Another argument frequently adduced for some central intervention in health care is the more
efficient pricing of inputs by a single purchaser of health care. National bargaining is believed to
secure more favourable contracts with service providers as compared with a situation in which local
purchasers may have to accept the prices set by monopoly suppliers.
https://www.york.ac.uk/media/economics/documents/discussionpapers/2005/0510a.pdf
Centralization and decentralization are not "either-or" conditions. In most countries an appropriate
balance of centralization and decentralization is essential to the effective and efficient functioning of
government. Not all functions can or should be financed and managed in a decentralized fashion.
Even when national governments decentralize responsibilities, they often retain important policy
and supervisory roles. They must create or maintain the "enabling conditions" that allow local units
of administration or non-government organizations to take on more responsibilities. Central
ministries often have crucial roles in promoting and sustaining decentralization by developing
appropriate and effective national policies and regulations for decentralization and strengthening
local institutional capacity to assume responsibility for new functions. The success of
decentralization frequently depends heavily on training for both national and local officials in
decentralized administration. Technical assistance is often required for local governments, private
enterprises and local non-governmental groups in the planning, financing, and management of
decentralized functions.
http://www.ciesin.org/decentralization/English/General/Different_forms.html
Literature on low- and middle-income countries provides little evidence that decentralization has
resulted in creation of new posts, job re-profiling, or an improved staff mix [2]. A tightly centrallycontrolled civil service may not allow local managers to create new posts, or their budget may be
insufficient to increase staffing levels, even if they have this power. Planning skills, particularly
human resource skills, are generally weak at the peripheral level in most developing countries.
Human resource planning responsibilities are often transferred to local managers without providing
them with adequate skills for these roles. Human resource databases frequently deteriorate as a
result of decentralization, further hindering local and national planning [4, 5]. In the United
Kingdom, a review of historical staffing patterns did take place after decentralization to the NHS
trusts, but as Buchan reports, this created a tension between local health managers concerned
about costs, and health professionals whose main interest was patient care [5].
Decentralization can threaten the concept of equal pay for equal work. National employees may be
compensated differently from decentralized employees. Tang et al. report that in China, personnel
working in state-owned and devolved health centers are paid differently [26]. Evidence from the
Philippines shows that salaries of devolved health workers decreased in the early years of devolution
to local government units [9]. As decentralized units are given more financial autonomy, and as
flexibility in pay bargaining increases, health workers doing similar jobs but in different decentralized
units will be remunerated differently. This is emerging in Uganda, where salaries are set nationally
but staff benefits and allowances locally [27]. Considerable differences in salary levels and other
terms of employment have also emerged in South Africa, where salary levels are determined locally.
[Personal communication with Dr. Jon Rohde.]
Pensions have arisen as an important issue for health workers in countries such as Zambia, which
have tried to break the rigidity of the civil service system by making health workers local employees.
Public sector employees are usually included in a large national pension scheme, covering all civil
servants. The contributions are paid by the national government, and are part of benefit packages
that have been negotiated with labor unions. Under devolution, local authorities may be reluctant or
out-right refuse to accept the financial burden of paying for the pensions of prior civil servants. Thus,
a new pension fund to cover local employees may be needed. In Jamaica, for example, regionally
hired health workers now belong to a private pension fund. Contributions to it come both from the
regional health authority and the individual employee. Previously, the government paid the total
contribution.
Most health workers value job security highly. If their employment status changes from national civil
servants to local employees, they want to maintain at least the level of benefits, seniority, and status
that they had before decentralization. They prefer minimal changes in the location of their work, job
content or reporting relationships.
Decentralization and accompanying reform processes have brought an increased level of instability
to employment. In countries of the Latin American region, "rationalization" of public sector
personnel has resulted in a massive reduction of staff through separation, early retirement, merging
of staff posts, etc. ILO reports that overall "there have been significant increases in the numbers of
people employed under more precarious forms of employment contract..." and that "...traditionally
high levels of job security in the health sector have changed"[12]. While more flexible employment
patterns are rapidly emerging in Latin American and Asian countries, they are still rare in Africa
[12, 24, 25].
Decentralization is also changing the degree of civil service protection that health workers have
against unfair hiring, disciplinary and work practices. National civil service rules no longer apply,
when health workers are hired under local terms and conditions of service. Where power has been
devolved to local governments, health workers are more exposed than before to local political
pressures and demands, even if they remain part of the national civil service. Under privatization,
health workers are governed under general private sector labor laws, and no civil service protections
apply to their employment.
https://human-resources-health.biomedcentral.com/articles/10.1186/1478-4491-2-5
The study reported a number of challenges from the perspective of SUs and providers. Problems
arising from the relationship between the centre and local authorities, and within the local
authorities, were also identified. Key challenges were identified at two levels—policy level and
operational level. At the policy level, there was a problem of HR policy. For example, local staff are
still under the control of central management. Second, there was no policy that focused on how to
build institutional capacity within local bodies in terms of developing bottom-up approaches,
including inclusive planning and its institutionalization. Third, coordination between and among
different stakeholders both at central and local levels was problematic. At the operational level, staff
career progression, lack of clarity on the role and accountability of new management committee
structures, poor infrastructure, the influence of party politics, resource generation and mobilization,
and central control over local priorities and budgeting were reported to be the major challenges.
http://jpubhealth.oxfordjournals.org/content/32/3/406.full
Political and process dimensions. As many observers have noted, decentralization is profoundly
political. Groups with a vested interest in the status quo and who will lose power, influence, and
resources as a result of administration or fiscal decentralization often oppose it. While there may be
strong technical arguments in favor of health sector decentralization, without attention to the
politics of decentralization, reforms may fail to yield the expected increases in efficiency,
effectiveness, and equity. These political dynamics are especially important because decentralization
reforms do not take place overnight. The reform process can be an extended one, even if the
implementation strategy aims for a comprehensive, big push. Without signs of success, support for
decentralization may wane, leading to reversals. The process dimension of decentralization
highlights the importance of stakeholder participation, effective communication, and political will.
http://www.phrplus.org/Pubs/IS1.pdf
Whatever the institutions used for decentralization, the ensuing process of decision-making will be
highly charged politically. The choice of representative government as a means of delivering health
services locally builds constitutional politics into the decision-making process, especially the
recruitment of officeholders and the choice of policy priorities. In PNG, for example, decentralization
was found to be associated with increased politicization. Devolution opens up opportunities for
corruption and political patronage though these are by no means the exclusive preserve of local
government, being found in other forms of decentralization
http://www.swisstph.ch/fileadmin/user_upload/Pdfs/swap/swap236.pdf
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