Epidemic preparedness financing and response
Can amending and broadening scope of the COVID-19 Health Recovery Levy Act be the solution?
At any point in time, countries face challenges. To prevent a recurrence, they take far-reaching decisions to respond to such challenges.
Ghana, throughout her development, has had to grapple with some problems such as infrastructure deficits, especially in education, bad roads, and ‘cash and carry’ for health care delivery amongst others.
To ensure the availability of resources to respond to such challenges, the country established the Ghana Education Trust Fund (GETFund), the Road Fund, and the National Health Insurance Scheme (NHIS).
An act of Parliament established the GETFund in the year 2000 to provide funding to supplement the government’s effort for the provision of educational infrastructure and facilities within the public sector.
The sources of money for the GETFund include 2.5 per cent of Value Added Tax (VAT) amongst others.
In the same vein, the Road Fund was also established by an Act of Parliament in 1997 to finance routine and periodic maintenance and rehabilitation of public roads.
Sources of funds
The sources of funds for the Road Fund include a fuel levy, bridge and ferry tolls, weigh bridge fees, vehicle license fees, and international transit fees. The NHIS provides financial access to quality health care for residents of the country.
The NHIS is largely funded by the National Health Insurance Levy, which is a 2.5% levy on goods and services collected under the VAT, 2.5% of Social Security and National Insurance Trust contributions per month, return on National Health Insurance Fund investments, premium paid by informal sector subscribers amongst others.
While there are other funds for specific purposes, the public health sector, which is the nerve centre of the country’s well-being, does not have any dedicated and reliable source of funding.
It only relies on inadequate budgetary allocations. This was why when COVID-19 struck in March, 2020, the government had to resort to borrowing aside other donor grants to supplement its resources to fight the pandemic.
Realising that this route was not sustainable, the government passed the COVID-19 Health Recovery Levy Act, 2021 (ACT 1068) to generate more funds to fight the pandemic. However, the COVID-19 pandemic is not the only disease of public health concern and will not also be the last.
Even during the COVID-19 pandemic, the country recorded other disease outbreaks such as polio, cerebrospinal meningitis (CSM), and Yellow Fever, which also spread quickly resulting in loss of lives especially in the case of CSM and Yellow Fever.
The fiscal data released by the Ministry of Finance on April 22, 2022, showed that an amount of GH¢773.93 million was realised from the levy within the first eight months its implementation.
In view of this, and against the backdrop that the country does not have a reliable source of funds to support its Integrated Disease Surveillance and Response (IDSR) plan and or Epidemic Preparedness Response (EPR), it will be important to amend the COVID-19 Health Recovery Levy Act to broaden its scope to serve as a source of revenue for Public Health Emergency Fund, which will yield more resources to fund EPR in the country.
The COVID-19 Health Recovery Levy Act, 2021 (ACT 1068), and its potential
A year into Ghana’s fight to contain the COVID-19 pandemic, she passed the COVID-19 Health Recovery Levy Act to impose a special levy on the supply of goods and services and imports to raise revenue to support COVID-19 expenditures and to provide for related matters.
At the time, the government had already committed a lot of funds derived from loans, and grants from donor partners to fighting the disease.
The passage of this law was, therefore, seen as a move towards establishing a reliable source of funds for the continuing fight against the pandemic.
However, the nature of this law implies that when the pandemic is over, the country will cease to collect this levy.
The implementation of the levy began in May 2021. The fiscal data released by the Ministry of Finance on April 22, 2022, showed that an amount of GH¢773.93 million was realised from the levy within the first eight months (May 2021 to December 2021) of its implementation.
This amount, which was spent to contain the spread of the virus and its effects on lives and the economy, represented a substantial portion of the budgetary allocation to the country’s health sector. This shows that this levy has the potential to rake in the resources needed for the intended purpose.
Need to amend and broaden the scope of the COVID-19 Health Recovery Levy Act
Already, a section of the public has started arguing that government should stop collecting the COVID-19 Health Recovery Levy because the COVID-19 pandemic is over.
What if there is another outbreak given the fact that diseases will continue to come? However, given the potential of this levy, the country cannot afford to stop collecting it even when the COVID-19 pandemic is over.
This law needs to be amended to broaden its scope beyond the fight against the COVID-19 pandemic to include the entire public health emergency concerns.
By this, the argument against its collection will cease. With increase in business activities and projected expansion of the economy, this levy could offer the country a reliable source of funds to undertake routine activities as part of the country’s IDSR plan and for that matter EPR.
Challenges in implementing EPR in Ghana
Over the past couple of years, funding for routine disease surveillance activities or IDSR has dwindled. Budgetary allocations to the health sector go into emoluments for health staff and the construction of health facilities leaving significantly fewer resources available to undertake routine disease surveillance activities.
This implies that diseases that could be detected and managed on time will be left to degenerate into an epidemic level with devastating consequences for the population.
In the year 2021, the total national health budget was $1.30 billion. This budget included payment of salaries and health research amongst others.
Out of the figure, $803m was expected to be spent on health delivery and $9 million on goods and services. EPR fell under the goods and services budget. This was woefully inadequate considering the volume of work expected under the EPR.
The way forward
While some countries can anticipate challenges and prepare adequately for them, others are not able to anticipate the challenges, and therefore, suffer the consequences.
As has been witnessed over the years, diseases will continue to come. Therefore, the country needs to continue to be prepared by strengthening her IDSR by ensuring funds to undertake public health emergency activities. The motivation for establishing GETFund, Road Fund, and NHIS is enough justification to urgently amend the COVID-19 Health Recovery Levy Act to broaden its scope to implement the establishment of a Public Health Emergency Fund as indicated in the country’s National Medium Term Development Policy Framework (2021-2025) to ensure reliable funds to support public health activities to protect the population.
By Albert Futukpor