The Rs 86,200 crore allocated to the ministry of health and family welfare for FY23 is a mere Rs 200-crore increase over the revised estimates for FY22; in real terms, the allocation may actually end up smaller than last year’s. While it took the Covid-19 pandemic—and how it exposed our public healthcare as woefully inadequate—for public spending on health to gather some momentum, the allocations need to be much bigger. More so, given experts across sectors have warned of many more pandemics in the future, of varying severity. Bear in mind, as per the WHO, good health budgeting is all about “multi-year planning and budgeting” and “realistic and credible estimates of costs”, among other traits.
As per the latest Economic Survey the spending on health (the Centre plus the states) stood at 2.1% of the GDP in FY21; this puts us on the path to achieving the 2.5% target set for 2025. But, the Union health ministry spend, as a percentage of the GDP, dipped this year (though only slightly) from the peak reached in the first pandemic year. Thus, the momentum from the modest increases before the pandemic could need fostering. Between FY16 and FY20, the Union health ministry spending moved from 0.3% of the GDP to 0.44%, and came in at 0.6% in FY21; in FY22, it was 0.58%. To be sure, health is a state subject, but given the implications for the economy, the Centre and the states should be doing much more if “multi-year planning” is a goal.
Last year, the Centre adopted an expanded definition of health expenditure, and pencilled in close to Rs 40,000 crore for Covid-19 vaccination. This year, it has earmarked Rs 5,000 crore for vaccine support, which could also be a sign that market forces will come into play—bear in mind, a substantially large chunk of the population is yet to receive a single dose of approved vaccines, while full coverage is yet to reach the desired level. The FY21 budget had earmarked 64,180 crore, over six years, for the Pradhan Mantri Ayushman Bharat Infrastructure Mission (PMABHIM), which aims to improve primary, secondary, and tertiary healthcare facilities across the country; however, this year’s allocation for the health infrastructure overall is only Rs 5,156 crore. Since its inception in October 2021, the PMABHIM has only seen spending of Rs 585 crore (FY22 RE). Without ambitious spending and implementation, realising the PMABHIM vision seems difficult.
Moreover, WHO recommends taking out capital expenditure while considering allocation, as these are one-time expenditures for the long-term. The National Health Mission, the umbrella mission that includes both the urban and rural health missions, has seen a mere 7% increase in allocation. Given how the urban mission is yet to make a dent in the smaller cities, a larger allocation was perhaps merited.
The focus areas of the healthcare system, as the pandemic has underscored, are healthcare infrastructure as well as workforce. WHO recommends a ratio of 1 doctor for 1,000 people, a goal India is yet to realise. Given the large gaps in public healthcare, budgeting for the health ministry budget should not come across as uninspired. The immediate focus should be on not just meeting but bettering the WHO ideals for healthcare infrastructure, access and personnel. There is some effort towards this, especially on bolstering tertiary healthcare and medical education capacity, but much more is needed. The latest National Health Accounts figures do suggest welcome relief for citizens when it comes to out of pocket expenditure on health, but there can be no room for complacency.The primary responsibility is of the states, but the Centre also needs to participate more enthusiastically.