WORLD HEALTH ORGANIZATION
ORGANISATION MONDIALE DE LA SANTE
REGIONAL OFFICE FOR THE WESTERN PACIFIC BUREAU REGIONAL DU PACIFIQUE OCCIDENTAL
REGIONAL COMMITTEE Fiftieth session Macao 13–17 September 1999 Provisional agenda item 9.2
WPR/RC50/5 7 August 1999 ORIGINAL: ENGLISH
PROPOSED PROGRAMME BUDGET 2002–2003: COUNTRY ALLOCATIONS
In May 1998, the World Health Assembly adopted resolution WHA51.31 which recommended that regular budget allocations to regions would, for the most part, be guided by a model based upon an index. The result has been a major realignment of regional allocations. Compared to the previous biennium, the budget for the Western Pacific Region for 2000–2001 has been reduced by US$ 4.4 million from US$ 80.3 million to US$ 75.9 million. During its forty-ninth session, the Regional Committee for the Western Pacific requested the Regional Director to report to the fiftieth session on the method and process to be applied in determining country allocations in the budget for the 2002–2003 biennium. This paper outlines the present method and process for determining country allocations. It also offers some guiding principles to be applied for the 2002–2003 biennium and beyond for country budget allocations in the Region. These principles are presented for consideration by the Regional Committee.
WPR/RC50/5 page 2
1. INTRODUCTION
In May 1998, World Health Assembly resolution WHA51.31 recommended that regional, intercountry and country allocations in future programme budgets approved by the Health Assembly should, for the most part, be guided by a model that: “(a) draws upon UNDP’ s Human Development Index, possibly adjusted for immunization
coverage; (b) incorporates population statistics of countries calculated according to commonly
accepted methods, such as ‘ logarithmic smoothing’ .” The Health Assembly also decided that the model should be applied in a flexible manner in order to minimize, as far as possible, adverse effects on countries when budgetary allocations to regions were reduced. This included a request to the Director-General to ensure that all least developed countries (LDCs) would be guaranteed during the 2000–2001 biennium that their allocation from the regular budget would not be less than that of the 1998–1999 budget by use of the 2% transfer from global and interregional activities and by casual income, if available. It further requested the
Director-General to continue to give high priority to protecting the situation of least developed countries in subsequent bienniums. The full text of resolution WHA 51.31 is reproduced in Annex 1. Applying the model described in paragraphs (a) and (b) above strictly would have resulted in dramatic shifts between WHO regions. For example, the total allocation for the Western Pacific Region for 2000–2001 would have been US$ 53 210 300, a reduction of US$ 13.8 million or 31%. However, following discussions at the World Health Assembly, it was agreed to limit the overall reduction to any one region to 18% implemented over three bienniums. This resulted in a reduction in the overall budget allocation to the Region for 2000–2001 from US$ 80 279 000 to US$ 75 889 000, a reduction of US$ 4 390 000 or 5.47%. During the presentation of the 2000–2001 global budget to the Executive Board in January 1999, there was further discussion on the subject of a global formula for country allocations. The Director-General proposed, and the Executive Board agreed, to review this issue and to present the
WPR/RC50/5 page 3
findings of the review to the Executive Board in January 2000. A summary of planned expenditure for Headquarters and the regions for 1998–1999 and 2000–2001 is provided in Annex 2. At the regional level, during the presentation of the proposed programme budget for 2000– 2001 for the Region to the forty-ninth session of Regional Committee for the Western Pacific, a discussion took place as to the basis for the allocation of funds to individual countries within the Region. Resolution WPR/RC49.R5, which was adopted to record the Regional Committee’ s views on the proposed programme budget, therefore included a request to the Regional Director to report to the fiftieth session on the method and process to be applied in determining country allocations in the programme budget for the 2002–2003 biennium. The full text of the resolution is reproduced in Annex 3. The components of the overall regional allocation are explained in Annex 4. The purpose of this paper is to present the current method and process for determining country allocations and to outline other possible options for determining country allocations in the Western Pacific Region. The Regional Committee’ s conclusions will be forwarded to the Director-General who will take them into account when making her presentation to the Executive Board in January 2000.
2. EXISTING METHOD AND PROCESS OF DETERMINING COUNTRY ALLOCATIONS
The allocations for the regions are communicated to the Regional Office through a memorandum sent by the Director-General to Regional Directors giving overall instructions on the preparation of the budget and providing an initial planning allocation before cost increases. This memorandum specifies the amount to be included for the total of all country allocations. The Regional Directors then determine the country planning figure and the allocation to country offices. remainder is distributed between the intercountry allocation and the Regional Office allocation. In the Western Pacific Region, the criteria used to allocate the country planning figure have evolved over time and have been published in the proposed programme budgets under the section “Development, presentation and funding of the proposed programme budget”. The criteria include the following: The
WPR/RC50/5 page 4
•
the level of need, measured in part by the socioeconomic and health indicators of each country or area, paying particular attention to the needs of least developed countries;
•
the country’ s commitment to build up its health systems in accordance with existing policies and strategies;
•
the effectiveness of national systems for financial monitoring and evaluation, including assessing the effective use of resources;
• •
the capacity of countries to implement planned technical activities; and, expected support from extrabudgetary resources. Because of the qualitative nature of some of these criteria, it is not possible for them to be
applied mechanically. As part of the application of the above criteria, WHO Representatives and Country Liaison Officers are asked to determine the level of cooperation required by countries based on “first hand” information on government priorities, inflation, health services programmes, and other health and socioeconomic indicators. The comments of the WHO Representatives and Country Liaison Officers, together with the documentation on the criteria used to allocate country resources referred to above, are discussed in detail at a meeting with the WHO Representatives and Country Liaison Officers before the country allocations are consolidated and presented to the Regional Director for final approval.
3. GUIDING PRINCIPLES FOR FUTURE COUNTRY BUDGET ALLOCATIONS
The adoption of resolution WPR/RC49.R5 by the Regional Committee and of resolution WHA51.31 by the World Health Assembly makes this an appropriate time to consider alternative ways of determining country planning figures, including the possibility of using an index, which would allow the determination of individual country planning figures to be more objective (Annex 5). The model recommended by resolution WHA51.31 to determine regional allocations would appear to provide a reasonable basis for determining country planing figures within the Western Pacific
WPR/RC50/5 page 5
Region. It is therefore recommended that the Regional Committee should accept the model as a basis for determining country planning figures within the Region. However, even taking into account the flexible application of the model recommended by resolution WHA51.31 (particularly with regard to the preservation of allocations to LDCs, as described at the beginning of this paper) there are a number of additional difficulties with the model which suggest that it should be used for guidance, rather than being applied in a mechanical manner. For example: 1) There must always be some delay in gathering economic indicators. 2) The use of health indicators will inevitably reduce allocations to countries with more favourable statistics. For example, some developing countries have better immunization coverage than some developed countries. 3) Some specific factors need to be taken into account for some countries within the Region. These include the need to recognize the needs of small island countries and the effect of the recent Asian economic crisis. 4) Human Development Index (HDI) factors are not available for every country When data are not available, the model uses a standard factor. For least developed countries (LDCs), when no other figure is available, a figure of 0.344 is used.1 countries, a figure of 0.586 is used.2 5) Some countries’ allocations would be reduced to zero under the model recommended by resolution WHA51.31 because their GNP per capita is greater than US$ 9636.3 For other developing
1
In the Western Pacific Region, this applies to Kiribati and Tuvalu (data were available for all other LDCs in the Region). These countries and areas include American Samoa, Cook Islands, French Polynesia, Guam, Macao, Marshall Islands, Federated States of Micronesia, Nauru, New Caledonia, Niue, Northern Mariana Islands, Palau, Tokelau and Tonga. 3 The following countries and areas would receive a zero allocation according to the model recommended by resolution WHA51.31: Australia; Brunei Darussalam; French Polynesia; Guam; Hong Kong, China; Japan; Macao; Northern Mariana Islands; New Caledonia; New Zealand; Republic of Korea; and Singapore. 2
WPR/RC50/5 page 6
For these reasons, it is recommended that, as a guiding principle for future budget allocations, only 60% of the country planning figure should be determined in accordance with the model recommended by resolution WHA51.31. The allocation of the remaining 40% would be determined by the Regional Director in the course of preparing the proposed budget, taking into account the following considerations: 1) The difference between the allocation for 2000–2001 and the new allocation should be adjusted over three bienniums. 2) An adjustment should be made to ensure that LDCs should not receive a lower allocation in 2002–2003 than they did in 2000–2001. 3) The possibility of a minimum allocation should be considered for countries and areas which would have received zero allocation if the model recommended by resolution WHA51.31 were applied (item 5 and footnote 3, page 5). If the principle of a minimum allocation is accepted: a) Members of the Organization for Economic Cooperation and Development (OECD)4 may choose to forego their allocations. b) For other countries and areas in this category, a fixed amount, such as US$ 50 000 per biennium, may be appropriate. 4) The specific health needs of individual countries should be taken into account. If the Regional Committee agrees to these proposals, this method will be used to establish the individual country allocations for the proposed programme budget for 2002–2003 and beyond.
4
Australia, Japan, New Zealand and the Republic of Korea are members of the OECD.
FIFTY-FIRST WORLD HEALTH ASSEMBLY Agenda item 27.2
WHA51.31 16 May 1998
Review of the Constitution and regional arrangements of the World Health Organization Regular budget allocations to regions
The Fifty-first World Health Assembly, Recalling resolution EB99.R24 on regional arrangements within the context of WHO reform; Noting that regular budget allocations to regions have not been based on objective criteria but rather on the basis of history and previous practice; Concerned that, as a result, each region’s share of such allocations has remained largely unchanged since the Organization’s inception; Recalling that two basic principles governing the work of WHO are those of equity and support to countries in greatest need; and stressing the need for the Organization to apply principles which Member States have adopted collectively; Noting that other organizations of the United Nations system, particularly UNICEF, have already adopted models based on objective criteria to ensure a more equitable distribution of programme resources to countries, 1. THANKS the Executive Board and its special group for the review of the Constitution for the comprehensive study of allocations from the regular budget to regions; 2. REAFFIRMS Article 55 of the Constitution which stipulates that it is the Director-General’s prerogative to prepare and submit to the Board the budget estimates of the Organization, and requests her/him to take into account the discussion on this matter during the Fifty-first World Health Assembly when preparing future programme budgets; 3. RECOMMENDS that, globally, the regional, intercountry and country allocation in future programme budgets approved by the Health Assembly should for the most part be guided by a model that: (a) draws upon UNDP’s Human Development Index, possibly adjusted for immunization coverage;
(b) incorporates population statistics of countries calculated according to commonly accepted methods, such as “logarithmic smoothing”;
WHA51.31
(c) can be implemented gradually so that the reduction for any region would not exceed 3% per year and would be spread over a period of three bienniums; 4. REQUESTS the Director-General to present a thorough evaluation of that model to the Fifty-seventh World Health Assembly for the purpose of continuing response to health needs and equitable allocation of the resources of the World Health Organization; 5. DECIDES that the model should be applied in a flexible rather than a mechanical manner so as to minimize, to the extent possible, any adverse effects on countries whose budgetary allocations will be reduced; 6. REQUESTS the Director-General to ensure that all least developed countries will be guaranteed during the 2000-2001 biennium that their allocation from the regular budget will not be less than that of the 1998-1999 budget by use of the 2% transfer from global and interregional activities foreseen in resolution WHA48.26 and by casual income if available; and to continue in subsequent bienniums to give high priority to protect the situation of least developed countries; 7. REQUESTS the Director-General, while emphasizing that any additional funds resulting from the present process of reallocation should flow to the country level, to enable regions within the terms of the Constitution to determine for themselves the partition between country, intercountry and regional office budgets; 8. REQUESTS the Director-General to monitor and evaluate closely the working and the impact of this new process in the light, in particular, of changes in international social and economic conditions, and to report annually to the Executive Board and the World Health Assembly with a view to any further refinement, development or modification to ensure response to health needs and the equitable allocation of the resources of the World Health Organization; 9. REQUESTS the Director-General to report to the 103rd session of the Executive Board and to the Fifty-second World Health Assembly on the details of the model and the regional, intercountry and country allocations to be applied to the 2000-2001 biennium; 10. FURTHER REQUESTS the Director-General to report to the 103rd session of the Executive Board and to the Fifty-second World Health Assembly within the context of the request in paragraph 4 above, on the use of extrabudgetary allocations in regional, intercountry and country programmes in the previous three bienniums.
Tenth plenary meeting, 16 May 1998 A51/VR/10
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WPR/RC50/5 Page 9 ANNEX 2 Summary of planned expenditure (Headquarters and regions ) from regular budget and other sources for 2000-2001 as compared to 1998-1999 (US$ thousand)
REAL 1998-1999 REGULAR BUDGET US$ Headquarters 282 953 % 33.58 INCREASE/ (DECREASE) US$ (3 898) % (1.38)
2000-2001 PROPOSED REGULAR BUDGET US$ 279 055 % 33.12 1998-1999 OTHER SOURCES US$ 527 408 % 65.56 2000-2001 OTHER SOURCES US$ 663 200 % 69.21 US$ 810 361 1998-1999 TOTAL % 49.20 US$ 942 255 2000-2001 TOTAL % 52.32
Africa
157 413
18.68
19 409
12.33
176 822
20.98
116 484
14.48
143 564
14.98
273 897
16.63
320 386
17.79
The Americas
82 686
9.81
(4 961)
(6.00)
77 725
9.22
11 120
1.38
315
0.03
93 806
5.70
78 040
4.33
South-East Asia
99 251
11.78
(3 656)
(3.68)
95 595
11.34
67 066
8.34
7 077
0.74
166 317
10.10
102 672
5.70
Europe
49 823
5.91
1 876
3.77
51 699
6.14
40 823
5.07
32 911
3.43
90 646
5.50
84 610
4.70
Eastern Mediterranean
90 249
10.71
(4 380)
(4.85)
85 869
10.19
10 144
1.26
11 242
1.17
100 393
6.09
97 111
5.39
Western Pacific Country activities not yet allocated Total
80 279
9.53
(4 390)
(5.47)
75 889
9.01
31 458
3.91
17 726 82 165
1.85 8.57 100.00
111 737
6.78
93 615 82 165
5.20 4.56 100.00
842 654
100.00
-
0.00%
842 654
100.00
804 503
100.00
958 200
1647 157
100.00
1800 854
WORLD HEALTH ORGANIZATION
ORGANISATION MONDIALE DE LA SANTE
R E S O L U T I O N REGIONAL COMMITTEE FOR THE WESTERN PACIFIC COMITE REGIONAL DU PACIFIQUE OCCIDENTAL
WPR/RC49.R5 17 September 1998
PROPOSED PROGRAMME BUDGET: 2000-2001
The Regional Committee, Having examined the Proposed Programme Budget for the biennium 2000-2001 to be financed from the regular budget and other sources of funds;1 Noting the impact of the reduced allocation resulting from the adoption of resolution WHA51.31 on priority programmes; REQUESTS the Regional Director to: (1) review the Proposed Programme Budget to ensure that allocations reflect key WHO
priorities as outlined to the forty-ninth session of the Regional Committee by the Director-General; (2) report to the fiftieth session on the method and process to be applied in determining
country allocations in the programme budget for the 2002-2003 biennium; (3) transmit the Proposed Programme Budget to the Director-General for consideration
and inclusion in her proposed programme budget for the financial period 2000-2001.
Seventh Meeting, 17 September 1998 WPR/RC49/SR/7 1
Document WPR/WR49/5.
WPR/RC49.R page 2
WPR/RC50/5 page 13
ANNEX 4
COMPONENTS OF THE OVERALL REGIONAL ALLOCATION
The regular budget allocations to WHO regions are financed primarily by contributions of Member States in accordance with the scale of assessment as approved by the United Nations General Assembly. Based on the Programme Budget as approved by the World Health Assembly and tentative indicators of expected contributions, the Director-General issues budgetary guidance and a planning allocation to Headquarters and each region.
In each of the six regions, the programme budget proposals are broken down into three organizational levels as detailed below: A. Country allocation
This is the fund allocated to countries or areas to support governments to build up their health systems. The total allocation currently includes provisions for the WHO Representatives’offices which are added to the country planning figures for each country when the proposed budget document is finalized. B. Intercountry allocation
This portion of the regular programme budget is used to serve “two or more countries”. It has been an effective and economical means of providing direct technical cooperation, especially for small islands and least developed countries. It includes the cost of Regional Advisers in the Regional Office and their support staff. C. Regional Office allocation
The Regional Office allocation covers the costs of regional activities that are not included in the intercountry allocation, such as meetings of the Regional Committee, executive and programme management, public information, management of fellowships and administrative services.
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Annex 4
For the 2000–2001 biennium, the country allocations, including WHO Representatives’and Country Liaison Officers’offices, came to 56% of the total regional allocation, the intercountry allocation to 26% and Regional Office allocation to 18%. This breakdown was virtually the same as in the previous biennium.
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ANNEX 5
USE OF AN INDEX FOR ALLOCATING RESOURCES
In 1998, World Health Assembly resolution WHA51.31 recommended that regional, intercountry and country allocations should be guided by a model that: “(a) draws upon UNDP’ s human development index (HDI), possibly adjusted for
immunization coverage; (b) incorporates population statistics of countries calculated according to commonly
accepted methods, such as ‘ logarithmic smoothing’”. The basis for the selection of the indicators that make up the HDI is the identification of basic capabilities that people must have in order to participate in and contribute to society. These include: (1) (2) (3) the ability to lead a long and healthy life; the ability to be knowledgeable; and the ability to have access to resources needed for a decent standard of living.
HDI has three components which provide a basis for measuring these capabilities: (1) (2) life expectancy at birth; educational attainment, as measured by a combination of adult literacy (given two-thirds weight),
and combined primary, secondary and tertiary enrolment ratios (one-third weight); and (3) standard of living, as measured by real GDP per capita. To stabilize the variances for big and small populations, the squared natural logarithm of the population was multiplied by an adjustment factor which is proportional to the country’ s population. In addition, any country with a per capita GNP greater than US$ 9636 was not allocated any funds. The lowest allocation to any other country was US$ 100 000. It was anticipated that the model’ s objective criteria would ensure a more equitable distribution
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Annex 5
of resources to countries. However, any model will contain some deficiencies and limitations. For instance, countries might have health priorities such as chronic diseases, accidents, or new and emerging diseases, which are not reflected in the selected indicators. Data on some variables may be missing, in which case the average values of the countries in the Region may have to be used. It is expected that the indicators will be reviewed at WHO Headquarters every time an allocation model is used.