, inadequate resources for capacity building at local levels, low speed in civil servant and local government reforms which contributed to the delay of the Health Sector Reforms implementation and inadequate supervision and follow-up at all levels COMMUNITY HEALTH FUND (CHF) · some of the major achievements of the CHF, which is a fund whereby families can contribute a premium in order to have medication for the whole family per year, are the improved availability of drugs and medical supplies, rehabilitation/construction of infrastructure facilities, am improved sense of ownership due to community involvement and participation in planning, - 22 - monitoring and spending of the money · however, the fund encountered some shortcomings such as the fact the enrolment of CHF members is increasing slowly, there is an over utilization of health services by the members and the current limited coverage · in order to make sure that the implementation of the fund is sustainable, more resources are required for promotion and advocacy of the scheme, there is a need to improve the health services at all levels so as to attract more people, especially the poor, to ensure community involvement and participation of planning and monitoring and management of health services · some of the future challenges are for the government to provide matching funds and to provide guidelines and regulations for running the scheme, for the contributors to advocate and promote the scheme and for the health providers to improve availability of drugs and medical supplies Comments regarding IDA supported project by the component manager of Environmental and Health Sanitation: · implementation of environmental activities, such as the development and printing of the PHAST guidelines and the waste management guidelines, despite the long time it took for this, as well as the development of hygiene tools and construction of 30 incinerators for health care waste management, were mostly successful, except the last 2, due to auditing procedures; the non-implementation of these last two activities would produce negative results in addressing HIV/AIDS · the performance of the bank was good, but the implementation of some activities did not materialize because of the late response from the regions · the performance of the project was ranked as medium because of the non-implementation of some activities Comments regarding HSDP-Phase I by the HRH-Section: · some of the factors affecting the implementation of the project are delay in the disbursement of the funds to the project, the human resource shortage in the health sector to implement decentralized roles effectively, insufficient improvement in planning, budgeting, monitoring and evaluation, as well as inadequate capacity building due to limited financial resources leading to few opportunities for training · in order for the project to be successful, there is a need for more decentralization, which currently is taking place at a low speed · strong commitment is necessary at all stages by GoT and donors, particularly in the disbursement of the funds which is normally done very late. (b) Cofinanciers: SWISS 1. Currently the MTEF captures 65-70% of recurrent and development planned expenditures in the sector. 2. The MoH has made tremendous strides in strengthening the budgetary process through the MTEF process, however, a number of issues to note include the following: a) limitation of the MTEF within a decentralized health system (it only covers the Ministry of Health); - 23 - b) it is extremely detailed on inputs making it very long (2 Volumes - approx 700 pages); c) More clearer alignment is required between the MTEF and the Health Sector Strategic Plan/Poverty reduction Strategy (it is difficult to link how the MTEF itself is actually translating the strategic outputs of the HSSP into a medium term financial framework); d) more clearer prioritization is required in light of the potential resources available; e) it should be a dynamic and rolling expenditure plan that programs resources to strategic activities. f) Government block grants to Councils and the conditional council grant from basket are not captured by MoH MTEF and are under the PORALG MTEF (global figures). Therefore, the Public Expenditure Review (PER) is a necessary consolidating instrument. However, PER needs to be further strengthened and institutionalized within the Sector as it currently relies heavily on an external consultant to undertake the work. The domestic allocations to the Sector are stagnant for FY04, it appears that external resources are replacing GoT resources and in FY05 we will see an actual decline in domestic allocations to the Sector. This at a time when there are tremendous funding needs/gaps in the Sector and additional new demands coming on stream. There will be a reduction in GoT budget resources to the Sector for FY04 following a supplementary budget that reduced the MoH budget by TSh 3.7bn. While the Human Resource (HR) plan was not updated since 1995, norms ands standards for HR were elaborated in 1999. The HR database for the Ministry has been developed over the last 3 years. HMIS is collecting too detailed/too much information and should be streamlined into an essential package of information. Data entry is computerized at the regional level and is still manual at district level although there are two ongoing district level computerized data entry pilots. IRISH AID (Development Cooperation Ireland - DCI) MTEF: It should be reviewed to avoid repetition of already completed activities, calculations mistakes, and should be linked to the 5 years strategy plan. In its current form it does not include DCI's and SDC's contribution on National Malaria Control Program. While not being a pressing need since it is overwhelmingly carried out at the district level, procurement is a sensitive issue that the Irish Aid, like many other donors, would prefer to subcontract it to a specialized agency rather than be left under the responsibility of the MoH. On WB contribution, Irish Aid believed that seed funds provided outside the basket by the WB rightly focused on system improvement, and the participation of the WB in Basket Financing was crucial to its existence. However, while the WB recently pledged important funds for the upcoming phase, it failed to properly communicate its strategy. From a questionnaire provided to the co-financiers it can be drawn that the WB did address the right issues during the preparation of the project and did not impose it on the government, but that the supervision of the project did not reach its potential. The government on the other hand, had only a `medium' rated performance. Community participation is crucial to the sustainability of the Program. - 24 - Private sector involvement is improving, being actively represented in Annual Joint Reviews. Health Service delivery: Irish Aid underlines the inappropriate advertisement of the media as the reason why some people revert back from SP to chloroquine, which is no more effective. On family planning, Irish Aid believes that CPR is stagnating over the last years because the MoH does not raise awareness. Community participation should be in kind due to the seasonal economies and shortages in cash in rural areas. The indent system for drug supply proved to be more cost-effective than the kit system. DANIDA While the WB is going to reduce its share in the basket and increases its PRSC support, DANIDA strongly supports the advocacy for an increase of government share into the MTEF or at least to prevent the government reducing its share. Regarding the District basket, DANIDA wanted to follow the Zambia model: a deconcentrated reform leading to a new system. In the implementation of the district basket there were too many restrictions, confusing guidelines, problematic financial management (shown by a recent audit), possible corruption (still to determine) during the 1st phase. Number of disclaimers, suggesting mismanaging, increased for unclear reasons. Council accountants are obviously overstretched or not enough qualified. While the indent system is much cheaper than the kit system, it is logistically more complex. The management of MSD is getting better, although the MSD Board is not fully autonomous and is therefore not effective in firing less effective staff. There is no strategic thinking in the Board, in particular regarding the introduction of ARV for which MSD has no clear direction. Management remains too conservative, relying on too much stock. Hence expanding to medical equipment will be difficult. HMIS, the result of two decades of DANIDA support, did not produced credible results ­ questionable data collection at the base among other reasons. The new LGA might rectify this with it emphasis on having reliable statistics. GTZ and KFW GTZ also emphasized that MTEF is not fully articulated with the 5 years HSP. While the regional level is moderately integrated in the central level, the regional hospitals are not. SWAp, which focuses mainly on system improvement, impacted as well the quality of service through increased availability of funds, drugs, and equipment at the periphery during the previous 3 years. The hospital reform is making slow improvements, and the process encounters no opposition. GTZ underlined the critical issue of HR. Since 1995 the workforce lost approximately 20,000 units, leaving only 48,000 out of which only 36% are qualified. Furthermore, the urban/rural repartition is biased. Immediate solutions suggested by GTZ were: (i) recruit the qualified, outside of the system, medical and paramedical staff (estimated to be in significant numbers), (ii) increase the productivity and improve personnel management, (iii) expand SASE, a training and better housing program, (iv) increase output, and (v) allow private practice in public hospitals to - 25 - increase the incentive to work in the public sector. GTZ noted that given the enormous workload implied by the introduction of anti-retroviral (ARV) drugs, the government should be cautious in introducing them without accompanying measures. User fees were recently expanded. CHF is used to purchase equipment. Health delivery (coverage >70% - first contact at less 5 km): IMCI approach cannot be expanded further than the 20 districts in which it is currently enforced due to lack of funding. Also, the IMCI community component is not yet implemented. The steady increase in EPI (DPT3 coverage of 89% including HSb) is due to the significant contributions of JICA and GAVI Since chloroquine resistance reached levels >50% there was a switch to Sulfadoxine- pyrimethamine (SP), but some is of low quality (even the quantity supplied by MoH). (c) Other partners (NGOs/private sector): 10. Additional Information Domain Issue Recommendations Health System Administration Annual setting of priorities among MoH's It is currently focusing on frequency of Use the Burden of Diseases Profile activities health problems, severity, feasibility of (derived from the frequency and ranking case management and population's point of health problems), supported by a of view. HERA Review Team considered simple computerized methodology it to be inadequate developed by the TEHIP project. Budget allocation formula Until last year, it was norm-based, input Should validate the new formula: Age and oriented, and established on national sex-weighted population (50%); Poverty Minimum Standards levels, based on the Poverty Welfare; Index of the geographical area under question (15%); An index of mileage, to and within the LGA (15%); and Burden of disease, to incorporate under-five and adult mortality rates plus any others available (20%) Budget execution Lack of clear and concise guidelines Need to review and streamline all guidelines to avoid over-lapping and incoherence. Local capacity is weak (council accountant overstretched or not qualified Support needs to be provided by Regional Health Support Teams to improve the capacity of local staff in health planning and management. Zonal training centers need to offer the necessary short-term skill-building training modules in planning management and quality care. Auditing of the first 37 districts during the first two year satisfactory. The third audit, covering 82 councils, provided a mixed picture - 26 - HMIS The system is too detailed. System needs to be streamlined to an essential package of information. Data collection at the periphery is weak Computerized data entry (pilot program in not systematic, and handled manually two districts) should be extended to all districts. Set as priority for Phase 2 Health care service delivery Policy and disease specific control There are too many sets of guidelines, A review should be undertaken to avoid guidelines incoherent and overlapping repetition and incoherence Supervision Lack of supervision guidelines Proper guidelines to be developed Supervision of peripheral health facilities Feedback of supervision report should be by DHMT was insufficient. properly documented and distributed. Supervision of districts by regional level Expand Regional Secretariat and RHMT was improper; lack of proper staff technical capacity, and review their roles Malaria Low coverage in bed nets and Boost distribution, by encouraging re-impregnation activites like the Tanzania National Voucher Scheme which permits pregnant women to buy the bed nets at a significant discount. Organize re-impregnation campaigns and evaluate the re-impregnation rate in Tanazania to reorient bed net strategy if necessary Delay in shifting from CQ to effective Given already high resistance to SP, first line treatment swiftly program shift from SP to ACT IMCI Shown to be effective in Tanzanian Scale-up community IMCI country wide. context. Implemented in 28 districts. Family planning Stagnated at 15% contraceptive Boost CPR through community based prevalence rate for modern methods over distribution of oral contraceptives and the last years expansion of long duration methods. Guidelines for Quality Assurance programBased on standards and norms for Should be oriented towards assessing the (developed under the office of the CMO, manpower, equipment and infrastructure quality of services measured against and later disseminated) and routine inspection. There is a lack in standards and clients' perspective. monitoring the quality of services on a Analyze and adapt the experiences of continuous basis. other QA cases like the one in Ghana Level 2 and 3 hospitals Autonomy of MMC Situation analysis done Simplify procedures and speed up process Revision of relevant legislation for extension of Hospital reform to other Bill on the autonomy passed selected tertiary and regional hospitals. Executive Board installed. MMC new management fee policy The PPP steering group elaborating Expand scope of service agreement to standard service agreement based on include QA issues distinguish respective existing Designated District Hospitals oneroles of district, region and central levels Pharmacy Board set up pilot to provide Accredited dispensing outlets authorized Carefully monitor quality assurance, Accreditation to Drug Dispensing Outlets to sell drugs to public health facilities on scope, duration and price of the drugs that (ADDO) to prevent them illegally selling recovered funds in case of drug shortage. can be purchased by health facility at the prescription drugs. outlet Role of Central MoH & Sector-wide Management MTEF / Annual PER MoH in control of and provides MoH should use the MTEF and the PER ownership of health sector activities. as supports of advocacy for appropriate Budget estimates rose from 69.5% to funding of the sector by MoF and donors - 27 - 79.3% of the FY03 budget (actual given increased absorption capacity and expenditure, rose from 57.3% to 62.4% existing huge financing gaps. between FY01 and FY02) Develop medium term planning (3 years) Inadequate medium-term horizon and and analyze past performance trend analysis. MoH organized Regular meetings of: Improved quality of dialog between Basket funding (abandoned by DFID and - Annual Joint Review donors and MoH, MoF and LGA. attracted UNFPA) should be attractive - Basket financing committee and Joint financing system (disbursement, enough to involve more donors and more - SWAp committee accounting, financial management, and funding. reporting) progressively set in place. Basket expenditures disbursement rate improved (actual versus budgeted) from 47% in FY01 up to 86.6% in FY02. The following tables provide additional information as it relates to Program Costs and Disbursements: Table 2.2: Program Projected costs and Actual expenditures per financing sources (in US$ millions) 2001 2002 2003 2004 Total 2001-2004 GoT 102.30 121.70 145.10 146.63 515.73 Actual 125.01 144.30 172.91 442.22 Loans 0.00 0.00 0.00 0.00 Actual 0.00 0.00 0.00 0.00 Internally 5.50 5.80 6.20 1.56 19.06 Generated Actual 2.25 1.47 1.67 5.39 External Aid -IDA 20.00 35.00 50.00 105.05 210.05 credit included Actual 12.87 23.19 32.28 3.11 71.44 Total 127.80 162.50 201.30 253.23 744.83 140.13 168.96 206.86 3.11 519.06 n.b.: Actual expenditure data is from the final draft of the Health Sector PER update FY2004, unless otherwise noted; and program projected cost is from PAD page 60. The amounts from 2004 are actual data; estimated data is available from PER update FY2004 Table 2.3: Disbursement into Health Account and IDA financing (in US$ million equivalent) All Sources IDA Year Health Project Total Exchange Health Project Total % of % of Total Fund Direct rate Fund Direct Health (Basket (TSh/$) (Basket Fund Fund) Fund) 2001 12.87 106.05 118.91 826.15 0.00 2.28 2.28 0.00% 1.92% 2002 23.19 105.54 128.73 930.34 0.16 4.46 4.62 0.70% 3.59% 2003 32.28 86.92 119.19 999.71 6.28 4.96 11.24 19.45% 9.43% n.b.: Data for the above table is from the final draft of the Health Sector PER update FY2004, unless otherwise noted. Contributions to the Health Fund are taken from MOH data. Project direct data is calculated as the difference between the MOH data for the contribution to the Health Fund and the Project data for disbursement. - 28 - Annex 1. Key Performance Indicators/Log Frame Matrix Outcome / Impact Indicators: 1 Indicator/Matrix Projected in last PSR Actual/Latest Estimate A health sector program integrated in GOT's 61% of external resources are on-budget 79.3% of external resources were on-budget Medium-Term Expenditure Framework for FY03% as per Public Expenditure Review per the FY02 Public Expenditure Review (MTEF), with at least 50% of donor (PER) (PER). The FY03 PER will not be available resources for the sector reflected in the until after the Project has Closed. MTEF.* District-based health planning and i) Comprehensive District health Plans have As of July 2003, all districts produce management system and its financing been prepare by all of the 37 councils and comprehensive plans and receive grants through block grants, that are linked to block grants allocatied on this basis to these against these plans. outputs, outcomes and performance, tested districts/councils and ii) For Phase 2 and 3 , and operational in at least 30% of the 113 these processes are ongoing districts.* National guidelines for an Essential Health i) The national guidelines for an EHP have Package completed, costed, district been developed and costing done ii) Training management teams trained for its use, and guidelines have been developed being used. quality assurance program in place.* iii) A District level training is ongoing. iv) Access to drugs and training strengthened and v) supervision improved Performance-based budgeting and Quartery progress reports are submitted by monitoring at the central level introduced and districts to monitor progress in the tested. implementation of the district health plans based on the 19 performance indicators established For HIV/AIDS, high level national bodies A national HIV/AIDS fund fully operational i) HIV/AIDS policy in place ii) TACAIDS (NABA, NAC, NACP) to oversee the and financing approved projects. establish to coordinate national response iii) multi-sectoral response, strengthened in staff NMSF developed and HIV/AIDS and fully functional.* maistreamed into sectors % of children under one year old receiving 75% 85% DPT3 is increased from 71.0% in 1996 to 75% in 2003. % of population satisfied with quality, 50% positive response This indicator has not yet been measured, quantity, access, affordability and availability but anecdotale evidence suggests that the of preventive, curative and referral health population is more satisfied, particularly as services (baseline and target figures to be drug availability has improved. established). Output Indicators: 1 Indicator/Matrix Projected in last PSR Actual/Latest Estimate i) 37 plus all remaining in the process ii) 37 As of July 2003, all districts produce (i) No. of districts trained in district-based plus all remaining districts in the process and comprehensive plans and receive grants planning and management. 37 plus all remaining districts in the process against these plans. (ii) No. of districts with approved health plans. (ii) No. of districts producing quarterly financial and physical progress reports in a timely manner with satisfactory quality. (i) MMC reform: Legislation & regulation for (i) MMC management restructured. Capacity Less progress has been made in this area restructuring approved. Management building implemented. (ii) Strategies and that was envisioned. Hospital reforms have restructured. Capacity building implemented action hospitals for other reform hospitals thus been prioritized under th 2nd Health as in the action plan. approved and new management structure in Sector Strategic Plan which is to be (ii) Reform of tertiary/regional hospitals: place. supported by the 2nd Phase of the APL. Strategies & action plans approved. New management in place. A policy/strategy for private sector (A policy/strategy for private sector A bill has been passed on practice of collaboration drafted in a consultative collaboration drafted in a consultative traditional medicine and private practice. manner. manner. Privare providers are being accredited to deliver care and drugs under the national health insurance fund ( NHIF) A sector program integrated in the MTEF. PER and MTEF processes fully established This target has been fully achieved. - 29 - Reform strategy for the new role of central in the sector with improved reporting , MoH developed. Legislation/regulations monitoring and evaluation systems reviewed/revised. QA guidelines developed. Annual reporting of sector program implementation. Annual joint reviews carried out. Decreased stock-out rates of (selected) A rehabilitation plan for primary health essential drugs/supplies at public health facilities prepared and approved. Percentage facilities. Assessment of the public health of health facilities with designated malaria facility network. A realistic & affordable drugs in stock has increased to 25%. HMIS infrastructure investment/maintenance plan. however remains weak and a target for Hospital HMIS operational. Phase II. Database for human resource for health There is shortage of both number and skills (HRH). Five-year plan for HRH in the district staff. Recruitment of district reviewed/updated. Remuneration and staff lags and authorization to fill vacant posts incentive packages for health workers are not addressesd in a uniform manner reviewed/revised. Curricula for all cadres nationawide. revised as needed. Zonal centers strengthened. (i) % of recurrent GoT budget for health. (ii) - Recurrent GOT budget for health was 83% % of user fees generated from the Cost in FY02 Sharing Program to total non-salary recurrent - % of user fees generated not yet expenditures. (iii) NHI established. (iv) CHF determined replicated with declining start-up costs. (v) - NHI established. Hospital DRF operational. - CHF replicated - DRF operational A multi-sectoral national HIV/AIDS fund Tanzania MAP is effective since October 15, established & operational. Enhanced, more 2003 with a community AIDS response Fund visible leadership and advocacy. Number. of component to finance community/drived high-impact, innovative, and/or HIV/AIDS response. More resources for community-based AIDS-related programs HIV/AIDs eg Global Fund Clinton Foudation financed & implemented. National AIDS are forthcoming. strategy.( 1 End of project Additional information is provided in ANNEX 10 - 30 - Annex 2. Project Costs and Financing Project Cost by Component (in US$ million equivalent) Appraisal Actual/Latest Percentage of Estimate Estimate Appraisal Component US$ million US$ million 2001 PROGRAM OF WORK 1.81 2.28 126 2002 PROGRAM OF WORK 3.69 4.62 125 2003 PROGRAM OF WORK 7.70 11.24 146 2004 PROGRAM OF WORK 8.80 3.11 35 Total Baseline Cost 22.00 21.25 Total Project Costs 22.00 21.25 Total Financing Required 22.00 21.25 Data is from the project disbursement schedule Project Costs by Procurement Arrangements (Appraisal Estimate) (US$ million equivalent) 1 Procurement Method Expenditure Category ICB NCB 2 N.B.F. Total Cost Other 1. Works 0.00 0.06 0.00 0.00 0.06 (0.00) (0.06) (0.00) (0.00) (0.06) 2. Goods 0.24 0.22 0.05 0.00 0.51 (0.24) (0.22) (0.05) (0.00) (0.51) 3. Services 0.00 0.00 0.43 0.00 0.43 (0.00) (0.00) (0.43) (0.00) (0.43) 4. Incremental Costs 0.00 0.00 5.60 0.00 5.60 (0.00) (0.00) (5.60) (0.00) (5.60) Total 0.24 0.28 6.08 0.00 6.60 (0.24) (0.28) (6.08) (0.00) (6.60) 1/Figures in parenthesis are the amounts to be financed by the IDA Credit. All costs include contingencies. 2/Includes civil works and goods to be procured through national shopping, consulting services, services of contracted staff of the project management office, training, technical assistance services, and incremental operating costs related to (i) managing the project, and (ii) re-lending project funds to local government units. - 31 - Annex 3. Economic Costs and Benefits The economic analysis at appraisal concluded that public sector involvement in the health sector was justified and given the then prevailing sector constraints called for a comprehensive approach of health sector reform under a sector-wide mode of program planning and financing. Consistent with the 1995 Tanzania Social Sector Review and the CAS, the GoT would target its efforts in the following domains: (i) decentralization and increased community participation; (ii) concentration of fiscal resources on primary health care while ensuring a policy environment that facilitates greater private participation in curative services; (iii) decentralize responsibility, increase local resource mobilization, and rationalize expenditures; (iv) shift resources to child and maternity care and preventive health services; and (v) shift authority to local agencies. The proposed benchmark was increased rural access to primary health care. The $ 21.3 million IDA contribution to the $ 654 million Program over the project period, i.e.; 3.7% percent of the total, constitutes a relatively small share compared to the GoT' share and to some other donors. Moreover, the focus of Phase 1 of HSDP was on system improvement as demonstrated by the Development Objectives, which were, except for the immunization coverage, more oriented towards reform and process indicators. This was also true for the Program in general and for most other "basket" donors. The following considerations apply to the total program. 1. Planning and budgeting most of the sector resources using the MTEF, both at central and PORALG level, resulted in a dramatic improvement in the MoH efficiently allocating the resources across domains and across levels: preventive versus curative care, central and intermediate versus peripheral level; primary health care versus secondary and tertiary hospital level care. Furthermore, expanding a robust method to plan and budget activities using objective criteria (population, poverty, burden of diseases, logistical constraints) to all the districts countrywide over 3 years had an impact on allocative efficiency at district level. 2. The pooling of a significant portion of the foreign aid using a joint financing system (disbursement, accounting, financial management, and reporting) and jointly agreed procurement procedures has improved the efficiency of the health expenditures financed by development assistance. The increase in the volume of drugs purchased and channeled to the districts combined with an expanding cost-sharing system as well as setting in place drug revolving funds at hospital level improved drug availability countrywide. This at the cost of accessibility, particularly for the poor since the exemption system was not yet systematic. 3. All these improvements benefited the quality of health service delivery as demonstrated by the doubling of the percentage of population satisfied with quality of health services (from 30% prior to Phase 1 to 62% in the Household Budget Survey FY01). In view of the stagnating child mortality, despite excellent immunization coverage and a relatively high utilization rate, the impact from the above benefits may have been lessened due to the conjunction of the delayed decision regarding an appropriate first line malaria treatment and the high toll due to the spreading of the HIV/AIDS epidemic - 32 - Annex 4. Bank Inputs (a) Missions: Stage of Project Cycle No. of Persons and Specialty Performance Rating (e.g. 2 Economists, 1 FMS, etc.) Implementation Development Month/Year Count Specialty Progress Objective Identification/Preparation March 1999 6 Economist, TTL Sr. Health Specialists (2) Health Economist Financial Management Specialist Procurement Specialist Appraisal/Negotiation Appraisal August 8 Procurement Analyst ­ September 1999 Lead Financial Specialist Lead Procurement Specialist HIV/AIDS Specialist Sr. Economist (Health) Sr. Health Specialists (3) Negotiations November 1999 Supervision December 2000 8 Sr Health Specialist S S Sr. Economist Legal Officer Disbursement Officer Sr. Procurement Specialist FM Specialists (2) Sr. Operations Officer March 2001 6 Sr. Health Specialist S S Lead Health Specialist Sr. Economist FM Specialist Task Assistant M&E Specialist November 2001 6 Sr. Health Specialist S S Sr. Economist FM Specialist Procurement Specialist Disbursement Assistant Task Assistant March 2002 (MTR) 6 Sr. Health Specialist S S Lead Implementation Specialist Health Specialists (2) FM Specialist TB Specialist December 2002 3 Sr. Health Specialist S S Procurement Specialist FM Specialist May 2003 9 Sr. Health Specialist (2) S S - 33 - Sr. Nutritionist Sr. Economist FM Specialist (2) Procurement Specialist Nutrition/Community Health Specialists (2) Task Team Assistant ICR ICR 7 Sr. Health Specialist (3) S S Operations Officer Task Team Assistants (3) (b) Staff: Stage of Project Cycle Actual/Latest Estimate No. Staff weeks US$ ('000) Identification/Preparation 85 365,863 Appraisal/Negotiation Supervision 148 262,216 ICR 8 31,000 Total 241 659,079 - 34 - Annex 5. Ratings for Achievement of Objectives/Outputs of Components (H=High, SU=Substantial, M=Modest, N=Negligible, NA=Not Applicable) Rating Macro policies H SU M N NA Sector Policies H SU M N NA Physical H SU M N NA Financial H SU M N NA Institutional Development H SU M N NA Environmental H SU M N NA Social Poverty Reduction H SU M N NA Gender H SU M N NA Other (Please specify) H SU M N NA Private sector development H SU M N NA Public sector management H SU M N NA Other (Please specify) H SU M N NA - 35 - Annex 6. Ratings of Bank and Borrower Performance (HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HU=Highly Unsatisfactory) 6.1 Bank performance Rating Lending HS S U HU Supervision HS S U HU Overall HS S U HU 6.2 Borrower performance Rating Preparation HS S U HU Government implementation performance HS S U HU Implementation agency performance HS S U HU Overall HS S U HU - 36 - Annex 7. List of Supporting Documents 1. Community Health Financing Scheme in Tanzania 2. Final Report of the Health sector Main Review 2002 3. Health Care Under Community Health Financing in Songea Rural District 4. Health Financing with a Focus on Exemptions: Iringa District Council Experience, First Annual DMOs Meeting held at Tanesco Training Centre, Morogoro June 9-15, 2003 5. Health Sector PER, Update 2004 6. How to Solve the Human Resources for Health Problems at Local Government Authority Level, Experience of CHF Mbinga District Council 7. Human Resources for Health: Requirements and availability in the context of scaling-up priority interventions, A case study from Tanzania; Cristoph Kurowski, Salim Abdulla; and Anne Mills; October 2003. 8. Implementation Completion Report, Tanzania Health and Nutrition Project Report No. 19964 9. Ministry of Health Vote 52 - Medium Term Expenditure Framework 2001/2002 - 2003/2004 10. Ministry of Health Vote 52 - Medium Term Expenditure Framework 2002/2003 - 2004/2005 11. National HIV Multisectoral Framework - final document 12. NHIF REPORT progress report 13. Project Appraisal Document, Tanzania Health Sector Development Program 14. Project Status Report, Tanzania Health Sector Development Program Sequence 1 15. Project Status Report, Tanzania Health Sector Development Program Sequence 2 16. Project Status Report, Tanzania Health Sector Development Program Sequence 3 17. Project Status Report, Tanzania Health Sector Development Program Sequence 4 18. Project Status Report, Tanzania Health Sector Development Program Sequence 5 19. Project Status Report, Tanzania Health Sector Development Program Sequence 6 20. Project Status Report, Tanzania Health Sector Development Program Sequence 7 21. Project Status Report, Tanzania Health Sector Development Program Sequence 8 22. PRSP Progress report 2002 23. Setting and Monitoring Health, Nutrition, and Population Goals from a Poverty Perspective, The Case of Tanzania's Poverty Reduction Strategy; Davidson Gwatkin; July 2001 24. Technical Review of Health Service Delivery at District Level, HERA, March 2003. 25. Technical Review of Health Service Delivery at District Level, HERA, March 2004. 26. Progress report on implementation status on some of key milestones to facilitate improved performance in the health sector: Tanzania Joint Health Review 11-13 March 2003 Main Report 27. Supplemental Aide Memoire - March 12 - 30, 2001 28. Supervision Mission - March 20-31, 2000 29. Aide Memoire: Appraisal Mission - August 23 to September 03, 1999 30. Aide Memoire HSDP SPN - March 2001 31. Ministry of Health Vote 52 - Detailed Cash Flow for July 2002 - June 2003 32. Final PER Draft report Feb 2003 33. Tanzania Health Sector Joint Review, March 2004 - 37 - 34. Tanzania Joint Annual Health Sector Review, March 15-7, 2004 35. Aide Memoire ­ Final: Supervision - December 4-12. 2003 36. Supervision Mission - November 12-16, 2001 37. Aide Memoire for the SPN and MTR of the HSDP - March 11 - 22, 2002 38. Aide Memoire HSDP Supervision Mission - March 10 - 26, 1999 - 38 - - 39 -