District Level Financial Management

Editorial

In order for the health workers (managers, clinicians and support staff) in a district to work efficiently and effectively, they should have as much control over what they do as possible.

One of the key areas where districts should have their say is in the management of resources in the district.

This means, in effect, that districts should have the accountability and responsibility for financial decision making, and therefore control over staffing.

Most people would agree with this, and the White Paper on Transformation of the Health Services (April 1997) makes this point quite clearly.

However the reality and practicality of financial management at the district level is not as easy as it sounds. Sound financial management in the public sector has a number of essential components:
1) Adequate financial management systems need to be in place. If there is no information no informed decisions can be made.
2) There needs to be adequate staffing with the required level of skills.
3) There needs to be adequate infrastructure and equipment to do the job.
4) There needs to be an adequate legislative framework in place.

Most districts are currently not in a position to provide these requirements. As is highlighted by the difficulties in the North West province, if the approach to district financial management is not systematic and well planned then it is likely to end in frustration, and not achieve what is needed.

District managers are being asked to do a number of sophisticated, technical tasks such as MTEF (Medium Team Expenditure Framework) budgeting zero-based budgeting and programme budgeting without having the necessary background, training, infrastructure and information to do so. This is like asking a child to skip the crawling and walking phases and go straight into running.

The first essential task for decentralised financial management is to have a straight forward financial management information system in place and working.

There is a national financial management system (FMS) which is the system that must be used. At present there are few health workers at district level capable of managing this system mainly due to a lack of training. This is one obstacle that needs to be overcome.

Another obstacle is the lack of decentralisation of decision making. Until decisions can actually be taken by those who draw up the budgets then these budgets will not be respected and will remain paper exercises. In essence district budgeting and financial management is an exciting goal.

If it is achieved it is likely that district managers will be able to give real effect to the slogan think globally act locally. However for it to be achieved will require a much more logical systematic and pragmatic intervention than has thus far occurred in the health system.