This blog post has been co-written by Nidda Yusuf, Lead on Global Health Financing and Universal Health Coverage, and Elo Otobo, Senior Health Advocacy Adviser
Despite ongoing disruptions to health services for women, children and babies, and immense need for services, global donors have rolled back contributions to development financing. At the same time, the poorest countries struggle to raise domestic resources for health. The COVID-19 pandemic, coupled with the ongoing crisis in Ukraine, has impacted the global economy, reducing fiscal space for health.
In this blog, we call on donors to halt this rollback of support and explore new avenues of sustainable financing for health.
A global deficit in essential health services
In February, the World Health Organization released the third iteration of its pulse survey, which reported that two years into the pandemic, 90% of countries are still experiencing disruptions to essential health services like childhood vaccinations, family planning, nutrition and safe birthing services.
This astonishing statistic is a warning to governments, donors and policy experts whose goal is to ensure women, children and babies can access the health care they need, when they need it.
Worryingly, these disruptions have been reported across all major touch points of health service delivery and are caused by challenges on both the demand and the supply side. One-third of countries reported a lack of health care resources (like shortages of medical supplies and staff shortages) and the impact of COVID-19 related policies, which have caused the suspension or scale back of health services. And 25% of countries reported a decrease in health-seeking behaviour, with fewer pregnant women travelling to facilities to give birth and fewer women and adolescents seeking family planning services.
Health systems around the world are more stretched than ever, managing a triple onslaught:
- responding to the clinical impact of the pandemic
- delivering the COVID-19 tools needed to end the acute phase of the pandemic
- maintaining life-saving routine essential services.
Donor fatigue
Countries all over the world are at risk of losing all the progress they made before the pandemic in reaching Sustainable Development Goal 3 – Ensure healthy lives and promote wellbeing for all at all ages – by 2030.
At a time when governments are in crucial need of additional support to reverse the effects of the pandemic on their health systems, we have seen a tremendous rollback in global development financing. During the pandemic, governments cut capital spending like infrastructure and education. The fallout from the war in Ukraine may also compound the stresses, causing higher energy and commodity prices as well as supply chain disruptions.
The poorest countries rely heavily on donors to help fund their health systems. In 2019, funding from donors accounted for 29% of total health financing. In some contexts, donor funds are a larger share of health spending than domestic sources. This means that these health systems are vulnerable to shocks and further fragmentation caused by any sudden reduction in donor financing. Donor funding streams that previously upheld these systems are now in question.
Donors that previously championed services that meet the needs of women, children and adolescents, like family planning, immunisation and community care, have cut these programmes. Since 2020, the UK government reduced its overall aid contributions of 0.7% to 0.5% of gross national income, citing economic challenges caused by the pandemic. This left a deficit of £4.5 billion in the 2019 budget and cut health spending in half. To date, the UK’s aid cuts have disrupted family planning. malaria and nutrition programming and contributions to the UN Population Fund (UNFPA), which provides low-cost family planning services and supplies around the world. As a result, these cuts risk “7.5 million additional unintended pregnancies, 2.7 million unsafe abortions, and 22,000 maternal deaths worldwide over the next year” and hamper HIV-related programming. In March, Germany also announced a proposed 12% reduction in its aid budget to €10.8 billion.
Domestic fiscal space for health
Before the pandemic, global health systems lacked an estimated $176 billion each year, a substantial gap in financing for universal, basic, good-quality healthcare. Although the pandemic forced governments to spend more on health, this was not spent on essential health services. Investments were directed to tackling COVID-19 and diverting resources away from routine services that meet the day-to-day healthcare needs of our communities. Last year, the Global Financing Facility reported that for each COVID-19 death, more than two women and children have died due to disruptions in health systems – far bypassing the scale of the pandemic.
Low- and middle-income countries have been disproportionately affected by the reduced economic growth in 2020. Some of these countries' economies may only recover to pre-pandemic gross domestic product (GDP) levels (already far behind richer countries) in 2025. Governments had less to spend and compensated by borrowing more money – costing countries an estimated 14% of GDP in terms of interest repayments alone and leading to 60% of poor countries in debt distress. Economic recovery and health recovery go hand in hand – therefore we must reverse the damage done to essential health services during the pandemic.
Opening fiscal space for health
Governments should opt for a pro-health spending policy as a sound economic policy:
- increasing government spending on health to ensure a healthy workforce
- investing more in good-quality, basic health services at the primary health care level – so that care is provided free at the point of use and equitably, including in harder-to-reach areas.
Governments should creatively construct mechanisms to raise additional revenues for health through
- progressive taxation: applying a higher tax burden on those with more ability to pay
- pro-health taxes: taxing health-damaging goods to raise revenue, as well as contributing to reducing non-communicable diseases.
In tandem, governments should:
- reform their health financing architecture for increased protection, coverage, equity and access for all.
Donor governments should:
- as a critical first step, reduce the harm done; increase development assistance budgets to pre-pandemic levels to support fragmented health systems; and enable essential health services at this critical juncture
- provide technical assistance to low- and middle-income countries to establish a progressive health financing architecture for universal health coverage, on the road to enabling sustainable health financing in the longer term.
International financial institutions and G20 countries should
- strengthen debt relief initiatives in the short to medium term
- ensure any support on debt relief is not counted in official development assistance budgets – to reduce the likelihood of a situation where ‘what one hand giveth the other taketh away’.
Civil society organisations and communities should:
- be empowered to hold governments to account on health financing decisions.
The alternative…
In poor countries, the burden of paying for healthcare is often put on families as they seek care. These payments account for 40% of total health spending, nearly double that of rich countries. In these cases, the poorest families are forced to choose between accessing lifesaving healthcare at extremely high costs or meeting their basic living needs.
…is not an option
Prioritising expenditure on essential health services is a political choice. Governments must work to expand fiscal space for health and reform health financing structures to ensure all women, children and babies benefit from good-quality healthcare at the point of need without suffering financial hardship. After all, spending on Health for All underpins economic growth.
Time To Act
Establishing sustainable and equitable health financing structures will require collective action from governments, donor governments and international institutions. Upcoming global moments, including the G20 Summit and the International Conference on Family Planning in November, are opportunities for stakeholders to make solid commitments that prioritise essential health services.
Last week, donors raised $500 million for the Global Financing Facility, showing strong commitment for catalytic investments to increase government spending on health and resolve the ongoing crisis in essential health services for women and children. At the event, titled Reclaim the Gains, civil society, donors and governments all recognised a crucial point – the window of opportunity to reverse losses for women and children is still open right now, but it is closing fast.
Photo: Six-month-old Alaziz receives a pneumonia vaccine in Ethiopia (Hanna Adcock / Save the Children)
Safeguard health services