How Government’s under-investment is limiting growth in health sector

Despite the plethora of opportunities for health care providers and drug makers, underinvestment by the government in Nigeria’s healthcare sector has made it difficult to attract investments. The low level of investments in the sector has, in turn, hindered any significant improvement in health care.

The Need for Improved Healthcare

Interestingly, studies suggest that there is a positive correlation between improved health and economic growth, as healthy workers lose less time from work due to ill health and are more productive and a healthy workforce can increase the incentives for business investment.

Improved childhood health can also have a direct effect on cognitive development and their ability to contribute to innovations and inventions- two essential ingredients that lead to higher output per worker. A longer prospective lifespan can also increase the incentive to save for retirement, generating higher levels of savings and wealth.

Nigeria is Lagging Behind

Nigeria has continually ignored the commitment it made alongside other African countries 16 years ago on funding of health care services. In 2001, Nigeria hosted the Heads of State of member countries of the African Union (AU) who made the “Abuja Declaration” under which the leaders pledged to commit at least 15% of their annual budgets to improve their health sector. According to the World Health Organization (WHO) Health Expenditure Database, only four SSA countries met their 15% target in 2014: Ethiopia, Malawi, Swaziland, and The Gambia and have fallen short in other years.

2019 Health Budget

The country’s approved national budget for 2019 includes a N315.7bn (US$876.9m) allocation for the healthcare sector. Of this amount, N258.6bn (US$718.3m) has been earmarked for recurrent expenditure with the balance of N57.1bn (US$158.6m) for capital expenditure. This equates to about 3.5% of the overall budgeted expenditure of N8.92trn (US$24.7bn). This allocation is however lower than 3.7% and 4.2%  made to the health sector in the 2018 and 2017 budgets respectively. Meanwhile, it is estimated that Nigerians spend N359.2bn on medical tourism annually.

The Deplorable State of Healthcare in Northern Nigeria

Nigeria’s health situation appears to be approaching its lowest ebb particularly in the North Eastern region, where the insurgency has diminished access to medical care facilities. Various statistics also show that Nigeria has one of the worst health care delivery records in the world. According to the World Health Organization, Nigeria is rated 187 out of 191 countries in terms of health care delivery. The organization reports that around one-third of more than 700 health facilities have been demolished in the country.

Apart from poor health interventions apparently caused by the paucity of government funding, the sector has also experienced a series of industrial actions by doctors over unpaid salaries.

We believe there is a need for policymakers to give more funding and attention to the health sector. While we acknowledge that infrastructure, building roads and constructing bridges are the impetus for boosting economic growth, it is noteworthy to mention that it is only a healthy population that can utilize them effectively for enhanced economic growth.

Source: Nairametrics

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